Shelford v Automania Limited - Reference No. MVD 218/2011 (Auckland) [2011] NZMVDT 178 (16 December 2011)

Motor Vehicle Disputes Tribunal of New Zealand

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Shelford v Automania Limited - Reference No. MVD 218/2011 (Auckland) [2011] NZMVDT 178 (16 December 2011)

Last Updated: 9 February 2012

Decision No. AK 144/2011

Reference No. MVD 218/2011

IN THE MATTER of the Motor Vehicle Sales Act 2003

AND

IN THE MATTER of a dispute

BETWEEN MARTIN MACEY SHELFORD

Purchaser

AND AUTOMANIA LIMITED

Trader

BEFORE THE AUCKLAND MOTOR VEHICLE DISPUTES TRIBUNAL

Mr C H Cornwell, Barrister & Solicitor, Adjudicator
Mr D Clough, Assessor

HEARING at Hamilton on 15 December 2011

APPEARANCES
Mrs K D M Shelford representing the purchaser
Mr N M O’Connell, Salesperson representing the trader

DECISION

Background

[1] On 1 September 2011 Mr Shelford (“the purchaser”) purchased a 1998 Toyota Camry registration number ECQ126 (“the vehicle”) for $2,000 from Automania Limited (“the trader”). The vehicle’s odometer at the time of sale was 200,229kms. The purchaser says the vehicle’s cam belt broke a month after he purchased it and he seeks to recover his repair costs of $757.00 from the trader.

[2] The trader says that the failure of a cam belt in a vehicle which is 13 years old and has travelled over 200,000kms is to be expected as a matter of wear and tear at any time. The trader has offered to pay one half of the purchaser’s repair costs but the purchaser has rejected that offer.

[3] Prior to the commencement of the Tribunal’s inquiry, the Tribunal appointed Mr Clough who took the oath required of an assessor by Schedule 1 cl. 10(2) of the Motor Vehicle Sales Act 2003. As an assessor Mr Clough assisted the adjudicator but the application was determined by the adjudicator alone.

[4] The purchaser did not appear at the hearing. Mrs Shelford the purchaser’s wife came to the hearing and asked the Tribunal to allow her to represent the purchaser. In view of the fact that Mrs Shelford had travelled to Hamilton from Leigh for the hearing and was present at the time the vehicle was sold to the purchaser the Tribunal agreed in the circumstances to allow her to represent the purchaser.

Facts

[5] On 1 September 2011 the purchaser agreed to purchase the vehicle from the trader for $2,000 following a short test drive. Mrs Shelford says the vehicle drove very smoothly. She says the trader’s salesman Mr O’Connell told the purchaser and her that the vehicle had been a taxi and had been recently traded in. Mrs Shelford told the Tribunal that neither she nor the purchaser asked if the vehicle’s cam belt had been replaced and the subject of the cam belt was not discussed. There was no service record supplied with the vehicle and it did not have a service sticker on its windscreen. The purchaser financed the full purchase price of the vehicle with a collateral finance agreement with Douglas Rushbrooke Limited trading as MTF-Te Awamutu although the vehicle offer and sale agreement records that the purchaser paid a deposit of $500. The vehicle’s odometer was recorded on the vehicle offer and sale agreement and the consumer information notice as 200,229kms. The trader did not obtain a fresh warrant of fitness for the vehicle within 28 days prior to the date of sale as it is required to do under the Road Traffic Regulations.

[6] Mrs Shelford says the vehicle was purchased for her use in getting to work as a caregiver and transporting her to hospital for treatment. She says the purchaser has owned two other vehicles, a Toyota Lucinda for 8 years and a Suzuki for 7 years and is sufficiently mechanically handy to have done oil changes, replace spark plugs and change tyres on those vehicles. Mrs Shelford says that to her knowledge the purchaser has not replaced the cam belts on either of those vehicles although both have travelled more than 200,000kms.

[7] Mrs Shelford says she was driving the vehicle from Leigh to Matakana on Saturday 1 October 2011 when the engine suddenly stopped. She left the vehicle on the side of the road and the next day telephoned Mr Stephen Paddison the Manager of Leigh Motors Ltd who arranged to inspect the vehicle and found the engine had broken its cam belt. Mr Paddison towed the vehicle to Leigh Motors Ltd and informed Mrs Shelford the cam belt had broken. Mrs Shelford telephoned the trader and spoke to Mr O’Connell on 3 October who told her it was unlikely that the trader would be willing to pay for the repairs to the vehicle but he would ask the trader’s director to telephone her.

[8] On 4 October Mr Shane Henderson the trader’s Director telephoned Mr Paddison to tell him the trader did not consider it was liable to repair the vehicle and to advise Mrs Shelford of that.

[9] Leigh Motors Ltd replaced the cam belt and the water pump and tested the vehicle for bent valves which, luckily, were undamaged. The amount charged for the repair was $757. Mrs Shelford produces the invoice from Leigh Motors Ltd which records the odometer at the time of the breakdown as 202,499kms showing the vehicle had travelled 2,270kms when the cam belt broke.

[10] The purchaser filed her application with the Tribunal on 21 October 2011 and a copy was sent to the trader on that date. The trader sent a fax to the Tribunal on 25 October (dated 22 October 2011) in which Mr Henderson said the broken cam belt was a general maintenance and wear and tear item. The trader “out of good faith” had offered to pay one half of the purchaser’s repair bill but Mrs Shelford had declined that offer.

[11] Mrs Shelford says that since filing the application the vehicle’s radiator has cracked. It was repaired by Leigh Motors Ltd at a cost of $358 on 25 October 2011 at 203,730kms.

[12] Mr O’Connell for the trader says he thinks he might have told the purchaser to have the cam belt replaced but he cannot recall and is not sure whether he did so or not. He thinks he told the purchaser to have the vehicle serviced. Mr O’Connell says the vehicle was sold for only $2,000 and had already travelled 200,229kms at the time of sale. He says a cam belt can fail on such a high mileage vehicle at any time and is generally considered to be a maintenance issue.

Issues

[13] The facts raise the following issues:
[a] Whether the vehicle complied with the guarantee of acceptable quality?
[b] If not what remedy is the purchaser entitled to?

[14] Section 6 of the Consumer Guarantees Act 1993 (“the Act”) imposes on a supplier and the manufacturer of consumer goods "a guarantee that the goods are of acceptable quality." Section 2 of the Act defines "goods" as including "vehicles.”

[15] The expression "acceptable quality" is defined in s 7 of the Act 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, ¾

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 ¾

(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:

(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) of this section 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 maintain 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) of this section to a defect means any

failure of the goods to comply with the guarantee of acceptable quality.”

[16] The guarantee of acceptable quality is in three parts. A set of quality elements set out in s. 7(1)(a) to (e), a reasonable consumer test which applies a consumer’s objective evaluation of those quality elements and a set of factors in s.7(1)( f) to (j) which are to be taken into account by the reasonable consumer to modify his or her assessment of the quality of the goods.

[17] The vehicle sold to the purchaser is a 13 year imported Toyota Camry which had an odometer reading of 200,229kms at the time of sale. It was sold for only $2,000. The vehicle was near the end of its economic life when it was sold to the purchaser. The vehicle had formerly been a taxi and the purchaser was told of that when he agreed to buy it. The vehicle had no service sticker on its windscreen and no service handbook was supplied with it and so its service history is unknown. Mr O’Connell’s gave evidence that he thought he might have mentioned to the purchaser the need to have the cam belt replaced and he says that he told the purchaser the vehicle needed servicing however the Tribunal did not find Mr O’Connell a very convincing witness and places little reliance on his recollection of what he thinks he might have told the purchaser. The Tribunal thinks it far more likely than not that the cam belt was not mentioned by either party and the purchaser certainly does not appear to have considered, before buying the vehicle, the real risk that the vehicle with over 200,200kms on its odometer might not have had its cam belt replaced because the purchaser apparently took no interest in enquiring about its service history. Had he done so he would have discovered that there was no evidence as to when the vehicle’s cam belt had last been changed or indeed if it has ever been changed.

[18] There was no evidence that there was anything wrong with the vehicle’s cam belt at the time of sale and the vehicle drove satisfactorily for 2,270kms before the cam belt broke. The Tribunal and the motor vehicle industry considers that a cam belt is a maintenance item which is subject to wear and tear and can break at any time if it has not been replaced at about 100,000kms or after 7 years use. The Tribunal considers that a reasonable purchaser paying only $2,000 for a 200,229km 13 year old former taxi vehicle with no service history would not expect much of it in the way of durability. Accordingly the Tribunal does not think that the vehicle failed to comply with the guarantee of acceptable quality in s 6 of the Consumer Guarantees Act 1993 and it must therefore dismiss the purchaser’s application.

Order

The purchaser’s application is dismissed.

DATED at Auckland this 16th day of December 2011.

C.H.Cornwell
Adjudicator