Entitlement of a deposit?

legal updates

Sometimes the customer wishes to cancel and requests their deposit be returned.

Read our disclaimer keyboard_arrow_down

This website content is intended as a general guide to law as it applies to the motor trade. Lawgistics has taken every effort to ensure that the contents are as accurate and up to date as at the date of first publication.

The laws and opinions expressed within this website may be varied as the law develops. As such we cannot accept liability for or the consequence of, any change of law, or official guidelines since publication or any misuse of the information provided.

The opinions in this website are based upon the experience of the authors and it must be recognised that only the courts and recognised tribunals can interpret the law with authority.

Examples given within the website are based on the experience of the authors and centre upon issues that commonly give rise to disputes. Each situation in practice will be different and may comprise several points commented upon.

If you have any doubt about the correct legal position you should seek further legal advice from Lawgistics or a suitably qualified solicitor. We cannot accept liability for your failure to take professional advice where it should reasonably be sought by a prudent person.

All characters are fictitious and should not be taken as referring to any person living or dead.

Use of this website shall be considered acceptance of the terms of the disclaimer presented above.

We are often asked advice when it comes to keeping a deposit, so what is the entitlement?

You have a customer arrive and place a deposit on a vehicle and sign an order form. You would then hope they conclude the agreement, unfortunately sometimes the customer wishes to cancel and requests their deposit be returned.

Essentially they are in breach of contract, you therefore are entitled to retain X amount for the breach but this X amount should be for your losses!

Therefore, if the customer places a £100 deposit and you have carried out a service and a MOT test for the date of the collection of the vehicle, then it may be that you are entitled to retain the full amount as you will be able to show the company’s loss.

But if you take £1,000 deposit and do the same as above, MOT and service then your customer will be entitled to a proportion of it back.

The scenario will be different if the customer has placed a deposit but they feel the company are in breach of contract (not completed any requirements which was agreed when placing a deposit) then it is likely they are entitled to the full deposit being returned.

As always, the wording on your order form pad will also play a role.

Lawgistics members can get further advice on this matter by calling the legal helpline 01480 455500.

Cable For My CarWe offer free next day delivery* on all EV charging cables when shipped within mainland UK

Stocking only premium EV charging cables, we ensure you experience a stress-free EV charge, over and over, confidently backed by our 2 year warranty. Our premium & reliable charging cables are compliant with EU & UK safety standards. We offer free next day delivery* on all EV charging cables when shipped within mainland UK.

Roxanne BradleyLegal AdvisorRead More by this author

Related Legal Updates

A settlement agreement may not protect you

An agreement does not need to be in writing to be binding, but it is much easier to prove the terms of an agreement if there is a documented paper trail.

The customer isn’t always right…

As it was a defect he knew about, he cannot now claim it renders the vehicle not fit for purpose or not of satisfactory quality.

Implications, assumptions, and confusion – why being clear on your actions could be key to winning

The diagnosis showed the third-party garage had failed to repair the vehicle to a satisfactory standard and this was relayed to the consumer.

Burden of proof? Get your evidence while you can!

The burden of proof reverses for issues raised between 30 days and six months of ownership.

On your Marks… Get Set… Doh!

The TSO told our member that the consumer ought not to have experienced a failure given the age and mileage of the car.

Claim Dismissed: No Proof of Fault at Purchase

Our member argued that numerous issues could have caused the overheating and ultimate failure.

Court Rules Against ‘Serial Returner’ in Distance Selling Dispute

It is clear from his evidence that his true intention was that he wanted the ability to reject the car at a time of his choosing.

Get in touch

Complete the form to get in touch or via our details below:

Phone
01480 455500
Address

Vinpenta House
High Causeway
Whittlesey
Peterborough
PE7 1AE

By submitting this quote you agree to our Terms & Conditions and Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.