ConsumerTalk with Wendy Knowler

Dealerships must pay for cars damaged or stolen in their care, it's the law

Car dealerships are not above the law.

The Consumer Protection Act (CPA) states that dealerships are liable for the damage or loss of property in their care.

The Act reads as follows:

In the handling, safeguarding and utilisation of that property, companies must exercise the degree of care, diligence and skill that can reasonably be expected of a person responsible for managing any property belonging to another person; and is liable to the owner of the property for any loss resulting from a failure to do so.

Despite this, consumer journalist Wendy Knowler says most dealerships are reluctant to take responsibility when vehicles are damaged or stolen while in for services or repairs.

Knowler says the dealerships usually expect their customers to shrug and claim on their own insurance policies, and offer to pay their excess amounts as a goodwill gesture.

But this is not enough.

Both the Consumer Goods and Services Ombud Magauta Mphahlele and Motor Industry Ombudsman Johan van Vreden agree that dealerships must be held liable according to the law.

Dealerships tend to rely on disclaimers displayed on their premises that cars are left at the consumer’s risk but the CPA’s Section 65 is very clear that the dealership must take reasonable due care in handling the car and ensuring its safety.

Magauta Mphahlele, Consumer Goods and Services Ombud

Attorney Trudie Broekmann, a consumer law specialist, says car dealerships must pay up when they have acted with negligence.

Knowler describes a case in which a man's new high-end bakkie was stolen at a dealership after its very first service. The keys were left in the ignition and the vehicle unattended.

The dealer principal argues that vehicles and their contents enter on the premises entirely at the owners or drivers risk.

However, Broekmann says the dealership must pay the consumer the current value of the car "along with interest if they don’t pay immediately, and any legal costs which the consumer may need to incur to obtain payment from them."

Broekmann adds that dealerships cannot use disclaimer of liability, such as a notice or contractual term which states that the cars are left on their premises at the customer’s risk, to get out of accountability.

Two ombudsmen agree that the dealerships are responsible, but the dealerships are doing their own thing.

Wendy Knowler, consumer journalist

Dealerships do know that this is a problem area. It's very rare that they take full responsibility. In most cases, there's a battle.

Wendy Knowler, consumer journalist

Listen to the entire ConsumerTalk discussion on The Pippa Hudson Show:

Every Wednesday, on The Pippa Hudson Show, consumer expert Wendy Knowler provides useful insights and tips on how to make the most of your buying power.

For more stories visit the ConsumerTalk feature page.

Got a consumer case you need help resolving?

Email: consumer@knowler.co.za, put Cape Talk in the subject line, followed by the issue e.g. cellphone contract dispute


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