Inconsistent sales documentation

The consumer’s issue:

My 17-plate hybrid crossover that I bought in February 2019 is performing as it should do, but my complaint is in relation to the sales process at the dealership. To purchase this crossover, I part exchanged my old car, which was not serviced at either the 10,000 or 20,000 intervals. I was therefore advised that my previous vehicle could not be sold under the approved plus second-hand car scheme.

 Because of my lack of adherence to the servicing schedule, the car suffered a drop in value and could only be sold at auction. So, to complete the new deal, the sales advisor told me that I would need to pay £500 in addition to the deposit of £1,750. A review of the dealership’s website subsequently showed me they were selling the car under their approved plus second-hand car scheme.

 This goes against the information that I was given during the sales process. In addition, I was given three documents which related to the car sale, namely two order forms and the credit agreement. However, they all have different information about the breakdown of the costs incurred, and none of them show the £500 that I paid in cash at the third meeting. I therefore think that the business is being underhand, and as a resolution to my complaint, I would like a refund of this amount.”

The accredited business’ response:

  • Our investigation into this matter disclosed the customer took out GAP insurance for £433. The original vehicle order form dated 9 February 2019 incorrectly deducted £433 from the basic price of the vehicle. The amended order form dated 15 February 2019 correctly added the GAP insurance to the vehicle’s selling price.
  • We have investigated the appraisal history of the part exchange to determine the reason why £500 was taken from the customer. The sales invoice dated 18 February 2019 showed an adjusted part exchange value from £6,500 to £6,000, meeting the financed amount of £18,055.15.
  • The vehicle valuation dated 17 February 2019 also shows the adjusted value at £6,025. The agreed value was to be £6,000 to cover any unexpected work. It also took into account the warranty cost to put the vehicle back to an approved used car status.
  • After investigating the complaint, we will refund £250 to the customer as a goodwill gesture.

The adjudication outcome:

  • The Motor Ombudsman adjudicator reviewed the evidence submitted (i.e. the used vehicle order forms, the hire purchase agreement, the part exchange appraisal, as well as the receipt for £500), and found that there was a breach of the Vehicle Sales Code by the dealership.
  • They explained that the dealership is required to be clear and transparent when discussing all aspects of the vehicle sale. This includes a clear breakdown provided to the customer which shows the actual cost for the deal.
  • The adjudicator expected to see the vehicle purchase price, the part exchange amount, all the associated costs for the deal, including all add-ons (e.g. the GAP insurance), the deposit and any additional amounts paid (£500).
  • However, all three documents for the deal (used vehicle order forms and the hire purchase agreement) held different figures and amounts. In addition, the explanation offered by the dealership for the discrepancy did not tally with the evidence submitted. The information provided also omitted the £500 paid by the customer.
  • The adjudicator found this to be unclear, misleading and in breach of The Motor Ombudsman’s Vehicle Sales Code.
  • The adjudicator did not agree the evidence submitted showed the dealership was employing underhand practices as alleged by the customer.
  • However, the complaint was upheld in the customer’s favour, and the adjudicator recommended that a fair outcome to this dispute would be to award the consumer a refund of £500.

Conclusion:

  • Both parties agreed with the adjudication outcome, and the business agreed to pay the consumer £500 as recommended by the adjudicator, thereby closing the case.