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SA Private Car Purchase From Gumtree - Misleading Advertising?

Discussion in 'Australian Consumer Law Forum' started by Antonio Sarno, 17 September 2014.

  1. Antonio Sarno

    Antonio Sarno Member

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    We bought a car from gumtree and it was advertised as a 2008. We met the seller at the bank and had done a bank transfer.He then produced the registration papers. We noticed the model was a 2007 model. When we asked him to explain, he stated that was the year her registered it. He made no attempt to explain it was a honest mistake and renegotiate. The ad shows 2008 in bold letters and this plays a very important part in considering the price and purchase of a car. Is there anything we can do, and is this considered as misleading advertising under Australian Consumer Law?
     
  2. Sophea

    Sophea Well-Known Member

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    Dear Antonio,

    Assuming the seller is not a registered second hand car dealer, I don't know of any applicable consumer laws that would provide you with a cooling off period or implied warranties that would apply to your purchase under South Australian law.

    However, you would likely have grounds to cancel the contract at common law, on the basis that the seller had made a pre-contractual misrepresentation. This requires you to prove that there was a 'false representation' which is a statement of fact (not opinion) made to you and that it 'induced' the sale.

    I would contact the seller and advise him that you are cancelling the contract on the basis of his misrepresentation and demanding the return of your full payment, but that in order to avoid legal costs you would be willing to settle the matter on the basis that he pay to you the difference between what you would have paid for a 2007 model and what you actually paid. Capisce? If he refuses to agree to the settlement say you will have no choice but to take it to the Magistrate's Court. I believe the monetary jurisdiction of small claims down in SA has increased to $25,000.

    Apart from that I would contact Consumer and Business Services (SA) cbs.sa.gov.au, and see if they have any further advice.
     
  3. Antonio Sarno

    Antonio Sarno Member

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    Hi Sophea
    Thank you for your reply and your advise is greatly appreciated my partner had viewed the car after looking around for the last few weeks,and we had done a lot of investigation on the current market value taking as many factors one of them being the age of the car. She was happy with the vehicle and felt the price they settled on was fair considering the age and condition and mileage ect. she was happy and confident that she had made the right decision by herself and felt the owner was honest and fair. so I was happy to help her with the transaction so we decided to meet the owner at the bank and do a direct transfer so both party,s were satisfied, I did the transaction and he then produced the registration papers and we completed the transaction. but we did not notice the year 2007 until we got home and rang the insurance company for cover. Then we discovered that it was a 2007 model my partner rang him and said we just found that this car is a 2007 model and not a 2008 model as you advertised on gum tree, he replied oh yer 2008 was when I first registered the vehicle and made no attempt to discuss the matter further. So now seeing that I carried out the transfer in my name and getting a copy of the ad of gum tree I will take it up with the owner, I have written to CBS and waiting for a response we only want a fair deal from the him and hope he will come to the party if not I will let the court decide on the matter. Thank you for the good advice Kind Regards Antonio
     
  4. Sarah J

    Sarah J Well-Known Member

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    Hi Antonio,

    You may find that CBS do not handle matters between a consumer and a private seller (which is the case here). I would suggest in the future, to have a look at the registration papers first before signing any contract and making payment. This is because, sometimes, the purported owner may misrepresent that they are the true owners when in fact, the car was stolen. Of course, here, you were misrepresented, but the misrepresentation could be much worse, so do check all details beforehand.

    As to what you can do now, figure out what the difference between a 2007 and 2008 model is, monetary wise (difference in insurance premiums may be a start). Figure out if this difference in years is a big issue for you and would be something you would cancel the contract over if the seller refuses to compensate.

    1. Negotiate with the seller and ask them to compensate you for the difference due to the misrepresentation. Note that he may not have intentionally misrepresented you so try not to accuse him of this out of good faith.
    2. Your other option is unfortunately litigation. As Sophea pointed out, the Magistrates' Court is a good forum. You certainly would have a case here. However, the amount in damages may be reduced according to the amount of responsibility you bear in this matter, which is failing to check the registration papers before purchase. You may mitigate this reduction if this was your first purchase through a private seller and you have little experience purchasing cars, or that the seller was in a rush and gave you little window of opportunity to decide.
     

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