Advice Please

Reaching out to the power of the BBS.

The wife bought a car last year from a dealer that works from home, was only a 55 plate Vauxhall Zafira £1400 cash deal.

Only did the basic background check and everything was fine, not stolen all service history there and flown through every Mot.

Didn't realise that you can actually to a HPI check yourself, anyway we have decided we are going to treat ourselves and buy a new car. So the wife went along with her dad to car people in Wakefield yesterday chose the car she wants paid deposit and they have offered 600 for ours.

They then ran the check on our car and it came back that it has finance against it. Was told this might be a mistake and the HPI may not have been updated after the final payment but NO.

I got in touch with the finance company last night and they have got back to me this morning saying they still hold a significant interest in the car and they are sending out an innocent party pack to fill in and send back to them.

Anybody had anything similar happen to them and anyone know where we stand legally on this.

Before anyone says it, Coca-Cola won't work but petrol and a match might

TIA

 

Not a solicitor but this might help.....

Citizens Advice Specialist Support:
"Where a motor vehicle is subject to an HP or conditional sale agreement, while the vendor does not own it and has no right to sell it, a private purchaser who buys the car in good faith without notice of the HP or conditional sale agreement obtains good title to it. He does so under section 27 of the Hire Purchase Act 1964."

We still maintain that it an HPI check is highly prudent when buying a used vehicle as it should show whether the car is stolen, was previously involved in a bad crash - and is the subject of outstanding finance.

 

Pretty sure my bro had a similar situation where he bought a car which unknowingly had a log book loan against it. In that situation they were perfectly in legal order to seize the vehicle. Luckily turned out Ok as the other person paid off the loan so the car could be returned. If he hadn't then pretty much would have been screwed from a legal standpoint. It's always buyer beware unfortunately.

 

Further to my post re section 27 of the Hire Purchase Act 1964


Khan v FirstRand Bank Ltd
The Claimant in the case, Mr. Hasanain Khan was represented by Abdul W Hussain of Carter Law Solicitors.

The Defendant, FirstRand Bank Ltd was represented by DWF Solicitors.

Facts Surrounding the Case
Mr. Hasanain Khan purchased a Mercedes C200 Sport from a private individual for £7000. Approximately one month later the police seized the vehicle due to it being reported stolen by the Defendant’s finance company MotoNovo Finance.

Mr. Khan protested his innocence, explaining that he had purchased the vehicle from a private individual and had a receipt and log book as proof.

The police disregarded this and advised that the vehicle was still the property of the finance company, and as such would be returned to them.

Mr Khan contacted MotoNovo finance who were unsympathetic to his concerns, advising him that the car belonged to them and he couldn’t do anything about it.

Mr Khan contacted Carter Law Solicitors for advice and assistance in recovering the vehicle.


Solicitor and Managing Director of Carter Law, Abdul W Hussain, contacted MotoNovo finance to obtain further information but was met with same opposition received by Mr. Khan. The finance company advised that Mr. Khan had been negligent in not carrying out a HPI check before he purchased the vehicle and furthermore, the vehicle had been purchased at an undervalued price. They argued that the vehicle was worth over £15,000, and as such Mr Khan should have known that something was wrong.

Not to be deterred, Abdul further investigated the matter and issued court proceedings against the Defendant.

Mr Khan had purchased the vehicle in good faith and was unaware of the finance agreement on the vehicle.

Accordingly, a claim was pursued under Section 27 of the Hire Purchase Act 1964.

S.27 Applies where a motor vehicle has bailed or hired under a hire purchase agreement, or has been agreed to be sold under a conditional sale agreement, and, before the property in the vehicle has become vested in the debtor, he disposes of the vehicle to another person.

S.27 (2) Provides that where the disposition of a motor vehicle has taken place to a private purchaser in good faith and without notice of the hire-purchase agreement or conditional sale agreement, that disposition shall have effect as if the title of the owner or seller to the vehicle had been vested in the hirer or buyer immediately before that disposition.

The matter proceeded to a full hearing and Mr Khan’s evidence was presented before the court.

It was held that in order to establish a claim under Section 27 of the Hire Purchase Act 1964, the claimant must prove on the balance of probabilities that the vehicle was purchased in good faith and without notice of the hire purchase agreement.

A ‘disposition’ must take place; that is the title to the goods must be passed from the seller to buyer.

Outcome of the Case
Mr. Khan was able to establish that he did purchase the vehicle in good faith. The vehicle had been involved in an accident before he purchased it and it was reasonable for him to pay the amount that he did.

Mr Khan was able to prove that a disposition had taken place as he evidenced the cash payment made to the seller and the V5 log book being registered in his name.

The court ordered the Defendant to return the vehicle to Mr Khan and pay all of his legal costs associated with the action.

Hope this helps!

 

computer gone into nervous breakdown

 

Don’t be a morron.

 

Not yet. The previous owner on the log book isn't the name of the person that sold us the car. So he was either selling it on consignment or just didn't register the change of ownership. Will see what the papers say when they come through

 

Eh?

 

Best advice you’ll ever get, it applies to every situation, Don’t be a moron.

 

Thanks for the useful advice MORON

 

I've never come across this provision before. The usual rule is 'nemo dat quod non habet' (you can't give what you don't have). This piece of legislation (the 1964 Act) seems to transfer the finance company's right to laying against the debtor, rather than the innocent purchaser.

 

I follow the advice.

 

I had a similar experience some years ago when I got a new van.

I paid a deposit, 47 monthly payments and then a final balloon payment, believing that the van was then mine.

A month later the company took another monthly payment, so I contacted them to be told that the van still belonged to them and I they would take 1 monthly payment per annum as long as I had the vehicle.

Van was still in good nick and had all my signage on so I just rolled with it.

Problem came when it was written off. Insurance refused to pay out as I didn't own the van. All they were willing to pay was a end of agreement fee between myself and the van dealer.

Thankfully I had insured through a broker, who took up the case and the insurance company did pay me, bearing in mind the money I had shelled out over the years, in payments and upkeep, which had exceeded the value of the vehicle.

My own fault for not meticulously reading the small print, but the sales advisor also led me to believe that I could hand in the van after 4 years or make the balloon payment and it would be mine.

 

That appears to be the case (although like I said I am no solicitor). Even the police seem to be unaware of it as evidenced by their initial reaction on the example case above.
I wonder how many people have had their ('legitimately' bought in good faith) cars repossessed and not known about the '64 Act. Morally it does seem fair as the new owner bought in good faith and has done nothing wrong except forgetting Uberrima Fides and so the Finance company pursue the person with whom the contract existed. However, to a lay person like myself, on the face of it, the contract between debtor and new 'owner' would seem void or non-binding since as you say the property was not the debtors to sell so, regardless of who's name is on the logbook, the vehicle still belongs to the finance company. Nevertheless, I would have thought that the debtor by selling the vehicle and pocketing the proceeds should surely be committing some sort of criminal offence, be it, fraud, obtaining money by deception or both as well as a simple civil breach of contract.

 

Technically, it wasnt the 'dealers' car to sell. It was and remains the property of the finance company until the loan is settled.

Where the finance company goes varies from company to company, what liability they have outstanding and likelyhood of any of it being recouperated.

If its a logbook loan you are looking at either paying out more or losing the asset unless theyve mis registered the bill of sale.
Your recourse then is againt the bloke you brought it off. They are a minefield.

If its a bogstandard HP agreement it will vary from company to company.

The 1st issue is your dealer is not actually a dealer based on what youve posted but a bloke who buys and sells to make a bit of cash here amd there.
If the car was purchased from a tradtional 'forecourt' the finace company would go after these as they would be indemnified.it would be seen as dealer error that theyve not dont the correct paperwork buying the car in the 1st place.

Secondly, 'substantial interest'v what the asset is worth to recover.
Bear in mind that they would auction the asset should they recover it...
So 1500 on the forecourt price becomes 500 at BCA. Plus the costs of recovery fees etc..
That 500 then becomes nothing. Theyll weigh up if its wort their time.

Coupled into this is the likelyhood of recovering their outlay from the party who they lent money to.

Sterotyping somewhat they are less likely to be arsed about the asset if it was employed property owner Doris from.darton who got the car for the school run as they can recover (and strangly enough get more) the monies through legal recourse.
If its Polish Pete on basic wages and hours at Asos then theyll see asset as their main recourse to recover their outlay.

The innocent party questionaire is really simple.
Itll be questions along lines of who did yoi buy it from. Where do they live. How did you pay. How was it advertised. Did you do a Hpi. Do you know the seller in a private capacity and so forth.

As long as youve got a receipt then theres a receipt to confirm how much,when and wherefrom theres a greater than good chance theyll let you keep the asset and leave it as that.

Also keep it on your drive. Blocked in. Do not sign any paperwork that you get given by anyone outside of the IP questionaire.

Unless you volunteer to hand it back its a mindfuck getting a car back when its on private property. And expensive.

 

Cheers Deetee. Yes got the receipt, log book and everything else. Obviously finance company wouldn't give me any details and with the car being 13 years old I can't really see it being a finance deal to buy the car more a log book loan which is worrying.

 

If you’d done a HPI check, they also guarantee their results for either 12 months or 24 months (can’t remember which). Up to a value of £10k I think.

Anyway, moving on - your loss would be £600? Might be best to see what happens with finance company. To start legal proceedings will cost more than £600, so it may be worth cutting your losses if no initial success.

 

Is there only me and the OPer looked at my 2 posts on section 27 of the Hire Purchase Act 1964 as it overrides half of the advice given on here including this above post re legal costs

 

Yes.

Your Mr Kahn test case shows the use of a solicitor.

For which needs to be paid for first before claiming back. This can take time - I have legal knowledge, and for £600 plus the hassle and stress it would be first put to the client that it may be worth just seeing what the finance company says yourself.m before engaging their services.