Everything You Need to Know About Arbitration

At Winfooz, our goal is to become a zero arbitration company; however, that’s not always possible. Sometimes people will find an issue or a fault with a purchased vehicle and would like to have the problem resolved.

Our arbitration policy is based on the NAAA standards, with the intention of being fair, impartial and quick. We feel that it is part of our duty to ensure customer issues are dealt with in a timely manner to avoid being held up in the court system.Customer service is essential to us and coming up with a resolution that is fair on both the buying and selling party is something that we feel is very important. That’s why in this article we will be discussing arbitration, to shed some light on the process and to give you all the information you need to know.

What is arbitration?

Image result for auto arbitration

In essence, arbitration is a form of alternative dispute resolution that’s created to resolve disputes outside of the court’s system.

Arbitration is the process of bringing a business dispute before an impartial third party for a speedy resolution. From our perspective, we would hear the evidence brought to us by both parties, gather evidence from third-party contractors and make a decision based on facts. Arbitration aims to conduct a fair, impartial screening and resolution of unforeseen issues. An arbitration award is legally binding on both sides and is also enforceable in the courts. It’s often used for the resolution of commercial disputes, but at Winfooz it’s how we take care of customer disputes transparently and quickly to resolve issues in a way that works for all parties.

Arbitration is frequently confused with mediation, which is an informal process of bringing in a third-party to settle a dispute. A mediation process is not legally binding, and a mediator does not hear evidence. Litigation, mediation and arbitration are all methods used when attempting to resolve business disputes. However, arbitration is more thorough than mediation and less costly and time-consuming than litigation.

We as an arbitrator can use meditative techniques, especially if both parties are cooperative and willing to work towards a resolution. Mediations are less formal, allowing for clients to feel more comfortable and willing to share information. With mediation you can be more creative when coming up with “outside the box” resolutions whereas arbitration is more formal and has rules and standards to adhere by. One can also use hybrid technique called MED-ARB which is a form of arbitration in which the arbitrator starts as a mediator, but in the event of a failure of mediation, the arbitrator imposes a binding decision.

The purpose of arbitration

It’s important to note that only issues where there is a valid potential claim will be considered under arbitration proceedings. Arbitration is not a way in which a dealer can try to claim a discount or back out of a deal after the fact. It exists to support customer claims and resolve potential issues without the added time, cost and stress of a judicial hearing.

It is often used in place of litigation proceedings to settle a dispute. Litigation is a court-based process that involves a decision that is binding on both parties and a means of appealing the decision.

As an arbiter, we try to help the parties find a middle ground on which to compromise. We remain removed from the settlement process and will only give a determination of liability and, if appropriate, an indication of the quantum of damages payable.

About our policy

As mentioned at the beginning of this article, our arbitration policy is based on the NAAA standards and is also compliant with the Motor Vehicle Dealers Act, 2002.

Sales made on our platform are intended to promote the fair and reasonable treatment of both the Buyer and the Seller. If we determine through proceedings that a sale is not fair, or reasonable, or that a clerical error has occurred, we may, at our sole discretion, cancel or adjust a sale. It’s important to note that any arbitration conducted is also subject to our terms and conditions.

We aim to be a zero or minimal arbitration company. Therefore a seller is responsible for ensuring all facts relating to vehicle history and condition is listed on our marketplace. We also prepare our Condition Reports to provide our customers with a summary of the general features and status of a vehicle offered for sale. While we try to ensure our reports are as accurate as possible (which we do through our team of expert Vehicle Condition Inspectors), it is still a sellers responsibility to ensure that all vehicles listed for sale are accurately described and that all required disclosures have been made.

You will find in our platform that we also provide an optional CarFax Report integration for Sellers. We also ask Sellers the question: Is there a Carproof claim on the vehicle?” If Seller indicates Yes they must disclose the amount for claims over $3000.

If at this point you would like to read our full arbitration policy, you can find it here.

Grounds for arbitration

Image result for slightly damaged car

To aid our dealers we operate a coloured light system to give bidders more visual information about the conditions under which a vehicle has been listed. The lights mean:

  • Green – Arbitration is allowed on all issues subject to Arbitration
  • Yellow – The Seller has made Disclosure(s) regarding the Vehicle. Arbitration is not available for Vehicle conditions that have been disclosed.
  • Red – The Vehicle is being sold “AS IS”. Arbitration is limited
  • White – Any of the following disclosures or conditions apply: 1) The Vehicle is being sold as ownership/registration documents absent on sale day 2) Out of Province 3) Daily Rental

Under each light condition, any vehicle that sells for less than $3,000, arbitration is limited to the odometer (Odo Rollback, Odo Replaces, TKU), title issues, branding issue and existing structural damage caused by a collision. So what does that all mean under our light condition system?

  • Green – Arbitration allowed on all matters normally subject to arbitration.
  • Green & Yellow – Green Light Sale with Disclosure(s). Arbitration allowed on all matters normally subject to arbitration except for disclosed conditions.
  • Red – Red Light Sale. The vehicle is sold AS IS. No specific disclosures have been made. Arbitration is limited.
  • White & Yellow – Red Light Sale. The vehicle is sold AS IS. No specific disclosures have been made. Arbitration is limited.

As mentioned previously, white light may be on any of the above light combinations, this indicated that the:

  1. Ownership/registration documents are not available on sale day.
  2. Out of Province Vehicle.
  3. Daily Rental Vehicle.

Under any light, arbitration is limited for Vehicles that sell for less than $3,000.

When arbitration is not available & exceptions

Now that we understand what arbitration is and the grounds where arbitration is possible, it’s important to note the occasions in which arbitration is not possible. These are as follows:

  • Matters that were properly disclosed as Seller Disclosures –
    • Exceptions – None
  • Matters disclosed in a Vehicle History Report, Condition Report or similar source made available to the Buyer before the bidding begins. Note: Arbitration may not be available for conditions disclosed in a Vehicle History Report if contradicted by other more reliable sources.
    • Exceptions – None
  • Vehicles sold for $3,000 or more under a Red Light
    • Exceptions – Odometer (Odo Rollback, Odo Replaced, TKU), Title issues, Branding issues, Existing structural damage caused by a collision.
  • Vehicles sold for less than $3,000
    • Exceptions – Green Light Sale, Odometer (Odo Rollback, Odo Replaced, TKU), Title issues, Branding issues
  • Vehicles with over 160,000 km
    • Exceptions – Green Light Sale, Odometer (Odo Rollback, Odo Replaced, TKU), Title issues, Branding issues, Existing structural damage caused by collision
  • Vehicles older than 10 model years
    • Exceptions – Green Light Sale, Odometer (Odo Rollback, Odo Replaced, TKU), Title issues, Branding issues, Existing structural damage caused by collision
  • Matters raised outside of the applicable Arbitration period
    • Exceptions – At Winfooz Canada Inc. discretion
  • Vehicles not intended for use on a public roadway (e.g. boats, snowmobiles, equipment)
    • Exceptions – Green Light Sale
  • Antique vehicles, recreational vehicles, motor homes, or motorcycles
    • Exceptions – Green Light Sale
  • Wearable Items and Normal Wear and Tear.
    • Exceptions – None
  • Minor odometer discrepancies of 3,000 km or 5% (whichever is less).
    • Exceptions – None
  • Noise and Inherent Conditions. Arbitration cannot be based on noises or conditions that are inherent or typical to a particular model or manufacturer unless deemed “excessive” by the arbitrator on non-warranty items. OEM dealer warranty guidelines will be used where applicable to determine whether the condition is excessive.
    • Exceptions – None

How the process works

Our screening process ensures that resolutions happen quickly, we review our VCI inspections and all car proofs. The aim is to try and make all parties as happy as possible, therefore our highly trained staff promise brilliant customer service.

Our goal is to become a zero arbitration company. We believe that conducting the most detailed CRs on the market, coupled with our use of innovative technology such as our 360 ̊ imaging feature, gives customers more insight than ever before and should thereby reduce cases where arbitration is required. We are continuing work in the background to create new features and technologies that aim to improve customer visibility and transparency with the eventual end goal of having arbitration as a thing of the past.

In the meantime we know that sometimes things don’t always go as planned; therefore our arbitration process is quick, transparent and has our customers best interests in mind.

Once the vehicle is paid in full and in the possession of a Buyer, they can begin the arbitration process under one of the following:

  1. Not as sold
  2. Clerical error
  3. Post sale inspection requested

As no two cars are alike, each claim is taken care of on a case to case basis. It can be challenging to put an exact timeframe on, but we work to complete each case as soon as possible.

In the case where a Buyer has requested a post-sale inspection, the vehicle will be inspected by a third party – namely, mobile auto-technicians GoWrench. An examination by this third party costs $150, which will be paid by the “losing” party in any arbitration case.

After notifying the other party of the open case, we will then gather all of the data needed to make an impartial decision. We do this by:

  • Information digging
  • Gathering car proofs
  • Organize inspection if required
  • Review damage vs disclosure(s)
  • Third party testimony

Resolution

Once this data has been compiled, we can then decide whether a case is valid. If we deem a claim invalid, the Buyer will be liable to pay any inspection cost and no amendments will be made to correct the terms of sale.

When a case is deemed valid, both parties will be notified, and we begin conflict resolution. In most cases, the sale will be cancelled, or an adjustment to the price will be given based on the inspection results.

In some cases dealers will have a previous relationship and discussions can take place regarding alternative solutions, an example of which would be the “losing” dealer agreeing to pay the “winning” dealers next buy or sell fee. The goal here is to ensure all parties go away happy with the resolution and that everyone is content with the transparency and level of service they have been provided.

Now that the claim has been resolved, it’s now on our arbitration team to arrange the finer details. From logistics to payments, and adjustments to collections, the team must file the relevant paperwork such as vehicle ownership/titles and accounting changes.

Conclusion

We value our customers and ensuring a high standard of customer service and support is one of the pillars we are built on. From start to finish, from initial inspection to aftercare, we aim to resolve any issue that arises in a transparent, detailed and fair manner for all parties.

There are several reasons why an arbitration case might be opened, but we promise that we will always be there to help.

For more information, please view our terms and conditions and full arbitration policy.