A defect in a second-hand car

The car has a defect,

• if it develops premature faults in relation to the car’s age, price and mileage. Many car parts have an indicative expected service life, on the basis of which the prematurity of the fault can be assessed. You can ask professionals in the field for indicative estimates of the service life of car parts.
• if the fault is due to an incorrect repair carried out before the sale.

Read more:
Which party should be contacted about a defect in a second-hand car?
What kind of compensation can I demand for a defect in the car?
Making a complaint and resolving disputes

The car has a defect if it does not correspond to the information given by the vendor. The vendor is liable for the defect even if they themselves did not know that the information was incorrect.

The vendor is liable, for example, for incorrect information contained in the sales advertisement, unless they corrected it before the sale was agreed.

If the incorrect information has no effect on the car’s value or usability, it is not a defect entitling you to compensation.

Examples of situations in which you as the buyer of the car may be entitled to compensation on the basis of incorrect information:

• incorrectly stated model year or year of first registration
• mileage stated as too low
• missing equipment that was stated
• missing operating and maintenance instructions
• incorrect information has been given about the car’s history, or information that would have affected the purchase decision has been omitted. For example, the car has been registered again due to a collision, or the car has been used as a taxi or a rental car.

Read more:

How must the vendor compensate for incorrect information given by them?
Making a complaint and resolving disputes

The car has a defect if it is in worse condition than you can expect on the basis of its age, mileage, price and the information given by the vendor about the car.

The car’s characteristics must also correspond to the characteristics that cars of the same type normally have and that the buyer can generally expect.

The vendor may be released from liability for defects if

• the shortcoming or fault in the car was clearly and specifically disclosed to you before the sale was concluded
• and you accepted the matter before the sale was concluded.

Read more:
Which party should be contacted about a defect in a second-hand car?
What kind of compensation can I demand for a defect in the car?
Making a complaint and resolving disputes

The car has a defect if, during the validity of the warranty, it develops a fault that is covered by the warranty.

A warranty is an additional benefit granted by the vendor or importer that covers certain faults or shortcomings in the car’s functioning.

Read more:
Which party should be contacted about a defect in a second-hand car?
What kind of compensation can I demand for a defect in the car?
Making a complaint and resolving disputes

The car dealership is liable for defects in a second-hand car in accordance with the Consumer Protection Act.

Diagnostics

The vendor has the right to determine the defect and repair the fault.

• If the vendor’s examination confirms that the car is defective, the diagnostics costs shall be borne in full by the vendor.
• If no defect is found in the examination, the vendor may charge you a reasonable fee for the diagnostics if the possible charge was disclosed in advance.
• If the vendor denies liability and refuses to investigate the fault, the burden of proving the defect is on you. Proceed as follows:
• Obtain a fault diagnosis and a repair cost estimate, for example from a repair shop. If the car is found to have a defect, you may demand that the vendor reimburse the diagnostics costs afterwards.
• Once the fault has been determined, contact the vendor again. Make a new complaint to the vendor and try to negotiate repair of the defect or other compensation.

Read more:
What kind of compensation can I demand for a defect in the car?
Making a complaint and resolving disputes

The warranty for a second-hand car may be granted by the manufacturer or importer, or by the vendor. The vendor is liable for a warranty granted by the importer or manufacturer if the vendor has not expressly disclaimed it before the sale was concluded.

You may demand that faults covered by the warranty be investigated and repaired free of charge. The warranty provider has the right to choose the place of repair.

You may have to compensate reasonable costs arising from investigation of the fault if you caused the fault yourself and you should have been aware of this.

The warranty provider does not have to repair the fault if the warranty provider can show that the fault is probably due to a cause on the buyer’s side, such as

• improper use
• external damage or an accident
• neglect of the manufacturer’s maintenance instructions. The neglect must have affected the occurrence of the fault in order for the warranty provider to withdraw from liability.

For example, a clearly overdue engine oil change may be sufficient grounds for rejecting a warranty claim concerning engine damage if the fault was caused by lack of lubrication. It is generally known that the lubricating properties of oil deteriorate rapidly after the service interval has been exceeded.

You may be entitled to partial compensation if the car has, for example, a manufacturing defect, but neglect of maintenance or some other action by the buyer has worsened the fault.

If, according to the car dealership, the warranty does not cover the fault in the car, find out whether the car dealership is liable for the defect on the basis of the Consumer Protection Act. Read more under: Warranty not valid

Read more:
What kind of compensation can I demand for a defect in the car?
Making a complaint and resolving disputes

Car dealerships may offer various kinds of additional cover for second-hand cars. They may be included in the purchase price or sold separately. The additional cover may be based, for example, on an insurance contract.

By law, the vendor is obliged to repair a defect that appears in the car at their own expense on the basis of liability for defects, so you do not need additional cover in order to prepare for defects in the car.

Additional cover is intended for situations where the fault is not one for which the vendor is liable. Before obtaining additional cover, it is worth considering carefully whether it is necessary and examining its scope and terms with care. Also remember to check whether some other insurance you have already covers the same risks.

In the sale of a second-hand car, the buyer’s rights and the vendor’s liability are different from those when the car is purchased from a business.

• The Consumer Protection Act does not apply to a sale between private individuals; instead, the Sale of Goods Act and its provisions on defects apply, unless the parties have agreed otherwise.
• Consumer authorities do not have jurisdiction in car sales between private individuals, so Consumer Advisory Services or the Consumer Disputes Board do not handle matters related to car sales between private individuals.

If you believe that the second-hand car you purchased from a private individual has a defect, you can proceed as follows:

• Contact the vendor or the warranty provider.
• If the warranty for the car purchased from a private individual is valid, you can contact the party that granted the warranty, which is liable for faults in the car in accordance with the warranty. The warranty is usually granted by the importer or manufacturer. Read more:
  What kind of compensation can I demand for a defect in the car?
  Making a complaint and resolving disputes
• If the warranty is not valid, contact the car’s vendor and try to find, through negotiation, a solution that satisfies both parties. If you are unable to reach a settlement, you may also take the disagreement to court for resolution. Please note that court proceedings involve a cost risk. The losing party is usually required to reimburse the winning party’s legal costs in whole or in part.

If you justifiably need a car during the repair of the defect,

• first find out from the vendor whether you can get a replacement car free of charge
• if the vendor does not provide you with a replacement car, you may demand compensation from the vendor for necessary car rental costs.

Read more: Damage compensation related to the defect of a second-hand car

The vendor must repair the defect in the car at their own expense. The vendor cannot require you to participate in the repair costs even if the car’s condition improves as a result of the repair.

The vendor may choose an appropriate method of repair and may, for example, use used or factory-reconditioned parts in the repair. The part to be fitted must be at least of such condition and remaining service life as the broken part would have had without the defect.

If used or factory-reconditioned parts are not available within a reasonable time, the repair must be carried out using new parts. Even in this case, the vendor cannot require you to participate in the repair costs.

Read more: Making a complaint and resolving disputes

The vendor may refuse to repair the defect only if this would cause the vendor unreasonable costs or if there is an insurmountable obstacle to the repair.

Unreasonableness is assessed on a case-by-case basis. In the assessment, account is taken of, for example,

• the amount of the repair costs
• the car’s purchase price
• the significance of the defect for the use of the vehicle
• how much time has passed since the sale was concluded.

The costs may be unreasonable for the vendor, for example, when the repair would be very expensive in relation to the value of the car or if the repair costs of a minor defect would be very high.

If the vendor is entitled to refuse repair due to unreasonable costs, you have other rights:

• You may demand a price reduction or damage compensation. This does not usually correspond to the full price of the repair, but only to a proportion of it that can be considered reasonable. The amount of reasonable compensation is assessed on a case-by-case basis.
• You may demand cancellation of the sale if the defect is more than minor. This requirement is usually met when the vendor is entitled to refuse repair of the defect due to unreasonable repair costs and the defect is not insignificant in terms of the car’s use or value.

In addition, if you wish, you may agree with the vendor on the repair, for example so that you participate in part of the costs. However, you have no obligation to do so.

Read more:

Other forms of compensation
Damage compensation related to the defect of a second-hand car
Making a complaint and resolving disputes

The vendor may compensate for an information defect by bringing the car into conformity with the information given, by granting a price reduction or by cancelling the sale.

• Rectification of the defect: for example, the vendor may install the missing equipment in the car at their own expense.
• Price reduction: If the defect cannot be rectified by repair or if the cost of rectification would be unreasonably high for the vendor, you may demand a price reduction corresponding to the defect. Such defects may include, for example, mileage stated as too low or a missing service book. Read more about price reductions.
• Cancellation of the sale: If the incorrect information is of more than minor significance, you may demand cancellation of the sale instead of a price reduction.

Read more:

Other forms of compensation
Making a complaint and resolving disputes

If you have not given the vendor the opportunity to repair the car, you may lose the right to full compensation even if the fault in your car is a defect for which the vendor is liable.

Even if you have not notified the vendor of the defect and have not given an opportunity to repair the car, you may demand that the vendor reimburse the costs as follows:

• You may demand that the vendor reimburse the costs that would in any event have arisen for the vendor from repairing the defect.
  OR
• You may demand that the vendor reimburse the repair costs in full if
  • you have not been able to contact the vendor or
  • the repair could not be postponed without unreasonable inconvenience, for example because the defect had to be repaired urgently during a trip in another locality.

Read more:
Damage compensation related to the defect of a second-hand car
Making a complaint and resolving disputes

A price reduction means that the vendor returns to you part of the purchase price you paid for the car.

A price reduction typically comes into consideration when the car has some defect that can be regarded as minor and that does not affect the car’s usability or safety. In these situations, cancellation of the sale is not possible. Such defects may include, for example, various surface defects and other cosmetic defects that do not affect use, functional defects in comfort equipment or the absence of such equipment.

When assessing whether the defect is minor, account is taken of its significance for the overall usability of the car. If the defect impairs the car’s safety, it is never minor.

The amount of the price reduction is assessed on a case-by-case basis, taking into account, for example, the effect of the defect on the car’s value and use and the estimated or actual repair costs.

If the vendor had the right to refuse to repair the defect on the basis of unreasonable repair costs, the price reduction is usually smaller than it would be if the vendor ought to have repaired the defect at their own expense.

Read more:

Damage compensation related to the defect of a second-hand car
Making a complaint and resolving disputes

If the vendor has not repaired the defect and the defect is not minor, you may demand cancellation of the sale instead of a price reduction.

Cancellation of the sale is usually no longer possible after the car has been repaired by the vendor, even if the repair did not take place within a reasonable time.

When the sale is cancelled:

• You must return the car to the vendor.
• The vendor must return the purchase price to you, to which the vendor must add interest.
• The vendor must reimburse you for the costs of returning the car.
• The vendor may deduct from the purchase price to be returned the usage benefit you obtained from the car, the amount of which is determined on the basis of the car’s purchase price and the kilometres you drove. Compensation for usage benefit can never exceed the car’s actual depreciation in value.
• In connection with cancellation of the sale, the vendor must compensate for new parts installed in the car during your period of ownership, because they remain for the vendor’s benefit.

Read more:

Damage compensation related to the defect of a second-hand car
Making a complaint and resolving disputes

If the defect in the car has caused you loss, you may demand compensation from the vendor.

You may receive compensation for, for example,

• travel, postal and telephone costs caused by the defect
• necessary costs of investigating the defect, for example costs arising from diagnostics or from determining the cause of the fault
• costs caused to you by having the defect repaired, if the vendor has refused to carry out the repair. The amount of damage compensation is affected by whether the vendor had the right to refuse to repair the defect or not. If the vendor would not have been entitled to refuse to repair the defect, you may in principle demand that the vendor reimburse the repair costs caused to you in full.

There must be a receipt or other reliable account of the costs. Both parties must act so that the costs caused by the losses remain as low as possible.

Distress and the inconvenience caused by the defect are not compensable losses.

Read more: Making a complaint and resolving disputes

If the vendor’s business (or another responsible party) has acted negligently, you may demand compensation for indirect losses.

Indirect losses include, for example,

• substantial loss of use of the car due to a prolonged repair, even if no costs have been caused by it
• loss of income if you have to be absent from work without pay because of dealing with the matter.

A technical fault appearing in the car cannot usually be regarded as a consequence of negligence by the vendor or the warranty provider, and compensation cannot be demanded for losses caused by it.

Read more: Making a complaint and resolving disputes