Behemoth auction house demanding return of purchased lot - Letter before action

[dylan2408]

Backstory: Looking to get a good deal on a vehicle so purchased through a company called Copart. They are one of the largest auction houses in the world dealing in salvage vehicles.

Last week I watched a vehicle go through the auction and bid up to £41,500. The vehicle sold above what I was willing to pay at a seemingly inflated price. Monday (06/12/21) the vehicle goes back up for sale but this time with a buy it now price of £23,000. Assuming the previous buyer turned up and there was some sort of undisclosed damage or one of many other reasons why a vehicle may be resold at a lower price I purchased the vehicle. Paid in full and collected Monday.

This is where things get odd. I receive an email from copart after I had already collected the vehicle from their yard stating

"Please be advised that we have had to remove the above lot from your account at the seller's request, the vehicle has been reassigned to auction if do wish to bid on it in again in future. If you have any questions regarding this, please call us on ____"

At this point I had already paid for and collected the vehicle, I believe they was unaware I had already collected at this time. I replied stating I am now in possession of the vehicle and having already paid and outgone expense I will be keeping it.

Fast forward to now I have received a letter demanding the vehicle is returned on the basis they had some error in pricing and said the alternative is paying my previous bid submitted in the last auction, an increase of some £20,000 because I had to be aware and took advantage of a pricing issue.

I'm of the belief that because I have already paid for the lot and they have released to me that they have no right to request any further money from me or the vehicle back. Not only has the contract of sale concluded but the property is mine.


I need some advice how to reply to this letter, their member rules can be found here: https://www.copart.co.uk/content/uk/...rms-conditions

[echat11]

I don't think you can actually truly know the value of something put up at an auction, you auction and 'find' out. It's an interesting situation.

des8 R0b Can you please take a look and advise, many thanks.

[dylan2408]

Anyone coming into this - I thought it may be worth further explaining that this vehicle in its current state is a category S write off, non running and (not drivable Something I was not aware of when placing my previous bid or purchasing) this time round.

The vehicle valuation from https://www.parkers.co.uk/ which I would consider an impartial party (Not a used car buying service) is Private Price
£19,095 - £26,055. The valuation is based on a running driving vehicle with no history.
I would argue their valuation is low however should give you an idea that asking for the full amount of £41k simply because that is what it previously achieved in an auction is bizarre, also backing up my point that £23,000 isn't a unrealistic price so their claim is baseless in that I have not taken advantage of a clear pricing error.

The second part of their claim being that in their terms they can end a contract of sale after it has been concluded (Their wording of a concluded sale is a lot that has been purchased and paid for) and refuse collection. On this point I really need advice because I cannot fathom how a company can terminate a contract of sale when the property is already sold and collected.

Anyone who knows about this stuff would be amazing to get some feedback - I have a little while to put together a response and want to make sure its one that stops whatever proceedings they want to pursue.

I can only find cases of errors in pricing leading to cancelled sales before people receive the item and people taking companies to court for the goods not arriving and often winning, not one single case of a business chasing a client for the item back or more monies after it has been collected / delivered.

[des8]

At a quick glance, one of your problems is that the T&Cs make this a business to business contract.
The contract does seem, on the face of it, to give the house the opportunity to rescind any contract for any reason at any time (as said only had a quick look)
Courts rarely interfere with B2B contracts, no matter how unfair.

I'll look into it in more detail over the next couple of days, but hopefully R0b will get there before me!

[R0b]

It would be helpful to see their letter(s) with your personal info redacted to see exactly what in their terms and conditions they're seeking to rely on that enables them to dissolve a contract once it is deemed concluded.

Couple of initial thoughts but give not certainty of success:

- If there is a right for them to rescind a contract at will once it is deemed concluded, for any reason whatsoever, could amount to an unfair contract term. It's not clear whether you are trade or a consumer but in either case it may fall under the Unfair Contract Terms Act if you're trade, or the Consumer Rights Act. Probably stand more of a chance if acting as a consumer than a trade. That clause seems to be unusual and onerous and should really be brought to your attention at the beginning (not sure if they do that) but in any event it sounds pretty extreme.

- The email is suggesting that they are asking for the return on behalf of a seller, rather than themselves. If that's the case, and I've only just scanned the terms but clause Clause 7.5 says (my emphasis):

A bid you place will be binding if we accept it by a notice displayed on the Website. The moment you are so notified that your bid has been successful, a Contract of Sale will be concluded in respect of the Lot that was the subject matter of your bid in relation to Pure Sales. A Contract of Sale will only be concluded in relation to Minimum Sales if the reserve price has been met or exceeded. A Contract of Sale will be concluded in relation to On Approval Sales if and when the Seller accepts your bid. In each case, the Contract of Sale will be between you as the winning bidder and the Seller (who may on occasions be us). Unless we are the owner of the Lot sold, we are not party to any Contract of Sale. These Terms and Conditions, however, govern the Contract of Sale.

If they have made a mistake on behalf of the seller, then it should be down to the seller to bring it's case, since CoPart have no interest and are not a party to the contract.

[dylan2408]

I have uploaded the letter before action redacted - I have only included the specific parts of the member rules they highlighted in the letter as the file size is too large.

They have everyone down as a "business account", I have purchased vehicles from here before with no issue using my company card however this was a personal purchase and if it helps I did for the first time use my personal bank card for this purchase.

Their terms seem to allow them unlimited right to cancel a concluded sale for an unrestricted timeframe. I would argue the state of this sale was not their definition of a concluded sale (Paid for) as I had indeed collected it. In their member terms it says they reserve the right not to allow collection of a concluded sale lot.

Found a few interesting clauses that in their words overwrite all other conditions as this was a buy it now sale:

14. “BUY IT NOW” SALES

14.1 We may offer some Lots for purchase outside our usual auction through your use of our “Buy It Now” facility. These Terms and Conditions shall apply (as permitted by law) to all Buy It Now sales, with the provisions of this clause 14 taking precedence over any conflicting provisions elsewhere in these Terms and Conditions.


14.4 YOU ARE BUYING LOTS IN YOUR CAPACITY AS A TRADE MEMBER, SO CONSUMER PROTECTION LAWS DO NOT APPLY TO BUY IT NOW PURCHASES AND ALL IMPLIED TERMS (STATUTORY OR OTHERWISE) ARE EXCLUDED TO THE FULLEST EXTENT PERMITTED BY LAW. ALL BUY IT NOW SALES ARE FINAL – RETURNS ARE NOT ACCEPTED – AND ARE MADE ON AN “AS IS, WHERE IS” BASIS. IT IS YOUR SOLE RESPONSIBILITY TO MAKE ALL NECESSARY ENQUIRIES AND INSPECTIONS TO SATISFY YOURSELF AS TO A LOT’S STATUS, CONDITION AND HISTORY BEFORE MAKING A BUY IT NOW OFFER. THE PROVISIONS OF CLAUSE 8 APPLY IN FULL TO BUY IT NOW PURCHASES.

14.6 We may at our discretion cancel your Buy It Now order, either before or after acceptance. If we cancel your Buy It Now order after you have made payment in respect of that order, we will refund the sums you have already paid.


No mentioned of being able to cancel a concluded buy it now sale. Only a buy it now order, In this case the order was completed. Notice nowhere in their wording do they mention a sale that has been removed from their yard and do not mention any return of vehicles?

I'll wait to hear back from you guys before I word a reply.

[des8]

10.5 Such right and title as we or the Seller has to each Lot you purchase will transfer to you absolutely when we receive the Price and all applicable Fees in cleared funds, subject always to our right to cancel any Contract of Sale and negate such title transfer in accordance with these Terms and Conditions.

I don't see that anything in clause 14 which conflicts with the above clause as it is the only clause (I could see) which confirms transfer of title

But that clause is contradictory IMO ; if an item has been transferred absolutely it cannot also be conditional to a right of cancellation.
Similarly IMO they cannot have an open ended right to cancel a concluded contract after delivery has taken place
Ownership of goods must pass absolutely at some point, otherwise it makes a mockery of contract law
That point surely is on delivery?


The argument about you knowing the value of the vehicle is an utter nonsense.
you made an offer in line with their asking price which they accepted.
the vehicle may have been relisted because the original winning bidder found undeclared faults or misrepresentation which rendered the original sale invalid and so cancelled.
Perhaps they just wanted to dispose of the vehicle quickly and offered you a black Friday deal
All you were aware was they gave you the chance to offer, which you did.
Nothing to do with the perceived value, just a business to business contract.

With what you have noted, together with R0b's comments I would be telling them to get on their bikes (but ever so politely!)

[dylan2408]

Anyone interested in continuing to follow or help with this, I have some interesting updates.

I sent a detailed response on the 4th of Jan within their set out time limit, going over all the points and common sense backing up my case of not being responsible for their error. Please see redacted letter here:
2022.01.letter redacted.pdf


Quite shockingly Copart decided not to adhere to my fair 14 day deadline for a response and instead replied via an unrecorded un signed for letter in the post 26 days after mine, 13 DAYS past the limit on response. Pretty much concluding that not only am I not a consumer, I apparently also do not apply to the unfair contract terms act 1977.

In line with their actions and rhetoric I am merely a small insignificant man in the ring with a billion £ corporation. See below their response.







I plan on wording a response to this letter in the coming days and would appreciate any pointers / advice, I wish to at this stage make them aware of any counterclaim / claim for costs and defence if the claim is not dropped due to reasons already stated in my last letter.

@des8 @R0b echat11

Bizarre and very demeaning behaviour from this company.

[des8]

Regardless of their registering everyone who bids as a "trade purchaser" are you in fact a trader in motor vehicles?
You did mention that you have purchased cars previously using your company card.

If you are in the motor trade it is pointless for us to consider your position from the point of a consumer

The Sale of Goods Act to which you refer applies to B2B contracts as does The Unfair Contract Terms Act, contrary to their statement, and IMO that is where your your best defence lies.

Regarding the non compliance with your deadline of 14 days, I make a point of disregarding such deadlines as they are meaningless unless from a court (or perhaps plod!).
.

[dylan2408]

des8 I did use my company card to buy a couple cars last year but just as a means of payment (dividends) rather than as actual business use. I'm a hobbyist, I suppose kind of a collector. Of the 8 cars I have purchased in the past year I still own 7 of them. The card I used to pay is linked with a company solely supplying IT consultancy and registered as such with gov.

In the case of this vehicle however I did use my personal bank, I am not in the motor trade so I guess I will continue arguing consumer as that gives the best overall protection but my argument is even if they want to suggest this is still a B2B contract, I feel that I am still more then adequately protected by as you mentioned the UCTA and SoGA.

They seem to offer no further arguments to the unjust enrichment they have based this whole claim on, I'm not really sure why they are still continuing at this point I'm just looking for the smoking gun now to get them to stop bothering me.

[des8]

I don't see that declaring yourself as a motor trader to obtain access to their sales actually makes you a trader and not a consumer.
However by making that false statement of fact, the auction might be able to void the contract because it induced them to make the contract when otherwise they would not.
They do not seem to be going down that route, just insisting that you are a trader.

I would stick with unfair terms etc...

Of course for £20,000 they might well try their luck in court.
As any such case will be allocated to Fast Track it might be as well to seek professional advice at that point

[dylan2408]

For anyone who still has notifications setup, I have now received a letter of claim filed through the county court business centre for the amount 20,150 + interest at around 1500 ontop.

What is my next step I cannot believe almost a year after purchasing a vehicle legitimately through an auction site I am now being taken to court to pay additional amounts. Realistically I am about to get dragged into a costly legal battle, what are my options of recovering any of that money?

Thanks

[des8]

As you suggest this could become expensive as the case will almost certainly be allocated to the Fast Track.

First thing is to indicate you will defend the claim, but not yet enter a defence.
That will give you time to seek professional advice, and see what funding options exist

Tagging atticus R0b dslippy

[atticus]

Yes, you should take professional advice. The amount of this claim means it will be allocated to the Fast track, not Small Claims. This means a likelihood that the loser will be ordered to pay the winner's legal costs. The stakes are higher.

[R0b]

Echo what Atticus and Des have already said and ideally it would have paid to seek legal advice beforehand to at least indicate where you might stand if a claim came about.

Whilst we can give you pointers on how to defend and prepare your case, the difficulty lies in the fact that issues in the dispute are not straight forward which makes defending this case risky given the sums involved.

I would be curious at least to see what the particulars of claim actually say, and what they are relying on as having the right to recover the sums claimed.