Code Of Practice For The Motor Industry

A Code, drawn up by the Retail Motor Industry Federation, the Scottish Motor Trade Association and the Society of Motor Manufacturers and Traders in consultation with the Director General of Fair Trading.

(Revised March 1981 - Reprinted June 1990)

Used Car Sales

1. Used cars sold to customers must conform to legislation affecting the construction and use of cars and should, were appropriate, be accompanied by a current Department of Transport Test (MoT) Certificate.

2. Dealers must bear in mind that sales of used cars are subject to the Sale of Goods Act 1979 and attention is specifically drawn to the conditions of merchantable quality and fitness for purpose contained in this Act. If, however, defects are specifically brought to the attention of the customer or the customer examines the car before the contract is made there is no condition of merchantable quality as regards those specific defects or ones which that examination ought to reveal. Dealers should therefore reveal defects on an approved checklist (see 5). The format and use of the checklist are determined and approved by the trade associations or the manufacturer of the car concerned. Dealers should provide all reasonable facilities to enable prospective customers or their nominees to carry out an examination of the car prior to sale, in order than any defects which ought to be revealed at the time of sale are made known to both parties.

3. Dealers are reminded of the legal requirement that when selling a used car subject to a printed guarantee or warranty, that guarantee or warranty must not purport to take away or diminish any rights which the consumer would otherwise enjoy in law. The warranty document must also include a statement advising the consumer that the warranty is in addition to his statutory or common law rights.

4. If a printed guarantee or warranty is not used, then any specific promises which the dealer is willing to make in relation to the used car should be set out in writing.

5. Used cars will be subject to pre-sales inspection in accordance with an approved checklist. The checklist must be completed before the car is offered for sale and displayed in a prominent place in the car. A copy of the checklist shall be given to the customer for his retention.

6. All descriptions, whether used in advertisements or in negotiations regarding the sale of used cars should be honest and truthful. Terms which are likely to be misunderstood by the customer or which are not capable of exact definition should be avoided.

7. Reasonable steps will be taken to verify the recorded mileage of a used car and dealers will use their best endeavours to obtain a signed statement from the previous owner as to the car's mileage. Dealers should pass on any known facts about an odometer reading to a prospective customer.

8. Unless the dealer is satisfied that the quoted mileage of a used car in accurate, such mileage should not be quoted in advertisements, discussions or negotiations or in any documents related to the supply of the used car. Where the car's mileage cannot be verified the customer should be informed. The law requires that any disclaimer used must be bold, precise and compelling as the car's mileage reading itself and as effectively brought to the prospective customer's attention.

Complaints and Arbitration

1. A customer who has a complaint about the quality of goods or service to his motor car should in the first place and at the earliest opportunity refer it to the dealer concerned.

2. The complaint, preferably in writing, should be addressed to a senior executive, a director, a partner or the proprietor. Some dealers will have an executive especially appointed to deal with complaints.

3. If the complaint relates to warranty on a new car and the dealer is unable to resolve the matter, the customer should take his complaint direct to the manufacturer concerned.

4. If attempts to reach a satisfactory solution fail, the customer has a right to refer his complaint to one of the trade associations who subscribe to the Code of Practice for the Motor Industry, if the dealer concerned is a member of that association. Any such complaint must be in writing.

   (a) if the complaint refers to a manufacturer's warranty or lies against a dealer who is a member the address is:
   The Customer Relations Department, Society of Motor Manufacturers & Traders Ltd., Forbes House, Halkin Street, London SW1X 7DS.

   (b) if the complaint lies against a dealer who is a member situated in any part of the United Kingdom except Scotland the address is:
   The National Conciliation Service, Retail Motor Industry Federation, 9 North Street, Rugby CV21 2AB.

   (c) if the complain lies against a dealer who is a member situated in Scotland, the address is:
   Customer Complaints Service, Scottish Motor Trade Association, 3 Palmerston Place, Edinburgh EH 12 5AQ.

5. All complaints referred to the appropriate trade association (SMMT, RMI or SMTA) within a reasonable time of the cause for complaint arising will be considered.

6. If the trade association fails to resolve the complaint, its members will agree to go to arbitration except in those cases where the trade association is of the opinion that it would be unreasonable for the member to be required to do so.

7. Parties to arbitration will be asked to pay the registration fee laid down by the Chartered Institute of Arbitrators. When, later, the arbitrator makes his award, he will consider whether the registration fee should be returned to the successful party.

8. The parties will also be asked to sign an application for arbitration which will be sent, together with the registration fee, to: The Independent Panel of Arbitrators, c/o Retail Motor Industry Federation, 9 North Street, Rugby CV21 2AB.

9. In order to keep costs as low as possible, the arbitration will normally rely on documents. In these cases, none of the parties to the dispute may be present nor may they be represented by any other person.

10. The trade association will submit to the Chartered Institute of Arbitrators all the documentary evidence in their possession that they consider relevant to the case. The Chartered Institute of Arbitrators will advise the parties to the dispute of the written evidence they have available on which to base their judgement and invite the parties to submit any further evidence which they consider relevant.

11. The President of the Chartered Institute of Arbitrators will appoint a single arbitrator and will make all the necessary arrangements for the arbitration to be conducted as speedily as possible.

12. In suitable cases, the Arbitrator has the right to conduct an oral arbitration and the parties may then attend to present their evidence. Legal representation only be employed if the Arbitrator so directs.

13. The Arbitrator will have the power to direct any party to provide him and to the other party(ies) any additional document or information he considers to be relevant to the matter under dispute.

14. The award of the Arbitrator will be published in writing to the parties to the dispute and to the relevant association.

15. The award of the Arbitrator is enforceable in the Courts by any party.

Retail Motor Industry Federation, 201 Great Portland Street, London W1N 6AB.

The Society of Motor Manufacturers and Traders, Forbes House, Halkin Street, London SW1X 7DS.

The Scottish Motor Trade Association, 3 Palmerston Place, Edinburgh EH12 5AQ.