Harpur v Turners Group NZ Limited Reference No. MVD 381/2018 [2018] NZMVDT 310 (21 December 2018)

Last Updated: 15 January 2019

BEFORE THE MOTOR VEHICLE DISPUTES TRIBUNAL

I TE RŌPŪ TAKE TAUTOHENGA Ā-WAKA

MVD 381/2018
[2018] NZMVDT 310

BETWEEN RAYMOND JOHN HARPUR

Purchaser

AND TURNERS GROUP NZ LIMITED

Trader

HEARING at Christchurch on 23 November 2018

MEMBERS OF TRIBUNAL

J S McHerron, Barrister – Adjudicator

S N Haynes – Assessor
APPEARANCES

R J Harpur, Purchaser

B M Butler, Branch Manager of Trader

DATE OF DECISION 21 December 2018

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DECISION OF THE TRIBUNAL

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1. Raymond Harpur's application to reject his vehicle is dismissed.
2. Turners Group NZ Ltd must pay Mr Harpur $1,165.78 no later than 11 January 2019.

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REASONS

Introduction

[1] Raymond Harpur purchased a 2003 Volkswagen Passat from Turners Group NZ Limited (Turners) for $3,010. Mr Harpur enjoyed driving the car at first, but he has not driven it since August 2018. That is because of a recurring warning light on the dashboard, which has been traced to a malfunctioning throttle valve control module.
[2] Mr Harpur has carried out a number of other repairs to the vehicle at his own expense and his Tribunal application initially sought to recover these costs, plus the estimated cost of replacing the throttle body. However, at the hearing, Mr Harpur announced that he has had enough of this vehicle, which he describes as a “horror story”. Mr Harpur seeks a full refund of the purchase price, plus reimbursement of the cost of the repairs he has already undertaken. Turners has offered to contribute to the cost of replacing the throttle body, but it generally denies that it is liable to do so, due to the age, mileage, the price paid for the vehicle and the time since Mr Harpur purchased it. Turners denies that it is liable to pay Mr Harpur for any of the work that he had already carried out before giving Turners the opportunity to put things right in the first instance.
[3] From this background, the following issues arise for determination:

• (a) Did the vehicle fail to comply with the guarantee of acceptable quality?
• (b) If so, what remedy (if any) is Mr Harpur entitled to?

Issue one: Did the vehicle fail to comply with the guarantee of acceptable quality?

[4] Section 6(1) of the Consumer Guarantees Act 1993 (the Act) provides that "where goods are supplied to a consumer there is a guarantee that the goods are of acceptable quality”. According to s 2 of the Act, “goods” includes vehicles.
[5] "Acceptable quality" is defined in s 7 of the Act (as far as is relevant) 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.

[6] Whether a vehicle is of acceptable quality is considered from the point of view of a reasonable consumer who is fully acquainted with the state and condition of the vehicle, including any hidden defects.
[7] Two days after Mr Harpur collected the vehicle from Turners, it started flashing a warning light, which Mr Harpur described as the "EPS" light, but which according to the Tribunal’s Assessor Mr Haynes’ understanding is the electronic power control (EPC) warning indication. This is a computerised ignition and engine management system and embraces a number of different systems on the car.
[8] When Mr Harpur first noticed the warning light, he stopped the car and had a quick look around it. On restarting the engine, the warning light disappeared. Mr Harpur does not appear to have experienced any further problems with this EPC warning light for several more weeks. However, in the meantime, he had to address several other problems with the car.
[9] First, the battery went flat. Mr Harpur took the car to Lineside Auto Electrical, which found water ingress through a scuttle panel which it remedied by unblocking drains. Mr Harpur was charged $158.70 for this work. Later, however, Mr Harpur replaced the battery on 18 June 2018 at a cost of $135.
[10] Mr Harpur also replaced the damaged right rear door at a cost to him of $250. This damage had been identified on the Turners Basic Vehicle Condition Guide which was provided to Mr Harpur prior to his purchasing the car.
[11] On 11 June 2018, Mr Harpur replaced damaged door linings at a cost of $448. Again, this damage was identified on the Turners Basic Vehicle Condition Guide.
[12] On 12 June 2018, Mr Harpur replaced a cracked right rear tail light at a cost of $120. Again, this damage had previously been identified and disclosed by Turners.
[13] On 14 June 2018, Mr Harpur replaced the car’s radio at a cost of $205, because it had stopped working.
[14] The EPC light reappeared on 22 June 2018. This time, the car went into limp mode and could not be reset on restarting. Mr Harpur took the car to Vantage Auto Diagnostics, which scanned it for fault codes and found multiple throttle faults. It cleaned the throttle body and also replaced some damaged hoses around the intake. For this work, Vantage charged Mr Harpur $228.80.
[15] On 9 August 2018, the vehicle flashed the EPC warning again. Mr Harpur stopped and restarted the car and the warning light disappeared.
[16] On 13 August 2018, Mr Harpur complained to Turners about these faults. Reviewing his complaint form, it appears that Mr Harpur was particularly concerned about the recurring EPC light. He concluded his complaint report by asking Turners to contact him urgently as he was currently unwilling to drive the vehicle with the EPC warning light illuminated.
[17] Turners appears to have encouraged Mr Harpur to obtain a quote for any repairs that were needed. Mr Harpur obtained a quote on 17 August 2018. Vantage Auto Diagnostics performed a further diagnostic check on the car and found that the throttle valve control module had a mechanical malfunction. It recommended replacement of the throttle body and provided Mr Harpur with an estimate for this work in the sum of $1,165.78. As at the date of the hearing, Mr Harpur had not had the recommended repair work carried out.
[18] The evidence indicates that the recurring illumination of the EPC light is related to a malfunctioning throttle valve control module. Mr Haynes advises that this is an important part of the car’s throttle control functioning and is necessary to ensure its operation. If the repair is not carried out, then it is possible Mr Harpur will continue to find that the vehicle goes into limp mode, as it did on 22 June 2018.
[19] Turners has declined to pay for the full cost of the repairs recommended by Vantage Auto Diagnostics, namely to replace the throttle control body. In short, Turners argues that the car is old, reasonably high mileage (104,500 km) and was sold for the low price of $3,010. Significantly, Turners points to the fact that it took approximately three months from the time of purchase before Mr Harpur complained to it about the car's defects.
[20] However, against Turners’ position, it is apparent from the evidence that the EPC light first came on only two days after Mr Harpur took delivery of the car. Although Mr Harpur waited approximately three months before approaching Turners, it is clear that the problem itself arose very soon after Mr Harpur bought the car. Moreover, the issue with the throttle valve control module was not identified in the Turners Basic Vehicle Condition Guide. Nor were any warning lights mentioned. Accordingly, I do not think the fact that Mr Harpur waited three months before complaining to Turners counts against him. Relevantly, he has not yet carried out the necessary repairs in respect of the throttle body.
[21] For these reasons, I do not consider that the car was as free from minor defects or as durable as a reasonable consumer would regard as acceptable, even having regard to the fact that it is a relatively old, high-mileage and low-priced car.
[22] I therefore conclude that Mr Harpur's car vehicle failed to comply with the guarantee of acceptable quality.

Issue two: What remedy (if any) is Mr Harpur entitled to?

[23] Section 18(2)(a) of the Act provides that where a failure of goods to comply with the guarantee can be remedied, the consumer may require the supplier to remedy the failure within a reasonable time. It is only if the supplier fails to take up that opportunity to remedy a failure by refusing or neglecting to do so, or by attempting to do so and failing, or if the failure is of a substantial character, that the consumer can take matters into their own hands, get the defects repaired, and seek reimbursement from the supplier.[1]
[24] In Mr Harpur’s complaint report to Turners, dated 13 August 2018, he highlighted the car’s defects as described above and stated “I want the car fixed as I still like driving the car. I have all the receipts for the work done to date”.
[25] Mr Harpur asked for Turners to contact him urgently as he was unwilling to drive the car with the warning light illuminating.
[26] Regrettably for Mr Harpur, the EPC warning light issue is the only matter for which he is entitled to any remedy from Turners, as that is the only matter for which he has not as yet taken matters into his own hands and authorised repairs.

It is too late for Mr Harpur to reject the vehicle

[27] At the hearing, Mr Harpur changed his position and said that, rather than repairs, he was now seeking a full refund of the car's purchase price, plus reimbursement for several of the repair invoices.
[28] Mr Harpur’s application to reject the car cannot be upheld. Apart from anything else, this is because Mr Harpur did not notify Turners of his decision to reject the vehicle, which is required under s 22 of the Act. It is too late for Mr Harpur to reveal his change of position at the hearing (from initially wanting repairs to latterly wanting a full refund) as Turners did not have adequate time to respond.

But Mr Harpur is entitled to the cost of replacing the throttle body

[29] Turners’ position was that it had declined Mr Harpur’s claim to recover the cost of the repairs now required estimated by Vantage Auto Diagnostics in the sum of $1,165.78 to replace the throttle body on account of the period of time since purchase. As I explained above, however, the evidence is clear that the problem with the throttle valve control module arose very soon after Mr Harpur purchased the car. Accordingly, I consider that his delay in complaining about that problem should not be held against him.

Conclusion

[30] Mr Harpur is entitled to have the necessary repairs recommended by Vantage Auto Diagnostics carried out at Turners’ expense. Accordingly, I order Turners to pay Mr Harpur $1,165.78 no later than 11 January 2019.

J S McHerron
Adjudicator

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[1] Acquired Holdings Ltd v Turvey [2007] NZHC 1251; (2008) 8 NZBLC 102,107 (HC) at [11].