Petschner v Armstrong Prestige Dunedin Limited - Reference No. MVD 207/12 (Auckland) [2013] NZMVDT 36 (19 April 2013)

Last Updated: 19 June 2013

Decision No: AK 32/2013
Reference No. MVD 207/12

IN THE MATTER of the Motor Vehicle Sales Act 2003

AND

IN THE MATTER of a dispute

BETWEEN THOMAS PETSCHNER

Purchaser

AND ARMSTRONG PRESTIGE DUNEDIN LIMITED

Trader

BEFORE THE MOTOR VEHICLE DISPUTES TRIBUNAL

Mr C H Cornwell, Barrister & Solicitor, Adjudicator
Mr S D Gregory, Assessor

HEARING at Christchurch on 11 April 2013

APPEARANCES

Mr T Petschner, the purchaser

Mr G Rudhall, General Manager for the trader
Mr J Duffy, Service Manager for the trader

DECISION

Background

[1] On 17 September 2011 Mr Petschner (“the purchaser”) agreed to buy, sight unseen, a 2007 Mercedes-Benz A180 car (“the vehicle”) from Armstrong Prestige Dunedin Limited (“the trader”) for $25,000. The purchaser rejected the vehicle on 23 October 2012 because he says it has a serious fault that cannot be repaired. The fault is that the right front tyre on the car wears quickly on its outer shoulder and needs to be replaced frequently. He seeks the Tribunal’s order upholding his rejection and ordering the trader to refund the purchase price.

[2] The trader was represented at the hearing by Mr Rudhall the General Manager of Armstrong Prestige who says that there is nothing wrong with the vehicle, that it has not been in an accident and that the manner the purchaser drives it has caused the damage to the tyres.

[3] Pursuant to clause 10 of Schedule 1 of the Motor Vehicle Sales Act 2003 the Tribunal has appointed Mr Gregory as expert assessor to assist in the determination of the complaint. Mr Gregory took the oath required by cl 10(2) of Schedule 1 to that Act. As an assessor Mr Gregory assisted the adjudicator but the application was determined by the adjudicator alone.

Issues

[4] The Tribunal thinks the issues in this application are:
[a] Whether the vehicle sold to the purchaser is of acceptable quality?
[b] If not, has the trader succeeded in remedying the fault within a reasonable time?
[c] Is the failure one of substantial character?
[d] Whether the purchaser is entitled to reject the vehicle and if not what remedy is he entitled to?

Legal Principles

[5] Section 6 of the Consumer Guarantees Act 1993 (“the Act”) provides a guarantee that goods supplied to a consumer must be of acceptable quality. Section 6 provides:
“6 Guarantee as to acceptable quality
(1) Subject to section 41, where goods are supplied to a consumer there is a guarantee that the goods are of acceptable quality.

(2) Where the goods fail to comply with the guarantee in this section,-

(a) Part 2 may give the consumer a right of redress against the supplier; and

(b) Part 3 may give the consumer a right of redress against the manufacturer.”

[6] The expression "acceptable quality" is defined in s 7(1) 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.”

[7] In Stephens v Chevron Motor Court Limited [1996] DCR1, the District Court held that the correct approach to the Act was first to consider whether the vehicle was of “acceptable quality”. If the vehicle was not of acceptable quality, the next point to consider was whether the purchaser required the trader to remedy any faults within a reasonable time in accordance with s 19 of the Act. If the failure to comply with the guarantee of acceptable quality is of a “substantial character” within the meaning of s 21, or if the faults cannot be remedied, the Tribunal is directed to ask whether the purchaser has exercised his/her right to reject the vehicle within a reasonable time.

Application of law to facts

Issue [a]: Whether the vehicle sold to the purchaser is of acceptable quality?

[8] The purchaser who lives near Lyttelton says he saw the vehicle, a 2007 Mercedes-Benz A180 Avantgarde with 48,637kms on its odometer, advertised for sale on TradeMe by the trader in Dunedin. He says he telephoned the trader and spoke to its salesman, Mr Matt Smith. He says that Mr Smith told him in reply to his questions that the vehicle had not been involved in any accidents as far as he knew and that the vehicle was in very good condition and had been always well serviced in the trader’s workshop. The purchaser says that on 17 September 2011 he agreed to buy the vehicle for a negotiated price of $25,000 with the trader paying the cost of transporting it to Christchurch. He paid a deposit of $1,000 and the balance of $24,000 when he collected the vehicle from Armstrong Prestige in Christchurch on 27 September 2011.

[9] When the purchaser went to collect the vehicle from Armstrong Prestige he found the left front (offside) tyre was almost bald of tread and the front right tyre was damaged. He says he telephoned Mr Smith about the condition of the tyres but Mr Smith was unwilling to agree to replace them until one of Armstrong Prestige’s Christchurch employees confirmed the damage and urged Mr Smith to agree to replace the two front tyres. The purchaser says that as soon as he drove the vehicle he noticed it pulled strongly to the left and he immediately returned the car to Armstrong Prestige who promised to check that when he brought the vehicle back to have the tyres replaced. The purchaser arranged for his wife to take the vehicle into Armstrong Prestige in October 2011 and both front tyres were replaced.

[10] The purchaser says he was overseas from 29 September until 23 November 2011 but when he returned to New Zealand and drove the vehicle he noticed it was still pulling to the left. He went back to Armstrong Prestige on 25 November 2011 and spoke to a person named Ljubo about the vehicle whom he says told him that the Armstrong Prestige Christchurch workshop were not prepared to do any more work on the vehicle unless the purchaser paid for it.

[11] On 8 December 2011 the purchaser sent a long email to Mr Smith in which he complained of various faults with the vehicle including the wheel alignment, that the two new tyres the trader had replaced in October were already showing signs of wear, and the steering wheel alignment. The purchaser suggested two possible ways of solving the issues; either that he return the vehicle for a refund of the purchase price or the matter be referred to the Tribunal for its decision. Mr Smith did not reply to the purchaser’s email but the purchaser had a telephone call from Armstrong Prestige saying they would repair all the faults listed in his email to Mr Smith.

[12] On 11 January 2012 the purchaser took the vehicle to Armstrong Prestige. Its odometer was then 51,823kms He says that after just 3,900kms of use since the two front tyres had been replaced, both tyres were badly damaged in the same way as the previous two tyres had been; the front left tyre was worn on the outside and the front right tyre was worn on its inside. The right front tyre was a little less worn than the front left tyre. At that time the purchaser discussed with Mr Rudhall trading in the vehicle on a new car but Mr Rudhall calculated the vehicle had already lost $4,000 of its value in the four months the purchaser had owned it so they discussed other options. Mr Rudhall proposed that all four tyres on the vehicle be replaced and the purchaser agreed to pay $250 towards the cost. The new tyres were replaced and a wheel alignment done by Mag & Turbo who recorded the vehicle’s odometer as 52,574kms. Mr Rudhall and the purchaser took the vehicle for a test drive after the new tyres had been fitted and the wheel alignment done and agreed with the purchaser that there was some improvement but that the vehicle did not drive as straight as it should. Mr Rudhall and the purchaser agreed that the purchaser would drive the vehicle for some time to see how it went.

[13] By April 2012 the front tyres fitted in January 2012 were already showing signs of wear. The purchaser contacted Ljubo at Armstrong Prestige who arranged for him to take the vehicle back to Mag & Turbo to have another two front tyres fitted free of charge on 17 April 2012. Mag & Turbo were apparently too busy to do a wheel alignment but recommended the purchaser have this done by Shepherd & Kime Ltd which he did on 17 April 2012 for which the purchaser paid $70. The wheel alignment report records the odometer as 58,043kms on 17 April 2012

[14] At the end of August 2012 the front tyres on the vehicle were again showing wear. The purchaser says he discussed the matter with Mr Duffy the Service Manager for Armstrong Prestige who received copies of the wheel alignment reports done in January and April 2012 and on 4 September 2012 another wheel alignment was done on the vehicle. Mr Duffy promised to contact the purchaser after discussing the alignment report with a technician wheel alignment specialist. On 8 October 2012 the purchaser took the vehicle back to Armstrong Prestige and spoke to Mr Duffy whom he says told him there was nothing more that the workshop could do and in his opinion the vehicle was fine, there was nothing wrong with the vehicle and it does not require any further repair.

[15] On 5 October 2012 the purchaser took the vehicle to Oil Changers Riccarton for a warrant of fitness. The odometer was recorded as 65,345kms. The vehicle failed its warrant for unbalanced rear brake pads and the WOF checksheet records under “comments”: what appears to be “worn out tyres poor front”. Both the front tyre tread depths recorded on the check sheet are 2mm with 4.5mm on each of the rear tyres. The purchaser discussed the warrant of fitness report findings on the vehicle’s tyres with Mr Duffy who told him he thought the problem with the tyres must be caused by “environmental reasons” such as the condition of the roads on which the vehicle is driven. The purchaser also discussed with Mr Duffy the information he had been given by the WOF inspector that the vehicle had its front fender painted and would Mr Duffy please check with his colleagues in Dunedin to see if the vehicle had been involved in an accident. Mr Duffy told him that the vehicle had no sign that it had been in a previous accident.

[16] On 11 October 2012 the purchaser says he received a telephone call from Mr Duffy telling him that the trader did not see it had an obligation to replace the damaged tyres on the vehicle. On 23 October 2012 the purchaser sent Armstrong Prestige a letter rejecting the vehicle claiming it had a serious fault that could not be repaired and that it did not match the description given to him by Mr Smith of the trader. He also claimed that the trader had failed to repair the vehicle’s fault within a year which was well beyond any reasonable period. He notified the trader that the serious fault he complained of made the vehicle unsafe for himself and his family as well as for other people. The purchaser’s letter of rejection had attached to it a chronology of the events since the purchaser had agreed to buy the vehicle.

[17] Armstrong Prestige sent the purchaser a letter dated 26 October 2012 rejecting the purchaser’s claims the vehicle has a serious fault and disputing that it had taken a year to rectify the faults. Its reasons for refusing rejection were stated as follows:
1. there had not been satisfactory systematic monitoring of the tyre wear over a set period to determine a basis for determining a fault;

2. other businesses had contaminated any monitoring that could have been completed due to work on the suspension and replacement of tyres without their knowledge or input;

3. they had endeavoured to offer solutions and help to improve the purchaser’s experience of the vehicle at the trader’s cost.
Armstrong Prestige concluded its response to the purchaser by proposing an independent inspector be appointed to assess the vehicle and provide comment for both parties to review. The purchaser sent the trader an email on 1 November 2012 agreeing to this proposal.

[18] On 7 November 2012 Clunie Automotive inspected the vehicle. The purchaser produced their report which does not record the vehicle’s odometer at that time but states:
“Checked wheel alignment
Found wheel alignment to be out of spec.
Front toe- left +o.8mm, right -1.5mm, spec +1.46
Front camber left -1.33’, right -1.01’
Checked previous wheel alignment reports to find wheel alignment is constantly changing.
Checked sub frame and all mount points for movement, all fine.
Checked suspension components for excessive movement, could not fault.
Unsure at this stage as to why the wheel alignment is constantly changing.
This is not a normal condition of the vehicle and requires further investigation to fix the issues.”

[19] Armstrong Prestige proposed in an email on 12 November 2012 a means of attempting to resolve the matter but it involved the purchaser in further expense in sharing the cost of replacing the tyres which he was not prepared to agree to do.

[20] Prior to the hearing the Tribunal, as part of its inquisitional role asked the purchaser to obtain a report from a panel beater on possible accident damage to the vehicle and its steering rack. On 3 April 2013 the vehicle was inspected by Doug Smith Panelbeaters Ltd who wrote two reports; both dated 3 April 2013. The second and more comprehensive report (Exhibit 6) states that they removed the RF headlight, RF guard liner and LF guard liner to assess possible previous damage. The vehicle was then sent to an independent wheel alignment and 3D measurement specialist for the owner’s assurance. Both the wheel alignment and the 3D measure came back within specifications of the design. However Doug Smith’s report states
“We have found the vehicle has had a repair to the RF corner including the bonnet, RF guard & door, the bonnet has some shrink back and the guard and door gaps are not unified. The front bar has also had a previous repair. We measured the distance between each strut and tower and have found a difference between the left and right. Although the struts are meant to have a small bend or kink half way down we believe the RF strut is bent thus making the vehicle pull and or scrub out tyres faster than it should.
As in relation to the steering rack there is no visible problem obvious, however it could well be bent and would be advisable to have it checked by a steering component specialist. As above was within wheel alignment specs.
PN: we have been told this vehicle is a NZ new Mercedes and if any new parts have been purchased through Armstrong Prestige they should have a record to show which parts have been acquired for this vehicle.”
The purchaser produced a copy of the Chassis Repairs wheel alignment report dated 28 March 2013.

[21] The trader was requested by the Tribunal to provide copies of all invoices for work done on the vehicle and the invoices show that on 28 November 2008 when the vehicle ‘s odometer was 11,197kms the trader replaced both front tyres and did a wheel alignment. The trader replaced the front tyres on the vehicle for the second time on 7 May 2010 at 30,822kms and did another wheel alignment.

[22] Mr Rudhall for the trader says that the trader’s efforts to remedy the issues with the vehicle’s worn tyres have been “frustrated by the purchaser’s inability to consistently monitor and agree a course of action that might allow us to effect a better result.” In particular that the purchaser failed after say 1,000kms to monitor the wear on the front tyres or allow the wheel alignment specialists to view the vehicle. In a letter to the Tribunal Mr Rudhall says that the trader believes the purchaser’s excessive tyre wear is related to poor maintenance and observation, driving environment on hills and possibly even driving style. At the hearing Mr Rudhall repeated those arguments and said his manner of driving the vehicle on the corners and hills of Dyers Pass Road caused the tyre wear he complains of.

[23] The purchaser gave evidence that he had a Honda Odyssey car which he also drove on the Dyers Pass Road and he had not had any problems with the tyres on that car.

[24] Mr Duffy also gave evidence that he believed the vehicle was within specification as confirmed by the Doug Smith report and he disagreed with the conclusion in the Doug Smith report that there was a bent strut. He says if the strut is bent that would have been evident in the alignment report from the measurement of the camber or castor. Mr Duffy acknowledged in answer to a question from the Adjudicator that he had never driven the vehicle on any of the occasions it had been returned to Armstrong Prestige.

[25] Following the conclusion of the hearing the Assessor drove the vehicle. He has reported to the Adjudicator that the vehicle’s track does not drift to the left as he might expect a car’s steering to be designed to do normally but has an unusual characteristic; the vehicle’s steering wheel kicks slightly to the left about the same distance on each of the several occasions he allowed it to do so which in turn causes the vehicle to steer to the left and requires continuous correction to steer the vehicle back to the right.

[26] After listening to the evidence the Tribunal finds as a fact that the vehicle supplied to the purchaser by the trader was very probably faulty at the time of sale. The Tribunal’s reasons are as follows: first, the frequency that this vehicle has required the replacement of its front tyres, and in particular the fairly short distances travelled between replacing the front tyres on the vehicle is indicative of a fault. The trader’s evidence shows that the replacement of the front types occurred twice before the vehicle was supplied to the purchaser at only 11,197kms and 30,822kms. The purchaser’s evidence shows the vehicle needed its front tyres replaced again when it was supplied to the purchaser at 48,637kms in September 2011 and again four months and 3,186kms later on 11 January 2012. The front tyres were replaced for the third time (whilst in the purchaser’s ownership) three months and 6,220kms later on 17 April 2012. The problem has persisted and when the vehicle was taken for its last warrant of fitness on 5 October 2012 the front tyres were found to be in poor condition.

[27] The second reason the Tribunal finds the vehicle is faulty is that the Clunie Automotive report confirms there is a fault with the vehicle’s wheel alignment constantly changing.

[28] The third reason is that the Doug Smith report confirms that the vehicle has been accident damaged. Although the trader denied this it produced no evidence to support its claim the vehicle had not been accident damaged. The Tribunal prefers the evidence of Doug Smith to the unsupported claim made by the trader. The vehicle may well have been damaged and repaired in Dunedin by the previous owner without the trader knowing it.

[29] The explanations offered by the trader’s service manager, Mr Duffy, that the wear on the front tyres is normal in not credible and nor is the explanation which Mr Rudhall offered that the left front tyre wear is caused by environmental factors such as the road the purchaser drives on and his manner of driving. That claim was unsupported by any reliable evidence. Furthermore, when the purchaser first picked up the vehicle the tyres were worn in the same manner so his driving environment and style could not possibly be the cause of the front tyre wear because he had, at that time, never driven the vehicle. The Tribunal, on the advice of its Assessor, considers that if the purchaser were driving the vehicle in an abusive manner there would have been evidence of this from the pattern of tyre wear on the other tyres on the vehicle. The Assessor checked for this and says he found none.

[30] The front left (offside) outer tyre has consistently worn faster than the right front tyre and the Assessor considers it is very probable, as reported by Doug Smith, that the right front strut has been damaged by impact to the right front of the vehicle. The Assessor considers this probably accounts for the unusually heavy wear to the left front tyre.

[31] Accordingly the Tribunal finds that the vehicle supplied by the trader did not, at the time of sale, comply with the guarantee of acceptable quality in s 6 of the Act because no reasonable purchaser paying $25,000 for a four year old New Zealand new Mercedes-Benz with only 48,637kms would expect to have the problems with tyre wear and steering that this vehicle has.
Issue [b]: Did the trader succeed in remedying the fault within a reasonable time?

[32]Section 18 of the Act provides as follows:

“18 Options against suppliers where goods do not comply with guarantees
(1) Where a consumer has a right of redress against the supplier in accordance with this Part in respect of the failure of any goods to comply with a guarantee, the consumer may exercise the following remedies:

(2) Where the failure can be remedied, the consumer may ¾
(a) require the supplier to remedy the failure within a reasonable time in accordance with section 19:
(b) where a supplier who has been required to remedy a failure refuses or neglects to do so, or does not succeed in doing so within a reasonable time, ¾
(i) have the failure remedied elsewhere and obtain from the supplier all reasonable costs incurred in having the failure remedied; or
(ii) subject to section 20, reject the goods in accordance with section 22.

(3) Where the failure cannot be remedied or is of a substantial character within the meaning of Section 21, the consumer may ¾
(a) subject to section 20, reject the goods in accordance with section 22; or
(b) obtain from the supplier damages in compensation for any reduction in
value of the goods below the price paid or payable by the consumer for the
goods.

(4) In addition to the remedies set out in subsection (2) and subsection (3), the
consumer may obtain from the supplier damages for any loss or damage to the
consumer resulting from the failure (other than loss or damage through
reduction in value of the goods) which was reasonably foreseeable as liable to
result from the failure."

[33] The Tribunal sees from the email correspondence between the purchaser to the trader that the purchaser first recorded in writing his requirement that the trader remedy the fault with the tyre wear and wheel alignment in his email to Mr Smith dated 8 December 2011. The vehicle was returned to the trader to have the fault rectified on 11 January 2012, 17 April 2012, 4 September 2012 and 8 October 2012 before the trader informed him on 11 October 2012 that it did not see that it was its obligation to replace the damaged tyres. However even after the purchaser rejected the vehicle on 23 October 2012 the trader proposed in an email dated 12 November 2012 making adjustments to the castor, camber and toe that it said would help with both the pulling left and the tyre wear. It therefore seems to the Tribunal that even as late as November 2012 the trader had little idea what was causing the problem and still wanted to be given time to find and fix it. The Tribunal therefore finds that the trader has not succeeded in remedying the problem within a reasonable time and as a consequence the purchaser is entitled to one of the two applicable remedies in s 18(2) of the Act.
Issue [c]: Is the failure one of substantial character?

[34] Section 21 of the Act defines the circumstances in which a failure to comply with the guarantee as to acceptable quality will be regarded as being a failure of a substantial character for the purposes of s18(3) of the Act. Section 21 of the Act provides as follows:

“ 21 Failure of substantial character
For the purposes of section 18(3), a failure to comply with a guarantee is of a substantial character in any case where ¾
(a) the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; or

(b) the goods depart in 1 or more significant respects from the description by which they were supplied or, where they were supplied by reference to a sample or demonstration model, from the sample or demonstration model; or

(c) the goods are substantially unfit for a purpose for which goods of the type in question are commonly supplied or, where section 8(1) applies, the goods are unfit for a particular purpose made known to the supplier or represented by the supplier to be a purpose for which the goods would be fit, and the goods cannot easily and within a reasonable time be remedied to make them fit for such purpose; or

(d) the goods are not of acceptable quality within the meaning of section 7
because they are unsafe."

[35] The Tribunal considers the issue which has caused the front tyres on the vehicle to wear is certainly annoying but it does not consider, as the purchaser claimed in his letter of rejection that it is either serious or that it makes the car unsafe for himself, his passengers or other road users. If the purchaser honestly thought the vehicle was unsafe he would not have driven over 25,549kms in it since he purchased it over 19 months ago much less would he have continued, as he does, to drive the vehicle over 7,000kms since he rejected it six months ago. The Tribunal is therefore not satisfied the vehicle’s failure to comply with the guarantee of acceptable quality is a failure of substantial character.

Issue [d]: Whether the purchaser is entitled to reject the vehicle?

[36] The remedy the purchaser has asked the Tribunal for is rejection. In order to uphold the purchaser’s rejection the Tribunal needs to enquire whether the purchaser rejected the vehicle within a reasonable time.
Section 20(1) of the Act provides as follows:
“20 Loss of right to reject goods
(1) The right to reject goods conferred by this Act shall not apply if-
(a) the right is not exercised within a reasonable time within the meaning of subsection (2); or
(b) the goods have been disposed of by the consumer, or have been lost or destroyed while in the possession of a person other than the supplier or an agent of the supplier; or
(c) the goods were damaged after delivery to the consumer for reasons not related to their state or condition at the time of supply; or
(d) the goods have been attached to or incorporated in any real or personal property and they cannot be detached or isolated without damaging them.”

(2) In subsection (1)(a), the term reasonable time means a period from the time of supply of the goods in which it would be reasonable to expect the defect to become apparent having regard to—
(a) the type of goods:
(b) the use to which a consumer is likely to put them:
(c) the length of time for which it is reasonable for them to be used:
(d) the amount of use to which it is reasonable for them to be put before the defect becomes apparent.
(3) This section applies notwithstanding section 37 of the Sale of Goods Act 1908.”

[37] The period of time within which rejection must occur runs from the date of supply (here 29 September 2011), not from the date any defect was, or ought to have been, detected. The purchaser did not reject the vehicle until 23 October 2012, a period of 13 months after the date of supply.

[38] The Court of Appeal in Nesbit v Porter [2000] NZCA 288; (2000) 9 TCLR 395 in considering s20 and what was a “reasonable time” under the Act in respect of an 11 year old Nissan Navarra sold for $10,990 and rejected because of rust nine months after purchase said:
“In many, if not most, cases the period will be longer for new goods, which a buyer is entitled to expect to be defect free when first used, than it will be for second hand goods of the same type. As a general rule, the older the goods, the shorter is likely to be the reasonable time.” The Court in Nesbit also said:
“Another factor which will influence the period to be allowed for exercise of the right of rejection is whether regular inspections of the goods for defects are customary or, as in the case of motor vehicles, required by law. But for defects which cannot be expected to be revealed by such inspections the reasonable time may be longer.” And later in the same decision the Court said:
“A reasonable time under s20 must accordingly be one which suffices to enable the consumer to become fully acquainted with the nature of the defects, which, where the cause of a breakage or malfunction is not apparent the consumer can be expected to do by taking the goods to someone, usually and preferably the supplier, for inspection. In this context therefore, a defect is not “apparent” until its cause has been identified and the buyer knows what has to be done to fix it, and what that will cost; in other words, until the buyer is in a position to determine whether the defect is substantial.” Finally and probably most relevantly to the present fact situation the Court said:
“We consider that in a vehicle the age and type of this Navara it is reasonable to expect defects of the kind actually encountered by the Nesbits, latent at the time
of the supply, to become apparent relatively soon after the supply. (We do not understand there to have been an allegation that there was any concealment on the part of Porter Motors.) In our view the motor vehicle dealer should generally be freed from the burden of having to accept rejection of a vehicle of this age and pedigree after the time of the next mandatory six monthly Warrant of Fitness check has passed. If, at the latest, a defect of the kind found in the Navara has not manifested itself on such an inspection, it would be an unfair burden upon the supplier if a buyer of such a vehicle, which must be assumed to have been in daily use, sometimes in rough conditions, should thereafter be able to reject it. Bearing in mind, however, that most people do not have their vehicles tested until the six month period is expiring; there is a need for some latitude to give time to decide whether to exercise that right.”

[39] In Nesbit the Court of Appeal held that the right to reject the vehicle for rust had been lost when it was not exercised seven months after the date of supply of the vehicle.

[40] In applying these principals to this application the Tribunal considers that even allowing for the fact that the cause of the tyre wear and the vehicle pulling to the left has not been definitively found, the purchaser ought to have realised by 17 April 2012 (seven months after supply) that the fault with the vehicle steering and tyres was not being fixed by the trader because by then he had already had three sets of front tyres replaced. The Tribunal concludes that, by not rejecting the vehicle until 23 October 2012 the purchaser lost his right to reject the vehicle by delay. Furthermore since he purported to reject the vehicle the purchaser has continued to use it. The vehicle had travelled 25,549kms from the date of supply until the date of the hearing of which the Tribunal estimates it was used to travel about 7,000kms since the purchaser rejected it. The Tribunal thinks the purchaser’s conduct since rejection has been inconsistent with rejection. The Tribunal has decided, because of the purchaser’s delay in rejecting the vehicle and also because of his continued use of the vehicle since he rejected it, not to make an order allowing the remedy of rejection.

[41] The Tribunal considers the purchaser’s remedy is limited to damages under s18(3)(b) of the Act. The Tribunal was not supplied by either of the parties with an estimate of the cost the purchaser will incur in having the right front strut removed, inspected and replaced as well as the cost of replacing, once again, the two front tyres on the vehicle and having a wheel alignment done. The Tribunal, on the advice of its Assessor estimates the cost of these parts and the work involved in fitting them, replacing balancing and carrying out a wheel alignment to be about $1,350 inclusive of GST. The Tribunal will therefore order the trader to pay that sum to the purchaser to enable him, using a repairer such as Clunie Automotive, to remove, examine and replace the right front strut and, if it is found to be damaged that strut and the left front strut and also to replace the two front tyres and have a wheel alignment done.

Order

The trader shall pay the purchaser $1,350 immediately.

DATED at Auckland 19 April 2013

C.H Cornwell
Adjudicator