Judge slams No Deposit Cars, cancels ‘fraudulent’ contract

No Deposit Cars adopted fraudulent commercial practices when selling a second-hand car, a judge has ruled annulling a hire purchase contract entered into with a client.  

Judge Toni Abela said No Deposit Cars, owned by alleged kidnapper Christian Borg, is making customers sign contracts with unfavourable conditions.

In a scathing ruling, the judge said the company’s contracts were not premised on good faith and included a clause that prevented clients from making complaints on latent defects.

“The principle of good faith is a basic element, even when buying something second-hand. The practices adopted by the company amount to misleading commercial practices because it was using deceptive methods to cheat ordinary consumers… in civil law, bad faith is the equivalent of fraud,” the judge ruled.

The judge was presiding over a case filed by No Deposit Cars against its client Mark Cauchi who had purchased a Citroen C3 on hire purchase. Lawyer Noel Cutajar represented Cauchi.

The client returned the car after a few months and asked for it to be repaired after it developed problems. But when his request was not entertained Cauchi stopped making monthly repayments.

The company sold the car again to a third party, who also returned it back because of defects that emerged. The judge expressed hope the car will remain in the company’s warehouse.

A court-appointed expert had deemed the car not to be roadworthy, noting that the latent defects it had could not have been noticed by an ordinary individual.

No Deposit Cars had asked the court to order Cauchi to pay it the outstanding balance due to it on the car, which was initially calculated at €17,800. The balance was subsequently reduced to €12,000.

However, Mr Justice Abela threw out the company’s request and ruled the company acted in a fraudulent manner when drawing up the contract. “As a result of this judgment the bills of exchange have lost all strength at law,” the judge ruled, effectively cancelling the contract and any money owed.

Christian Borg, owner of No Deposit Cars (Photo: Facebook)

No Deposit Cars has been in the news over its dubious business practices. The company sells second-hand cars without asking clients to fork out a deposit. However, their contracts stipulate that the company has the right to take possession of the sold vehicle if the individual misses one payment.

Several customers have come forward complaining on the inferior quality of the cars sold to them.

Customers took the company to court earlier this year for a series of complaints, including unfair terms in the hire purchase contracts and the inclusion of GPS tracking devices in the vehicles.

Last month, Magistrate Elaine Rizzo ordered a magisterial inquiry into accusations of serious crimes, including kidnapping, money laundering, theft and stalking involving persons connected to No Deposit Cars Ltd.

The magisterial inquiry will investigate the company and its representatives Christian Borg, Joe Camenzuli, Luke Milton, Thorne Mangion, James Spiteri and Tyson Grech.

In a separate case, Borg, Grech, Milton and Mangion, along with two other associates, Jeremy Borg and Burton Azzopardi, are facing charges of abducting a panel beater and severely beating him in 2022. All five have denied the charges.

READ ALSO: Rabat abduction: who are the men behind a car hire business empire?