Harvey-Heads v Nigel Thompson Motor Company Limited - Reference No. MVD 56/13 (Wellington) [2013] NZMVDT 76 (10 July 2013)

Last Updated: 17 August 2013

Decision No. WN 12/2013

Reference No. MVD 56/13

IN THE MATTER of the Motor Vehicle Sales Act 2003

AND

IN THE MATTER of a dispute

BETWEEN SHARLAYNE HARVEY-HEADS

Purchaser

AND NIGEL THOMPSON MOTOR COMPANY LIMITED

Trader

BEFORE THE WELLINGTON MOTOR VEHICLE DISPUTES TRIBUNAL

N J Wills - Barrister, Adjudicator
N Barrett - Assessor

HEARING at Christchurch on 17 June 2013

APPEARANCES

Sharlayne Harvey-Heads, purchaser
Kevin Parker, witness for the purchaser (by telephone)
Nigel Thompson, director, for the trader
Chris Donaldson, Sales Manager, witness for the trader

DECISION

Background

[1] On 16 July 2012, Sharlayne Harvey-Heads (the purchaser) purchased a 2000 VW Beetle (the car) for $10,999 from Nigel Thompson Motor Company Limited (the trader). Ms Harvey-Heads is concerned that the car has ongoing problems. She would like a refund or for the car to be fixed.

[2] The trader's position is that the purchaser is not entitled to a refund, nor does the trader accept any responsibility for repairs.

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

Facts
Background

[4] On 16 July 2012 the parties entered into a vehicle offer and sale agreement (VOSA) for the purchaser to buy the car from the trader for $10,999. At the time of purchase the car’s odometer reading was 103,968 kilometres.

[5] In December 2012 a problem arose with the car’s blower motor for the EGR system, (which pumps air into the exhaust system to aid the catalytic converter in lowering exhaust emissions). The trader had the blower motor replaced at no cost to Ms Harvey-Heads.

[6] In early 2013 Ms Harvey-Heads went on holiday in the South Island. While she was away she noticed some banging noises in the car. She had the car checked by a mechanic in Alexandra who advised her that the problem was the rear shock absorbers/strut (The tribunal notes that these terms are often used interchangeably). When she got back from holiday Ms Harvey Heads took the car to Parker Automotive who fitted a new left rear shock at a cost of $529.

[7] The tribunal heard from Kevin Parker the owner and operator of Parker Automotive. Mr Parker said that Ms Harvey Heads asked him to replace the rear shock. He told the tribunal that he understood that the problem had been diagnosed elsewhere as a shock absorber problem and so that is the repair he carried out. At the time of this repair (18 January 2013) the car’s odometer reading was 111,078

[8] This repair did not remedy the noise and the car went back to Parker Automotive. On 23 January 2013 both rear strut (or shock) mounts were replaced at a cost of $353.62. The car’s odometer reading at the time of this repair was 111,118 kilometres.

[9] Ms Harvey-Heads sent the trader copies of the invoices for both repairs. Ms Harvey-Heads and Mr Thompson engaged in email correspondence. The trader offered $300 without accepting any liability. Mr Thompson told the tribunal that in his view the first repair was unnecessary and was carried out as a result of a mis-diagnosis. The offer of $300 was set at that amount to reflect the cost of replacing the strut mounts and was a gesture of goodwill. Mr Thompson’s key submission for the trader was that replacement of the strut mounts is a maintenance item and not an issue of acceptable quality or otherwise. He also made the point that Ms Harvey-Heads did not approach the trader about the repair before it was carried out.

[10] At the hearing Ms Harvey-Heads identified as a key concern the fact that the trader had advised her during negotiations for compensation for the repairs carried out, that the shock absorbers/struts had been replaced as part of the vehicle compliance process when the car was imported. At the hearing Mr Thompson clarified that he had called the Automobile Association (who had carried out the compliance checks on the car) and been advised that it was a requirement that shocks, struts and CV joints on vehicles over five years old have to be replaced if they are not new at the time of import.

[11] In February 2013, Ms Harvey-Heads noticed more banging noises in the front of the car. She raised this with the trader who referred her to Motor Works. Motor Works have diagnosed a problem with the front top shock mounting bushes. The trader has negotiated a price of $300 for this repair with Motor Works but does not accept liability for it. Mr Thompson reiterated that this was a maintenance issue not a warranty item. He made the point that the car obtained a warrant of fitness in December 2012 (requiring only a replacement bulb). Motor Works carried out the warrant of fitness inspection and recommended that the car be serviced at the time the inspection was carried out but Ms Harvey-Heads chose not to service the car.

[12] Mr Thompson also submitted that the condition of Christchurch roads has resulted in a significant increase in repairs to suspension components. Ms Harvey-Heads denied that she drove regularly on any particularly rough roads.

[13] At the time of her application to the tribunal (3 April 2013), the car’s odometer reading was 114,217 kilometres.

The Consumer Guarantees Act 1993

The guarantee of acceptable quality

[14] Section 6 of the Consumer Guarantees Act 1993 provides a guarantee as to the acceptable quality of goods sold:

"6 Guarantee as to acceptable quality

(1) Subject to section 41 of this Act, 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 of this Act may give the consumer a right of redress against the supplier; and

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

[15] Section 7 sets out a definition of the guarantee of acceptable quality:

"7 Meaning of “acceptable quality”
(1) For the purposes of section 6 of this Act, 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:
(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 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) of this section to a defect means any failure of the goods to comply with the guarantee of acceptable quality."

[16] 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) to (e) as modified by the factors set out in section 7(1)(f) to (j) from the perspective of a “reasonable consumer”. This test is an objective test. It is not a review of those factors from the purchaser’s subjective perspective.

[17] The reasonable consumer test is derived from the statement of Dickson J in Australian Knitting Mills Limited v Grant [1933] HCA 35; (1937) 50 CLR 387:

"The condition that goods are of merchantable quality requires that they should be in such an actual state that a buyer fully acquainted with the facts and, therefore, knowing what hidden defects exist, and not being limited to their apparent condition would buy them without abatement or price ... and without special terms".

[18] In this case the goods supplied are a thirteen year old second hand car with an odometer reading of 103,968 kilometres sold for a purchase price of $10,999. Ms Harvey-Heads has travelled over 10,000 kilometres in the car and has incurred costs of around $800 to date – some of which may not have been necessary and $300 of which has been paid for by the trader. The current issue with the front shock mounting bushes will cost around $300 to repair. The tribunal agrees with the trader that the problems that have arisen are maintenance items that could reasonably be expected in a car of this age and mileage.

[19] The tribunal notes Ms Harvey-Head’s concern about the information provided by the trader that the shocks/struts would have been replaced when the car was imported if they were not in “new” condition. This does not accord with Mr Barrett’s view of the certification process. Mr Barrett’s view is that shocks/struts would not be replaced as a matter of course but would be replaced if their condition was sub-standard. In that sense the trader’s statements about the certification process were somewhat misleading however Ms Harvey-Heads has not suffered any loss as a result of that advice. It may have been a different matter had she been told that prior to buying the car and had she relied on that statement in making her decision to buy the car.

Orders

1. The purchaser’s application is dismissed.
   

DATED at WELLINGTON this 10th day of July 2013