Keown v Glamour Cars Limited - Reference No. MVD 28/2013 (Auckland) [2013] NZMVDT 37 (19 April 2013)

Last Updated: 19 June 2013

Decision No. AK 33/2013

Reference No. MVD 28/2013

IN THE MATTER of the Motor Vehicle Sales Act 2003

AND

IN THE MATTER of a dispute

BETWEEN RUDI VERNON KEOWN

Purchaser

AND GLAMOUR CARS LIMITED

Trader

BEFORE THE AUCKLAND MOTOR VEHICLE DISPUTES TRIBUNAL

Mr C H Cornwell, Barrister & Solicitor, Adjudicator
Mr S D Gregory, Assessor
HEARING at Auckland on 25 March 2013

APPEARANCES
Mr R V Keown, the purchaser
Mr Y Singh, director, for the trader
Mr L P Hunter, support person for trader

AMENDED DECISION

Background

[1] This Amended Decision replaces the Tribunal’s Decision in this matter dated 28 March 2013. That decision omitted to deal with the Loan Agreement which Mr Keown had made with Alphera Financial Services on 3 October 2012. On 3 October 2012 Mr Keown bought, sight unseen, a 2004 Renault Megane car from Glamour Cars Limited for $7,000. He financed the purchase by borrowing the full purchase price from BMW Financial Services New Zealand Limited trading as Alphera Financial Services. A few days after collecting the car Mr Keown discovered the vehicle’s transmission had a fault and there are other minor faults with the vehicle. Mr Keown applied to the Tribunal in 2012 for an order that the faults be fixed in Rotorua by his mechanic at Glamour Cars’ cost.

[2] The Tribunal heard Mr Keown’s application on 10 December 2012. Mr Singh the director of Glamour Cars told the Tribunal at that hearing that his company was willing to uplift the vehicle and have it transported back to Auckland and repaired by its repairers at its cost. The Tribunal issued its decision on 12 December 2012 and decided, applying s18(2) of the Consumer Guarantees Act 1993 (“the Act”), that Glamour Cars should be given the opportunity to collect the car as soon as reasonably possible and repair it in Auckland at its cost within a reasonable time before returning the car to Mr Keown. It also ordered Glamour Cars to pay Mr Keown the sum of $341.71.

[3] Mr Keown applied to the Tribunal on 25 February 2013 for an order upholding his rejection of the car on 20 February 2013 and ordering Glamour Cars to refund his purchase price for the car and other costs he has incurred because he says Glamour Cars did not repair the car and return it to him within a reasonable time. Glamour Cars claim they have repaired the car within a reasonable time and have paid $341.71 ordered to be paid to Mr Keown and that Mr Keown is not entitled to reject the car.

[4] Prior to the commencement of the Tribunal’s inquiry, the Tribunal appointed Mr Gregory 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 Gregory assisted the adjudicator but the application was determined by the adjudicator alone.

The Issue

[5] There is only one issue to be determined by the Tribunal from this fresh application by Mr Keown, namely: whether Glamour Cars repaired the car’s faults within a reasonable time of the Tribunal ordering it to do so.

Issue: Did Glamour Cars repair the car’s faults within a reasonable time of being ordered to do so?

Relevant law

[6] 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."

Application of law to facts

[7] The Tribunal’s orders dated 12 December 2012 was sent to Glamour Cars the same day electronically and a sealed copy of it was sent to Glamour Cars in the post on 12 December 2012. The orders were as follows:
“1.Glamour Cars Limited shall, as soon as reasonably possible, collect the car from Mr Keown in Rotorua and transport it to Auckland and shall investigate and rectify the following faults within a reasonable time before returning the vehicle to Mr Keown, all at its cost:
a) the transmission flare;
b) the air conditioning fault;
c) the radio fault;
d) the left rear window;
e) the left rear fog lamp.

2. Glamour Cars Ltd shall on production of GST receipted invoices by Mr Keown refund him the sum of $341.71 as follows:
a) the cost of the warrant of fitness: $45;
b) the cost of the ABS speed sensor: $114.70;
c) the cost of fitting the speed sensor: $65;
d) the cost of Driveline Automotive Ltd’s assessment: $117.01.”

[8] Mr Keown produced copies of his exchanges of emails with Glamour Cars commencing with an email from Glamour Cars on 7 January 2013 in which Mr Singh promised to arrange to collect the car and bring it to Auckland and asked for Mr Keown’s contact number, which Mr Keown says he supplied to Mr Singh the same day by email.

[9] Mr Keown sent Glamour Cars an email on 21 January 2013 when he had not heard from the transporting firm and Mr Singh replied that the transporting firm had tried to contact him and would call again.

[10] Mr Keown says that on 24 January 2013 he sent Glamour Cars an email saying that he had spoken to the firm in Auckland who were to repair the car and was still awaiting instructions for the transport of his car to Auckland. Glamour Cars then sent an email asking him to contact a Mr Karl at Auto Movements to arrange for his car to be collected and taken to Transmission Solutions.

[11] On 4 February 2013 Mr Keown contacted Auto Movements who asked that Mr Singh contact them to arrange the collection of the car which Mr Singh said he had done in an email sent to Mr Keown. However, it is not disputed by Glamour Cars that the car was not collected from Mr Keown until 8 February 2013 and not delivered to Transmission Solutions until 9 February 2013.

[12] Mr Keown sent Glamour Cars an email on 19 February 2013 asking Mr Singh to tell him what was happening with the repair of his car because he says he had been previously told by Transmission Solutions that repairs would take no longer than 10 days. Mr Singh sent Mr Keown an email on 19 February asking him to wait. The email states that Mr Singh had asked for a further 10 working days within which to fix the car and return it to Mr Keown. This request was unacceptable to Mr Keown who on 20 February 2013 sent Glamour Cars an email rejecting the car due to repairs not having been done in a reasonable time. Mr Keown’s email requested a refund of the purchase price. Mr Singh then sent Mr Keown an email in which he said he was still willing to fix the car but if Mr Keown could not wait a few days then he could do what he liked but Mr Singh would not take the car back. Glamour Cars Ltd did not lodge the $341.71 it was ordered to pay Mr Keown to the credit of bank account until 25 February 2013.

[13] Mr Singh told the Tribunal he had arranged in December 2012 for Transmission Solutions to collect and repair the car on behalf of Glamour Cars but they did not have the car collected from Mr Keown in Rotorua until 8 February 2013 and delivered to Transmission Solutions the next day. The car’s transmission was repaired by Transmission Solutions Ltd about 22 February 2013 at a cost of $914.02. The work involved a road test, scan, removing the valve body, fitting an EVM solenoid, reassembling the transmission and road testing the car. The labour component of the work done by Transmission Solutions was only $280 plus GST. The car was then taken to Brett Payne Auto Electrical Ltd who repaired the left rear electric window and replaced a CD player at a total cost of $299. The invoice for this work is dated 25 February 2013. The car was inspected by the AA on 27 February 2013 and was found to be in fair order.

[14] Mr Singh says that Glamour Cars left the repairs to be managed by Transmission Solutions and they did not arrange to get the car transported to Auckland until February 2013. He says he understands that Transmission Solutions were closed for three weeks from Christmas and did not reopen until 14 January 2013.

[15] The Tribunal in deciding whether Glamour Cars repaired the car’s faults within a reasonable time has had regard to the following:
(a) the date on which Glamour Cars knew the Tribunal had ordered them to repair the car of 12 December 2012;
(b) the fact that although there were eight working days remaining in December 2012 it would be extremely difficult to have the car collected and repaired before the Christmas closure in December 2012;
c) that Mr Singh promised on 7 January 2013 to collect the car;
(d) the fact that after several emails the car was not collected until 8 February 2013;
(e) the fact that Mr Keown had been told by Transmission Solutions that his car would be repaired within 10 days of their receiving it;
(f) the fact that the transmission repairs involved the replacement of a solenoid and were relatively quick, cheap and easy to implement;
(g) the fact that Glamour Cars had not completed repairs to the car until about 25 February 2013.

[16] Taking each of the above factors into account the Tribunal has calculated that Glamour Cars had 38 working days between 12 December 2012 and 20 February 2013 in which to collect the car and repair it. Even if the 8 working days in December 2012 are deducted from this total, Glamour Cars still took more than 30 working days or six working weeks to do $1,213.02 of fairly simple repairs. The Tribunal thinks that is well beyond what is a reasonable time.

Conclusion

[17] Glamour Cars did not repair the car within a reasonable time as they were required to do by s18(2)(a) of the Act. Accordingly Mr Keown was entitled and did properly reject the car on 20 February 2013.

[18] The Tribunal will order the loan agreement between the purchaser and Alphera Financial Services to vest in Glamour Cars Ltd from the date of rejection namely 20 February 2013. Glamour Cars will be ordered to refund Mr Keown with the capital component of all payments made by him to Alphera Financial Services up to 20 February 2013 and the aggregate amount of all payments of principal and interest paid by Mr Keown to Alphera Financial Services from 20 February 2013 to the date of this amended order. Glamour Cars will also be ordered to pay the following consequential losses that Mr Keown has suffered in terms of s18(4) of the Act:
a) filing fee on second application $51.11
b) Bank cheque fee $5.00
c) Travelling expenses to second hearing –
464km @ $0-62 cents per km= $287.68 $287.68
d) Loss of wages for one day (net of tax) $115.00
Total $458.79

Orders

1.Mr Keown’s rejection of a 2004 Renault Megane registration number GLH324 is upheld with effect from 20 February 2013.

2. The Loan Agreement dated 3 October 2012 between Mr Keown and Mrs Keown and BMW Financial Services New Zealand Limited trading as Alphera Financial Services (“the Alphera Loan Agreement”) in respect of the vehicle shall vest in Glamour Cars Limited from 20 February 2013 and Glamour Cars Ltd shall be responsible for all the obligations of Mr & Mrs Keown under the Alphera Loan Agreement.

3. Glamour Cars Limited shall pay to Mr Keown the following sums:
a) $458.79; and

b) the capital component of all payments made by Mr & Mrs Keown to Alphera Financial Services under the Alphera Loan Agreement from 3 October 2012 to 20 February 2013; and

c) The total amount of all payments made by Mr & Mrs Keown to Alphera Financial Services under the Alphera Loan Agreement after 20 February 2013 to the date of this amended order.

4. If there is any dispute between the parties as to the amount repayable to Mr & Mrs Keown in terms of Order 3 (above) leave is granted to either party to refer that matter back to the Tribunal for determination with the unsuccessful party paying the reasonable costs of the Tribunal’s hearing.

DATED at Auckland this 19 April 2013

C.H.Cornwell
Adjudicator