The recent decision in David Adam v Moneybarn No1 Limited provides some pause for thought regarding the rejection of vehicles due to latent defects (hidden flaws or defects in the vehicle that are not visible at the time of purchase). The ruling clarifies that the defect must be present at the time of purchase for rejection to be an option. Additionally, the decision discusses important issues related to expert or skilled witnesses.
The facts
Mr Adam entered into a conditional sale agreement—a type of finance agreement—with Moneybarn No1 Limited ("Moneybarn") on 28 February 2022 for the purchase of a car. The car was eight years old and had a mileage of 45,624 miles. The car passed MOT tests in 2018, 2019, 2020, and 2022. The post-sale MOT in July 2022 recommended monitoring and repairing, if required, three items concerning wear to the tyre and exhaust mounting.
Mr Adam experienced problems with the car in late 2022. He took advice from mechanics as to the cause of the problems—various diagnostic checks were conducted on the car, and a replacement coil pack was fitted.
Mr Adam engaged Reject My Car to represent him in disputing the quality of the car with Moneybarn and instructed Scottish Independent Vehicle Inspections ("SIVI") to inspect the car. Moneybarn also instructed an expert to inspect the car and prepare a report. Fault codes were identified by both inspectors, though no actual cause of any fault was confirmed by either expert.
Some correspondence followed, and Mr Adam ultimately intimated his rejection of the car to Moneybarn, relying on the report prepared by SIVI, on the basis that the car was not of satisfactory quality when he purchased it in February 2022.
Moneybarn did not accept Mr Adam's rejection of the car, maintaining the position that the car was of satisfactory quality, commensurate with its age, price and mileage, as at the date of sale. Court action then followed.
The case proceeded to an evidential hearing at Dumbarton Sheriff Court, where the Sheriff considered three issues:
- Should Mr Adam's expert witness be certified as an expert or skilled witness?
- Was the vehicle sold to Mr Adam in breach of the terms of the Consumer Rights Act 2015 ("the 2015 Act"), specifically section 9 of the 2015 Act?
- If Mr Adam succeeded in proving that the vehicle was sold in breach of the 2015 Act, what remedies were available to him?
The decision
After hearing evidence from both experts, the Sheriff was concerned about the impartiality of Mr Adam's expert. The Sheriff's concerns stemmed from Facebook accounts and posts belonging to Mr Adam's expert, particularly the expert's affinity with Reject My Car and that entity's business model. This included "likes" of posts about claims against car dealers, settlement of cases and Reject My Car's alleged preference for legal action over negotiation. As Reject My Car was advising Mr Adam regarding his claim against Moneybarn, the Sheriff confirmed that legitimate issues regarding the expert's impartiality had been raised. Consequently, the Sheriff did not view him as suitable to be impartial in his assessment of the car or to give evidence to the court as an expert regarding the fitness and durability of the car. The Sheriff therefore rejected Mr Adam's expert's evidence as a skilled witness.
The Sheriff viewed Mr Adam's evidence regarding the suggested faults in the car as exaggerated, evidenced by the fact that the car had incurred over 10,000 miles since it was purchased by Mr Adam in February 2022. The court ruled that Mr Adam failed to prove that the car was not of satisfactory quality when it was purchased in February 2022. This was because there was no evidence to confirm what was wrong with the car, allowing the court to infer that the car did not have a latent defect at the date of sale. Mr Adam was therefore unable to prove that Moneybarn had breached the terms of section 9 of the 2015 Act.
The Sheriff accordingly rejected all of Mr Adam's claims and absolved Moneybarn of any liability to Mr Adam in respect of the car.
Comment
This decision serves as a reminder to all practitioners to ensure the suitability of an expert witness. The Sheriff in this case had clear and legitimate concerns regarding Mr Adam's expert's impartiality and his links to Reject My Car and rightly rejected his evidence regarding the fitness and durability of the car, on the basis that he did not think it was impartial.
Further, this decision serves to underpin the requirements of the 2015 Act and the necessity to prove that a latent defect was present at the time of purchase. If there is no evidence to show that the defect was present at the time of purchase, the purchaser cannot legally reject the car based on that latent defect, and any claim for rejection on that basis should not succeed. Experts will be pivotal in cases such as this, and with rejection cases on the increase, finance companies and vehicle dealerships need to be on their guard. They must ensure that inspections are thorough and that reports received from disgruntled customers and those representing them are properly scrutinised.
