VTing my PCP but will my guarantor be liable?

[Joanna C]

Re: VTing my PCP but will my guarantor be liable?

Hi

I love discussions like this. I makes me want to study law and have a career change.

My car has currently done circa 22,000 above the 48,000 miles.

Do you have experience whereby you have seen BMW, Audi, Merc, etc do a full and final offer over the excess mileage. For example at the end of the lease or if I VT, they charge me say £2,000, would they accept an offer of say half that?

There is always room for negotiation. It depends on circumstances and I would suggest keeping it amicable.

i would suggest starting with an offer of around say £650 and then increase to half if need be. They will have to factor in the costs involved in pursuing you for the money. If you ask them for a quote for a new PCP with them they may waive it or work it into the new quote.

If you would,like to keep the car maybe ask them to finance the balloon payment for you in which case the excess mileage provision wouldn't apply.

[R0b]

Re: VTing my PCP but will my guarantor be liable?

It is up to the OP whether or not he wants to take the advice as to the law from a trained solicitor who specialises in consumer credit and cases like this or from somebody who does not.

I have specialised previously in consumer credit, particularly in this area and still do to some extent, though I now work in-house.

Again, your referring to the excess mileage contractual term which sets out a certain number of miles over the period of the agreement. The liability under that clause falls away where the agreement is terminated under s.100 and is not applicable and the question is not about mileage limits under the agreement but the condition of the car.

If a hirer racks up 90,000 miles but he services the car each year as required and replacement parts are carried out in accordance with the servicing manual, I would find it difficult to believe that the hirer has not kept it in the condition that a reasonably minded hirer would have kept it in simply because the value of the car has depreciated because of the excess mileage. Sure, the mechanics of the car would have meant that due to the mileage parts may needed to have been repaired or replaced sooner than expected, but that is likely to have come about through reasonable wear and tear, and not because of reckless or negligent driving.

On the other hand, you could argue that someone who never services the vehicle or has it repaired or maintained will likely have caused the car to have been put in an unreasonable condition. That's because if some parts are not checked regularly it is possible that there would be a knock on effect with other mechanical parts that could severely damage the car and/or it's engine.

The depreciated value of a vehicle due to it's high mileage is entirely distinct from whether or not a person has taken reasonable care of the car. You've suggested that an expert would conclude that going 22,000 miles over the contractual limit would consider the car to be in an unreasonable condition but at the same time, another expert would conclude that if the car is maintained and repaired in accordance with the servicing requirements, then it would likely be in a reasonable condition. Your interpretation of s.100(4) appears to be that the value of the car will be much lower than it would be if it was at 48,000 miles but S.100 does not concern itself with the value, it only concerns the condition of it.

The fact that the car may have a lower resale value due to the high mileage does not automatically mean that the car is returned in an unreasonable condition. Again, another example is where the car has done 65,000 miles and it has had a new engine, you can't honestly expect BMW or a court to say that despite the new engine being fitted, the car has gone over the contractual mileage limit and so its in an unreasonable condition so you owe us money (a new engine may be an extreme example but nevertheless applies).

You've highlighted part of Denning's quote about how a reasonably minded hirer would maintain it, and I agree with you but the question really is what would a reasonable person be expected to do in order to look after the car properly? Denning has already pointed out that if there are immediate repairs to be done, then you would expect the person to have it repaired and he also mentions in the course of running the car, but nothing more.

Applying your reasoning, if the hirer reached the mileage limit before the end of the agreement, then what you are saying is that the hirer should not use the car anymore even if he has some months to go on it, because any more use will mean it will be in an unreasonable condition? If the hirer just expected to have a car sitting there for perhaps a number of months until the agreement comes to an end? That sort of stance in my eyes would be unreasonable.

We have for example had a recent case involving a Audi where there was a difference of some £4,000 in the value of the car due to the excess mileage.

Did this case go all the way through to trial? if possible, I would like to know the case number and court it was heard in so that I can obtain a transcript of the judgement. There are little to nothing that I am aware of which has come through the courts for claims of excess mileage and if everything was so straightforward, I would expect to have heard or seen a number of cases like these through the courts, with exception to those with small value.

The OP's original question was whether or not he'd be liable. Contractually he is not liable for the charges, yet for some reason you are applying the contractual charge set out in the agreement for s.100(4) unreasonableness

[carrtim1]

Re: VTing my PCP but will my guarantor be liable?

My position is I'm registered blind and I've just been awarded the PIP enhanced mobility element. So I'm looking to get a car through the motability scheme.

So I now don't need my current BMW. Should I VT now or just see the lease through to the end and then negotiate the excess mileage?

Life is never simple hey!

[Joanna C]

Re: VTing my PCP but will my guarantor be liable?

[QUOTE=R0b;710564]

Applying your reasoning, if the hirer reached the mileage limit before the end of the agreement, then what you are saying is that the hirer should not use the car anymore even if he has some months to go on it, because any more use will mean it will be in an unreasonable condition? If the hirer just expected to have a car sitting there for perhaps a number of months until the agreement comes to an end? That sort of stance in my eyes would be unreasonable.


I doubt the court would take the same view as you.

The OP contracted to hire the vehicle on an annual mileage of 12,000 miles. There is a term which he agreed to (not hidden in small print but on the face of the agreement) saying that if he chooses to exceed that amount then should he choose to hand the car back he will have to pay the 6.45p a mile excess charge. He didn't have to agree to it - he could have walked away and not signed the contract.

If the OP chooses to exceed the annual 12,000 miles then that is fine. The contract allows for it. He can carry on driving the car - he does not have to as you say "not use the car anymore" What a ridiculous suggestion. However he is using the car in the knowledge that he is incurring the 6.45p excess mile charge. If the OP comes to the end of the agreement and retains the vehicle then the mileage charge is in effect an irrelevance.

As I said in my previous post it is up to the OP the advice he wishes to follow. However if you are a legal professional then as we both know in court there are always two sides to a case- though only one normally wins and the other pays the price. It is rare that there is a draw.

In my view the OP would be likely to lose this if it went to court and I think it irresponsible to encourage the OP to risk incurring legal costs and the stress of a court case and possible County Court judgment.

I will not be posting on this thread anymore as I have provided my advice and stand by it.

[carrtim1]

Re: VTing my PCP but will my guarantor be liable?

My position is I'm registered blind and I've just been awarded the PIP enhanced mobility element. So I'm looking to get a car through the motability scheme.

So I now don't need my current BMW. Should I VT now or just see the lease through to the end and then negotiate the excess mileage?

Life is never simple hey!

[R0b]

Re: VTing my PCP but will my guarantor be liable?

Let's be clear, I am not advocating the OP to risk any legal costs, it is the OPs decision as to whether or not he wishes to defend the matter or pay up and nobody can make that decision other than himself. Equally, the OP should have the full knowledge of both sides of arguments so as to make an informed decision. As I calculate it, the excess mileage outstanding would be £143 (22,000 x 0.65) plus the pro-rata which may come to around £39 so under £200 altogether, though I am happy to be corrected. This would make it a small claims case and therefore there is fixed costs only which are minimal. Given the size of the excess mileage charge, I think it would be unlikely that they would issue proceedings on such a low amount as it would not be commercially viable to do so.

Yes, there are risks and additional minimal costs above the alleged amount owed, but the OP has to consider whether he wishes to take that risk and if he could afford to pay the amount within 30 days should the court decide against him, and if so then he could take the risk of seeing it through to court knowing that if he loses, he won't have a CCJ provided it is paid in time. There is the question of going to court and that is something he would have to consider as you say the stress of it.

But as lawyers, we all know there are always going to be two sides to an argument and ultimately its the argument which sounds more convincing that will win. I respect your comments as I do with anyone else on here but in this particular case, I have set out why I thought you are wrong on this point - there is no harm in having a healthy discussion about it. I am simply confused as to some of comments because your switching between the contractual clause and S.100(4) blurring the lines between them, and again with respect, I think you are wrong on this point about the excess mileage costs. There is likely to be a high hurdle to climb for BMW to argue the condition of the car if the OP can prove he maintained and looked after the car whilst in his possession. For BMW to simply argue that the condition of the car is unreasonable would be risky given that you can have a car in good condition yet have excessively high mileage - a driving instructor's car springs to mind as an example.

Anyhow, you are right and it is ultimately the OPs decision.

[Diana M]

Re: VTing my PCP but will my guarantor be liable?

My position is I'm registered blind and I've just been awarded the PIP enhanced mobility element. So I'm looking to get a car through the motability scheme.

So I now don't need my current BMW. Should I VT now or just see the lease through to the end and then negotiate the excess mileage?

This earlier post by Jo explains your options especially if you believe you're entitled to a free car through the motability scheme.

In answer to your question I would suggest the following:

1. Obtain an up to date valuation for your car.

You have 7 payments @ £475.97 and a final payment of £12,529.36. A total of £15,861.15 ( if my maths is correct!)

so - if the car is of higher market value keep it and sell it yourself. If it is of lower value maybe return it asap to maximise the saving which will offset the excess mileage charge.

2. Calculate the excess mileage @ 6.45p a mile ( pro rata) first in order to help you to make your decision.

Di

[carrtim1]

Re: VTing my PCP but will my guarantor be liable?

Thanks Rob & Joanna, I didn't want anyone to fall out :-) .

Do you know of anyone that has been taken to court regarding excess mileage and won their case? Or is it simply a case of people get scared and pay up or the likes of BMW back down in the end?

[Diana M]

Re: VTing my PCP but will my guarantor be liable?

Do you know of anyone that has been taken to court regarding excess mileage

Since you are registered blind I think it would be foolish of the finance company to take you to court where they'll be relying on the terms of the contract you signed to prove their case. You could argue that you didn't read and fully understand them at the time if that was the case.

As Jo has suggested you should keep the negotiations amicable which could include telling them that you're only returning the car because you'll be getting one on the motability scheme due to your blindness, not because you've had a change of mind or any other perceived fickle reason.

Di

[R0b]

Re: VTing my PCP but will my guarantor be liable?

Thanks Rob & Joanna, I didn't want anyone to fall out :-) .

Do you know of anyone that has been taken to court regarding excess mileage and won their case? Or is it simply a case of people get scared and pay up or the likes of BMW back down in the end?

No falling out, just a difference of opinion but to date, I am not aware of any excess mileage court case going to court.

I've noticed that your monthly payments are £475 and if I am correct, the excess mileage amount would come to less than half of your monthly instalments. So unless your willing to fight the charges on principle, and you can still afford to pay the excess charge, if you want it resolved swiftly then would it not make sense to just pay the charges without question and save all the faffing about with negotiation? Or as Joanna has said, if the value of the car is worth more than what is owed under the agreement, sell it, pay off the agreement outstanding, pocket the difference and bring the agreement to an end.

[carrtim1]

Re: VTing my PCP but will my guarantor be liable?

Thanks everyone for your input. It has given me a lot think about. Much appreciated.