Date Issued: February 23, 2021

File: SC-2020-007968

Type: Small Claims

Civil Resolution Tribunal

Indexed as: Wall v. Davis, 2021 BCCRT 209

Between:

LAUREN WALL

Applicant

And:

DIANA DAVIS

Respondent

INTRODUCTION

1.      This dispute is about the private sale of a used vehicle. The applicant, Lauren Wall, says she bought a 2008 Ford Escape from the respondent, Diana Davis, but later discovered that there were problems with the vehicle’s transmission. She asks for an order that Ms. Davis reimburse her the vehicle’s $3,950 purchase price, plus taxes and associated expenses, for a total of $4,028.70.

2.      Ms. Davis says that she had no issues with the vehicle, and denies that she misrepresented its condition or that she is responsible for the damages Ms. Wall claims.

3.      The parties are self-represented.

JURISDICTION AND PROCEDURE

4.      These are the formal written reasons of the Civil Resolution Tribunal (CRT). The CRT has jurisdiction over small claims brought under section 118 of the Civil Resolution Tribunal Act (CRTA). Section 2 of the CRTA states that the CRT’s mandate is to provide dispute resolution services accessibly, quickly, economically, informally, and flexibly. In resolving disputes, the CRT must apply principles of law and fairness, and recognize any relationships between the dispute’s parties that will likely continue after the CRT process has ended.

5.      Section 39 of the CRTA says the CRT has discretion to decide the format of the hearing, including by writing, telephone, videoconferencing, email, or a combination of these. Here, I find that I am properly able to assess and weigh the documentary evidence and submissions before me. Further, bearing in mind the CRT’s mandate that includes proportionality and a speedy resolution of disputes, I find that an oral hearing is not necessary in the interests of justice.

6.      Section 42 of the CRTA says the CRT may accept as evidence information that it considers relevant, necessary and appropriate, whether or not the information would be admissible in a court of law. The CRT may also ask questions of the parties and witnesses and inform itself in any other way it considers appropriate.

7.      Where permitted by section 118 of the CRTA, in resolving this dispute the CRT may order a party to do or stop doing something, pay money or make an order that includes any terms or conditions the CRT considers appropriate.

ISSUES

8.      The issues in this dispute are:

a.    Whether Ms. Davis breached an implied warranty of durability, and

b.    Whether Ms. Davis misrepresented the vehicle’s condition.

EVIDENCE AND ANALYSIS

9.      In a civil dispute like this, an applicant must prove their claims on a balance of probabilities. I have read all the parties’ submissions but refer only to the evidence and argument that I find relevant and necessary to provide context for my decision.

10.   Ms. Davis advertised the Escape for sale for $3,950. A photo of the advertisement documents the details: 190,000 kilometres, excellent condition, great tires, clean, and ready for winter. Ms. Wall responded to the advertisement and arranged to test drive the vehicle on October 3, 2020.

11.   During the test drive, Ms. Wall says she noticed that the vehicle “revved high” and that there was a “lit up wrench” on the dashboard. The parties have differing recollections about their discussions about the meaning of the revving and the wrench light, and whether Ms. Davis offered Ms. Wall the opportunity to take the vehicle for inspection. However, there is no dispute that Ms. Wall did not have the vehicle inspected before she purchased it that same day.

12.   Although the Transfer/Tax Form identifies the selling price as $2,000, the parties agree that the selling price was $3,950. The parties also signed a handwritten document says that Ms. Davis sold the Escape to Ms. Wall “as currently is”.

13.   Shortly after she purchased the car, Ms. Wall had the car assessed by a transmission specialist. According to the specialist (and as later confirmed in his November 19, 2020 letter), the wrench light indicated a transmission issue and the error codes from the car indicated “slippage” in the transmission that required significant repairs. Ms. Wall had the transmission repaired at a cost of $4,147.43.

14.   Ms. Wall felt that Ms. Davis had not told her the truth with her about the length of time she had owned the vehicle, how much she had driven it, or its condition. She also felt that Ms. Davis had not been honest about what she knew about the warning light. Ms. Wall’s relative communicated with Ms. Davis who, in an October 6, 2020 text message, reported that she did not know about the transmission problem and would not have sold the Escape if she had known about it. The relative and Ms. Davis exchanged messages about how to resolve the situation, but no agreement was reached.

Implied Warranty of Durability – Sale of Goods Act

15.   Ms. Wall says that, as the Escape required significant repairs within days of the purchase, it was not durable for a reasonable period of time. Ms. Davis says the vehicle was “fine” during the time that she owned and drove it.

16.   Apart from cases of misrepresentation, which I will discuss below, the principle of “buyer beware” applies to private used vehicle sales. This means that the buyer assumes the risk that the vehicle might be either defective or unsuitable to their needs (Rusak v. Henneken, [1986] B.C.J. No. 3072 (S.C.) at paragraphs 17-18).

17.   The principle of buyer beware is limited by the warranties set out in section 18 of the Sale of Goods Act (SGA). Section 18(c), which applies to private sales, requires that the goods sold be durable for a reasonable period with normal use, considering the sale’s surrounding circumstances.

18.   However, the sale agreement in this case was subject to the condition that the Escape was “as currently is”. The British Columbia Provincial Court has held that the term “as is” conveys that the goods are being purchased without any attached conditions about their quality, durability or fitness, and that the buyer is assuming the risk of any problems that occur after the sale (Conners v. McMillan, 2020 BCPC 230 at paragraph 68). In the context of a used vehicle, a buyer who fails to have the vehicle inspected is “subject to the risk that they did not get what they thought they were getting and made a bad bargain” (Conners at paragraph 69).

19.   The effect of the decision in Conners (which is binding upon me), is that a sale on an “as is” basis removes the implied condition of durability found in section 18(c) of the SGA. As Ms. Wall did not have the Escape inspected, she cannot rely on the warranties in the SGA. The transaction was on a “buyer beware” basis, and she bore the risk of the parties’ agreement.

Misrepresentation

20.   The next consideration is whether Ms. Davis fraudulently misrepresented the vehicle’s condition by saying there were no mechanical issues with it. If a seller misrepresents a vehicle’s condition, its buyer may be entitled to compensation for losses arising from that misrepresentation.

21.   A “misrepresentation” is a false statement of fact made during negotiations or in an advertisement that has the effect of inducing a reasonable person to enter into the contract. The seller must have acted negligently or fraudulently in making the misrepresentation, the buyer must have reasonably relied on the misrepresentation to enter into the contract, and the reliance “must have been detrimental in the sense that damages resulted”: see Queen v. Cognos Inc., [1993] 1 SCR 87 at paragraph 110.

22.   Although she also takes issue with Ms. Davis’ alleged statements about how long she had owned and driven the vehicle, it is apparent from Ms. Wall’s submissions that her claim for misrepresentation relates to Ms. Davis’ advice that there were no mechanical issues with the vehicle as this is what led to her decision to buy it. I infer that Ms. Wall’s position is that Ms. Davis must have known about the problems with the vehicle and failed to inform her. For her part, Ms. Davis says that the revving was related to the way in which Ms. Wall drove the vehicle and that she had called a dealership to ask about the wrench light and was told it was “fine”. According to Ms. Wall, the dealership never told her that the Escape was unsafe and she never felt unsafe while driving it with her children as passengers.

23.   There is no dispute that Ms. Wall was aware of the revving issue and the wrench light after she test drove the vehicle. There is no indication that Ms. Davis did anything to the Escape to prevent any problems from being discovered. I find that these issues were obvious, and there was no active concealment of the problems, despite any comments that Ms. Davis may have made about them. I also find that being aware of the revving and wrench light did not mean that Ms. Davis was aware of the specific problem with the transmission, its nature or its extent.

24.   I find that the problem with the Escape’s transmission was either a patent defect that could have been discovered through an inspection or a latent defect that Ms. Davis did not know about. I acknowledge Ms. Wall’s submission that she relied upon Ms. Davis’ representations about the vehicle but, as noted, the sale was buyer beware. In any event, I find that the evidence before me does not support the conclusion that Ms. Davis misrepresented the Escape’s condition.

25.   As Ms. Wall has not established the breach of an implied warranty or a fraudulent misrepresentation, I find she is not entitled to the damages she claims.

26.   Under section 49 of the CRTA and CRT rules, the CRT will generally order an unsuccessful party to reimburse a successful party for CRT fees and reasonable dispute-related expenses. As Ms. Wall was not successful, I dismiss her claim for reimbursement of CRT fees.

ORDER

27.   I dismiss Ms. Wall’s claims and this dispute.