Between the manufacturer agreement, the finance house and the customer, I am not sure which contract governs a bad sale.
Automotive businesses sit between several counterparties with very different bargaining power: manufacturers, finance providers, fleet customers and consumers. We own the contract layer across all of them, and the disputes that arrive when a vehicle, a warranty or a payment goes wrong. What makes the sector unusual is that almost none of the important paper is yours. The franchise agreement is the manufacturer's, the finance documentation is the lender's, the fleet contract is the customer's, and the consumer position is set by statute. The value is in knowing precisely what each of those documents does to you, and acting before the document does it.
Dinmore Bell acts as the outsourced General Counsel for automotive businesses: dealer and franchise agreements, fleet and lease contracts, warranty and service terms, supplier arrangements and the disputes arising from them. It is a retained function on a fixed monthly fee, sitting inside the business rather than billing by the hour.
How we own it
The manufacturer agreement, read properly
Dealer and franchise agreements are drafted for the manufacturer and rarely negotiated. They are still worth reading closely: the termination provisions, the standards regime and the post-termination obligations decide what your business is worth on the day it ends. Three parts of that document carry most of the value. The first is the notice regime, because the length of notice on a no-fault termination is effectively the period over which you can realise the value of the site, the stock and the staff. The second is the standards and imagery regime, which is where a manufacturer that wants a dealer out usually starts: a programme of required investment, a scorecard, and a series of remediation notices that build a documented record long before termination is mentioned. The third is what happens to stock, tooling, demonstrators, parts and warranty claims in progress once the agreement ends, and whether the manufacturer has an option or an obligation to buy them back, at what price and on whose valuation. We read the agreement when there is nothing wrong, which is the only time the reading is useful. That produces a short list of the dates, thresholds and notice periods that matter, held somewhere other than the general manager's memory, and a settled position on which investment requests are contractual obligations and which are requests dressed as obligations.
Fleet and lease terms that price the risk
Condition standards, excess mileage, maintenance obligations and end-of-contract charges are where fleet contracts are won and lost. We write them so the expected argument at return is one you have already answered. The pattern is consistent across the sector. The rate is negotiated carefully and the return condition standard is attached as a schedule that nobody reads, often incorporating an industry fair wear and tear guide by reference without saying which edition. Three years later the vehicles come back, the charges are raised, and the customer's position is that the standard was never agreed in the form now being applied. The dispute is not really about the damage. It is about whether the measuring stick was ever fixed. So the drafting job is to fix it: name the guide and the edition, define who inspects and when, set out the photographic record required at delivery and at return, and provide a short escalation route for disputed items that does not begin with a solicitor's letter. We also look hard at the interaction between maintenance obligations and charging, because a customer who was contractually required to service the vehicle at your network, and did not, is in a very different position from one who serviced it elsewhere because the contract allowed it.
Warranty, defect and the awkward vehicle
A clear position on rejection, repair and replacement, and a process for the small number of vehicles that generate most of the cost, so the decision is made on the facts rather than on how loud the customer is. Consumer vehicle sales are governed by statute rather than by your terms, and the short rejection window in the first thirty days behaves very differently from the position after it. Most of the cost in a dealership's warranty book comes from a handful of vehicles where the first response was improvised. A customer told informally that a fault would be looked at, then told something different by a second person, has been given the makings of a complaint about the handling rather than the fault. What works is a written internal position: who decides, what evidence is gathered before a decision, what is offered at each stage, and at what point the matter is escalated. That position also has to reconcile three sets of obligations that do not automatically agree, being the statutory consumer position, the manufacturer's warranty terms, and any third party warranty or service plan sold alongside the vehicle. Where a finance agreement sits behind the sale, the funder is a party to the dispute whether or not anyone has told them, and the claim will often be brought against them rather than against you.
Introductions, finance and the regulatory perimeter
Almost every retail automotive business touches regulated activity, usually through credit introductions and insurance-based add-ons, and the commercial arrangements around those are contracts like any other. The paper that matters here is the agreement with the lender or the insurer: what you are appointed to do, what you warrant about how it is done, the indemnity you give, the audit and file review rights, and the clawback provisions on commission. Clawback is the part with the sharpest edge, because it often survives termination and can reach transactions written years earlier. Dinmore Bell holds those agreements, the record of what each one permits, and the training and process obligations they impose. Authorisation itself, the regulatory advice on the perimeter, and any dealing with the regulator sit with your compliance adviser or a specialist firm, and we coordinate that rather than duplicate it. What we own is making sure the commercial terms you have signed, the process the business actually runs, and the record you would have to produce in a file review are the same three things.
How the function runs
One retained function, a fixed monthly fee, and a single register of every contract, renewal date, break and notice period across the business. The point of holding it centrally is not tidiness. It is that almost every expensive event in an automotive business was visible in a document months before it happened. In practice that means the franchise agreement dates are diaried, the fleet return standards are fixed before the vehicles go out, the lender agreements and their clawback terms are known, the trade purchase terms protect title, and the disputes that do arrive are answered from a file rather than from memory. Specialist work is coordinated rather than absorbed: advocacy, regulatory advice, tax computation and insurance placement all stay with the people who do them.
Where specialists come in
We do not conduct regulated consumer credit or insurance mediation activities, and we do not advise on FCA authorisation or permissions — those are matters for appropriately authorised advisers, whom we instruct and coordinate. Trading Standards enforcement, prosecutions and any matter before a court are conducted by regulated specialists. We hold the budget and remain accountable for the commercial outcome.
Services we run here
- Can a manufacturer terminate a dealer agreement without cause?
- Most franchise agreements include a no-fault termination right exercisable on notice, and the notice period is the commercially important term rather than the right itself. What matters is how long you have, what happens to stock, tooling and warranty work in progress, and whether any investment you were required to make is compensated. Those answers are in the agreement and are worth knowing before the letter arrives.
- Who is liable when a vehicle is rejected under consumer law, the dealer or the finance company?
- Where the vehicle was supplied under a regulated finance agreement, the customer's claim is usually brought against the finance company as supplier, and the finance company then looks to the dealer under the terms of its own agreement with you. That is why the indemnity and recourse provisions in the lender agreement matter as much as your customer-facing terms.
- What should a fleet return condition standard actually say?
- It should name the fair wear and tear guide and the edition being applied, define who inspects the vehicle and when, require a photographic record at delivery and at return, set out how charges are calculated, and give a short route for disputing individual items. Incorporating a guide by reference without naming the edition is the most common weakness.
- We took a vehicle in part exchange with finance still outstanding. Where do we stand?
- The finance company retains an interest in the vehicle and may be able to recover it from you or from the customer you sold it to. The practical questions are what checks were recorded before you took the vehicle in, and what warranties and indemnities you hold from the person who supplied it. Both determine whether the loss stays with you or moves up the chain.
- Does an outsourced General Counsel replace our compliance adviser?
- No. Dinmore Bell owns the commercial and contractual layer: the lender and insurer agreements, the process obligations they impose, and the record the business keeps. Regulatory authorisation, permissions advice and dealings with the regulator remain with your compliance adviser or a specialist firm, coordinated so that what you have signed and what you do are the same thing.
- How do you charge for an automotive retainer?
- A fixed monthly fee, scoped after a first conversation about the size of the contract estate, the number of sites and franchises, and the volume of disputes the business is currently carrying. The fee covers the retained function rather than a number of hours, and specialist work that has to be bought in is agreed separately before it is instructed.