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Motor Vehicles Disputes Tribunal of New Zealand |
Last Updated: 17 January 2020
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IN THE MOTOR VEHICLE DISPUTES TRIBUNAL
BETWEEN JOHN ASHLEY MCILWAINE
Purchaser
AND D.L.P.S. CAR IMPORTS AND EXPORTS LTD
Trader
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MEMBERS OF TRIBUNAL
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B R Carter, Barrister – Adjudicator
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S D Gregory, Assessor
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HEARING at Auckland on 16 December 2019
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APPEARANCES
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J A McIlwaine, Purchaser (by audio-visual link)
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P P Kastala and P Kastala, for the Trader
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DATE OF DECISION 23 December 2019
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_________________________________________________________________
DECISION OF THE TRIBUNAL
_________________________________________________________________
_________________________________________________________________
REASONS
Introduction
[1] John McIlwaine considers that the 2008 Honda Accord he purchased for $10,750 from D.L.P.S. Car Imports and Exports Ltd (DLPS) in June 2019 is of unacceptable quality for the purposes of the Consumer Guarantees Act 1993 (the CGA). Mr McIlwaine says that the vehicle has unacceptable blemishes to its paintwork and/or clearcoat and a poor quality radio band expander. Mr McIlwaine seeks orders requiring DLPS to pay for those defects to be rectified by a repairer of his choice.
[2] DLPS says that the vehicle’s paintwork was free of any material defect at the time of sale and remains in acceptable condition. It also denies that the vehicle’s band expander is of unacceptable quality.
[3] This summary of issues makes the matter look relatively straightforward, but it has been anything but. In the copious correspondence provided to the Tribunal before the hearing, and in submissions made during the hearing, the parties each made claim and counterclaim about alleged improper actions and behaviour of the other, with Mr McIlwaine being particularly prodigious in the volume of material produced and complaints raised. As discussed with the parties during the hearing, the Tribunal has no jurisdiction to consider or decide any claim in respect of those concerns, and the parties will need to pursue those in another forum if they choose.
[4] Mr McIlwaine also sent email submissions to the Tribunal that he asked to be kept confidential from DLPS. Despite a request from the Tribunal to provide grounds for that confidentiality request, Mr McIlwaine failed to adequately do so.
[5] The principles of natural justice require that information provided by one party for consideration by the Tribunal should be shared with the other party, unless exceptional reasons exist to keep information confidential. Because Mr McIlwaine provided no reasonable explanation as to why I should take account of his submission while keeping it confidential from DLPS, I have not taken that submission into account in reaching this decision. In any event, that submission was repetitive of earlier submissions and of the evidence Mr McIlwaine gave during the hearing and contained irrelevant allegations that would have had no material impact on the outcome if I had taken it into account.
The issues
[6] Against this background, the issues requiring consideration by the Tribunal are:
- (a) Issue 1: Does the vehicle have faults that breach the acceptable quality guarantee in s 6 of the CGA?
- (b) Issue 2: What remedy is Mr McIlwaine entitled to under the CGA?
Issue 1: Does the vehicle have faults that breach the acceptable quality guarantee?
[7] Section 6 of the CGA imposes on suppliers and manufacturers of consumer goods “a guarantee that the goods are of acceptable quality”. Section 2 of the CGA defines “goods” as including vehicles.
[8] The expression “acceptable quality” is defined in s 7(1) 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.
[9] In considering whether or not goods meet the guarantee of acceptable quality, the Tribunal must consider the quality elements as set out in s 7(1)(a)–(e) of the CGA as modified by the factors set out in s 7(1)(f)–(j), from the perspective of a “reasonable consumer”. The test is an objective one; it is not a view of those factors from Mr McIlwaine’s subjective perspective.
The paintwork blemishes
[10] Mr McIlwaine alleges that the vehicle’s paintwork is in unacceptable condition. Mr McIlwaine provided photographs, which show numerous tiny pinprick sized holes in the clearcoat which protects the vehicle’s paintwork. Mr McIlwaine has also had the vehicle assessed by Sovereign Panel and Paint (2011) Ltd, which states that, although it is hard to see in the photographs, the vehicle has “thousands of small chips and dimples” over its bonnet, roof and boot lid. Sovereign Panel and Paint considers that these blemishes require repair to ensure that further corrosion does not occur. It has provided an estimate of $1,633 for the repairs it considers necessary.
[11] DLPS accepts that the vehicle clearcoat now has blemishes. It had the vehicle assessed by Wellington Panel and Paint, which found “pinholes” on the bonnet, boot lid, A-pillars and the roof. Those holes were in the clearcoat only and had not penetrated through to the paint. Wellington Panel and Paint found no signs of any corrosion.
[12] However, DLPS denies that the vehicle has been of unacceptable quality having regard to its age and general condition. It says that the vehicle did not have these blemishes at the time of sale, and in that regard pointed me to evidence of the border inspection on the vehicle, where no signs of any paintwork blemishes in the affected areas were noted. It also says that the purchaser of a vehicle of this price and age should understand that the vehicle’s appearance and finish will not be perfect and that minor blemishes of this nature may develop.
[13] On the basis of the evidence presented by the parties, and the advice I have received from Mr Gregory, the Tribunal’s Assessor, I am satisfied that the vehicle does have numerous small holes in its clearcoat and that those blemishes were pre-existing.
[14] Although the vehicle is 12 years old, it had an odometer reading of only 7,000 km at the time of sale, which is extremely low for a vehicle of this age. That low mileage suggests that the vehicle has been in storage for much of its life. Mr Gregory advises that the pitting evident in the vehicle’s clearcoat is consistent with a vehicle that had been stored for long periods of time with little use. Dust and other particles can settle on the horizontal surfaces of an unused vehicle (i.e. the boot, roof, bonnet lid and A-pillars) and then slowly eat away the clearcoat if that vehicle remains unused or is not regularly washed. I am satisfied that this has occurred in this case.
[15] I am also satisfied that the pitting in the clearcoat means that the vehicle was not of acceptable quality for the purposes of s 6 of the CGA. Notwithstanding the vehicle’s age, its low mileage would give a reasonable consumer high expectations as to the quality of its appearance and finish, and I am satisfied that a reasonable consumer would not have expected such widespread pitting of the clearcoat to be present on the horizontal surfaces of the vehicle so shortly after purchase.
The band expander
[16] Mr McIlwaine says that the radio reception is limited, a fault he attributes to a poor quality radio band expander installed in the vehicle before purchase.
[17] I accept Mr McIlwaine’s evidence as to the poor quality of the radio reception. However, I am not satisfied that this poor reception is caused by the quality of the band expander. The band expander plays no role in the quality of a vehicle’s radio reception – it simply enables the vehicle’s radio to operate over a wider frequency. Instead, I consider it likely that the vehicle has a fault with its aerial, which could well have been caused when the band expander was installed, as the band expander must be connected to the aerial.
[18] The radio reception problems experienced by Mr McIlwaine mean the vehicle has not been of acceptable quality. The pre-purchase advertising for the vehicle stated that it came with a radio. A reasonable consumer would have interpreted that statement to mean that the radio would be reasonably operational. It has not been, and I am satisfied that a reasonable consumer would not consider this defect to be acceptable.
Issue 3: What remedy is Mr McIlwaine entitled to under the CGA?
[19] The remedies relevant to this claim are set out in s 18 of the CGA, which provides:
- 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—
(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,—
(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—
(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.
[20] Under s 18(2)(a) of the CGA, Mr McIlwaine is entitled to have the clearcoat blemishes and radio reception fault rectified within a reasonable time. In that regard, I order that DLPS shall, within 15 working days of the date of this decision:
- (a) repaint the boot, roof, bonnet and affected A-pillars (including by removing the windscreen and rear window to ensure proper paint coverage); and
- (b) rectify the radio reception fault.
[21] DLPS is reluctant to perform this repair, not because of any desire to avoid its obligations under the CGA, but because it considers that it will never be able to satisfy Mr McIlwaine and DLPS is concerned that he will continue to bombard it with messages of discontent even after the repair is performed. In that regard, DLPS says that it cannot reasonably be expected to perform the repairs, and it would prefer an order from the Tribunal requiring Mr McIlwaine to return the vehicle and receive a refund of the purchase price.
[22] While I certainly have sympathy for DLPS’ position, I consider that it can reasonably be expected to repair the vehicle. The required repairs will be straightforward, and although it may find dealing with Mr McIlwaine difficult, I am not satisfied that the point has been reached where DLPS can be excused of its obligation to repair the vehicle because of those difficulties. In saying that, the Tribunal implores Mr McIlwaine to cooperate with DLPS to enable it to perform the ordered repairs and to refrain from pestering the repairer who is appointed to perform those repairs, because any interference in the repair process by Mr McIlwaine could well excuse DLPS of its obligation to repair the vehicle.
DATED at AUCKLAND this 23rd day of December 2019
B.R. Carter
Adjudicator
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URL: http://www.nzlii.org/nz/cases/NZMVDT/2019/288.html