Carelsen v Luxxio Vehicles Limited - Reference No. MVD 241/2023 [2023] NZMVDT 195 (13 September 2023)

Last Updated: 9 November 2023

IN THE MOTOR VEHICLE DISPUTES TRIBUNAL I TE RŌPŪ TAKE TAUTOHENGA Ā-WAKA MVD 241/2023 [2023] NZMVDT 195 BETWEEN GERT VAN DER MERWE CARELSEN Applicant AND LUXXIO VEHICLES LIMITED Respondent

MEMBERS OF TRIBUNAL

D Watson, Adjudicator

S Gregory, Assessor

HEARING at Auckland on 5 September 2023 (by audio-visual link)

APPEARANCES

G Carelsen, Applicant

J Peterson, Director of the Respondent

DATE OF DECISION 13 September 2023

_________________________________________________________________

DECISION OF THE TRIBUNAL

_________________________________________________________________

The claims of Gert Carelsen are dismissed.

_________________________________________________________________

REASONS

Introduction

[1] Gert Van Der Merwe Carelsen purchased a 2010 Audi Q5 from Luxxio Vehicles Ltd (LVL) on 22 March 2022 for $19,505.00. The vehicle had then travelled 70,268 km. The vehicle has a direct shift gearbox (DSG) transmission. He wants to reject the vehicle which has recently been diagnosed as being in need of new DSG clutches. He also claims that LVL misled him by failing to disclose that the vehicle was used in a radiation contaminated area when it was in Japan. He believes that LVL may also have misled him about the correct odometer reading on the vehicle at the time of sale.
[2] LVL says that it has responded to all requests for repair of the vehicle but that the replacement of clutches after around 10,000 km since purchase and over a year of driving is not its responsibility. In relation to the contamination of the vehicle, it denies that the radiation exposure would make the vehicle unsafe and says that it did not have any duty to disclose that information to Mr Carelsen at the time of purchase. It also denies misleading Mr Carelsen in relation to the odometer reading.

The issues

[3] The issues requiring the Tribunal’s consideration in this case are:

• (a) Has the vehicle been of acceptable quality for the purposes of s 6 of the Consumer Guarantees Act 1993 (the CGA)?
• (b) Has LVL engaged in misleading conduct in breach of s 9 of the Fair Trading Act 1986 (the FTA)?

Relevant background

[4] Mr Carelsen’s wife drove the vehicle without incident until 13 May 2022, when the vehicle went into limp mode and a warning light came up on the dash saying “no reverse gear” as well as the transmission icon. The vehicle did this several times and Mr Carelsen got in contact with LVL and told it about this fault.
[5] The vehicle went back to LVL for repairs. According to LVL, it initially went to Kaspa Transmissions (Kaspa), a transmission expert for diagnosis. Kaspa advised that the vehicle had a transmission error caused by faulty mechatronic solenoids. A solenoid kit was supplied to LVL so that it could fit it in the vehicle. Because the installation of the solenoid pack was considered by LVL to be straightforward, it undertook that work at its own workshop.
[6] After installation of the solenoid kit, LVL tested the vehicle and it went back to Mr Carelsen.
[7] After about a week Mr Carelsen felt that the transmission was jerking and the gear shifts were not changing correctly. He could hear what sounded like a “conking” noise from the transmission. He contacted LVL who sent a mechanic to his home. When replacing a solenoid kit, a transmission should be recalibrated and it seemed that that recalibration may not have occurred. The mechanic attempted to calibrate the transmission at Mr Carelsen’s home but could not do so because the transmission oil was too hot. After this visit, Mr Carelsen smelt a very bad oil smell in the vehicle, which he subsequently complained to LVL about.
[8] LVL took the vehicle back and took advice from Kaspa, which confirmed that the transmission needed to be recalibrated. It successfully recalibrated the transmission in its workshop. After the recalibration was undertaken, Kaspa tested the vehicle again and found no faults. It also checked the vehicle for oil leaks at that time and found none.
[9] LVL produced an email from Kaspa dated the day of the hearing which corroborated LVL’s evidence about Kaspa’s attendances including resetting the transmission control module (the recalibration). The Tribunal did not have a copy of the email at the hearing but Mr Peterson, the Director of LVL who appeared at the hearing, read it out during the hearing and Mr Carelsen, who did have a copy of it, was able to reply to it.
[10] Before returning the vehicle to Mr Carelsen, LVL performed more road tests, and put the vehicle on a hoist to check that it was now in a perfect condition. The vehicle was returned to Mr Carelsen on 9 June 2022. Before it was returned, LVL cleaned the vehicle, including the interior carpet, in an attempt to remove the smell from the DSG oil used in the course of repairs.
[11] Mr Carelsen says that when he got the vehicle back, it still smelt of gear oil, but accepted that the smell dissipated over time.
[12] Mr Carelsen said that after receiving the vehicle back, the transmission was now “not bad”. He said it was not “100%” but thought it simply needed some time to settle in. Overtime, however, he was comfortable with the transmission and did not contact LVL during the balance of 2022 about any transmission issues.

February 2023 - further transmission issues

[13] On 2 February 2023, Mr Carelsen contacted LVL about the transmission issue again. Once again, the vehicle was in limp mode and the same warning lights and transmission icon were illuminated on the dashboard. Mr Carelsen also said that he could smell the very bad oil smell again, just before that happened.
[14] The odometer reading was then 79,883 km.
[15] At this stage, Mr Carelsen was now living near Dunedin and, although LVL was willing for the vehicle to be seen by a transmission expert, there were no suitable workshops familiar with DSG transmissions in the area to diagnose the issue. The closest was in Christchurch, being Aceomatic.
[16] At around this time, Mr Carelsen decided to obtain a Carjam report for the vehicle.[1] This disclosed that the vehicle was flagged as having been used in a “contaminated area” in Japan. The report noted:

The Fukushima Daiichi nuclear disaster was a catastrophic failure at the Fukushima Nuclear Power Plant on 11 March 2011, resulting in a meltdown of three of the plant's six nuclear reactors. As a result, some areas in the following prefectures were contaminated: Fukushima, Miyagi, Ibaraki, Tochigi.

[17] Mr Carelsen also discovered that the vehicle had had a vehicle inspection in Tsuchiura, Japan on 6 July 2021, located only 32 km away from the nuclear plant at Fukushima.
[18] He also noticed that the vehicle’s battery had a warranty label on it which recorded that the battery was replaced on 3 April 2013 at 63,414 km, whereas some nine years later when he purchased the vehicle, it only travelled approximately 70,000 km. This raised a suspicion in his mind that, if the information on the warranty label was correct, the vehicle could not have only travelled 7,000 km on a nine year timeframe. After the hearing, he sent a photograph of the relevant label attached to the battery.
[19] Mr Carelsen emailed LVL on 1 April 2023, advising that he was rejecting the vehicle. His reasons were that he had had multiple issues with the vehicle and the problem with the transmission was still not resolved. He also referred to the Carjam report and his belief that the vehicle had been used in a radiation exposed environment.
[20] LVL would not accept the rejection and wanted an opportunity to diagnose the vehicle.
[21] Mr Carelsen took the vehicle to Aceomatic on around 23 May 2023. The odometer reading was then 80,198 km so it had essentially not been driven since February. In the meantime, he and LVL had engaged with each other through the Motor Trade Association (MTA) in an attempt to find a solution.
[22] Aceomatic diagnosed the vehicle as in need of a new mechatronic solenoid kit. It therefore replaced the solenoids again. Its invoice dated 23 May 2023 recorded that the then odometer reading on the vehicle was 80,198 km and noted:

MAY HAVE CAUSED DAMAGE TO CLUTCH FROM FAULT WITH MECHATRONIC AND COULD REQURE FURTHER REPAIRS.

[23] After performing this work, Aceomatic tested the vehicle over the following few days but, when the same fault codes returned, it verbally told Mr Carelsen that the vehicle would not be able to be driven back to Gore where he and his wife were then living. Aceomatic diagnosed the vehicle as now in need of new clutches and provided an estimate replacement of the clutches of $4792.82. Mr Carelsen incurred a towing fee of $450 to have the vehicle transported back to his home.
[24] According to Mr Peterson, LVL trusted Aceomatic to adequately diagnose and repair the vehicle. LVL paid Aceomatic for replacement of the solenoid pack, believing that the same fault had returned. LVL considered it had responsibility to remedy the same fault, if it reemerged.
[25] LVL advised Mr Carelsen that it regarded the clutches as a wearable component which it was not prepared to cover due to the milage and time since purchase.
[26] Mr Carelsen produced a quote from Alltranz, another transmission specialist, for the cost of replacement of clutches and the mechatronic unit, at a cost of $11,179.15. Alltranz has not, however, seen the vehicle.
[27] Mr Carelsen’s case is that he believes the vehicle needs new clutches and that the underlying fault has been present since purchase. In submitting the quote from Alltranz he appears to also claim that the vehicle needs a new mechatronic unit. He claims that repair of either or both of these items is the responsibility of LVL pursuant to the CGA. Other evidence had been filed in relation to other issues but Mr Carelsen confirmed that he was not seeking any remedy with respect to those issues.
[28] Mr Carelsen claims that the correct odometer reading on the vehicle as at 3 April 2013 is that depicted in the photograph he has supplied, being 63,414 km. He says that, as such, he has been misled about the true odometer reading of the vehicle at the time of sale. He also alleges that LVL was misleading when it sold on the vehicle without disclosing its Carjam flag concerning radiation exposure.
[29] LVL’s position is essentially that:

• (a) It followed the advice of Kaspa to replace the solenoid kit when it first saw the vehicle. It accepts that there should have been a recalibration of the transmission after that work was done but says as soon as it was aware of the issue, it arranged for the recalibration to be done. It says that it has sufficiently responded to the complaint about the smell of the DSG oil by inspecting the vehicle for oil leaks (finding none) and arranging for the vehicle to be cleaned.
• (b) After replacing the solenoid kit and completing the recalibration, LVL did not then hear anything further from Mr Carelsen about the transmission until February 2023 when he contacted LVL to say that the vehicle had gone into limp mode and the same dashboard lights and transmission icon had returned. It says that the installation of the solenoid kit in May 2022 remedied that fault.
• (c) It paid for Aceomatic’s diagnosis and repair because it believed the fault was as a result of the same solenoid fault recurring. It does not deny that the vehicle now needs new clutches but says that the clutches are a wear and tear item and, this long after sale, are not its responsibility. It therefore says that Mr Carelsen has owned the vehicle for too long and driven too far for it to have any responsibility for what is essentially a wear and tear item.

[30] In relation to the radiation exposure area, it says that the vehicle would not have been imported in the first place if its exposure to radiation was at an unsafe level. It denies that it had any obligation to point this out to Mr Carelsen. It denies misleading conduct in relation to the odometer reading of the vehicle at the time of sale.

Further information relied upon

[31] The parties both filed information prior to the hearing. The Tribunal also relies on this information in reaching its decision.

Analysis

Issue 1: Was the vehicle of acceptable quality?

[32] Section 6 of the CGA imposes on suppliers and manufacturers that “where goods are supplied to a consumer there is a guarantee that the goods are of acceptable quality.” Section 2 of the CGA defines “goods” as including vehicles.
[33] The expression "acceptable quality" is defined in section 7 as follows:

7 Meaning of acceptable quality

(1) For the purposes of section 6, goods are of acceptable quality if they are as—

(a) fit for all the purposes for which goods of the type in question are commonly supplied; and

(b) acceptable in appearance and finish; and

(c) free from minor defects; and

(d) safe; and

(e) durable,—

as a reasonable consumer fully acquainted with the state and condition of the goods, including any hidden defects, would regard as acceptable, having regard to—

(f) the nature of the goods:

(g) the price (where relevant):

(h) any statements made about the goods on any packaging or label on the goods:

(ha) the nature of the supplier and the context in which the supplier supplies the goods:

(i) any representation made about the goods by the supplier or the manufacturer:

(j) all other relevant circumstances of the supply of the goods.

(2) Where any defects in goods have been specifically drawn to the consumer's attention before he or she agreed to the supply, then notwithstanding that a reasonable consumer may not have regarded the goods as acceptable with those defects, the goods will not fail to comply with the guarantee as to acceptable quality by reason only of those defects.

(3) Where goods are displayed for sale or hire, the defects that are to be treated as having been specifically drawn to the consumer's attention for the purposes of subsection (2) are those disclosed on a written notice displayed with the goods.

(4) Goods will not fail to comply with the guarantee of acceptable quality if—

(a) the goods have been used in a manner, or to an extent which is inconsistent with the manner or extent of use that a reasonable consumer would expect to obtain from the goods; and

(b) the goods would have complied with the guarantee of acceptable quality if they had not been used in that manner or to that extent.

(5) A reference in subsections (2) and (3) to a defect means any failure of the goods to comply with the guarantee of acceptable quality.

[34] In considering whether or not goods meet the guarantee of acceptable quality, the Tribunal must consider the quality elements as set out in section 7(1)(a)-(e) of the CGA as modified by the factors set out in section 7(1)(f)-(j), from the perspective of a “reasonable consumer”. The test is an objective one; it is not a view of those factors from a purchaser’s subjective perspective.

DSG transmissions

[35] Mr Gregory, the Tribunal’s Assessor,[2] has assisted me by providing information about the DSG gearbox installed in this vehicle. He advises that a DSG gearbox essentially comprises three separate components which together facilitate the vehicle smoothly changing gears. These components are the dual clutches, a mechatronic unit and the transmission. Only some manufacturers of motor vehicles install DSG gearboxes in their vehicles. Audi is one of them.
[36] Whilst each of the DSG components is separate from the other, faults with each can sometimes have similar characteristics. A problem with any of them will also produce a similar warning light and icon on the dashboard. Diagnosis of these components within a DSG gearbox is a specialist field and exact diagnosis is not always immediately apparent from first investigation and attempt at repair.

The solenoid pack

[37] I am satisfied that within a few weeks of sale, the vehicle was in need of a solenoid pack replacement within its mechatronic unit.
[38] A solenoid pack is a wear and tear item. A reasonable consumer of a vehicle of this age, price and milage would expect to encounter the need for ongoing maintenance, sometimes of an unplanned and expensive nature, but I am satisfied that a reasonable purchaser of this vehicle would not have expected replacement of the solenoid pack so early in their ownership of the vehicle. I find that they would have expected the vehicle to be more durable than this.
[39] The faulty solenoid pack has meant that the vehicle failed the guarantee of acceptable quality. The vehicle has not been as durable as would be expected by a reasonable purchaser of this vehicle, given its age, price and milage.
[40] I find that no remedy arises with respect to this fault because the solenoid pack was indeed replaced by LVL at its expense.

The recalibration

[41] Mr Gregory advises that after a new solenoid pack is installed, the transmission needs to be recalibrated. He also advises that after recalibration, the vehicle would then also need some time to settle in.[3] Until then, it may still continue to feel clunky when shifting gear.
[42] LVL did not recalibrate the transmission as it should have, however, I am satisfied that no remedy lies for that failing because the failure to recalibrate the transmission is a fresh issue, which emerged when LVL performed the repair services of installing the solenoid pack. It amounts to a failure of the guarantee that reasonable care and skill will be taken when carrying out services,[4] for which Mr Carelsen’s remedy was to request repair pursuant to s 32 of the CGA. He has received a remedy because ultimately the failure was remedied when LVL had the transmission recalibrated.

The faulty clutches

[43] It follows from the foregoing that I am satisfied that the replacement of the solenoids in May 2022 was the correct diagnosis and repair of the vehicle’s then fault. I note that following the replacement of the solenoid kit, the symptoms described by Mr Carelsen, although the same, did not emerge again until February 2023, when the vehicle had then travelled 79,883 km, some 9,600 km more than the date of purchase.
[44] As I have noted above, Mr Gregory advises that faults with each of the DSG gearboxes components can present with similar symptoms. The fact that the symptoms were the same or similar did not in and of itself mean that the same fault had arisen.
[45] Had the faulty solenoids been the cause of the fault in February 2023, then Mr Carelsen may have had grounds of rejection on the basis that LVL did not remedy the failure that occurred in May 2022. I am satisfied, however, that this was not the case. I find that the vehicle has developed a fresh fault with its gearbox in February 2023. Although not diagnosed until the vehicle could be seen by Aceomatic, I am satisfied that the vehicle suffered then and indeed still suffers now from worn clutches, which need to be replaced.
[46] To the extent it is necessary to make any finding, I find that it is more probable than not that replacement of the solenoid kit for a second time by Aceomatic was an unnecessary repair. I say this for the following reasons:

1. that the solenoid kit was perhaps not the problem is heralded by the note on the Aceomatic invoice relating to the possibility of damage to the clutch from the mechatronic unit and the additional note “could require further repairs”. Aceomatic appears to have contemplated that replacement of the solenoids may not address the problem,
2. Mr Gregory advises that the symptoms described by Mr Carelsen in February 2023, in particular the bad smell, are more consistent with worn clutches. The bad smell would have been the smell of the clutches slipping and burning oil.

100. Mr Gregory advises that it is very unlikely that a solenoid pack would need replacement again so soon after having already been replaced. He advises that he would expect a solenoid kit to last much longer than that.[5] He advises that had the solenoid pack been faulty then he would have expected a fault to emerge not long after May 2022. Instead, the vehicle has then driven in excess of 9,000 km with no faults.

4. Finally, Mr Gregory advises that it would not be unexpected that, at about 80,000 km, there may be failure of the DSG clutches, which are ultimately a wear and tear item that eventually need to be replaced. These clutches have not prematurely failed.
5. I have accepted all of Mr Gregory’s advice and assistance in reaching my determination.

[47] Aceomatic has clearly considered that replacement of the solenoid pack was the appropriate repair but, as noted above, faults with any one of the three components in a DSG gearbox can present with close similarities. LVL made it clear that it would not be prepared to pay for replacement of the clutches which it considered a wear and tear item. It was only prepared to pay if there was a defect with the solenoid kit that it had previously repaired. This is perhaps the reason why Aceomatic replaced the solenoid kit.
[48] I find that a reasonable purchaser of this vehicle would understand that vehicles of this price, age and milage will develop defects and require ongoing maintenance that can sometimes be expensive to perform. They would also understand that a supplier’s obligations under s 6 of the CGA are finite and, at some point, the risk of the vehicle developing defects must transfer from the supplier to the purchaser. The point in time at which that risk transfers is determined with reference to the factors in s 7(1)(f) to (j) of the CGA.
[49] A DSG gearbox in a European vehicle will be expensive to maintain, particularly as parts begin to wear out. The clutches have developed a fault in February 2023 after 11 months and approximately 9,600 km of driving. They are a wear and tear item that has failed at around the time when it would be expected that they may fail. They have not failed prematurely. I am not satisfied that the condition of the clutches in February 2023 amounts to a failure of the guarantee of acceptable quality. It follows that Mr Carelsen has no remedy under the CGA with respect to the clutches.
[50] In relation to the mechatronic unit, there was no evidence that this component is faulty and in need of replacement. The Alltranz quote was provided without Alltranz having inspected the vehicle. There is no evidence before me that the unit is faulty. Even if there was, I find that, as with the clutches, a failure at 9,600 km and 11 months of driving would be too long after purchase for LVL to have any ongoing liability.

The DSG oil smell

[51] As with the calibration, this was a fresh fault, arising out of the work that was done by LVL to install the solenoids and recalibrate the transmission. I find that a remedy was requested and that LVL took appropriate steps to remedy the fault by checking for oil leaks and cleaning the car and its carpet.
[52] Mr Carelsen accepted that the smell did dissipate over time, although in his evidence he referred to the smell at the time of the February 2023 failure. I have however found that that smell related to the failed clutches, so was a different issue.
[53] I find there to be inadequate evidence that the fault was not remedied. No remedy lies with respect to this issue.

Issue 2: Has LVL engaged in conduct that breached s 9 of the FTA?

[54] Section 9 of the FTA provides:

9. Misleading and deceptive conduct generally

No person shall, in trade, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

[55] The primary issue is to determine whether Mr Carelsen has proven that LVL breached s 9 of the FTA. The test for establishing a breach of s 9 was set out by the Supreme Court in Red Eagle Corp Ltd v Ellis:[6]

The question to be answered in relation to s 9 ... is ... whether a reasonable person in the claimant’s situation – that is, with the characteristics known to the defendant or of which the defendant ought to have been aware – would likely have been misled or deceived. If so, a breach of s 9 has been established. It is not necessary under s 9 to prove that the defendant’s conduct actually misled or deceived the particular plaintiff or anyone else. If the conduct objectively had the capacity to mislead or deceive a hypothetical reasonable person, there has been a breach of s 9. If it is likely to do so, it has the capacity to do so. Of course the fact that someone was actually misled or deceived may well be enough to show that the requisite capacity existed.

[56] There are two parts to Mr Carelsen’s claim. He says that:

1. LVL was misleading or deceptive when it failed to disclose to him at the time of sale that when in Japan, the vehicle was located in a contaminated area, being near the nuclear power plant at Fukushima. He claims that this is relevant information that should have been disclosed to him.
2. LVL was misleading or deceptive by advertising the vehicle and selling it as having travelled 70,268 km whereas the true odometer reading must have been significantly higher than that given that in 2013, some nine years previously it was 63,414 km.

[57] I now deal with each of these allegations separately. Before I do so, I record that it is for Mr Carelsen to prove the facts giving rise to the claim. The relevant standard of proof is on the balance of probabilities. He must prove that it is more probable than not that the facts he alleges exist. Bare oral assertions can often be insufficient evidence. Corroborating documents such as reports are often useful evidence to assist the Tribunal in determining what the relevant facts are.
[58] As to the degree of evidence required to discharge the burden of proof, in the words of Denning J in Miller v Minister of Pensions:[7]

... That degree is well settled. It must carry a reasonable degree of probability but not so high as is required in a criminal case. If the evidence is such that the tribunal can say: “We think it more probable than not,” the burden is discharged, but if the probabilities are equal it is not.

The radiation exposure allegations

[59] I am satisfied that the information in the Carjam report is reliable, in the absence of evidence to the contrary. I am therefore satisfied that this vehicle was, when in Japan, located in an area near the Fukushima nuclear power plant.
[60] The question is whether or not LVL had any obligation to disclose that information.
[61] There is authority supporting an obligation to disclose information in certain circumstances. In relation to the failure to disclose generally, in the case of Des Forges v Wright, Elias J (as she then was) stated:[8]

Silence may constitute misleading or deceptive conduct, but whether it does is to be objectively assessed in all the circumstances ... conduct may be misleading or deceptive within the meaning of s 9 of the Fair Trading Act 1986 by an omission to provide information even if no obligation to provide such information exists as a matter of general law, outside the standards of conduct required by the Fair Trading Act.

[62] Since Des Forges a “reasonable expectation of disclosure” test has been considered and developed in several other cases.[9]
[63] The law relating to what a motor vehicle trader is required to disclose to a purchaser of a vehicle has also been summarised by the High Court in McBride Street Cars Ltd v The District Court (Dunedin Registry).[10] That case upheld a decision of this Tribunal that the trader had breached s 9 of the FTA when it sold a vehicle without disclosing that vehicle was a statutory write-off.
[64] Davidson J set out the text of s 9 of the FTA before referring to the Supreme Court’s decision in Red Eagle Corporation Ltd v Ellis, summarising the Court’s statement of the relevant legal test as “straightforward”:[11]

Whether a reasonable person ... with the characteristics known to the defendant or of which the defendant ought to have been aware – would likely have been misled or deceived.

[65] Davidson J confirmed that it is now well accepted that silence can constitute misleading or deceptive conduct:[12] “if something is known by the vendor to be of consequence to the purchaser, the purchaser reasonably expects to be told”.[13]
[66] In determining whether silence is misleading in a particular case, His Honour stated the issue is whether a reasonable person, with the characteristics of the purchaser known to the trader, or of which the trader ought to have been aware, would likely have been misled or deceived having regard to all of the context of the sale.[14] The Court held that there will be a reasonable expectation of disclosure in respect of material, but not immaterial information. The Court recognised the challenge that it may not be obvious what is and what is not material and said that the:[15]

...answer to this challenge is that the vendor should simply disclose all it knows, and then it is up to the purchaser armed with this information, to be on guard, perhaps to abandon the purchase or to make enquiries, including having the vehicle further tested and priced.

[67] The Court then summarised this test as follows: [16]

This is consumer driven legislation and it is but a small thing to ask of a vendor in these circumstances to advise the prospective purchaser of what it knows, where it is obviously, as here, likely to be of consequence to the purchaser and thus material. The test I have articulated is not complex nor is it onerous on vendors. It merely requires them to be open, to act in good faith, in respect of the information to which they are privy.

[68] The question is whether a reasonable person with the characteristics of Mr Carelsen known to LVL, or of which LVL ought to have been aware, would likely have been misled or deceived, having regard to all of the context of the sale. In such a situation, there is a reasonable expectation of disclosure of material information.
[69] I find that, in the context of this case, there was inadequate evidence before me to satisfy me that the vehicle having been located in an area near the Fukushima nuclear explosion in 2011 would be material information to a reasonable purchaser with the characteristics of Mr Carelsen and known to LVL at the time of purchase, being 2022, some 11 years later.
[70] The obligation of proving the facts giving rise to the claim lies on Mr Carelsen. It is his obligation to put before the Tribunal adequate corroborative evidence to satisfy me that the radiation information would be material to a reasonable purchaser of this vehicle with his characteristics, known to LVL. I find that he has failed to do so. There was no evidence presented as to any harm, physical or otherwise that may have been caused by any such exposure nor why the vehicle was allowed to be imported into New Zealand given that it may have had exposure to radiation. This aspect of the claim is dismissed.

The odometer reading on the vehicle

[71] Likewise, I also dismiss this aspect of the claim. The allegation is that the vehicle had travelled significantly more kilometres at the time of sale than that represented by LVL. Mr Carelsen relies on a warranty sticker appended to the battery. That battery may however have been a reconditioned battery that came from another vehicle. The label that he refers to does not refer to any particular vehicle. Mr Gregory advises that he would have expected the vehicle’s battery in any event to have been replaced well before 63,414 km. It is highly likely therefore that the label relates to a reconditioned battery.
[72] I am simply not satisfied that Mr Carelsen has proven, on the balance of probabilities, that the distance travelled in this vehicle at the time of sale was anything other than that referred to on the vehicle offer and sale agreement he signed on 22 March 2022, being 70,268 km.
[73] This aspect of the claim is also dismissed.
[74] It follows that Mr Carelsen is not entitled to any remedy in relation to the FTA.

DATED at AUCKLAND this 13th day of September 2023

D Watson
Adjudicator

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[1] Carjam is the name of the website located at Carjam.co.nz (which extracts data from Waka Kotahi NZ Transport Agency records). It records such information as the vehicle’s odometer reading and the date when an imported vehicle is checked at the border for the first time and then the odometer reading and date each time it has had a WOF inspection.

[2] Assessors are appointed by the Minister of Commerce and Consumer Affairs pursuant to s 88(2) of the Motor Vehicles Sales Act 2003, having regard to the Assessor’s personal attributes, qualifications and skills, and knowledge of, or experience, and the different aspects of matters likely to come before the Tribunal. Assessors generally have significant expertise in technical matters that arise in claims before the Tribunal. Under cl 10 of Sch 1 of the Motor Vehicle Sales Act, an Assessor sits as a member of the Tribunal and has a duty to assist the Adjudicator in the determination of the claim, although the Adjudicator alone determines the claim. The duties of an Assessor are to: (a) sit with the Tribunal; and (b) act in all respects as an extra member of the Tribunal for the hearing of the application; and (c) act as an extra member of the Disputes Tribunal to assist in the determination of the application (see Reg 10 Sch 1 Motor Vehicle Sales Act 2003).

[3] Which explains why Mr Carelsen felt the gear shifts still felt unusual even after the solenoid pack replacement and recalibration of the transmission.

[4] In breach of s 28 of the CGA.

[5] More than eight years and / or 60,000 kms.

[6] Red Eagle Corp Ltd v Ellis [2010] NZSC 20, [2010] 2 NZLR 492 at [28].

[7] Miller v Minister of Pensions [1947] 2 All ER 372, 373–374

[8] Des Forges v Wright [1996] NZHC 1248; [1996] 2 NZLR 758 (HC) at 764.

[9] Hieber v Barfoot & Thompson Ltd (1996) 5 NZBLC 104,179 Tuiara v Frost & Sutcliffe [2003] 2 NZLR 833 at [91]; Guthrie v Taylor Parris Group Cossey Ltd (2002) 10 TCLR 367 at [21] and [32].

[10] McBride Street Cars Ltd v District Court (Dunedin Registry) [2018] NZHC 111, [2018] NZAR 289.

[11] Red Eagle Corporation Ltd v Ellis as above n 6, at [28].

[12] McBride Street Cars Ltd v District Court, above n 10, at [54].

[13] At [55].

[14] At [64].

[15] At [73].

[16] At [76].