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Section 75 PayPal credit card and car significantly not as described

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  • Section 75 PayPal credit card and car significantly not as described

    Looking for some advice. A few months ago I purchased an MGB bodyshell and parts from ebay. I paid using a PayPal credit card. The e bay advert text is shown below:

    “This was to be my last project, and so it has proved to be. Lack of time and good health mean my treasured roadster cannot be completed by me, and is therefore very very reluctantly for sale. A wonderful opportunity for someone to complete the project, put the B back on the road an enjoy ownership of what will be a beautiful example of the marque. 40 years old on 7th June, the car was originally yellow. It was stripped, new front wings, new rear wings, new floors, new sills, near rear bulkhead, new rear panel, new front panel, new bonnet, new jacking points, and resprayed in black. Thus it is as near to a new shell as can be! This was some 3 years ago, and the shell has sat in my garage since. There is absolutely no rust anywhere to be seen. There are a couple of very minor marks gained during storage. Originally rubber bumper, the work has been done professionally to convert to chrome, both front and rear as can be seen on the photos. I have accumulated a wealth of new parts, with no expense spared, costing over £4k, all of which will be included in the sale. These include : REAR END Parabolic springs, Gaz conversion shock absorbers, lowering blocks, polybushes and a complete brake renewal kit. New handbrake cable. New copper brake pipes. FRONT END Crossmember stripped and repainted, Gaz conversion shock absorbers, polybushes, lowered springs, complete rebuild kit for suspension, roller bearing king pins, complete front brake upgrade kit, new steering rack, new thicker anti-roll bar, rose jointed anti-roll bar control arms. There is a new propshaft, and a new clutch master cylinder. BODY & INTERIOR there is a brand new complete front screen and surround, fully assembled with sun visors, and a pair of brand new stainless steel quarter light assemblies. The hood and frame are as new, but could do with a clean after storage. There is a pair of brand new leather seats with headrests, in biscuit with black piping. I have probably forgotten some! There is also a host of other used parts, which will be included in the sale. The engine was refurbished and installed ready to go when I bought the car. I removed it, and the gearbox, intending to go the V* route. There is a set of Rostyle wheels, and a set of 15" alloy wheels, all included. Some parts will be required to complete the car. A radiator, hoses, oil cooler, door cards and panels, carpets, body trim and tyres, starter motor, alternator, battery and others, I am sure. Nothing major! There is an original jack, and 2 pairs of chrome bumpers, in need of a polish. The car is mounted on a 7' x 4' car body trolley, so it can be freely moved, and which will come with the car. Free to collect, or I will happily load onto trailer etc. A truly wonderful opportunity to create with little work, what will be a beautiful example of the marque!!”

    However, on winning the car I had it collected and inspected for my peace of mind by a classic car restored who found on stripping the shell that the car was significantly not as described. Basically none of the panels had been replaced and they were not new. There was quite a bit of rust damage on the shell and repairs to bring it up to MOT standard or even the standard that the advert claimed the shell to be would be very expensive. I alerted the seller to the problems that I had found and advised him that he could go and see the bodyshell if he wished to see the problems. He did so and did not dispute the findings. I asked him for a full refund and told him I would be willing to return the bodyshell and parts to him. I also told him if he agreed to this I wouldn’t seek to claim any of my costs for the collection and inspection of the bodyshell. He refused to refund me and has chosen to ignore my e mails from this point on. At this point I made a section 75 claim against PayPal credit card who I used for the purchase. After 9 weeks of waiting for a response they have written to me today refusing my claim.

    They say that:

    Following a thorough review of the transaction and all of the relevant information provided, we were unable to agree with your claim of misrepresentation.

    You purchased a MGB (Car) shell on eBay on 10/06/2018, and an inspection was carried out by a third party upon collection. I understand that the third party found the item to be not as described and that the cost to rectify would not be viable. We believe however that the condition of the shell should have been assessed prior to purchase. As you have not provided any sales document or contract we are unable to confirm that the item was misrepresented to you either during the advertisement or through to the completion of the sale.

    I regret that at this time we are not in a position to offer you any form of reimbursement. We are willing to review any new evidence that has not yet been provided to us, should you have any. Our decision does not affect your statutory rights nor your right to pursue a claim via any other method.”



    I am am now in the process of appealing their decision with the ombudsman. I am looking for any advice please. PayPal are saying that I should have assessed the condition of the shell before purchase but I am not an expert car restorer and the parts were hidden under paint and underseal. It was only when the restorer was able to grind away the paint and undeseal that it became clear that the car was not as described. The sales document or contract that PayPal are referring to as not being provided is surely the original advert which clearly misdescribed the true condition of the vehicle. Are PayPal just trying it on? Any advice greatfully received. Thanks and apologies for the long first post.
    Tags: None

  • #2
    Sounds a bit of a cop out by PayPal to be honest. It is irrelevant whether you should have had the vehicle inspected prior to the purchase, the advert was described in a certain way and under the laws of misrepresentation, you are entitled to rely on the description of the goods which induces you to enter into a contract, particularly if this is a distance sale such as an ebay auction.

    Which Ombudsman have you decided to go through?

    If the Ombudsman doesn't agree with your position then your next stop is likely to be legal proceedings. It is not uncommon for credit card providers to reject section 75 claims where it is not absolutely clear that something has gone wrong. Bearing in mind the person who rejected your claim probably doesn't have an understanding of the laws of misrepresentation - that will probably get picked up when legal proceedings are issued.

    Assuming you've saved a copy of the advert or printed it out, and the inspection report can be supplied on request then you appear to have fairly good chances of being successful. If the issues were not able to be discovered until the shell was removed and a deeper inspection took place, you could also argue that it was not practicable to carry out such an inspection before the goods were legally yours.
    If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
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    LEGAL DISCLAIMER
    Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

    Comment


    • #3
      Rob, thank you for your reply. I have complained to the financial services ombudsmen - is there another ombudsmen I should have complained to?
      I do have a copy of the original advert -I copied and pasted the original text above in my original post - and do have an inspection report clearly disagreeing with almost all of the seller’s original advert.
      I originally wanted to make a section 75 claim against my credit card company as I hoped it would be quicker than making a claim through the small claims court and also to avoid the court fees. I am happy to make a claim though through the small claims court - can anyone advise as to the time scales involved in doing so. Also can anyone advise on the timescales involved with appealing to the financial odbudsman?
      Thnakyou again for your help - my guess is that PayPal are simply hoping I’ll go away.

      Comment


      • #4
        No the Financial Ombudsman is the correct one, I was just double checking in case you submitted your complaint to another Ombudsman. In terms of timescale, it is usual for the FOS to take some time so I would expect 4-6 weeks on a good day, and longer if they are busy. But you should keep on top of things and send them an email from time to time to obtain an update on your case.

        Sometimes section 75 can be very quick and other times, they can take forever. It would not surprise me if CC providers have some sort of 'first time reject' policy where they reject all but the obvious failures in the first instance and then see who pushes back after that.

        Maybe I'm just being cynical but hey ho.
        If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
        - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
        LEGAL DISCLAIMER
        Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

        Comment


        • #5
          Rob - if I did need to go down the small claims court route would I make a claim against PayPal credit card or the seller or indeed both?

          Comment


          • #6
            I have complained to ebay regarding their decision. This is the response I’ve received from them:

            “Please understand that we have performed a thorough investigation before taking any decision concerning your Section 75 claim. I am very sorry for any dissatisfaction this may have caused.

            I have reviewed your account and this matter in question and I see that, on 22 August 2018, we finished our investigation.

            I regret to inform you that, unfortunately, we are not in a position to offer you a refund or settlement.

            Following my revision, I see that, on 21 June 2018, the following documents were requested:
            • A copy of the receipt, invoice, proof of purchase or similar document.
            • A written summary of the purchase, including the merchant’s name, how the product was described, the date of your transaction, date of delivery and any other information that may be helpful.
            • A copy of the merchant’s terms and conditions, and a clear statement highlighting which term of this agreement you believe they breached.
            • A written summary of the claim, setting out what has happened and the amount you are seeking as compensation.

            I see that you provided a copy of an independent experts report and the original eBay listing. Regrettably, a sales document or contract was not provided.

            In order to reopen this investigation, I kindly ask you to reply this email by 30 August 2018 keeping in place the subject heading and attach a copy of the document that it has not been provided us or with any new evidence that it shows ta clear evidence of misrepresentation of the item received.

            Please do not hesitate to contact me if you have any further questions or concern and look forward to hearing back from your soon.”

            I’m unsure now what to do. I’m not sure how it could be any clearer that the seller seriously misdescribed the item either deliberately or innocently. My understanding was that the contract was formed on the basis of his original ebay listing so I can’t undestand why PayPal are asking for a sales document or contract? Any further help much appreciated.

            Comment


            • #7
              Hi YellowMGB,

              If you wanted to maximise your chances of obtaining a successful judgment, you would bring a claim against both PayPal and the seller.

              As for PayPal's response, it sounds like they don't have a clue and I am not entirely sure why thy are placing focus on the lack of a sales document or contract. It should be well known that a contract does not need to be in writing as they can be created orally or by way of conduct. In your case, the seller enters into a legally binding contract with the highest bidder (you) at the end of the bidding period. Indeed, eBay's terms and conditions also state this and is made clear in their terms (Click here for link) as per below.

              Click image for larger version

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              Click image for larger version

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              The fact that you were the successful bidder means that you have entered into an agreement to purchase the body shell. It can't be any clearer than that. Whoever has sent you that email hasn't quite grasped that this was an eBay bid and the terms and conditions of the trader are not particularly relevant, except for the eBay ones and including the relevant key points I highlighted above. The eBay User Agreement has a heading titled 'Purchase Conditions' and it says clearly in there that you enter into a legally binding contract when you have won the bid (Link here).

              Have you received confirmation from the FOS yet, and are PayPal aware that you've submitted your complaint to FOS? If you haven't already, you need to clearly set out the position and make it clear you that reliance was placed on the description of the body shell, you bid for the item on eBay and upon becoming the successful bidder, created a contract between the seller and yourself (backed up with reference to the eBay T&Cs). Also if you have yet to state that you have now pursued the complaint to the FOS, you could also throw that in for good measure.

              Happy to give feedback on any response if you post it up the draft first (personal info removed) and we can comment on it or the best way to approach your complaint.
              If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
              - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
              LEGAL DISCLAIMER
              Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

              Comment


              • #8
                Thank you Rob. I shall draft something this evening and post it up.

                Comment


                • #9
                  Rob, please seee my draft response to PayPal credit card, any suggestions welcome:


                  Dear PayPal

                  I am confused as to your statement that I have not sent you a sales document or contract. I was the winning bidder on the body-shell in an ebay auction. E bays own terms and conditions state under purchase conditions that ‘you enter into a legally binding contract when you commit to buy an item, or if you have the winning bid’. To be clear I only bid on this body shell because of the description offered by the seller - the seller provided clear and definite statements of fact that the panels on the shell were new and that there was no rust which I have relied on and induced me to enter into a contract to purchase the shell. I believe I have legal protection under the Sales of Goods Act that the item needs to be as described. I have sent you an independent inspection report clearly showing that the shell was not as described and also sent you correspondence from the seller whereby he agrees that the shell was not as described.

                  I have contacted the Financial Ombudsman Service and raised a complaint with them. Whilst I await their response I would ask you to reconsider your decision.

                  Comment


                  • #10
                    I have realise that I should mention the Consumer Rights Act 2015 as opposed to the Sale of Goods Act.

                    Comment


                    • #11
                      Thought I'd pop in at this point with a tongue in cheek query.
                      Why did you think an MGB would be without rust ....it's built in !!!!!!
                      At least my 1971 "B" (a daily driver) is a constant battle against the worm, but it's such fun to drive I wouldn't change it.
                      Happy motoring and follow R0b's advice. IMO you have a good case


                      PS regarding the Act: CRA only applies to TRADER/CONSUMER contracts
                      From the advert it sounds as if this was a private deal, so you would need to claim under SOGA or the Misrepresentation Act 1967

                      Comment


                      • #12
                        Hello

                        I've set out below a quick template that you can use to send to PayPal. There's some thing in square brackets that will need your input but feel free to use however much of the letter that you think suits. You'll probably need to expand a bit more on the background area which shouldn't take you too long. Just make sure to attach all the relevant evidence.


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

                        Dear [name] or Sir or Madam],

                        Thank you for your email earlier today regarding my claim under Section 75 of the Consumer Credit Act 1974. With all due respect, it seems to me that you haven’t quite grasped the gist of my claim and so I have set out below, the background as well as the reasons for me claiming.

                        Background
                        [Insert some background to the claim for example, you were interested in purchasing the body shell for an MG [model] when you came across the advert on ebay for XYZ]

                        According to the eBay User Agreement terms and conditions under the heading titled “Purchase Conditions” it states, amongst other things, that:

                        you enter into a legally binding contract to purchase an item when you commit to buy an item, or if you have the winning bid (or your bid is otherwise accepted)

                        I then instructed a third party to [collect and] assess the body shell in its current state and it turned out that the seller’s description of the body shell was false.


                        The basis of my claim
                        It is my view that there has been a misrepresentation by the seller of the body shell contrary to Section 2(1) of the Misrepresentation Act 1967. The seller, by providing a description of the body shell stated that [insert the statement(s) that was/were not true]. In reliance of [that/those statement(s)] I bid for the body shell and was successful. It is clear from the independent report (which you have already been provided with) that the statements made by the seller are false and confirming that the body shell was not as described. As such I have suffered a loss, namely the cost of the bid being [amount].

                        I am somewhat confused as to why you are asking for the merchant’s terms and conditions because as I have made clear previously, both the seller and myself are bound by the eBay terms and conditions, which I have provided a link to at the end of this email. I also do not understand why you are asking for a sales receipt, invoice or similar document when again, the contract was formed when I became the successful bidder. Nonetheless, I attach a screenshot of the auction confirming that I won the bid.

                        I would appreciate if you could undertake a review of my claim and look at the documentation and the information I have supplied to you rather than providing generic statements which appears to show that you have not actually read my claim at all.

                        As an aside, I would mention that since you have failed to properly look into my claim and rejected it rather hastily, I have now raised a complaint to the Financial Ombudsman Service. Furthermore, I am also considering legal action against PayPal and joining the seller as a second defendant to recover the sums that I have paid out.

                        Regards,

                        [Your name]
                        If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
                        - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
                        LEGAL DISCLAIMER
                        Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

                        Comment


                        • #13
                          Rob, e mail sent this morning. Thank you again for your advice. I have yet to receive an acknowledgment from the Financial Ombudsman that they have received my complaint. I will keep you posted and thanks again.

                          Comment


                          • #14
                            I feel like I’m banging my head against a brick wall at the moment with PayPal. This was their response this morning to my email. To be clear I included all of their various transaction codes/complaint reference numbers etc etc in my email:

                            After reading your email, we have not been able to clearly determine the nature of your request. In order to assist you, you need to provide us with more information. In particular, we need to know the following:
                            • Transaction ID.
                            • Date and payment amount.
                            • Email address of the seller/buyer
                            • Case no.
                            • Any other information that may be of interest.

                            Comment


                            • #15
                              Up to you what you want to do, you can either re-supply that information or if they already have it then you respond by telling them that the information has already been given (on a number of occasions?) and it shows their incompetence. by repeatedly asking for information they have already been given. You might want to go on further to say you suggest they look at the history of your Section 75 claim again and provide a response within the next 7/14 days otherwise you will consider issuing legal proceedings against PayPal, as it is clear to you that you are going round in circles and the only way for them to take notice is to bring a claim against them.
                              If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
                              - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
                              LEGAL DISCLAIMER
                              Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

                              Comment

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