What happens when a part-exchange goes bad?
27 November 2009 15:57
What happens if you agree a part-exchange deal that means you are going to get some money back, with the details written down and a £100 deposit taken, but then the dealer decides they have overvalued the part-exchange and you have to pay them money to complete the deal?
You might think you can go ahead with the sale under the new terms from the dealer and write 'paid under protest' on the invoice and then sue them for the difference.
However, although you have proof of an agreement so it would seem that the dealer is in breach of contract, you still have a duty to mitigate (lessen) your loss, which you should do.
This means if you can get a different deal elsewhere on the same terms other than price, then you should. So you’d get a few quotes for the part-ex and go for the next best.
If that leaves you out of pocket by say £1000 in comparison to the dealer's first offer, then you can sue for the loss incurred and prove you mitigated your loss by going for the best alternative deal.
However, if you want to stick with this deal and sue, then the "paid under protest" term on the invoice should solve this issue. At least you would then have a loss on which to sue.
Let your opponent raise the "failure to mitigate" argument which places the burden on you to show with quotes that you were unable to get a comparable deal.
If they used the failure to mitigate argument it could reduce the value of your claim to that of a sample comparable deals from other dealers.