Darren Egan v Motor Services (Bath) Ltd (2007)

This case, heard in the Appeal Court, concerned Mr Egan's purchase of a new Audi TT 3.2 litre V6 from Motor Services (Bath) Ltd.  Mr Egan agreed to buy the car for £32,300 in July 2003 and took delivery on 5 March 2004.  He complained that the steering was unsatisfactory and after numerous tests, adjustments and the like, the dealer said that there was nothing wrong with the car.  He maintained that the steering was defective and requested that the dealer should take the car back, which they refused to do on the grounds that there was nothing wrong with it.

The dispute escalated to the Bristol County Court in April 2005, where Mr Egan claimed approximately £35,000 for the value of the car plus incidental expenses, alleging breach of the implied term of the Sale of Goods Act 1979 that the car should be of satisfactory quality.  The County Court found in favour of Motor Services and Mr Egan appealed.

In between the County Court hearing and the Court of Appeal, the car was sold by Mr Egan such that the difference between his initial claim of £35,000 and the second hand value realised was about £6,000.  At appeal, Mr Egan's claim was dismissed and the Court was made aware that the costs of the case exceeded £100,000.

Lord Justice Ward commented :-

"What I have found profoundly unsatisfactory, and made my views clear in the course of argument, is the fact that the parties have between them spent in the region of £100,000 arguing over a claim which is worth about £6,000.  In the florid language of the argument, I regarded them, one or other, if not both, of them, as "completely cuckoo" to have engaged in such expensive litigation with so little at stake.  ...............................................

"This case cries out for mediation", should be the advice given to both the claimant and the defendant.  Why?  Because it is perfectly obvious what can happen.  Feelings are running high, early positions are taken, positions become entrenched, the litigation bandwagon will roll on, experts are inevitably involved, and, before one knows it, there will be two/three day trial and even, heaven help them, an appeal.  It is on the cards a wholly disproportionate sum, £100,000, will be to fight over a tiny claim, £6,000.  And what benefit can mediation bring?  It brings an air of reality to negotiations that, I accept, may well have taken place in this case, though, for obvious reasons, we have not sought to enquire further into that at this stage.  Mediation can do more for the parties than negotiation. 

In this case the sheer commercial folly could have been amply demonstrated to both parties sitting at the same table but hearing it come from somebody who is independent.  At the time this dispute crystallised, the car was practically brand new.  It would not have been vastly different from any demonstration car.  The commercial possibilities are endless for finding an acceptable solution which would enable the parties to emerge, one with some satisfaction, perhaps a replacement vehicle and the other with its and Audi's good name intact and probably enhanced, but perhaps with each of them just a little less wealthy.  The cost of such a mediation would be paltry by comparison with the costs that would mount from the moment of the issue of the claim.  In so many cases, and this is just another example of one, the best time to mediate is before the litigation begins.  It is not a sign of weakness to suggest it.  It is the hallmark of commonsense.  Mediation is a perfectly proper adjunct to litigation.  The skills are now well developed.  The results are astonishingly good.  Try it more often."

For a full copy of the transcript refer to: 



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