A GIPPSLAND farmer is suing Case New Holland's finance arm and a Trafalgar machinery dealer over a repossessed tractor.
David Stothers, of Stratford, has alleged that CNH Capital failed in its duty of care to have the tractor it repossessed from him in 2007 properly valued.
He has also accused Alto Motors of Trafalgar of fraud, alleging that the company submitted a false report on the tractor's condition to CNH Capital so that it could buy the tractor for just $5000.
Mr Stothers said he bought the New Holland TL100 4WD tractor for $81,125 in 2002, borrowing $71,125 from CNH Capital.
He said when he later fell into financial difficulties and was unable to meet his repayments, CNH Capital repossessed the tractor and asked Alto Motors, a licensed CNH dealer, to value it. He claimed CNH Capital then sold it to Alto Motors for $5000, although it was worth about $60,000 at the time.
Mr Stothers is seeking damages of $55,000 from CNH Australia or from Alto Motors, on the basis that figure represents the difference between what the tractor was worth at the time and what CNH Capital sold it for.
The case opened in the Morwell Magistrates Court last week but was adjourned until August after the court ordered Alto Motors be added as a co-defendant.
In his revised statement of claim, Mr Stothers' lawyer, Peter Finkelstein, accused Alto Motors of submitting a false report on the tractor's condition to CNH Capital in order to buy it below its market value.
Mr Finkelstein accused Alto Motors of acting "both fraudulently and dishonestly in taking deliberate steps to make the tractor appear to be a 'wreck' of little value and suitable only as a source of second-hand parts".
"If the tractor had been sold at its proper and fair market value ... the outcome would have been money in my client's pocket because even though CNH was entitled to be paid out, he would have had something in the order of $40,000-$45,000 even after paying CNH," Mr Finkelstein claimed.
A Case New Holland Australia spokeswoman declined to comment.
Alto Motors director Anthony Moscato said: "We are restrained by our legal team on commenting on it and all will be revealed."
