Date Issued: October 20, 2023

File: SC-2022-003210

Type: Small Claims

Civil Resolution Tribunal

Indexed as: White v. P.S. Motors Ltd., 2023 BCCRT 901

Between:

THOMAS WHITE

Applicant

And:

P.S. MOTORS LTD.

Respondent

REASONS FOR DECISION
Tribunal Member:	Sarah Orr

INTRODUCTION

1.      This is a dispute about a used vehicle sale. On June 3, 2020, the applicant, Thomas White, purchased a used 2003 Jaguar S-Type from the respondent, P.S. Motors Ltd. (PSM), for $10,080. Mr. White says he told PSM before purchasing the vehicle that the 2 electronic keys that came with it were an important feature to him. However, he says the keys did not function remotely, which PSM failed to disclose to him. He says this made the vehicle unsafe. He also says PSM failed to repair or replace the keys as it promised to do at the time of the sale. Mr. White claims $1,506.42 for the cost of replacing the 2 electronic keys.

2.      PSM says that one of the electronic keys works remotely, and that although the spare key remote is inoperative, both keys have always functioned to manually lock, unlock, and start the vehicle. PSM denies that Mr. White told him the electronic keys were important to him before purchasing the vehicle. PSM also denies promising Mr. White verbally or in writing at the time of the sale to replace or repair the keys. PSM says it does not owe Mr. White anything.

3.      Mr. White is self-represented, and PSM is represented by an employee or principal.

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.

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.

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.    Do the 2 electronic keys function remotely?

b.    If not, is Mr. White is entitled to $1,506.42 for the cost of replacing the 2 electronic keys.

EVIDENCE AND ANALYSIS

9.      In a civil proceeding like this one, as the applicant Mr. White must prove his claims on a balance of probabilities, which means more likely than not. I have read all the parties’ evidence and submissions but refer only to what I find relevant to explain my decision. For the following reasons, I dismiss Mr. White’s claims.

Do the 2 electronic keys function remotely?

10.   Both electronic keys have undisputedly always worked manually to lock, unlock, and start the vehicle. However, Mr. White says that when he returned home immediately after purchasing the vehicle on June 3, 2020, he discovered that neither of the 2 electronic keys functioned remotely. PSM does not dispute this. Mr. White says the 2 electronic keys were not functioning remotely at the time he purchased the vehicle, though PSM disputes this. The evidence about when, precisely, the keys stopped working remotely is unclear. However, given that Mr. White undisputedly discovered the keys’ remote inoperability almost immediately after the sale, I find it is more likely than not that the 2 keys did not operate remotely at the time of the sale.

11.   On June 16, 2020, after Mr. White notified PSM about the keys’ remote inoperability, PSM reprogrammed the first key so that it operated remotely. PSM also attempted to reprogram the second key but was unable to do so. PSM did not charge Mr. White for the reprogramming services. Despite several attempts on later dates, PSM has been unable to successfully reprogram the second key. This means the second key has never worked remotely since Mr. White has owned the vehicle. None of this is disputed.

12.   Mr. White says the first key stopped functioning remotely again shortly after PSM reprogrammed it on June 16, 2020. However, PSM denies this, and I find Mr. White’s evidence about the key’s remote functionality is inconsistent. His notes from his June 16, 2020 visit to PSM state that PSM had reprogrammed the first key. At the bottom of this document there is a note in parentheses which states, “TW note – The reprogrammed one only works intermittently also.” Given the parentheses and the context, I find this additional note was added on an unspecified date after June 16, 2020. There is no indication that Mr. White shared this note with PSM before this dispute.

13.   Mr. White’s notes from his July 13, 2020 visit to PSM and a March 20, 2021 letter he wrote to PSM both state that PSM had reprogrammed the first key. Both documents mention the second key’s failure to function remotely, but there is nothing in either document indicating that the first key failed to function remotely again after PSM reprogrammed it.

14.   In a November 29, 2021 letter to PSM, Mr. White said the first key failed remotely shortly after PSM reprogrammed it. However, on the evidence before me, I find this is the first time since PSM reprogrammed the key that Mr. White told PSM about the first key’s alleged failure. Given Mr. White’s organized and detailed notetaking, and his persistence in communicating various problems with the vehicle to PSM, I find it unlikely he would have failed to disclose the key’s failure to PSM for over a year. Mr. White also provided no independent evidence proving the first key has failed to function remotely. For all of these reasons, I find Mr. White has failed to prove that the first key stopped functioning remotely after PSM reprogrammed it on June 16, 2020.

15.   In summary, I find the first key was inoperative remotely at the time of the sale until June 16, 2020, but that it has been operating remotely since that date. I find the second key has never operated remotely.

Is Mr. White entitled to $1,506.42 for the cost of replacing the 2 electronic keys?

16.   The general rule for used vehicle sales is “buyer beware”. There are several legal exceptions to the “buyer beware” principle, which are fraud, negligent misrepresentation, breach of contract, breach of warranty, or failure to disclose a known latent defect (see Mah Estate v. Lawrence, 2023 BCSC 411). This means that for Mr. White to be entitled to compensation, he must prove one of these legal exceptions to the “buyer beware” principle.

17.   First, I address fraudulent and negligent misrepresentation. A misrepresentation is a false statement made during negotiations or in an advertisement that induces a reasonable person to enter into a contract. If a seller fraudulently or negligently misrepresents the vehicle, the buyer may be entitled to compensation for losses caused by that misrepresentation.

18.   Mr. White says that before he purchased the vehicle PSM misrepresented that it came with 2 fully functioning keys. PSM denies making any representation about the number of keys that came with the vehicle, and I find there is no other evidence supporting Mr. White’s allegation. I find Mr. White has failed to establish that PSM misrepresented the number of keys that came with the vehicle.

19.   Mr. White also says PSM’s advertisement for the vehicle misrepresented that it had “keyless entry”. Having found the 2 keys did not operate remotely at the time of the sale, I find the phrase “keyless entry” in the vehicle’s advertisement was a misrepresentation. There is no evidence that PSM was aware that the keys did not function remotely at the time of the sale, or that it intentionally withheld this information from Mr. White. This means the “keyless entry” misrepresentation in the advertisement was negligent, not fraudulent.

20.   To be entitled to compensation for a negligent misrepresentation, Mr. White must establish that PSM’s misrepresentation caused him losses. I have already found that PSM reprogrammed one of the keys on June 16, 2020 and that it has been functioning remotely since that time. So, I find Mr. White was without “keyless entry” for approximately the first 2 weeks he owned the vehicle. However, he does not allege that he suffered any specific losses from not having keyless entry during that 2-week period, so I find he is not entitled to compensation for PSM’s negligent misrepresentation.

21.   Next, I address breach of contract. Mr. White says the parties’ contract required PSM to provide 2 fully functioning electronic keys, but PSM denies this. I agree with PSM. I find there is nothing in the written contract about the number of keys that came with the vehicle or their remote functionality. Mr. White submitted an excerpt from the vehicle manufacturer’s driver’s handbook which says that all vehicles are supplied with 2 key transmitters. However, as PSM correctly notes, this was a used vehicle sale, so that handbook does not apply to the sale unless the parties specifically agreed to it, which I find they did not.

22.   Mr. White also says PSM promised at the time of the sale to repair or replace the electronic keys. However, I find this is inconsistent with Mr. White’s evidence that PSM failed to disclose the keys’ remote inoperability at the time of the sale, and that he did not discover it until he returned home after purchasing the vehicle. PSM says it wrote on the contract template every promise it made to Mr. White, each of which it fulfilled, and Mr. White does not specifically dispute this. PSM undisputedly discounted the vehicle’s original sale price by $980, but it says it would not have done so if Mr. White had requested a replacement key as a condition of the sale. On balance, I find Mr. White has failed to prove that PSM promised to repair or replace the electronic keys at the time it sold him the vehicle.

23.   Mr. White also says that because PSM wrote the contract, it is biased in PSM’s favour. However, he does not say which terms of the contract are biased, and in any event, I find the evidence does not support this allegation. Mr. White does not allege that any of the terms are ambiguous such that they should be interpreted against PSM under the legal principle of contra proferentem. The contract is a template form, with some additional handwritten terms. Both parties signed the contract, and Mr. White does not allege that he signed it under duress.

24.   Mr. White also says that after purchasing the vehicle and notifying PSM about the failure of the 2 electronic keys, PSM promised to pay to repair or replace the keys. However, PSM denies this. While PSM undisputedly made several attempts to reprogram the second key, it says it did so out of goodwill, and that it never made such a promise. I find the only documentary evidence supporting Mr. White’s allegation is his own notes from conversations he says he had with PSM. Without more, I find Mr. White has failed to prove that PSM promised to repair or replace the keys anytime after he purchased the vehicle.  

25.   Next, I address breach of warranty. Section 18 of the Sale of Goods Act (SGA) sets out warranties that are implied into contracts in certain circumstances for the sale of goods, which includes used vehicles. I find 2 of these implied warranties in section 18 of the SGA apply to the circumstances of this dispute. Under section 18(a) of the SGA, if Mr. White can establish that he made known to PSM the particular purpose for which he required the vehicle, and that he relied on PSM’s skill or judgment, since PSM normally sells used vehicles, there would have been an implied condition in the contract that the vehicle was reasonably fit for Mr. White’s purpose.

26.   Mr. White says he told PSM that he was buying the vehicle for his wife who has mobility issues, and that having 2 remotely functioning keys was an important feature for this purpose. However, PSM denies that Mr. White mentioned the importance of the remotely functioning keys. PSM says that if the keys’ remote functionality was important to Mr. White, he should have asked about them or tested them out before purchasing the vehicle. There is no documentary evidence supporting Mr. White’s allegation. Without more, I am not satisfied that he made known to PSM, either expressly or by implication, the importance to him of the 2 remote keys when he purchased the vehicle. So, I find the implied warranty in section 18(a) of the SGA does not apply to the parties’ contract.

27.   Section 18(c) of the SGA says goods will be durable for a reasonable period of normal use, considering the sale’s context and the surrounding circumstances. In Sugiyama v. Pilsen, 2006 BCPC 265, the court said the seller of a used vehicle cannot guarantee the vehicle’s future performance, and a buyer must expect problems at some point. The court found the older the vehicle, the more likely that it will break down. For an older vehicle, if it is “roadworthy” at the time of sale, it is likely to be considered reasonably durable, even if it breaks down shortly afterwards.

28.   In this case, the vehicle was 17 years old when Mr. White purchased it from PSM. Mr. White says the failure of the keys’ remote function made the vehicle unsafe, which PSM denies. Mr. White also says that Jaguar’s key transmitter system has special features in addition to remotely locking and unlocking the vehicle, and some of these features did not function without remotely functioning keys. However, he failed to specify which features did not function. He also provided no independent or expert evidence to support either of these allegations, so I find they are unproven. I find Mr. White has failed to prove that the vehicle was not safe, roadworthy, or durable for a reasonable amount of time after he purchased it.

29.   Finally, I address whether PSM failed to disclose a known latent defect. A latent defect is one that is not obvious and cannot be discovered by a reasonable inspection. A seller who is aware of a latent defect and fails to disclose it or actively conceals it may be liable for damages.

30.   Mr. White says that each time he tested the vehicle before purchasing it, the driver’s door was already open, the key was in the ignition, and in some cases the engine was already running. He says he had no reason to suspect any deficiency with the keys. PSM denies that the vehicle was ever running before Mr. White test drove it, but I find nothing turns on this. This is because, based on the evidence before me, I find the defect with the keys’ remotes was obvious and could have been discovered by a reasonable inspection. I find Mr. White has failed to prove there was any latent defect with the 2 keys.

31.   In conclusion, I find Mr. White has failed to establish any of the legal exceptions to the general legal principle of “buyer beware” for used vehicle sales. So, I find he is not entitled to the cost of replacing the electronic keys. I dismiss Mr. White’s claim.

32.   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. Since Mr. White was unsuccessful, I find he is not entitled to reimbursement of his CRT fees or the $47.25 he claims for dispute-related expenses for corporate searches. PSM did not pay any CRT fees or claim any dispute-related expenses.

ORDER

33.   I dismiss Mr. White’s claims and this dispute.