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LawJaw last won the day on March 21

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About LawJaw

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  • Birthday 06/09/1971

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    Lawgistics Ltd

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  1. Hi BIGNIT, This is NOT distance selling but it is a contract concluded away from the business premises and that is subject to the same cancellation notices, periods and rights as distance sales. It's called an 'Off premises sale' which was originally designed for unsoliceted callers. This is not the case now as the legislation also applies to those who are invited by the consumer. Off Premises Sales Checklist for Car Sales All the following information must legally be made clear to the consumer BEFORE the customer is bound to make the purchase. All are required by law but failure to comply with the cancellation requirements (marked with an *) can lead to a fine and criminal conviction.  Each vehicle’s main characteristics. Be aware of pre-populated descriptions as these are likely to give the customer a reason to seek a refund or price reduction if an item is listed but not actually on the vehicle.  Your correct trading name.  Your geographical address, telephone number, fax and email address.  If you are acting on behalf of another trader, that traders geographical address and identity.  The address for any complaints.  The total price inclusive of VAT.  Any delivery or actual or potential additional charges.  Payment and delivery arrangements and timescale.  Your complaint handling policy.  *Conditions, time limits and procedures for exercising the consumer’s cancelation rights - see model form. NB Failure to provide this information can not only lead to the cancellation period being extended to 12 months but it is a criminal offence under Section 19 of these Regulations.  That the consumer will have to pay the cost of returning the vehicle and your reasonable costs if they choose to cancel  If you believe there is no right to cancel (and be very sure about this as you could end up with a fine and prison sentence if you are wrong) you must tell the customer that they have no right to cancel.  A reminder that you are under a legal duty to supply goods in conformity with the contract.  Conditions of any after sales support and/or warranty terms.  Any code of conduct you must meet for example, as part of a trade membership.  The conditions of any deposit to be paid by the consumer.  Details of any mediation service you are bound to offer under any Trade Association Membership. Once the contract is signed you must give a copy to the consumer and it must have all the above information as part of it, unless you have already given the above information separately. Once the contract is signed you must give a copy to the consumer and it must have all the above information as part of it, unless you have already given the above information separately.
  2. In a perfect world, car dealers want their showrooms to be full of stock, with significant numbers of prospective buyers milling around, sitting in cars, test driving, chatting to sales-staff and then driving off in them happy with their new purchase. But today is not the perfect world and won’t be for some time. A number of clients are wishing to deliver cars to customers at their home (self-isolating permitting!). As this could be considered running an organised distance selling scheme, customers could have the right to cancel the contract for UP TO A YEAR after delivery if they are not advised of the right to cancel the contract. Car dealers can also be prosecuted by Trading Standards. Where a consumer (not a business buyer) has a car delivered to them and where they have not visited the showroom beforehand, we suggest the following is given to consumers either separately (in person at handover) as well as in your terms and conditions online. Ideally, you should retain a copy of this clause with their signature signalling that they have received the notice - to ensure that they know they have the right to cancel. Do note that the mile limit and fee per mile travelled over that limit is for each dealer to decide and this example is indicative only. You cannot, though, allow for a 20 mile limit and £20 per mile driven over that amount! Lawgistics suggested wording: Cancellation under the Distance Selling Regulations Ordinarily we do not run an organised distance selling scheme. However, due to the coronavirus outbreak we need to support our valued customers by delivering your vehicle to your home. If you have ordered and taken delivery of your vehicle without visiting our showroom and you are not buying the car in the course of your trade or business, the following cancellation clause applies: You have 14 days to get to know your new vehicle and to make sure it suits you. If you change your mind just let us know in writing by post [insert address] or in email to [insert email address] and to reach us by 6pm on the 14th day following delivery and we will come and collect the vehicle for a refund. We cannot accept a return of the car if it has been damaged, modified or altered from the condition it was delivered in. An excess mileage charge of £1 per mile for any mileage over 150 miles in those 14 days will apply. If you do change your mind you cannot use the car once you have notified us - but you must still tax and insure the vehicle until it is collected. This cancellation (change of mind) clause does not affect any separate rights given to you in The Consumer Rights Act 2015 or the Sale of Goods Act 1979 (as amended).
  3. Love this video, this is a great way to explain known faults however it also proves the vehicle is unroadworthy. Therefore the video alone is not good enough, as ‘justlooking’ understands and states, the paperwork also must be CLEAR. To expose/offer for sale or sell unroadworthy vehicles without taking certain steps to make the customer aware is illegal. Unroadworthy means that the vehicle would not pass an MOT test. So to have a vehicle on the forecourt presented for sale with an illegal tyre, or faulty light, with no additional information could lead you to a prosecution. If you have the facilities on site, or a relationship with a local MOT station, then the minimum you should do, when intending to sell a vehicle as roadworthy, is to have a competent person check over the vehicle to ensure it is roadworthy prior to putting on the forecourt. One further step along the way you can take to ensure the cars are roadworthy is to actually have them MOT’d before they are put up for sale. Trading Standards Officers periodically do swoops on garage forecourts and check the stock. If any unroadworthy vehicles are up for sale, then you can be prosecuted. You are permitted to expose/offer for sale or sell if you can prove that you have made the customer aware that the vehicle is unroadworthy, its use on the road would be unlawful, and that you are satisfied it will not be used on the road until repaired and MOT’d. If it is your intention to sell a vehicle as unroadworthy you should make the above information absolutely clear and prominent by way of a notice on the vehicle ...and also in the video, if you choose to make a video. If the customer agrees to the purchase on those terms then the information should be repeated on the sales documents and the customer has the opportunity to read and sign to confirm their understanding. As well as relaying to the customer that it is unroadworthy, and illegal to use it on the road, and that it should not be used until repaired and MOT’d, we would also suggest that the customer should sign to confirm they will transport it away from your premises. Needless to say, you should not arrange for a test drive of an unroadworthy vehicle on the road and you should not supply the previous MOT certificate.
  4. It is a very difficult market and there is a huge temptation to forget the liabilities a motor dealer takes on when he/she has the pleasure of selling another car. The simple truth is that if you are selling to a private customer the car you sell must be of satisfactory quality. The other truth is that a car is such a complex beast you do not know when the components are going to fail. If you are not going to go out of business then you need to leave a sensible profit in the deal to cover these hidden problems that might arise and leave you with a wage. I always say the art of selling cars is the ability to buy the right one, at the right price.
  5. If the vehicle does have a fault, advertise the vehicle with the known fault and make this clear on any documentation that the consumer signs. If, a CD player is faulty, ensure to include this within the advertisement, state is on the pre-delivery inspection and on the sale invoice. Ask the consumer to sign to acknowledge and accept the vehicle with the faulty CD player being faulty. This will then form part of the agreement to purchase the vehicle. If the consumer returns a week later with a complaint of the CD player not working, no remedy will be owed to them as they knowingly purchased the vehicle with the faulty CD player and you can show it formed part of the agreement.
  6. We still see a few cases where the words ‘sold for spares and repairs’ have been scribbled across a sales invoice. We wrote an ‘Unroadworthy Vehicle Sales Invoice’ for vehicles that are genuinely being sold for spares and repairs. Sadly over time this has been misused by people who are uninformed or ill-informed. Please be aware, if these invoices are misused they can attract the interest of Trading Standards and severely reduce any bargaining power you have with customers when something goes wrong. You should NOT use these invoices: 1. To simply sell low value stock and/or part exchanges. 2. As a means of telling the customer that the car comes with no warranty. 3. Unless you clearly advertise the car as being “unroadworthy” and for spares or repairs only and that you clearly state it as such everywhere you do advertise the car including prominently inside the windows of the vehicle. You should take and retain evidence of that advertising. 4. You do NOT allow a test drive in the car. 5. Do NOT put a new MOT on the car. 6. You make it clear that the car is to be removed by low-loader and is not to be driven away by the customer. IF the customer insists on driving it away you ought to have him to write a short note to say that he acknowledges the vehicle not to be fit for the road, that you have told him that it ought not to be driven away but that the customer is to do so irrespective of that advice. Otherwise you open yourself up to claims that the buyer was never told the car was un-roadworthy until after they had paid the money for it and that they only found out when they got home and saw the sales document. Further, you should ideally state on that advertising what makes the car un-roadworthy even in the most basic of terms - “defective braking system”, “severely corroded”, “steering not working properly” for example.
  7. There is no legal requirement to give a warranty to your customers. Consumers will be covered by their statutory rights under the Consumer Rights Act 2015. However, a question we get asked a lot – who or what is a consumer? The Consumer Rights Act 2015 has made it clearer as to who constitutes a consumer and therefore who attracts the full range of consumer rights. The definition of consumer is: “an individual acting for purposes that are wholly or mainly outside that individual's trade, business, craft or profession.” This means people buying vehicles to use as a taxi or for their work as a self-employed plumber are unlikely to be seen by the law as a consumer. Special rules also apply to customers buying from a public live auction where the normal rules are ‘sold as seen’. In most other transactions with a dealer, the individual customer will be entitled to their consumer rights and any attempt to deny the customers those rights are likely to not end well for the dealer. We know some dealers will sell a vehicle for a reduced price in return for a “no warranty” sale. However, warranty or not, that customer will still be entitled to rely on the provisions set out in the Consumer Rights Act 2015 and so any discount given could end up being just the starting point for a reduction in profit on that sale. A recent reported case in Cornwall demonstrates how it can go really wrong. A dealer (not one of our members of course!) was selling cars he’d purchased as ‘trade/spares and repairs’ on to customers while posing as a private seller in a deliberate effort to try and deny the customers their rights and so avoid any comeback. Trading Standards got involved and the case ended with the Magistrates dishing out a 13-week suspended sentence in addition to an order to pay compensation to two customers to the value of £1671.50 plus an £80 victim surcharge and prosecution costs of £2500. The above really demonstrates the consequences of getting it wrong as it can not only cost money but can also lead to a criminal record.
  8. Is paying for warranties worth it? Sadly, many used car warranties do not live up to the 'peace of mind' they first promised. And unfortunately, when your customer becomes dissatisfied with their warranty it reflects badly on you and your car sales business. As a vehicle retailer you have Consumer Rights Act duties and the warranty, which should enhance basic customer rights, often has less customer rights than are automatically there when a vehicle is sold. We talk to car dealers every week that view warranties as their ‘own protection’ and often turn customers with problems away, hiding behind the warranty and refusing a customer claim. Your customers' legal rights cannot be restricted by the warranty and they can always potentially claim for compensation arising from the breakdown of a component that has failed. For instance, a failed timing belt often leads to a serious engine failure and a failed cylinder head gasket can lead to a 'cooked' engine. There may be a charge for recovery or vehicle hire and, in some cases, the consequential loss may extend to an overnight stay in a hotel. Unfortunately, you could be liable for all of this and much more! So, are warranties worth it? Sell 100 quality used cars to 100 customers and include a six month warranty. 90% of your customers will probably never have an issue with the car. They will be pleased with their purchase and happy with the warranty. However, the remaining 10% will probably have an issue and try to make a claim under the warranty. The challenge is to make these 10 customers very happy with the warranty. Warranty claims are all about customer issues. If a warranty claim is handled incorrectly the customers issue can quickly develop into a complaint. If your warranty fails to deal with a customer’s issue then it is not worth the paper it is written on! Of course, not every claim will be valid, and many customer demands can be unreasonable. The warranty should offer an alternative solution and help your customer understand what is legally reasonable... which does not mean paying out on every claim. Unfortunately making a claim under a warranty can be frustrating for a customer and feel like they are hitting a brick wall. With so many exclusions, terms and conditions the customer will have no other option but to call you (the supplying dealer). If customers' issues are landing on your doorstep then your warranty is not worth the paper it is written on! At Lawgistics we regard warranties as a defence mechanism not 'customer peace of mind'. The customer has peace of mind under the Consumer Rights Act and the warranty simply provides a set of instructions on how to make a claim if there is a problem. So, in theory, if the warranty deals with your customer issues successfully you should end up with 100% customer satisfaction. It does not matter if you use insurance warranties, a pot scheme or your own booklets, if your warranty deals with your customer issues at a cost you are happy with, then it is worth every penny.
  9. Hi Lazz, The fact you mentioned our warranty booklets caught my eye... I don’t like to get involved in selling the product and that is certainly taboo on a forum, however your dilemma ‘run it myself or get someone to administer it’ interested me. I have not answered that question for a long time, and I think the answer is simple. If you are mechanically/technically trained, have your own workshop and sell the majority of vehicles locally, run them yourself... you will be wasting your money on administration. You will find most customers will always contact you in the first instance and if you are one of those people that just can’t help but get involved... again, run them yourself. However, if you do not have ‘the knowledge’ and you just sell cars, certainly consider the outsourcing the administration. Also, if you have the knowledge but just don’t want to deal with warranty issues go administered. And finally, if you are selling cars far and wide, unless you have access to a network of garages, administration would be a good choice. With the Lawgistics solution you can mix it up, so run your local cars with our standard booklets and the cars at a distance on the administered booklets. Reference ‘pot’ schemes, we advise you avoid holding large amounts of money in other people’s accounts... most companies can offer you alternative ways of paying for work carried out. The money is safer in your bank! OTHER POINTS TO CONSIDER Choose a warranty administrator that understands your liabilities and can give sound advice in awkward situations. Your warranty will only be as good as your warranty administrator. It would be sad to see a good warranty let down by a poor administration service. Check that the warranty administrator and their warranty booklets comply with the The Consumer Rights Act 2015, The Consumer Contract (Information, Cancellation and Additional Charges) Regulations 2013 and the FCA regulations. Make sure they have a 24/7 claims helpline and administration service. If they can only answer your customers' queries 9-5 Monday to Friday, you could find you are administering your own warranties while paying someone else to do it. Your warranty administrator should also have access to technical advice and a good relationship with a reputable network of service and repair garages. Hope this helps.
  10. Thanks for the mention Arfur, we certainly do provide stationery for selling third party vehicles. It's our Sale or Return Pad and is available from ebay, amazon and our own online shop.
  11. We are pleased to note that the ICO have now produced a document Legitimate Interests which confirms what we at Lawgistics have been saying for many months and that is that legitimate interest is a business friendly ground for processing data. As we have previously advised, business do not need to jump through the consent hoops and reviews to continue to market to existing customers. To reiterate, garages can continue to send MOT reminders to their customer base as long as they offer the customer the option to opt out in every email or text. Further, it is absolutely fine to take a customer’s details and call them back – no separate consent is required, the customer has called you and so is expecting a call back. The trick to staying on the right side of legitimate interest is to consider the 3 part test which in plain English requires you to consider: why do you want to process the data in question? will processing the data help you achieve your purpose and is there a less intrusive way to achieve it? would the data subject reasonably expect you to be using their data in this way? As examples: An employer may ask for next of kin details from their employee so they know who to contact in an emergency. There is no need to ask the individual next of kin for their consent to hold their personal data as it is not unreasonable for such details to be held for health and safety reasons. There is no less intrusive way to be able to contact a relative after an emergency, the impact is minimal and only the Line Manager and Directors will have the details. A car dealer has a problem customer and seeks help from Lawgistics. The car dealer is entitled to seek specialist legal advice and only provides the customer data relative to the case. It is entirely reasonable for a business to seek advice and the customer’s details are looked after by Lawgistics who are GDPR compliant meaning there is minimal risk to the customer (except that they are likely to lose their case of course!). The key is giving the matter some thought. If it can reasonably be justified, then legitimate interest is your ground of choice – much less hassle and for marketing to existing customers, more likely to keep your marketing list alive as asking for consent may well end up with a limited response. So in summary, legitimate interest is your friend but like all good friendships, it shouldn’t be abused.
  12. Defamation falls broadly into two types - Libel and Slander People often think of the difference by connecting the 'S' of 'Slander' with the 'S' of 'Speech' or 'Spoken' and so you will often hear people say that slander is spoken and thus libel is in writing. For the most part that can be a correct conclusion but not always so. The distinction is one of permanence. Therefore, if speech is recorded and thus capable of being replayed time and time again (whether it is or not) then that speech is likely to be considered libel(ous) rather than slander(ous). With that in mind, a 'Name and Shame' campaign is the same as an online review, it is written content and therefore will have the potential to be libellous if; It is published The reputation of the 'Named and Shamed' has to be adversely affected by the comments However you cannot be defamed for statements that are actually truthful. Therefore, if you are going to name and shame someone make sure the facts are correct! Watch our legal advisor explain defermation in more detail on Trade Plates TV
  13. We are advising our members on the standard they must achieve if they wish to rely on consent as their lawful basis for utilising personal data for direct marketing purposes. Direct marketing being defined in the current Data Protection Act as “the communication (by whatever means) of any advertising or marketing material which is directed to particular individuals”. As a reminder Article 6 of the GDPR sets out 6 lawful bases for processing personal data:1. Consent2. Necessary for a contract with the individual3. Necessary for compliance of a legal obligation4. Necessary to protect interest of the data subject or another natural person5. Necessary for a public interest task or official duty 6. Necessary for legitimate interests of the controller or a third party. While consent may seem the obvious basis for marketing activity, your pre-existing marketing databases may not meet the GDPR standard and so unless you want to do a Wetherspoons and scrap your entire marketing database, you will need to see if another base can apply. This is where ‘legitimate interests’ can come to your aid. We suspect ‘legitimate interest’ will be well used. The ICO will no doubt be making sure it is not overused. So, what will work?Recital 47 of the GDPR specifically states that “the processing of personal data for direct marketing purposes may be regarded as carried out for a legitimate interest”. This is good news and could mean we can send out marketing under the lawful basis of legitimate interest. However, we need to balance this against the requirements of the Privacy and Electronic Communications Regulations (PECR) which deals with electronic marketing. PECR Regulation 22 requires that a company needs consent to send a marketing email unless;a. the recipient is an existing customer or potential customer who has previously made an enquiry for a product or service b. the direct marketing is in respect to similar products and services only; andc. the recipient has been given a simple means of refusing (free of charge except for the costs of the transmission of the refusal) the use of his contact details for the purposes of such direct marketing, at the time that the details were initially collected, and at the time of each subsequent communication.So companies will need to meet the GDPR criteria for consent to marketing unless it meets the above PECR criteria which is known as the ‘soft opt-in’ rule. The ‘soft op in’ means you can send marketing to your existing customers about similar products as long as you offered them the opportunity to opt-out when you first collected their details and you offer them to same opt-out opportunity in every subsequent marketing communication.So if you collected details from existing customers and had an opt out option, this marketing can continue under GDPR (using legitimate interest as the basis). But, you must comply with Article 21 of GDPR which gives customers the ‘right to object’ at any point. So, if you are a service and repair garage and you email existing customers prior to the anniversary of their car service to give them details of prices, then as long as you gave them the opportunity to opt-out when you took their details and state clearly in the email that they can opt-out at any time, you will be fine to continue emailing them every year. The same will apply if you send those customers details of similar services such as winter checks or MOT deals. Your GDPR lawful basis for processing is then legitimate interests (not consent as there is no opt-in, only an opt-out). However, if you haven’t been following the law in regard to email marketing already, then you are likely to need to start again and get consent when the customer first makes contact.
  14. The ‘Short Term Right to Reject’ is designed to allow consumers to return goods for a full refund if a fault appears in the first 30 days of ownership. The customer does not have to give you an opportunity to repair in this first 30 days.However, if the customer wants to exercise this Right they must:1. Prove there is a fault2. Prove that the fault was present at the point of saleFor the purposes of the Consumer Rights Act 2015, a fault is something which renders the vehicle not of satisfactory quality, not fit for particular purpose or not as described.Unfortunately, some consumer organisations advise customers that they can return an item for any fault. This is not correct! A wear and tear item or a minor fault such as a spark plug failure will not give the customer the Rights as set out in the Act. Your first consideration when a customer comes back to you asking for a repair or a refund under the Act should be ‘is this a fault which means the vehicle is not of satisfactory quality, not fit for purpose or not as described?’. Of course, your customer may have a different opinion to you but ultimately the law considers what a reasonable person would think about the fault considering factors such as the age, mileage and price paid for vehicle.If you have undertaken comprehensive pre-delivery checks and have kept good records of those checks, you will have made it very difficult for the consumer to prove the fault was there at the point of sale.It is obviously up to you how much time you want to put into your pre-delivery procedures but at Lawgistics we would recommend you:• Put a new MOT on each vehicle you sell• Complete a Pre-Delivery Checklist • Get the customer to sign to say there were no apparent faults during the test drive• Have the vehicle checked and/or serviced by an independent garage• Take photos or even a video of the vehicleOnce the 30 day Short Term Right to Reject period has passed, if the customer comes back to you with a fault, they must give you an opportunity to ‘Repair or Replace’ the goods before they can seek to reject the vehicle for a refund.Previously, under the Sale of Goods Act 1979, dealers could undertake several repairs before agreeing to a refund. However, this new Act now only gives you one chance to repair.To us, this makes the Act not fit for purpose as we all know that modern vehicles can be quite complex and so it is not always possible to correctly diagnose a fault at the first attempt, especially with intermittent faults. This then appears to put dealers at a disadvantage but there is nothing in the Act to prevent you from releasing a vehicle, as long as it is safe to do so, back to a customer and advising them that the repair job card remains open should they experience further problems.It is also possible to agree with a customer to undertake a repair under any warranty you may have sold with the car as that will constitute a contractual repair and so will not count as a statutory repair under the Act. In this instance, you will need to ensure you have the customer’s agreement to conduct any repairs under warranty (preferably in writing) so it is clear it is a contractual warranty repair and not a statutory repair – the difference being only a statutory repair will give rise to the ‘Final Right to Reject’.From day 31 i.e. on expiry of the Short Term Right to Reject period, the customer no longer has the right to reject the vehicle without giving you an opportunity to make a repair or provide a replacement. However, if you have already made a statutory repair (as opposed to a contractual repair) then the customer does have the choice of rejecting the vehicle for a refund under the Final Right to Reject. In this instance, you can reduce the amount of the refund to take account of the use the consumer has had of the vehicle. There is no set formula for this deduction and so the figure will need to be calculated depending on many factors such as time of ownership, mileage covered, condition of the vehicle on return etc. Ultimately if there is a disagreement between you and the consumer as to the amount of the deduction, it will up to the courts to decide.
  15. Earlier this month (January 2018) Gateshead Council’s Trading Standards Dept prosecuted a car dealer (not a Lawgistics client) for failing to point out that advertising a car with “one previous” owner amounted to an offence, when that previous owner turned out to be a well-known car hire firm. The offence being one of materially misleading a prospective consumer such that it affected their transactional decision, contrary to the Consumer Protection from Unfair Trading Regulations 2008 (CPRs). In other words – they may not have decided to buy (or even look at) the car had they known that it was once owned by a car hire company. The same point could be made if it was previously owned by a taxi firm, leasing company, driving school or similar. It follows on from a ruling in October 2017 from the Advertising Standards Authority (ASA) that “…if a dealer was aware that a vehicle was ex-fleet because it had previously been used for business purposes, then that was material information likely to influence a consumer’s decision to purchase it. Furthermore, if a dealer knew that such an ex-fleet vehicle was used by multiple users, then that too, was material information for consumers to make an informed decision.” The key words are “if the dealer knew” or “was aware”. Also “consumer” as CPRs do not include trade purchasers. And these words can be crucial. For we did have a Lawgistics client who was challenged by Trading Standards, looking to prosecute, on precisely the same grounds as the dealer prosecuted by Gateshead Trading Standards. We stated however, that the name of the previous keeper was such that the dealer could not reasonably have known that it was a leasing company. It may also have helped their case that the vehicle had only done 20,000 miles in the two years prior to sale by our client. On this occasion their local Trading Standards took no formal action. However, much media publicity has been made recently under the name of “Used Car Scandal”. We urge motor dealers not to immediately fold if they are approached by a customer demanding compensation or if approached by Trading Standards. They should contact their chosen legal advisor to ascertain whether they can dispute what is being alleged against the dealer. Lawgistics have more than one ex-Trading Standards Officer, who regularly stand up for car dealers when faced with what may appear to be overwhelming evidence against them in the first instance. Reverting to the prosecution by Trading Standards in Gateshead, the dealership was fined £5000, ordered to pay costs of £500 and to give the consumer compensation £1000. Note though that they pleaded guilty and, as such, the offences were not legally challenged in court, which we also believe to be important. A spokes-person for the Council said; “It is extremely disappointing to find a main car dealership failing to provide its customers with this kind of information”. Interesting, given that at the time of writing, the website of Gateshead Trading Standards tells businesses that “Applications for a Credit Licence must be made to the Office of Fair Trading”. Omitting to mention that the OFT was abolished – in 2014! But back to the serious side of things - car dealers must now make it clear in advertising if they are aware that they are selling a car that has been used either by multiple users (car hire / leasing) or for business purposes such as a driving school or taxi – even if it remains technically correct to say that they are “one previous owner”.