Voluntary Termination of Car Finance - Challenging "Damages" Bill

[JungleJme]

Hi,
I have been trying to challenge the items on a bill i received from GMAC after i VT'd my Vauxhall Corsa Finance agreement last May.

They sent me a letter ahead of time detailing their "Fair Wear and Tear Guidelines" - although i did not sign and send back my acceptance of these guidelines (as they requested) i still made attempts to adhere to them.

On the day a representative from Mannheim arrived, surveyed my car and presented me with a list of everything he found - punched it into his PDA and it came up with a bill of £1000+. He told me as it was GMAC it was "zero tolerance" - which i feel is a breech of the fact they should take due consideration for the age and use of the Vehicle. Anyway, i signed to say the survey had taken place but checked the box where i said i disagreed with the findings.

GMAC immediately referred the bill to Shoosmiths, and there started a long correspondence. I believe that the items are either a) fair wear and tear or b) cannot be shown to be due to a failure on my part to exercise reasonable care. Plus nearly all of them actually fall within the guidelines that GMAC presented me in their original letter (so i believe).

The three"big ticket" items are

- A scratch down the side (somebody keyed my car whilst it was parked outside) - GMAC advised that "Where primer is visible through paintwork SOME FORM OF REPAIR IS REQUIRED [sic]" - i therefore took it to a Professional Body Shop and had it touched in to stop any further rusting or damage, but stopped short of a full re-spray as i believed the repair to be reasonable and fulfill the above requirement. The inspector's PDA came up with a bill of nearly £300 as the mark was still faintly visible although no primer could be seen.

- There was some small holing in the drivers footwell, behind the accelerator. Although the guidelines said "no holing to carpets or upholstery". I believe, that with 2 1/2 years use as a commuting vehicle, this seemed to me to be the very definition of wear and tear as no specific event caused it and it occurred in the day to day operation of the Vehicle as it was shipped to me by the manufacturer. A bill of over £200 was presented for this.

- The GMAC letter advised that "small dents up to 10mm are acceptable" - one such dent on the front wing, clearly caused by a chip of some sort during motorway driving, is clearly under 10mm (even in their own photos) but the surveyor told me that as it occurred on a crease in the metal work GMAC would want to replace the whole wing. A bill of £240 was added on for that.

I feel like the standard the Mannheim representative held the car to was a) not what was represented by GMAC and b) took no consideration for the age and use of the vehicle. Also at one point, i was told that as i had signed the survey i had agreed to the bill and therefore accepted liability. That was a flagrant misrepresentation and I immediately refuted that this was the case.

During the process on two occasion Shoosmiths advised me to log a call with the BVRLA - i attempted to do this twice (one for GMAC and one for Mannheim) and both times the BVRLA wrote back saying the institution wasn't a member. I made a complaint regarding the wrong advice which GMAC partially upheld. I have not yet resubmitted a third attempt but am dubious to do so anyway, won't this organisation just circle the wagons to back their members?!

I have tried to make offers to settle the matter but all have been rejected. All correspondence has been in writing and i have retained it all.

GMAC have given me "breathing" space till next Monday to seek advice. I don't have money for solicitors and Citizen's Advice weren't much help. Telling me to get a solicitor or "give it a go in court".

So, what are my chances of contesting this? If i go to court, is the maximum i will have to pay the current bill? Or could GMAC up the fees to cover their solicitors etc... and i end up on the hook for thousands?

What should my course of action be when i write back to them? Your help is really appreciated this has been stressing me out for months

[R0b]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Firstly, you wont be on the hook for 'thousands' it will likely be a small claims issue and they can't recover solicitors fees except fr around £100 solicitor fees.

The law says that the vehicle need only be in a 'reasonable condition', not excellent, not good or great, but reasonable. If the vehicle is roadworthy then you could argue that it is in a reasonable condition. The fact that GMAC is not a membe could also be argued that the BVRLA guidelines do not give much weight as it is primarily used for commercial purposes as opposed to consumer.

Have they supplied any receipts on the work carried out? I am presuming they sold it off at auction which will make it more difficult to argue as there is no loss to them, but trying to claw back any losses arising from the VT which is void and against the Consumer credit act provisions.

Personally, if you think the car is in a reasonable condition then I wouldn't bother with trying to settle the claim, sounds like scare tactics from them. I can provide you with a template letter later today if you like or if you want to have a go yourself I can take a look later this evening.

[JungleJme]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Thank you for the reply Rob,

Yes, i believed the vehicle was in reasonable condition - it was fully serviced, still had the manufactuer's warranty - all the items on the list were minor/cosmetic.

In every letter i have sent i have referred constantly to the fact that i have not failed in my duty to keep the vehicle in a reasonable condition and have not accepted liability for any of the items listed. They say i have failed, therefore they can invoke the clause in the CCA that allows them to charge me.

I do owe them £243 for a separate part of the claim (which i know i am legally liable for) but this £1,000 is dubious imo. And no, i do not believe they had the work done (they specifically stated in one of their letters that it didn't matter if they did or not) - are the guidlines they came up with backed up by legal precedent? For example, I can't get my head around the fact that a 10mm scratch is fine but a 12mm scracth constitutes a breach in my duty of care??? Or as i mention, a dent is ok but not if its in the wrong place??

I've been pretty good with letters, i keep them professional and neutral (i.e. not ranting!) but firm in my arguments. Is there something specific you would state in a certain way?

[R0b]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Would it be possible for you to post up a letter from shoosmiths or GMAC where they state it did not matter if they had the work done or not? and also where they state you have failed to take reasonable care of the vehicle?

obviously redact any personal details of course - would help to give a proper response to their allegations.

[JungleJme]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Yes, but i have it all at home (currently at work) - will see if i can scan it and redact! Thanks again for your help

[R0b]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Just to add to my previous post what age is the vehicle?

by the way I would not accept any offer to settle the claim as if you do you could end up paying the fees of the solicitors which could be thousands. So at anytime between now and any potential court date, do not offer or accept an amount to settle, if you wish to keep costs down. An acceptance of an offer is automatically incorporated that you pay the claimants cost sup to the point of settlement. If you receive an offer and are unsure I would ask on here, but in general just reject it.

I'll get back to you later once you've posted the rest of the I formation.

[JungleJme]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Hi,
I've attached the extracts you requested, apologies for the quality i have no scanner at home so had to take photos.

In total i have around 28 letters between myself/GMAC/Shoosmiths/BVRLA - so these are just an extract of what you requested.

Thank you for the advice on any further settlement offers from them - if i had received one that i felt reasonable i could well have accepted and not been aware of hidden costs. Thank you very much!

Anything else you need, please let me know. Can't thank you enough for your time and help.
J

EDIT: I have letter from Shoosmiths on the 8th July explicitly stating that i need to pay the "outstanding balance £1056.50 for repairs due to the vehicle" - don't know if that is important as it contradicts their later statement.

EDIT2: Sorry, vehicle was 2 1/2 years old when VT'd

[R0b]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

I can't seem to open the PDF, try deleting it and re-uploading it, or you could email to admin@legalbeagles.info and then @Amethyst could upload if thats ok.

EDIT: Nevermind managed to download it.

[JungleJme]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Thanks, i've tried uploading again on this reply. If that is no good then i've also put it on dropcanvas..

http://dropcanvas.com/h8cl6

If neither work i will email the admin as you suggest....

- - - Updated - - -

Just saw you edit! Will wait patiently in that case....

[R0b]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

So here's a first stab at it, quite lengthy but could also be cut down if necessary. This is my interpretation of what I've read so far and if you disagree with any part of it then amend it as required but is simply my thoughts on the matter. IF you wish to still continue to settle the matter then go ahead - I am only here to provide some guidance and the decision is ultimately yours to take.

May need to look at this again in the morning see if i can add or remove anything.

-------------------------------------------

[DATE]

Dear Sirs,

Your Reference:

I am writing further to your letter dated [DATE] concerning your Client’s outstanding balance of £1,297.58 which relates to alleged damage to the vehicle under the conditional sale / hire purchase agreement between your Client and myself (the “Agreement”). After seeking further advice, my position is set out below.

Section 100 (4) of the Consumer Credit Act 1974 (“CCA”) explicitly states that there is an obligation to take reasonable care of the goods, as indicated in your previous correspondence. Firstly, your Client has acknowledged that the alleged damage to the vehicle was never repaired and so there had been no loss. Furthermore, the fact that the vehicle had been sold at auction does not guarantee that the vehicle would have sold at a higher cost than your Client is claiming. In any event, through your Client’s conduct of allowing the vehicle to be sold at auction in its current state, your Client has acknowledged that the vehicle was returned in a reasonable condition.

Secondly, section 100 (4) makes specific reference to the word “reasonable” which, by dictionary definition would also mean fair and acceptable. Although the CCA does not provide a definition of what is meant by the word “reasonable”, a common sense interpretation in relation to a vehicle is that it must be returned in a roadworthy condition i.e. it has an up to date MOT, serviced regularly and mechanically sound. A fair and reasonable vehicle taking into account its use may have some minor cosmetic defects (which would include touch ups to the paint and body of the vehicle) but not major defects that would make the car undesirable.

The amount your Client is claiming would relate to repairs that would put the car in what would be otherwise deemed more than a reasonable condition and it is therefore unacceptable for your Client to charge more than is necessary for such losses it is alleging. On the face of it, the charges claimed by your Client may be construed as a penalty and as I am sure you are aware, penalty charges are unenforceable. Notwithstanding the above, your Client has so far failed to qualify or evidence how the charges represent a true loss of the vehicle and it seems to be purely a fishing expedition in an attempt to recover further monies as a result of the voluntary termination. I therefore require you to produce evidence which proves on the balance of probabilities, the market value of the vehicle in a reasonable condition, to the vehicle returned to your Client in its current condition.

Another point to note is that in your letter dated 23 June 2015, you have referenced the BVRLA’s Fair Wear and Tear Guidelines. As you have already acknowledged, the BVRLA Guidelines are used in relation to leasing and renting of commercial vehicles; the guidelines therefore have no relevance to this dispute as the vehicle under the Agreement was not a commercial vehicle but a second hand vehicle purchased at a dealership.

Your letter also states that the BVRLA operates a conciliation service for its members and their customers which provides for an alternative resolution to legal proceedings. May I point out that I have contacted the BVRLA on several occasions inquiring into whether your Client is a member of the BVRLA. They have confirmed that your Client is not a member and so the conciliation service does not apply. Accordingly, it may be sensible to confirm with your Client whether or not they are a member of such association before deciding to refer to any guidelines or conciliation services which in this case are not available and do not apply.

In summary, given your Client’s unreasonable conduct in this matter in refusing to reach an amicable settlement, I hereby revoke all previous offers. To clarify, the vehicle was returned to your Client in a reasonable condition as per section 100 (4) of the CCA which, as stipulated above, your Client has failed to provide any evidence to the contrary. All alleged damaged by your Client is denied and should your Client wish to commence legal proceeding for the recovery of such amount, it shall be robustly defended.

Yours faithfully,

[JungleJme]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Thank you so much for this, i will also review in the morning - but some points i've noticed;

You have pointed out the BVRLA guidelines relate to Commercial leases - in their letter they say the BVRLA guidelines are for "both Corporate and Consumer's [sic] Users". Have they tacked the consumer bit on to a standard commercial response do you think, hence the bad grammar? Is it a strong argument to say the BVRLA aren't geared up to deal with a non-commercial dispute?

Also, when i complained about my rejected BVRLA submissions (one against GMAC Financial the other against Mannheim), Shoosmith's informed me that the former was incorrect advice and should have been against GM UK Ltd and the latter should not have been rejected - i have the letters to show that both were rejected though. So, the confirmation your refer to has taken place really - but after being burned twice, and now reading that the BVRLA is mainly focused on Commercial agreements PLUS my suspicion that they would circle the wagons anyway, should i still re-submit to them? If it goes to court will the judge???/magistrate???/tribunal??? want to see me attempting to seek mediation? So should i submit but reserve the right to not accept the findings? (Which you can in mediation right? Unlike arbitration? - is that true? or would it weaken my position if i was found against?)

Also, the car was not second hand, it was new.

If those facts don't change the general tone of the letter, then those first three paragraphs are the sort of rhetoric i was looking for but didn't have the knowledge to put down on paper as i wasn't sure if i could! Thank you, thank you, thank you. Just having someone to run this through with is a real help to me. Cannot thank you enough.
J

I will take my history of letters to work with me tomorrow, so should make it easier to scan anything you need to see. Just let me know if you need anything!

[R0b]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

The clue is in the name of the BVRLA (British Vehicle Rental and Leasing Association), therefore, the consumer part would be for rentals i.e. those companies such as Hertz or Enterprise etc. If you look at their members directory, the introductory information confirms that the BVRLA is a trade body setup specifically for the rental and leasing of commercial vehicles and cars. The BVRLA guidelines are a standard used because the vehicles would be going back into circulation for public or commercial use and therefore reasonable to expect that the vehicle should be in a better condition than just "reasonable" and non-commercial vehicles.

I am not following what you say in your second paragraph, when you complained to GMAC did they give you a final letter with the option to go to the ombudsman? No use complaining to Manheim they are under instruction of GMAC and likely to be in some sort of commission anyway. If they decide to go to court, they will need to prove that the vehicle was not in a reasonable condition, did you take any photographs prior to handing the vehicle back? As I said in the letter they would effectively have to prove the value of the car which would be deemed reasonable against the value of the car you returned to them - that is a difficult job to do as the car is probably sold on now and all they might have is some picture of the marks of the vehicle taken, which is not a true reflection of the vehicle in general. Mediation is similar to arbitration where a mediator tries to bring two parties together to come to a mutual agreement. You could be considered unreasonable if you reject eveyrthing without valid reason but again you just re-iterate what you said in the letter. The main fact is they have no proof that the vehicle was not in an unreasonable condition - yes there are photographs of markings but that does not mean it was in an unreasonable condition. The car was roadworthy, MOT'd and serviced which in most people's eyes, is a reasonable condition of the car.

As for the car being brand new, thats fine, just take out the second hand but don't mention brand new.

Thy also made reference in their letter about signing the paperwork therefore you must have agreed. You have said that there was a box disagreeing with findings - did you receive a copy of this and do you still have it? That is also something you could include in there so that they don't latch onto it and say you never disputed it so you must have agreed to the charges.

For future reference when getting a car on finance, take photographs at the beginning and send to the lender of its current condition, take photographs prior to returning the vehicle both inside and out and finally, never never sign any paperwork they ask you to sign - you are not legally obliged to do so and it puts you in a less stronger position because you have signed it. I think if you didn't sign the paperwork you may not have solicitors on your back demanding payment.

I don't think its necessary to upload all of them, just insert where it says [date] the last date of their letter and the rest should be okay. Its back and forwards arguments, GMAC will be paying each time they reply to you and those solicitor costs won't be recoverable in the small claims court which is where this is likely to end up as its less than £10,000.

Anyway, I'll make an update to the above letter tomorrow, bit late for me to be concentrating on something like this

[R0b]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Few amendments and additions in red below

Another point to note is that in your letter dated 23 June 2015, you have referenced the BVRLA’s Fair Wear and Tear Guidelines. As you have already acknowledged, the BVRLA Guidelines are used in relation to leasing and renting of commercial vehicles; the guidelines therefore have no relevance to this dispute as the vehicle under the Agreement was a non-commercial vehicle purchased at a dealership.

Your letter also states that the BVRLA operates a conciliation service for its members and their customers which provides for an alternative resolution to legal proceedings. May I point out that I have contacted the BVRLA on several occasions inquiring into whether your Client is a member of the BVRLA. They have confirmed that your Client is not a member and so the conciliation service does not apply. Accordingly, it may be sensible to confirm with your Client whether or not they are a member of such association before deciding to refer to any guidelines or conciliation services which in this case are not available and do not apply.

I also note you refer to the fact that I have signed the condition report which, according to you, means that I have accepted all charges and liability. I wholly disagree with this statement as it is simply incorrect. The condition report was signed to say that the vehicle had been collected and viewed however I had checked the box which stated that I disputed all of the charges. Again, it appears you have simply taken your Client's word on this matter at face value and failed to consider the documentation (if any) provided to you by your Client. The fact that I dispute the charges by your Client does not on the whole, mean that I have accepted them.

[JungleJme]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Thanks for all that, all makes perfect sense to me. To answer some of your specific questions

Yes i have had the "Final Letter" from GMAC which gave me six months to go to the ombudsman. I received this on 3/11/15

Yes, i took photos of everything on the morning of the inspection, but unfortunately - the phone on which i took them has since been lost! (i know i should have backed them up straight away!)

Yes, i have the vehicle inspection report - the Customer Signature box is unsigned, but i do remember signing that the inspection had taken place - but i remember at the time i definitely also selected an option that said i disagreed with the findings but i cannot see this on the print out. However the Signature box clearly states "By Signing this Document you agree to the damage set out within this Inspection Report only and to to any subsequent costs that may be applued by your finance provider and you confirm that you have removed all your personal possessions and evidence of personal data from the vehicle" - i basically didn't sign anything they sent me but they kept assuming i did in their letters. Not checking their facts before sending a response!

I am going to draft the letter later today using your draft paragraphs, thanks so much! I will post it here before sending

[JungleJme]

Re: Voluntary Termination of Car Finance - Challenging "Damages" Bill

Hi Bob,

So i have plugged in your paragraphs to my letter - and added some more detail from other correspondence and tweaked a few bits.

A slight difference to your letter is that i do actually accept some of the Charges (rejecting those for repairs) - i haven't paid the part i owe as i didn't want to until they agreed it was all i owed, so i have been honest throughout about owing that, but have withheld paying until the whole matter was resolved.

So, i guess i just wait for their response? I was going to get this in the post by 5pm tomorrow so it has plenty of time to arrive by the Sunday?! deadline.

Thanks for all your help in drafting this but i suspect this journey isn't over yet!