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At the end of November 2018, Middlesbrough Trading Standards prosecuted a car dealership, Evans Halshaw, which resulted in the court issuing a £134,000 fine for an alleged offence under the Consumer Protection from Unfair Trading Regulations 2008.

That being for their second-time failure to disclose in its advertising that a vehicle it was selling had once been owned by a leasing company.  Specifically, stating that it had “one previous owner” without disclosing that this owner was a leasing company.

Trading Standards (in support of a previous opinion by the Advertising Standards Authority) felt that failure to mention this point was “misleading” and could affect the decision of a prospective buyer whether to buy or not.

The consumer who complained about it, had found out about its history prior to purchase and so never went ahead to buy the car in the first place.

For several months subsequently other Trading Standards Departments and consumers have used the ruling to force dealers to reduce selling prices.

I for one was extremely happy to hear in April that on appeal, the fine had been overturned.  The judge ruling that the ex-business use of the car would have had no effect on its value. In order to clarify his position and in a veiled criticism of the original prosecution and its original outcome, the judge added that the courts exist to protect consumers against bad bargains where the playing-field is not level – and not irrational prejudice against ex-business use vehicles whose values are entirely unaffected.

In my opinion, this case illustrated a total naivety of those who are responsible for legal decisions. I know more about the motor industry than most in the UK which means I constantly see bad advice being given to consumers and businesses. Most businesses lease their cars and vans these days but some still buy them outright and service and maintain them themselves.

So what trading standards was saying was that if a car had been leased it was likely to be in poorer condition than those which were privately owned or owned by a business and in the case of BT maintained in their own workshops. As the leasing companies own the leased vehicles there is no way of finding out whether the car was leased privately or through a business.

And even if the cars were leased through a business the constraints on the lessees by the leasing companies are such that the condition of ex leased cars is better than privately owned cars and cars owned by companies.

Had the ruling remained ex-lease car values would have plummeted pushing up lease costs to customers. Another declaration that should be made to buyers is whether a car was an ex rental car. But again this isn’t as straight forward as it seems. Stephen Byers stopped the activity of heavily discounting pre-registered cars with his Supply Of New Cars Order 2000.

As a result, cars have been sold to daily rental companies at big discounts then sold on as ‘Pre-Registered’ but with the first owner a daily rental company. The problem is that you can’t tell if the car that was first registered to a daily rental company was actually used for rental by possibly a hundred different drivers or was sold as a Pre-Reg with no miles on the clock.

The one car that finds itself outside the constraints is the ex-demonstrator which can be a bag of bolts. They are often abused by sales staff who take the cars home at night and over the weekend. One manufacturer revealed that they mop up parts from all over the world from their various production plants which can result in some poor quality cars with many suffering with squeaks and various noises that simply can’t be repaired.

In industry, I was general manager in a large PLC and I had the transport department within my control. We had 700 cars and vans and they were meticulously looked after by the drivers but every week we had transporter loads of demonstrators dropped off from BMW’s to Vauxhalls, Hondas to Mercedes all with zero miles on the clock. Frankly, we allowed the salesmen and engineers to use the cars to let off steam in. They were abused and mistreated but were returned fully valeted looking like new cars. I would personally never ever have a demo. By Graham Hill