Under pressure from regional head office Ferrari Australasia to shift a prescribed quota of vehicles, Auckland dealer Continental Car Services took a punt that it could make a quick sale on a 6.3 litre Ferrari F12 sourced from Malaysia. It all turned to custard. Continental sold a car it didn’t have and failed to get, having to pay $130,000 damages to a disappointed customer. As a final ignominy, the coveted F12 wound up on a Christchurch dealer’s lot sitting unsold nearly two years later.
Disappointed buyer Martyn Thompson is a Ferrari aficionado. In 2016, he was in discussions with Continental Car about trading in his Ferrari 458 Spider for a F12 Berlinetta. The High Court was to learn that Continental Car was having trouble shifting high-end Ferraris. ‘Grey market’ vehicles imported privately into New Zealand were undercutting the maximum retail prices Ferrari Australasia demanded Continental Car charge. Learning that a Ferrari dealer in Malaysia had excess stock, Continental Cars struck a deal with Mr Thompson. He could have a new F12 with agreed modifications. A trade-in price for his Ferrari Spider was agreed. Mr Thompson paid a deposit of $5000. When he asked for further photos of his new purchase, Mr Thompson was told the car was ‘on the water’ en route to New Zealand. Weeks later Continental Cars fessed up; there was no car. Continental Cars said communication issues and exchange rate fluctuations made the deal uneconomic. In the High Court, one witness speculated Continental was working on very tight margins in order to make a sale in a competitive environment and had simply miscalculated. Justice Churchman ruled there was no evidence of either ‘communication issues’ or adverse exchange rate movements around the time of the sale. Continental was in breach of contract. It was ordered to pay $130,000: the difference between market value of the promised Ferrari F12 and the agreed contract price. The High Court faced some difficulty in determining the value of a new F12. The court was told few, if any, are sold at listed retail price. ‘Factory support’ in the form of inflated trade-in values, extended warranties and ‘free’ modifications serve to reduce the effective list price of new cars. The court was told the F12 Mr Thompson had agreed to buy in 2016 for $480,000 was sitting in Christchurch car yard in June 2018 listed at $529,990.
Thompson v. Continental Car Services Ltd – High Court (22.06.18)
18.127