Cms Scotland Limited V. Ing Lease (uk) Limited+mann Island Finance Limited
| Jurisdiction | Scotland |
| Judge | Lord Matthews |
| Neutral Citation | [2010] CSOH 39 |
| Docket Number | A609/07 |
| Date | 17 March 2010 |
| Court | Court of Session |
| Published date | 18 March 2010 |
| OUTER HOUSE, COURT OF SESSION [2010] CSOH | |
| A609/07 | OPINION OF LORD MATTHEWS in the cause CMS SCOTLAND LTD Pursuers; against ING LEASE (UK) LIMITED Defenders: and MANN ISLAND FINANCE LIMITED Third Party: ________________ |
Pursuers: Smith, QC; McClure Naismith
Defenders and Third Party: Watt; Morton Fraser LLP and RSC Solicitors respectively
17 March 2010
Background
[1] This case called before me as a Proof before Answer.
[2] On 23 October 2006 the pursuers and the defenders entered into a hire purchase agreement in connection with the purchase of a Bentley Azure convertible motor car, the cash price being £227,410.65. The vehicle was delivered to the pursuers at the premises of the supplier in Edinburgh, the defenders having purchased the vehicle from the third party under a contract dated 29 September 2006 for the same price. The third party are financiers.
[3] The pursuers aver that the vehicle was not of satisfactory quality. It is said that shortly after they took delivery of it, the mechanically operated roof jammed and it required to be returned for repair under warranty. After it was returned to the pursuers it is said to have suffered a complete failure of the braking system while being driven. At the beginning of the proof Mr Smith sought to amend the pleadings by deleting the word "complete" but he dropped that motion on the basis that he might return to it later.
[4] In answer it is averred that in about May 2007 the pursuers returned the car to Bentley Glasgow, complaining of a defect, and it was found that there was a leak in the rear shock absorber unit. The necessary repair work was completed and the shock absorbers were in good working order. After the pursuers ultimately returned the car to the defenders, having rejected it, it was examined and found to have suffered minor damage in the course of use but otherwise was in satisfactory condition. A fail-safe system would operate in the event of there being any defect in the brakes, the car being fitted with a dual tandem brake system, and it was inherently unlikely that the car would suffer from a catastrophic brake failure. At no time did the pursuers inform the defenders or the suppliers of any problem with the roof.
[5] The pursuers claim that the vehicle was not fit for its purpose and was unsafe. By letter dated 18 May 2007, their solicitors rejected the vehicle on their behalf and rescinded the contract. The car was uplifted by the defenders without prejudice to their rights in respect of the dispute.
[6] The defenders claim that if the vehicle was not of satisfactory quality they are entitled to relief from the third party.
[7] They also aver that, prior to the purported rescission of the contract by the pursuers, their managing director had intimated that he did not like the car and wished to change it for a Rolls Royce.
[8] The pursuers seek repayment of the sums of money they have paid in respect of the car, namely a deposit of £56,000, instalment payments amounting to £24,854.52 and an acceptance fee of £250.
Evidence
[9] The first witness for the pursuers, who were haulage contractors and property developers, was their managing director, Mr James Gerard Gaffney. He said that he had had around six Bentleys before the purchase of the one in question. Generally speaking he had various problems with it. The electrically operated hood sometimes jammed and would not come down and sometimes jammed half-way up. It was taken to Bentley and they repaired it, saying that it was a teething problem. The car had been supplied by Bentleys in Edinburgh but there was a dealership not far from his house known as Bentleys in Hamilton, a division of the Parks Group. The problem arose in about the second week after the witness had the car and after each repair the hood would work again for a time. However, it had to go in ten or twelve times because of the problem.
[10] He was never billed for the work, since it was done under warranty, and there was never any job sheet filled out. He agreed with the third party, who said that the car was recalled in February 2007 because of a problem with wheel bolts and insulation was fitted to the boot. It went to Edinburgh and was away for ten days. There was water in the boot and they tried to seal the top of the boot's lid. The witness went on to say that the car would not start on a few occasions and had to be re-programmed but Mr Smith did not pursue that line for which there was no Record, objection having been taken.
[11] There was a problem with the brakes but he did not remember exact dates and times. He said that he was driving the car by himself on the M74 at around 60-70mph. The first indication of a problem was when a light came on. It was shaped like a brake drum. There had been other electrical problems and the last thing he thought of was that there was an actual brake malfunction. He was coming off the slip road to go home to Bothwell. He applied the brakes and the pedal went further down than it should. He pumped the pedal as if he was bleeding the system and the pedal came up but it travelled back down and something was seriously wrong. He took the car out of "drive" and put it into third gear, then second gear. He was asked whether there was any braking at all and he said that on the first occasion when he pumped it two or three times there was some braking but not very much. He could not have stopped the car using the brakes. He was lucky with the traffic lights at the bottom of the slip road and he managed to get home. When he got home he stopped the vehicle by putting it into "park". He repeated that there was only any braking the first time he pumped the pedal but there was very little. Then the pedal went straight to the floor and there was nothing. His house was about half a mile away from the slip road and he drove there at 10-15mph in first gear.
[12] His firm had around 200 vehicles and he phoned the manager to come over, thinking that the brake pipes had been cut. The manager, Martin McGettigan, came over and the two of them looked at the problem. The witness was a time-served mechanic himself. There was hydraulic fluid at the nearside back wheel. They lifted the bonnet and looked at the reserve to find that there was no fluid in it. It was a dual system, suspension and braking being fed off the one reservoir. The car was settling down on its arches because of the lack of suspension fluid. They took the vehicle to Parks on their own recovery vehicle and he told the people there about the braking problem. They said that they would investigate. It was put onto a ramp and the mechanic saw the fluid at the rear back wheel. He was flabbergasted and said "I don't believe this". The mechanic thought that the fluid was coming from a "banjo" bolt or a leaking shock absorber but did not confirm the diagnosis at that stage. The car was left there. Bentley got back in touch and said that there had been a problem with the suspension and braking system and the car was ready. 7/3 was a computer printout from Bentley Glasgow which bore to be a warranty invoice, the date and tax points being 10 May 2007. The driver was described as Mr T Gaffney, 10 Allanshaw Gardens, Hamilton but there is no doubt that the document referred to this car. The document indicates that work was carried out under warranty. The car was checked and it was found that the near-side rear shocker was leaking. It was stripped out and renewed and the system was bled. It goes on to say "all okay now, duel (sic) system".
[13] The document indicates that Mr Gaffney was served by someone called Russell Graham and the mileage at the time was 527 miles.
[14] After all this he said that he spoke to the service engineer and said that there had been a complete brake failure. He had no confidence in the car. It had been a nightmare. The company had bought over 200 vehicles and they had never had a problem like this. He discussed the matter with Bentley and they said it would go back to the factory. They thought the vehicle was all right. However, they said that every time it went in but it was not. He consulted solicitors on the basis that he did not think that the vehicle was fit for its purpose and a letter was in due course sent to the defenders. The vehicle was then sold by the defenders. He was looking for return of his deposit and the payments which he had made. He was asked what standard of vehicle he was expecting to get. He said that it was a new model that had just come out and they were thin on the ground. There had been a cancelled order and he was telephoned about it. He was over the moon with the car and its appearance and he would still have the car had everything been fine. He had never had a problem before with a Bentley. The hood problem had perhaps resolved itself but he was still terrified to put it down in case it did not come back up again. A friend of his had a similar problem but his had been put right. He was asked whether his lack of confidence only extended to the braking and he said that he had no confidence in the car at all. He was asked whether he had ever driven it after the brakes were fixed and he said he took it to Edinburgh where it came from. It was there about ten times. It was the braking that made him decide that enough was enough because he had four young children and he was not having them going into that car.
[15] In cross-examination it was put to him that he was interested in purchasing the car in about September 2006 but he could not remember the date. He agreed that a pre-delivery inspection was carried out and finance was put in place. He signed an HP agreement on 23 October 2006 on behalf of the pursuers. Shortly after that the vehicle was picked up. He agreed that the first indication in the documentation that anything was wrong related to a recall at the end of February 2007. The manufacturers contacted him to bring it in in order to change the...
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