The consumer’s issue:
“I took out a top-of-the-range extended warranty policy for my saloon car that I bought new in August 2016 for around £30,000. When the car was less than five years old, a warning light appeared on the dashboard in relation to the height of the chassis. An independent specialist that looked at the car found that there was a fault with the suspension compressor valve block, and the warranty provider authorised its replacement. However, when the repair was being made, the mechanic noticed air escaping from the suspension air bags, so they made contact again with the warranty company, and it was agreed that they should also be replaced. However, after they were changed, the warning light re-appeared, and the garage found the same fault codes.
When the car was returned for further repairs, the warranty administrator authorised the work in relation to the suspension air bags, but withdrew the authorisation for the repair of the valve block, as they said that it did not meet the terms of the warranty, as the fault was said to be “progressive” rather than being a “sudden mechanical failure”. However, I disputed this, as the warranty policy covered suspension parts, and wear and tear up to five years of age or 60,000 miles. At the time of my claim, my car had only travelled about 42,500 miles, and was less than five years old, so met both of these criteria.
To resolve my dispute, I am looking for the warranty provider to honour the coverage provided by the policy, and to cover the £700 cost of replacing the compressor valve block, which they have refused to pay for.”
The accredited business’ response:
- The purpose of our warranty policy is to protect against sudden and unexpected breakdown to mechanical and electrical components within the vehicle. Our terms define a breakdown as: “The sudden and unexpected failure of a component arising from any permanent mechanical or electrical defect, (for a reason other than wear and tear, normal deterioration or negligence) causing a sudden stoppage of its function, necessitating immediate repair or replacement of the component before normal operation can be resumed.”
- The first diagnosis of the problem we received from the repairer was that the suspension valve block had failed and required replacement. The claim was subsequently authorised by us, but then the diagnosis changed, and it was confirmed that the suspension air bags had actually failed.
- Following this repair, the garage then told us that the fault remained and that the control module required replacement.
- From the final diagnosis, it was clear from our point of view that that the air bags deteriorated to the point of leaking, thus putting excessive strain on the compressor valve block, which eventually broke down. The garage said it was not a sudden failure, against which our warranty protects, but occurred over a period of time.
- Therefore, we stand by our claim authorisation in order to assist the customer with the cost of the most expensive element of repair needed to their vehicle, which we think is a fair resolution.
The adjudication outcome:
- The Motor Ombudsman adjudicator explained that, even though the invoices and the responses from each party confirmed the presence of a fault with the suspension system, there was no clear indication that the compressor block suffered a sudden and unexpected breakdown.
- Instead, the documentary evidence suggested that, on a balance of probabilities, the compressor block more likely broke down over an extended period of time, and its repair could therefore not be covered by the provider under the terms of the warranty agreement.
- Therefore, the adjudicator was unable to uphold the complaint in the consumer’s favour.
The consumer’s response to the adjudication outcome:
- The consumer rejected the adjudicator’s findings, because from their perspective, the part was covered under the terms of the warranty, as the claim was declined on the basis that the failure of the component was “progressive”, and that this word was not mentioned anywhere on the policy.
- The consumer also highlighted that suspension parts were not listed as excluded components, and brought attention to the wear and tear clause, which explained that, no claim would be rejected on the grounds of wear and tear, where the vehicle had covered less than 60,000 miles, and was under five years old at the time of the claim. At this point, the consumer’s car was less than five years old and had only covered about 42,500 miles.
- The consumer requested a final decision from an ombudsman.
The ombudsman’s final decision:
- The ombudsman acknowledged that the consumer had taken their car to a garage to be inspected shortly after the warning light appeared, which the warranty provider did not dispute, and was satisfied that the consumer did not continue to drive the vehicle, and cause damage after the warning light for the chassis height came on.
- In the ombudsman’s view, the compressor failed as a result of a sudden and unexpected mechanical failure, and may well have been as a result of wear and tear of the compressor, or related parts. However, the policy did state that no claim would be rejected on the grounds of wear and tear, and protected against sudden component failure requiring immediate repair and replacement.
- The ombudsman decided that these terms could be seen as contradictory. He added that, where there is any contradiction in the terms, the usual principle is for those terms to be construed in favour of the person who did not draft those terms i.e. the consumer . This is known as “contra proferentem”.
- Therefore, the ombudsman upheld the complaint in the consumer’s favour, as the policy said that a claim could not be declined due to wear and tear. Therefore, the consumer was entitled to the £700 cost of the repair to be covered by the warranty provider.
