The consumer’s issue:
A consumer purchased a second-hand ’19-plate diesel crossover SUV for around £25,000 from a franchise dealership in September 2020. However, when they went to part-exchange the vehicle in February 2026 for a newer model, they subsequently learned that it had previously been used for organised passenger transport and had been registered with a taxi or private hire marker – something they had not been advised of at the point of sale.
With used car retailers offering as much as £5,500 below the trade-in price, the consumer contacted the selling dealership to seek a reimbursement for this financial loss, as well as for the stress caused in having to deal with this matter.
In response, the business denied liability, and said it had not been aware before the sale that the vehicle was or had been registered as a taxi. To demonstrate this, the dealership supplied an HPI check carried out in August 2020.
However, correspondence from the previous owner within the vehicle’s records showed that the car had been used to transport children to and from school, and stated that some local authority areas required vehicles used for this purpose to be licensed as private hire vehicles, which could result in a taxi marker.
As a resolution to their complaint, the consumer was looking for compensation for the financial loss they incurred at the time of part-exchange due to the vehicle being previously used as a taxi.
The case outcome:
The Motor Ombudsman adjudicator reviewed the evidence supplied by both parties. It was noted that under the obligations of the Vehicle Sales Code, businesses should not withhold information about a vehicle’s history or usage that could affect a consumer’s purchase decision.
The adjudicator found that the business ought reasonably to have understood the nature of the previous use, and that this was vital material information when it came to a consumer’s decision to purchase, the price they were prepared to pay, or expectations about the vehicle’s future resale value.
As there had been a failure to disclose the vehicle’s full history and usage to the consumer in this case, this amounted to a breach of the Vehicle Sales Code.
In regards to the reduction in value at the point of trading in the vehicle, the sales invoice showed a £3,000 difference between the original part-exchange offer and the final amount actually received by the customer.
Conclusion:
In light of the financial loss incurred by the consumer, the adjudicator upheld the consumer’s case, and directed the selling dealership to provide a reimbursement of £3,000.
The adjudicator equally explained that The Motor Ombudsman does not consider compensation for losses that cannot be readily quantified, such as inconvenience, time or stress. No award was therefore made for those matters.
Key learning point:
A vehicle’s previous history and usage can be material information where it may affect a consumer’s decision to purchase, the price they are prepared to pay or their expectations about future resale value.
A vehicle retailer should therefore disclose information it knows, including about previous organised passenger transport or licensing where this could affect a consumer’s transactional decision.
Where a financial award is sought, this must be supported by evidence and be capable of being quantified in monetary terms.
