Car Dealer Trying to Pull out of Contract

leyton01 on 20/12/2023 - 01:14
Last edited 20/12/2023 - 09:06 by 1 other user

My Father-in-law recently signed a contract for a Mitsubishi Triton through a broker at a local dealer.

The pricing was very sharp and it is a limited edition model. The broker confirmed with the dealer that the model and pricing was correct before forwarding the contract to my FIL. This is in the context of a new Triton model arriving in the next month or so (already with reviewers) and not surprising if they are clearing out stock of the old model.

The car is on the lot and just needed to be detailed and the optional tow bar fitted. It was supposed to be ready last week but the dealer was dodging my FIL's calls and it turns out they have contacted the broker and said they don't want to do it at that price any more.

By this stage my FIL had already signed and sent back the contract and paid the deposit. No other reason was given other than they think the deal is too good. Not a stock problem, not a price rise problem (less that a week since signing the contract), not a trade issue. Just that they don't want to sell it for that price any more.

I am not sure how a dealer can expect to do this - especially with a contract that has "this is a legally binding" plastered all over it. Car is new and from a major dealer in Qld.

What are his rights here? If he wants to take it further would the Office of Fair Trading? Does the MTA have any sway? Is there an ombudsman similar to the Telecommunications Ombudsman who might be able to help or are the contracts just designed to screw customers and protect the dealers?

Automotive Car Mitsubishi

Comments

  • hasher22 on 20/12/2023 - 01:29
    +2

    Unfortunately there's no ombudsman for dealerships or retail trade. Depending on your state, it's fair trading then if they can't help they will refer you to possibly other legal avenues such as tribunals if applicable, in NSW it's NCAT.

    If you're in NSW, prob see NCAT first as they deal with contracts: https://ncat.nsw.gov.au/case-types/consumers-and-businesses/….

  • jv on 20/12/2023 - 01:43
    +6

    I am not sure how a dealer can expect to do this

    What does the contract say about terminating it?

    • leyton01 on 20/12/2023 - 09:34
      +1

      It has lots of details on what happens if the customer tries to terminate but nothing for the dealer (at least in the way of penalties).

      It does have this about prices changes, however the broker has pointed out that neither costs nor circumstances have changed (car is ready for delivery, no change in costs).

      1. PRICE The total price of the goods shown in this Contract is the price of the goods based on existing costs and circumstances. If there is any change in those costs or circumstances before delivery of the goods to the Customer, the Dealer reserves the right to increase the total price of the goods. If the Dealer increases the total price of the goods, (and unless the Customer takes delivery of the goods or such increase results only from a change in any applicable statutory charge) the Customer may by notice in writing to the Dealer cancel the Contract at anytime within three (3) days after receipt of notification of the increase.
  • ddilrat on 20/12/2023 - 02:28
    +13

    First step is just contact them and make it clear you won't be rolling over and the contract is legally binding. IMO if you're direct enough they'll accept it

    • jv on 20/12/2023 - 09:29

      and the contract is legally binding.

      Have you read it?

      It might not be.

      • leyton01 on 20/12/2023 - 09:34
        +10

        It says this above the signature line.

        THIS IS A LEGALLY BINDING CONTRACT

        • jv on 20/12/2023 - 10:00
          -6

          Oh, I missed that.

          thanks…

  • Euphemistic on 20/12/2023 - 07:27
    -5

    By using a broker you’ve added extra steps. Your deal is with the broker, not the dealer.

    • Ash-Say on 20/12/2023 - 07:55
      +5

      Wrong - I recently signed a contract and everythting is directly with the dealer though broker made a deal.

      There is no mention of broker on the contract.

      • Ash-Say on 20/12/2023 - 08:01

        If this Q is for me, I fully read the contract and even made changes. I am just stating the contract has no reference to deal with a broker though they were involved. My co tract is directly with the dealer.

        • Dollar General on 20/12/2023 - 08:02

          Not for you sorry

        • Euphemistic on 20/12/2023 - 08:31

          What’s the point of the broker then other than to liberate some of your money?

          • leyton01 on 20/12/2023 - 09:38
            +1

            @Euphemistic: You don't pay for a broker. They get commission from the dealer. They have access to fleet pricing, volume pricing and a wider network of dealers than if you were to do it yourself.

            Brokers will generally get you a better price than what you can negotiate at no cost to you.

    • Dollar General on 20/12/2023 - 08:03

      That’s a big call to make considering you haven’t seen the contract.

      So if I take out a mortgage via broker, is my deal with the broker or bank?

      • Euphemistic on 20/12/2023 - 08:31

        What’s the point of the broker other than adding extra steps.

        • Dollar General on 20/12/2023 - 08:57
          +1

          That wasn’t my question

          • Euphemistic on 20/12/2023 - 11:59

            @Dollar General: Your mortgage with is with the bank, but the terms you negotiate fall on the broker. If the bank turns around and says those terms are no good, that’s on the broker, not the bank.

            • Dollar General on 20/12/2023 - 13:42

              @Euphemistic: lol. The bank provides you with the agreement. The broker is simply narrowing your choices and allowing you to select from a few. What bank is going to say the terms are no good? Mortgage brokers don’t come up with the offers themselves.

              You must be new to this

              • Euphemistic on 20/12/2023 - 13:50

                @Dollar General: If the broker made you an offer that you accepted then turned out what they offered could not be supplied, then it’s on the broker. But yes, if the broker made a deal with you, and the bank and the bank changed the deal it’s the banks fault, but what recourse do you have for them as your deal is with the broke?

      • ddilrat on 27/12/2023 - 01:31

        The bank

    • JafferMoney on 20/12/2023 - 09:46
      +3

      By using a broker he's got a good deal, clearly too good now that the dealer wants to back out.

      Dealer should be named and shamed.

    • garetz on 20/12/2023 - 12:36

      A broker is the facilitator, the named parties on the contract are what's important.

  • holdenmg on 20/12/2023 - 07:49
    +2

    Sounds like an anticipatory breach, have a Solicitor phone them and ask when their client can collect the vehicle.

  • Ash-Say on 20/12/2023 - 07:59
    +5

    I will suggest to write a formal letter of demand and give them 14 days to honour their legally binding contract.

    If they dont respond or give resolution, lodge QCAT case and give them case number with a statement " See you in the Court".

    If they are major dealer, they wont drag it in the court just to save few thousand dollars.

    You can also refer to recent unfair contract term changes in your letter of demand if there is something unfair about the termination.
    https://asic.gov.au/about-asic/news-centre/news-items/unfair….

    Good luck!

    • leyton01 on 20/12/2023 - 09:43

      I have asked the dealer to provide, in writing, that they are not honouring the contract and the reason. So far they have only verbally said they would. Getting them to commit on paper is the first step (and lock them in to an excuse)

      • Protractor on 20/12/2023 - 10:31
        +4

        Give them 24 hours and then name them here. BTW if your FIL wins this battle, you WILL be finding another dealer/mechanic to service it.

    • akyeeeahdude on 20/12/2023 - 10:19
      -1

      This reply is really all you need to know - if talking to them, directly, and sternly, doesn't work (let them know you intend to take the matter further to QCAT etc), then you'll need to consider taking QCAT or legal action for breach of contract.

  • Dollar General on 20/12/2023 - 08:01
    +3

    As with all contracts, you need to determine what the loss is.

    Find a similar triton, add in a tow bar & if it’s more expensive, advise the dealer you will be purchasing this triton and claiming the difference from the dealer

  • Peanut money on 20/12/2023 - 08:17
    +4

    Demand 10% that they would of slugged you if you’d pulled out of the contract

  • AngusD on 20/12/2023 - 08:46
    +3

    Go in there and make a fuss in the showroom loud enough for other potential customers to hear all about how the dealer is stiffing you on a signed contract. See if they honour it just to get you out of there and avoid it costing them multiple other sales.

    • BeamMeUp on 20/12/2023 - 09:07
      +1

      & wait outside until you see there is a bunch of Customers in the showroom

      • AngusD on 20/12/2023 - 09:20

        And if you don't succeed the first time, go back the next day (or weekend, as work allows), and the next, etc. It's not worth their while to lose even 1 or 2 other sales just to stiff you out of a couple thousand on this one.

        Don't forget to put up the 1-star Google review outlining the situation, too.

  • timmysbiscuits on 20/12/2023 - 09:02

    Was the contract actually signed by the dealership? (and genuine question; would it matter if it wasn't?)

    • leyton01 on 20/12/2023 - 09:39

      Yes the contract was signed by both parties and a deposit taken.

  • BeamMeUp on 20/12/2023 - 09:39
    +2

    Contact Mitsubishi corporate. They will tell you your contract is with the Dealer but tell them if its not resolved you are going to plaster this all over social media, review sites, radio stations and contact ACA. The possible impact on the brand might get them to have a conversation with the dealer.

  • JIMB0 on 20/12/2023 - 09:53

    How much extra do they want?

    • jv on 20/12/2023 - 10:01

      A slab of VB.

      • Daabido on 20/12/2023 - 13:14

        Cheaper than a slab of JV.

    • leyton01 on 20/12/2023 - 10:15

      They have just said they can't do it. Have not come back with another offer. Sort of irrelevant though as my FIL doesn't want to pay any more than he had signed for.

      • AngusD on 20/12/2023 - 10:22

        Did somebody else come in with a better offer, perhaps? Do you know if the car is even still on the lot or have they already sold it to somebody else? If the car is actually gone, and it was a runout model ie they can't get another one in, then I'm not sure what options are available - if they don't actually have the car then they can't give it to you, no matter what the contract says.

        • leyton01 on 20/12/2023 - 10:57

          As far as we know it is still there. Even if someone comes in with a better offer they have already signed a contract…

          • AngusD on 20/12/2023 - 11:24

            @leyton01: Yeah, I'm not disputing the contract or the legitimacy of your case as you've described it. Just saying that if they've already sold the car and can't get another one because it's a runout of the old model then you may need to negotiate some other kind of settlement. I'm not sure what that would be. I mean, I'd want one of the new model for the price agreed for the old one, or a refund of double the original deposit paid to compensate for the time and inconvenience etc. But I can't imagine them agreeing to either of those, best they're probably going to give you without getting lawyers involved is a refund of your deposit.

            Does the contract include the exact specifics of the vehicle ie the VIN or something to indicate the exact car you're getting? I guess that might help to prevent them selling the car out from under you or, if it comes to lawyers, help you get some sort of compensation better than just a refund of your deposit.

            • leyton01 on 22/12/2023 - 01:18

              @AngusD: They are still advertising the vehicle for sale. It is a special edition in a specific colour. It has not been sold to someone else as far as I can tell.

  • jv on 20/12/2023 - 10:22
    +1

    Tell your father in law to make a funny Tik Tok video about the situation and let it go viral.
    The car dealer will eventually relent when their socials get plastered with comments.

    @Muzeeb should be able to assist with the choreography of the video.

    • DashCam AKA Rolts on 20/12/2023 - 11:47
      +1

      @Muzeeb is on it, and has already done the storyboard for the video, in MS Paint.

  • Godot on 20/12/2023 - 10:22

    But how much is he getting it for?! I need to know!

    • AngusD on 20/12/2023 - 10:23
      +1

      Name and shame the dealer, too! :P

    • Godot on 20/12/2023 - 10:24
      +2

      Or better yet, post it as a bargain so they get Ozbargain'd 😅

    • leyton01 on 22/12/2023 - 01:20

      His contract is for around $59k. There are listing for the equivalent model on carsales for $66k.

      The car was registered in Feb 2023 so has not sold since then.

  • payless69 on 20/12/2023 - 11:08
    -1

    Maybe he used Cadogan as a broker and headoffice is sick such lowballs?

  • dts88 on 20/12/2023 - 11:09
    +2

    tell the broker you are going to share their information (Dealership name) on OZBargain.

    Who is the broker/dealership?

    • Phlume on 20/12/2023 - 13:00

      Yes please name and shame. Also leave a review on google and their social media sites for other customers.

  • Phlume on 20/12/2023 - 13:01
    +1

    Name and shame OP. Post on their social media.

  • JDMcarfan on 20/12/2023 - 14:07

    would love to know the pricing and if possible the broker (feel free to PM)
    Don't have any real recommendations to add as you've clearly got the right approach already so can only wish you and FIL the best of luck
    I'd assume the contract has the VIN and other direct identifiers of the vehicle attached, so selling the vehicle without terminating your existing contract won't be possible. You've done all your DD when agreeing on the pricing and signing the contract. If they've fallen short, tough luck on them

  • CurlCurl on 20/12/2023 - 15:01

    Go to the top and ontact the dealer principal.

  • spackbace on 20/12/2023 - 18:05
    +2

    As above, go in, politely ask for the dealer principal or general manager and talk it over with them. Yelling and screaming will get you nowhere.

    This sounds like departments within the dealership not talking to each other. One (likely the fleet department) has agreed to the discount and then a decision has been made to not discount at all.

    Again, this can all be sorted with the higher ups

    • leyton01 on 22/12/2023 - 01:22
      +1

      The broker has mostly been dealing with them. He has much more sway with them as a commercial relationship and has contacts up.the chain, unfortunately most are already on leave.

      I don't doing he is acting in our best interests. He has never seen a car dealer pull out of a signed contract in 20 years.

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