Lauren is searching to buy a car. She finds two cars that shes very interested in. The
Question:
Lauren is searching to buy a car. She finds two cars that she’s very interested in. The first car is 2021 Range Rover, which she found on Kijiji and it was advertised as follows:
Randy: “2021 white Range Rover Sport, red interior seats, fully loaded with all the features, runs well, 20000kms. $40,000.” The second car was on the Lux Used Vehicles car dealership website, and it was advertised as follows:
“Accident free 2020 Range Rover Sport, black exterior, beige interior, fully loaded and only 40000km. $110,000 or finance at 4.99%.” Lauren is surprised that the Ranger Rover on Kijiji is priced at almost 1/3 of the price of Lux’s, despite it having similar (if not better) specifications. She responds to the ad and their interaction are as follows:
Lauren: Hello Randy, I just saw the ad for your car, and I’m surprised by how cheap it is! Is there anything else I should know about the car? Has it been in any accidents? Does it have any engine problems ? Can I come by this Friday, November 26th to see it?
Randy: Hey Lauren, thanks for your interest! The car is accident free and no engine problems. I have a lot of interested buyers so I want to make sure you’re not wasting my time. I can hold It till November 26th only if you’re willing to put a $1000 deposit down. My e-transfer is: Randythehandyman”
Lauren: No problem! I’m genuinely interested, I’ll send you the deposit right now. Lauren sends Randy the deposit. Lauren then proceeds to call Lux Used Vehicles to schedule a test drive and she was able to schedule an appointment for the following day. She goes to test drive the car and although it was beautiful, $110,000 is a little out of her budget and she was unable to qualify for financing, even with a $40,000 down deposit. The dealership tells her that they offer “private” financing, and they’ll lend her the remaining $70,000 at an interest rate of 80.49%. The rate is extremely high, but the dealer agrees that there will be no credit checks and if she accepts, she’ll be automatically approved. She tells them she’ll think about it. On November 26th, Lauren goes to test drive Randy’s car. Although the car ran well, the kms were actually 200000kms and not 20000kms as advertised. Lauren demands her deposit back and Randy refuses insisting that this was an “innocent typo, and any reasonable person should have known that you can’t buy a 2021 Range Rover Sport with 20000kms for only $40,000. The $1000 is for Lauren wasting his time!”.
Lauren leaves feeling defeated and goes back to Lux Used Vehicles and signs the private financing agreement for the 2020 Range Rover. She puts down a non-refundable $40,000 deposit and agrees to pick it up in two days. In the two days that the Range Rover was at the dealership, one of the employees takes the car out for a joyride. The employee crashes the car, and he doesn’t have car insurance.
Q1: Can Randy keep the $1000 deposit? Why or why not?
Q2: Is the private financing agreement a valid contract? Why or why not?
Q3: Who should pay for the damage of the car? Why?
Q4: If the car only had minor damages and it was able to be fixed, can Lauren rescind the contract?
