Jones v 2 Cheap Cars Limited - Reference No. MVD 199/2017 [2017] NZMVDT 125 (11 August 2017)

Last Updated: 15 September 2017

BEFORE THE MOTOR VEHICLE DISPUTES TRIBUNAL
		[2017] NZMVDT 125 Reference No. MVD 199/2017
	IN THE MATTER	of the Motor Vehicle Sales Act 2003
	AND
	IN THE MATTER	of a dispute
	BETWEEN	CLAIRE JONES
		Purchaser
	AND	2 CHEAP CARS LIMITED
		Trader
MEMBERS OF TRIBUNAL
B R Carter, Barrister – Adjudicator
S Gregory, Assessor
HEARING at Auckland on 10 August 2017
DATE OF DECISION 11 August 2017
APPEARANCES
Ms C A C Jones, Purchaser
Ms E Edson, for the Trader

ORDERS

A. Ms Jones’ application is dismissed.

DECISION

[1] The damage to the vehicle’s engine was most likely caused by Ms Jones using 91 octane fuel in the vehicle. As a result, the vehicle has not failed to comply with the acceptable quality guarantee in s 6 of the Consumer Guarantees Act 1993 (“the Act”).

REASONS

Introduction

[2] On 20 June 2015, Claire Jones purchased a 2006 Nissan Murano for $10,484 from 2 Cheap Cars Limited. The vehicle had an odometer reading of 126,627kms at the time of sale.
[3] On about 26 January 2017 the vehicle’s engine failed. Following negotiations, 2 Cheap Cars agreed to provide a second hand engine at its expense and Ms Jones paid the labour cost of replacing the engine.
[4] Ms Jones has now applied to the Tribunal to recover that labour cost, and the cost of having the engine damage diagnosed; alleging that the engine fault was a breach of the acceptable quality guarantee in s 6 of the Act.

The Issues

[5] There is only one issue that requires consideration in this case – did the vehicle fail to comply with the acceptable quality guarantee in s 6 of the Act?

Did the vehicle fail to comply with the guarantee of acceptable quality in s 6 of the Act?

[6] Section 6 of the Act imposes on suppliers and manufacturers of consumer goods "a guarantee that the goods are of acceptable quality." Section 2 of the Act defines "goods" as including vehicles.

[7] The expression "acceptable quality" is defined in s 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.”

[8] Ms Jones can only succeed in this application if she proves that the vehicle had a fault that breaches the acceptable quality guarantee in s 6 of the Act.
[9] Relevant to this case is s 7(4)(a) of the Act, which states that goods will not fail to comply with the guarantee of acceptable quality if the goods have been used in a manner which is inconsistent with the manner of use that a reasonable consumer would expect to obtain from the goods.
[10] I am satisfied that Ms Jones has used the vehicle in a manner that is inconsistent with the manner of use a reasonable consumer would expect to obtain from the vehicle. She has inadvertently used the wrong fuel, and by driving the vehicle with the wrong fuel, Ms Jones has caused the significant damage to the vehicle’s engine.

The engine damage was caused by the use of 91 octane fuel

[11] The vehicle has a 3.5 litre V6 petrol engine. Mr Gregory, the Tribunal’s Assessor, advises that such vehicles must use 95 octane fuel or higher. This is because the vehicle has been tuned, and has a compression ratio that requires the use of high octane fuel. Mr Gregory advises that using fuel with a lower octane, such as 91 octane fuel, can cause detonation in the engine’s combustion chamber that then damages the engine’s pistons and rings.
[12] Ms Jones gave evidence that she used only 91 octane fuel in the vehicle. This means that, throughout the 18 months of Ms Jones’ ownership, over which time she drove approximately 8,000kms, the incorrect fuel was being used in the vehicle.
[13] Ms Jones said that about a week before the engine failed, the vehicle developed a rattling sound in its engine, which progressively got louder to the point that she took the vehicle to her mechanic, who diagnosed a significant engine fault. Mr Gregory advises that the symptoms of the engine fault described by Ms Jones are entirely consistent with damage to the piston and rings caused by the use of incorrect fuel.
[14] Further, Ms Edson gave evidence as to a recent discussion with the mechanic at Marshall Automotive who assessed the engine damage and installed the replacement engine. I saw a copy of the notes Ms Edson made during that discussion. Her notes record that the mechanic considered that the vehicle had burnt or blown pistons. Mr Gregory advises that the mechanic’s observation is also consistent with engine damage caused by 91 octane fuel having been used in the vehicle.
[15] On the basis of the evidence I heard, and the advice I have received from Mr Gregory, I am satisfied that the damage to the vehicle’s engine was most likely caused by Ms Jones using 91 octane fuel in the vehicle, rather than any fault with the vehicle. As a result, I am satisfied that this vehicle has not failed to comply with the acceptable quality guarantee in s 6 of the Act.
[16] Ms Jones’ application is therefore dismissed.

DATED at AUCKLAND this 11th day of August 2017

B.R. Carter
Adjudicator