Transfer of Car PCP

[daveA Newcastle]

I hope someone can advise on the following situation:
We are around half way through a four year PCP with Mercedes for a used ML.
I am splitting up with my partner and although the car is mine it was originally leased in her name.
She does not want to keep the car in her name for obvious reasons and I would be happy to take over the existing agreement with Mercedes but they say that is not possible to transfer the agreement from my partner to myself. This leaves us in the unhappy position of being forced to sell the vehicle which is currently in around £2k of negative equity.
The seems unreasonable to me, do I have any grounds to challenge Mercedes position.
Thanks,
D

[R0b]

Re: Transfer of Car PCP

Firstly, let's be clear about a PCP - neither you nor your ex-partner owns the car, it is owned by Mercedes until you pa the final instalment to purchase and at that point, ownership then transfers to the person named on the agreement. If the car is sold and Mercedes become aware of it, that's a fundamental breach of the contract and they are entitled to sue for the remaining balance outstanding on the agreement.

The short answer is that you have no grounds to challenge Mercedes simply because your not named on the agreement, the contract is between your ex and Mercedes so you are not privy to that contract regardless of who uses the car primarily. Indeed most agreements these days state that the person on the agreement should be the main driver of the vehicle and that to allow others to use it more is also a breach of the agreement.

Although still a breach of contract, you could offer to continue paying your ex the monthly instalments though if she was wise enough she would insist on this being in a written agreement so she could recover any outstanding balance from you if Mercedes pursue her. The other option is for her to terminate the agreement early known as voluntary termination and you get yourself a new agreement with Mercedes.

Theoretically there will probably be a clause in the agreement which mentions that your ex partner cannot assign the contract to any other person without permission of Mercedes. Again, they are not obliged to say yes to this however. Assignments only transfer the benefit of the agreement but not the burden so it would still be up to your ex to make the payments and the only way to hold you liable for the payments is to enter into a novation which is essentially a three party agreement (you, Mercedes and your ex) and sets out that you are taking on both the benefit and burden of the agreement and your ex is released from her liabilities.

Novation agreements can create quite a bit of effort which is perhaps why Mercedes is reluctant to agree to this, plus the agreement was based on the financial status of your ex, not you so if you don't fit their criteria that could also be a problem.