Purpose Automobiles Pte Ltd v Wong Li Yan, Virginia and another

Purpose Automobiles Pte Ltd, a dealer in luxury cars, bought a Lamborghini Urus from Wong Li Yan, Virginia, the first defendant, for $908,000 under an agreement dated 13 April 2023 that stated the car's current mileage as 9,000 km. The agreement said nothing about the car's warranty. In June 2023 a prospective buyer offered $965,000, subject to inspection at Lamborghini's authorised dealer. On 20 June 2023 the dealer reported that mileage recorded in the car's electronic components was 9,074 km higher than the odometer showed, and that the manufacturer's warranty would be voided where the odometer had been altered. The claimant said the sale then fell through, and it sold the car for $800,000 in August 2023, receiving $19,500 in financing commission.

In District Court Originating Claim No 1300 of 2023, consent interlocutory judgment was entered against the first defendant on 2 February 2024 for breach of s 13(1) of the Sale of Goods Act 1978, with damages to be assessed. The claim against her husband, the second defendant, was held in abeyance. In this assessment, the claimant sought $145,500 for its lost profit or, alternatively, $88,500, plus financing costs and road tax.

1. Whether the breach of the mileage term caused the loss of the sale at $965,000, and whether that loss was too remote.
2. Whether the breach caused the eventual sale price of $800,000 and the extra financing and road tax costs.
3. What loss in value flowed from the car's higher mileage, and how the expert evidence should be weighed.

The court held that the claimant's evidence about the prospective buyer was hearsay, as neither the buyer nor his agent testified. In any event, on the claimant's own case the buyer withdrew because the warranty was voided, not because of the mileage itself. The warranty was voided because the manufacturer concluded from the discrepancy that the odometer had been altered. That loss was not caused by the breach of the mileage term and was too remote, since voiding of the warranty was not within the parties' reasonable contemplation. There was no evidence of what caused the discrepancy or that the first defendant had tampered with the odometer.

The $800,000 price also reflected the voided warranty, and both experts valued a car with this mileage and a subsisting warranty above that figure, so the alternative claim failed. The financing and road tax costs depended on the lost sale and also failed.

On the loss in value from mileage alone, the court substantially discounted the claimant's expert, who had not disclosed that his company financed the claimant's purchase of the car, and whose figures shifted repeatedly and lacked support. The first defendant's expert, a long-time dealer in luxury vehicles, gave consistent evidence supported by market advertisements that the Urus is designed for daily use and that the mileage difference was worth about $20,000. The court preferred his evidence.

The District Court allowed the claim in part, assessing damages for breach of the mileage term at $20,000 and ordering the first defendant to pay that sum with interest at 5.33% from the date of judgment. The other heads of claim were disallowed, with costs submissions directed if costs could not be agreed.