Rulings made by disputes tribunal

About 200 car dealers attended Motor Vehicle Disputes Tribunal (MVDT) hearings each year, which is a small amount compared to the numbers sold. About 17,000 cars were sold by traders to the public in March, with the tribunal also covering motorbikes and trucks. The 12 cases published by the MVDT in April cost 12 claimants $50 each in filing fees per case, but resulted in them being awarded about $47,250. Reliability and durability standards, as laid down in the Consumer Guarantees Act, depend on factors such age and distance. Buyers whose vehicles need fixing soon after purchase can go back to the dealer and demand repairs, reports Fairfax. If a car can’t be  fixed in a reasonable time, it can be rejected. Details of rulings published in April give an insight into the laws.

Rejection isn’t an automatic right

A man bought a Japanese imported 2004 BMW 545i for $28,000 and – after electronics problems, leaking water pump and oil leaks – rejected it claiming it wasn’t of acceptable quality. The dealer refused a refund. The problems were “not uncommon in Japanese-imported European cars”, the tribunal found, but showed the car “lacked durability”. But the buyer couldn’t reject because the trader had a right to fix the pump.

When rejection outweighs right to fix

A man bought a 2011 Suzuki Swift for $13,900. Within five days, its transmission became faulty. He was quoted $18,150 to fix it. The trader said it could be repaired for $3,950, but the buyer refused that and demanded a refund. The tribunal found the failure was substantial and ordered the dealer to refund the purchase price.

Purchasers bear the burden of proof

A man bought a truck later found to be rust-riddled and juddering when reversed. The MVDT awarded compensation for “loss of opportunity” because the owner had to sell the truck after buying it. This was determined by subtracting its value at the end of 2013 from what it was worth in November 2010 when the buyer owned it. The dealer and buyer presented valuations at the start and end of that period, and the tribunal accepted the trader’s valuation. The dealer had to pay $4,000 compensation to the buyer – the latter’s valuations showed a substantial difference.

Old vehicles need to be roadworthy

In October, a woman bought a 2000 Toyota Altezza for $7,000 after seeing it advertised with a warrant of fitness (WOF) but it had expired. The trader, who said he advertised it as having a WOF because he intended to get one, offered her paying $7,500 with a new warrant or $7,000 without one. The dealer said it would “fly through” an inspection, but it didn’t. The buyer provided an estimate of $2,000 but the trader put the costs at $900. As the car had 250,000km on the clock, he felt a reasonable consumer would expect to do major work on it. The tribunal ruled, even for its age, there was a substantial failure.

Marque’s recall no reason to reject

In September 2011, a couple bought a new Holden Cruze but electronics problems, including the keyless locking system and ignition failed, so they rejected it in December 2013. They said it was unsafe after the marque issued a recall to replace a switch. The tribunal was satisfied the vehicle was not unsafe, so they couldn’t reject it.

Wear-and-tear items in older cars

In July 2013, a woman bought a 2005 Nissan Lafesta for $8,400. She wanted the dealer to refund the $1,159 she paid to replace five engine mounts. The trader said the woman didn’t give it time to make the repairs, and argued worn mounts were fair wear and tear. It sold the car seven months before the mount was replaced. The tribunal found the gearbox engine mount, one of the five replaced, was probably not as durable as a reasonable consumer would regard as acceptable. A reasonable consumer wouldn’t expect to have an issue with a noisy gearbox mount after three months. But, because the buyer didn’t supply the other mounts, the tribunal wouldn’t rule they needed replacing. The dealer was order to pay $279, the cost of replacing the mount.

Bidding on vehicles ‘sight unseen’

A woman bought a 1998 Nissan Sentra for $2,260 sight unseen with the online advert claiming it had a new clutch fitted. But it only had a new clutch plate fitted and the buyer had problems after delivery. A mechanic for the buyer told the tribunal the cost of replacing the clutch was $650 to $750. It found the advert was misleading under the Fair Trading Act and ordered the trader to pay out $620.

Trader being ordered to repair

In August, a man bought a 2006 Volvo imported from Japan for family use but used his business to buy it “for tax purposes”. He rejected it in February claiming the trader had failed to fix faults in a reasonable time. The dealer had to repair brakes within a month, and a “clunk” in the suspension developed and was fixed but later returned. The air-con then failed and was repaired. The tribunal found the $23,990 vehicle wasn’t free of minor faults nor as durable as a reasonable consumer would view acceptable. The trader had to pay compensation for repairs of $1,950.

Tribunal expects dealers to appear

A man bought a 2001 Nissan Skyline for $10,000 but it failed a WOF three months later and needed substantial repairs. The trader he would pay but didn’t. The tribunal considered the car was probably not of acceptable quality especially because the headlights were misaligned and the tyres very worn. The trader had to pay repair costs of $625 and $500 for failing to attend the hearing.