Whose responsibility it is to pay for/have a faulty unit replaced?

• Thursday, 14 January 2010
• Kathleen Retourne
• 0 Comments

We have a problem with a faulty exchange heater/water system. The problem was notified to the site owners and lodge manufacturers shortly after taking occupation of the unit, but it took them six months before they reacted, despite reminders.
However, what seems to be muddying the water now is that it was an insurance replacement unit. Our original unit was destroyed in the floods of 2007 (there was never any problem with the exchange heater in the original unit). Nobody wants to accept responsibility for the cost of replacing the exchange heater, which has malfunctioned intermittently and despite many visits by the boilermakers we still have a problem, over 12 months after the first notification.
We are being told that as it is now out of warranty, we will have to pay £120 per service visit. Can you tell me whose responsibility it is to pay for/have the faulty unit replaced?
I have been to Citizen Advice Bureau but they are uncertain who I should be pressing to deal with the matter.
I have held back some money from the site owners, relating to the cost of ‘extras’ we ordered. If you indicate it is they who should be rectifying this, can I deduct the cost of replacing the system from what I owe them (having given notice of my intention to do so)?
Finally, when we come to sell the unit, if we go through the site owners, do we have to pay VAT to them? If so, why? If we sell it ourselves, I am assuming we would not have to charge any VAT to any purchaser?

Graham advises
You say there was never a problem with the exchange heater in the original unit so as I understand you now have a replacement as a result of a claim on your insurance policy and it is this replacement which is not functioning properly.
It seems to me that the home manufacturer and the site owner's responsibilities ended when the original unit (which apparently worked satisfactorily) was replaced by the insurance company. In my view, you are in a straightforward buyer/seller position with the responsibility for the defective replacement unit falling on the shoulders of the manufacturer provided the fault was not rendered so buy the installer.
So far as the warranty is concerned, provided you registered the continuing fault with the manufacturer in writing on the first event and have sufficient copy correspondence to show the same faults are continuing, your argument will be with the manufacturers. Here, I put aside the technicalities of contract law and focus on the common sense approach. I suggest that you have an independent contractor assess the problem whether that involves another replacement with the same manufacturer (or other) or not. Armed with the report you should write with a copy of the report to the unhelpful manufacturer telling them that unless they address the defective unit, you will have the unit replaced by others and you will then proceed to claim the cost via the Small Claims Court from them. The secret of a successful claim is a good evidence trial (i.e. correspondence).
In my view it is a manufacturer issue not a site owner. The other issues are between you and the owner.
I get no sense by your address as to the nature of your site other than that it is a holiday site. In terms of VAT, much will depend upon the wording of your contract with the owner of the site. This being the case, you will need to contact Her Majesty's Revenue and Customs. VAT on holiday caravans is a complicated issue dependent upon the status of the site, I suggest you contact HMRC and obtain VAT notice 701/20. Or you can download it from the HMRC website.