The legalities of a purchase order? Are we bound by it?

David See · 20-05-2008, 08:41 AM

Hi all,

Three weeks ago we found a car for the wife. It was a little more than we wanted to spend, but it was a lovely car and she fell in love with it. We were going to trade in her current vehicle, but needed more for the trade so we could pay out the car, so the dealer suggested we try to sell it privately as we should easily get the money we needed.

However we have had no success with selling the car privately so if we were to continue with the original purchase, we are going to have to find about three to four grand to get out of hers and get into the new one. Problem is, my job situation has since changed and we no longer have spare money to throw around to get out of one car and into another. I have never been happy with doing this kind of thing, anyway.

When we first saw the new car, we sent in a purchase order, at the dealer's request, to hold the new car while we tried to sell ours. But I think now, because of our circumstances, we need to get another, cheaper vehicle. Perhaps the same configuration but a few years older.

We have had a look at the dealer overnight and there is another, cheaper, option - (which is probably more practical anyway) - but I was wondering what the legalities of the purchase order is if we decide not to go with the original car, seeing as they have kept it off the market for us for three weeks.

Are we legally bound to the car or can we change our mind due to the changing circumstances?

I am not sure at this stage how the dealer is going to react...I just want to know my obligations/options in case something erupts.

I guess we would still be able to buy off him, but I am concerned that the other vehicle has been of the market because of us submitting the PO.

TIA

DS

hy_boi · 20-05-2008, 08:45 AM

If a purchase order is to become a sign contract it must be stated somewhere in the terms and conditions.

The only way I can see it being binding if it was a "Contract". But if i was him I would've got my kicked for only having you sign a purchase order.

David See · 20-05-2008, 08:49 AM

There were no terms and conditions anywhere. All we did was email a letter on a business letterhead stating "this is an order for xxxx vehicle". Nothing has been signed apart from the letter we emailed to them.

Yellow_Festiva · 20-05-2008, 08:56 AM

To see if your locked in or not all depends on the wording of anything you sent or signed.

But, you dont have spare cash right now, yet want to upgrade the car? Why? What is wrong with the car you have now?

If you have no spare money, get out of the purchase, save up a buffer of cash for a rainy day then start to think about the upgrade.

If you broke your leg or worse next week, the nice upgraded car won't pay for food while you sort yourself out financially.

4Vman · 20-05-2008, 09:01 AM

Explain your situation to them, they might be happy or prepared to let you out if they can on sell the car without grief, at worst they might be entitled to go after you for the difference in sale price from your contract to the next sale if its less...

David See · 20-05-2008, 09:03 AM

Quote:

Originally Posted by Yellow_Festiva

If you have no spare money, get out of the purchase, save up a buffer of cash for a rainy day then start to think about the upgrade.

If you broke your leg or worse next week, the nice upgraded car won't pay for food while you sort yourself out financially.

Not exactly the kind of advice I was after, but thanks anyway, Mum.

bingoTE50 · 20-05-2008, 09:09 AM

No signed contract no sale ...IMO ...
Sounds like you are looking to buy a different model off them .
If you do not tell them that and explain that you cannot afford the car as ordered at the said price ,they may renegotiate the pricing .Really depends on what it is you ordered and how popular it is for them to sell ! You are still in a position of strength as the buyer!

Keepleft · 20-05-2008, 09:13 AM

David,
A little surprised to see you caught up in this, being a media fella . . .

Good luck.

David See · 20-05-2008, 09:14 AM

Quote:

Originally Posted by bingoTE50

No signed contract no sale ...IMO ...
Sounds like you are looking to buy a different model off them .

Well, I thought that might have been an affordable option for us that would at least mean they sold a car.

David See · 20-05-2008, 09:18 AM

Quote:

Originally Posted by Keepleft

David,
A little surprised to see you caught up in this, being a media fella . . .

Good luck.

??? Sorry, don't see what that's got to do with it.

:

But seeing as you remembered I am a media fella, you should also understand why my financial situation has changed in the last two weeks.

bingoTE50 · 20-05-2008, 09:21 AM

Dave you do not owe them a thing .This happens to them all the time .
When I bought my GT I signed a contract "subject to finance" .
They were surprised how easy I got finance , as they said , a very high percentile of punters who go for a GT get knocked back on finance !! Now you can read into that what you will , but the fact is loss sales are experienced daily , and as someone else said they should have locked you in with at least a contract , but even so ,you could have had subject to finance as a disclaimer . I do this every time I buy just in case !!

Rodp · 20-05-2008, 06:27 PM

If there's no signature there's no deal. I think you're fine to negotiate for the cheaper car. Hopefully the salesman is reasonable considering your position and won't try and bully you into believing you have to purchase the more expensive vehicle.

hy_boi · 20-05-2008, 07:51 PM

Since you have done an offer it could be a little different...because it is an offer to purchase, it a legal agreement to purchase the said car for the seller. I'd prob just go talk to them though.

FPV 5TH · 20-05-2008, 08:07 PM

No signed contract No Sale. End of Story

FGII-XR6 · 20-05-2008, 08:16 PM

if it is an official compant PO with and abn it is technically enforcable but there are grey areas if things aren't done correctly . did you request a date of supply ? if not it is implied that you were ordering on the basis of immediate delivery and that time has now passed. did the po have itemised costing ? if not it becomes invalid. did you receive a return invoice detailing all costs ? if not they have not accepted you PO cancel before the invoice and it's unenforcable
the other issue it is normally seen as not worth the effort to go past a nasty letter

good luck

Sourbastard · 20-05-2008, 08:24 PM

No deposit, No signed dealer contract(which is necessary for any dealer purchase as it sets out all the terms and conditions under the varying acts that dealers must comply with). I reckon you will have dodged the bullet, but talk to consumer affairs to confirm the act governing your state and its ramifications for your specific case.

Smoke Pursuit · 20-05-2008, 08:28 PM

If you can commit to the other car straight away there should be no issues... As for the loss on the old car cant you just jack that into the finance on the new one?? I cant see whats wrong with doing that.

Wally · 20-05-2008, 10:45 PM

Gee I wish I could wriggle out of a contract as easy as has been suggested. P.O.s are a legal document and part of contract law.

Why do discussion forums always skew advice to the benefit of a member, even suggesting subdefuge as au3xr6 infers? At the other end of the agreement is another person who will be finanacially wronged by David if the deal falls through.

The two of three variables still applies with contracts, the two here are an instument of agreement and intent, consideration may not have been paid, but that wouldn't matter to a smart lawyer.

Unco · 21-05-2008, 12:33 AM

Quote:

Originally Posted by David See

Not exactly the kind of advice I was after, but thanks anyway, Mum.

surely if you have so much cash laying around, your slight change in work circumstances should have minimal effect on your purchase decision. hey, maybe you should go for an FPV instead.

and you're paying cash for this car, right?

this might help you next time... http://en.wikipedia.org/wiki/Purchase_order

as mum said, if you can't afford it, don't buy it.

:

FGII-XR6 · 21-05-2008, 08:00 AM

Quote:

Originally Posted by Wally

even suggesting subdefuge as au3xr6 infers?

I find that offensive i have worked in car sales myself and what i was advising are all legal avenues open to David . I was not advising him how to draught a document in order to be able to get out of the sale I was telling him instances where the PO is not legally binding . In doing this I was only offering up advice on how he stands as he asked which after all is the topic of the thread ( your comment was actually off topic as it was not answering the question) and to suggest subterfuge ( spelt correctly here) is not only offensive but slanderous .

I would watch who I falsely accuse of wrong doing if I were you if you make a practice of this you will find yourself in court so fast your head will spin. An apology is in order here and I will be reporting your slanderous accusation to the admin team

Opinionated fools like you only serve to denigrate this forum. And I for one would prefer to see the number of members reduce than have to put up with idiots like you

Wally · 21-05-2008, 09:00 AM

Quote:

Originally Posted by au3xr6

I find that offensive i have worked in car sales myself and what i was advising are all legal avenues open to David . I was not advising him how to draught a document in order to be able to get out of the sale I was telling him instances where the PO is not legally binding . In doing this I was only offering up advice on how he stands as he asked which after all is the topic of the thread ( your comment was actually off topic as it was not answering the question) and to suggest subterfuge ( spelt correctly here) is not only offensive but slanderous .

I would watch who I falsely accuse of wrong doing if I were you if you make a practice of this you will find yourself in court so fast your head will spin. An apology is in order here and I will be reporting your slanderous accusation to the admin team

Opinionated fools like you only serve to denigrate this forum. And I for one would prefer to see the number of members reduce than have to put up with idiots like you

I can just imagine you sitting at the computer, bolt upright, neck stiff, brow furrowed and typing two fingered at the rates of knots to get you own back. The indignation must have been all pervasive.

Stay with your selling cars and let the legal profession handle the legal advice, they're experienced in these matters. You know what you were trying to advise and so does anyone else reading your post.

David asked, in his OP, if he was legally bound by contract even though his financial position had changed and prima facie the dealer could act to enforce; they probably won't because David seems like a decent sought, but if he goes in trying to be a bush lawyer touting tenuous advice from a discussion board, things could turn nasty for him.

bArNsY · 21-05-2008, 09:15 AM

signatures are not everything, it is my understanding that the car dealer just has to prove that there was a meeting of minds, whether written, verbally ect

Sourbastard · 21-05-2008, 11:01 AM

Wally AU3XR6

Lets ALL just calm down before anyone declares Holy Jihad. This thread is full of enough legality without adding to the tonnage.

rodderz · 21-05-2008, 04:56 PM

Quote:

Originally Posted by au3xr6

I find that offensive i have worked in car sales myself and what i was advising are all legal avenues open to David . I was not advising him how to draught a document in order to be able to get out of the sale I was telling him instances where the PO is not legally binding . In doing this I was only offering up advice on how he stands as he asked which after all is the topic of the thread ( your comment was actually off topic as it was not answering the question) and to suggest subterfuge ( spelt correctly here) is not only offensive but slanderous .

I would watch who I falsely accuse of wrong doing if I were you if you make a practice of this you will find yourself in court so fast your head will spin. An apology is in order here and I will be reporting your slanderous accusation to the admin team

Opinionated fools like you only serve to denigrate this forum. And I for one would prefer to see the number of members reduce than have to put up with idiots like you

Perhaps you should take a leaf out of your own book, by thinking before you post sentences like your last one in the above post, instead of reporting each and every post only you seem to find offensive