Stringfellow v Stephen Hill Motors (Napier) Limited - Reference No. MVD 454/2021 [2022] NZMVDT 58 (8 April 2022)

Last Updated: 21 May 2022

IN THE MOTOR VEHICLE DISPUTES TRIBUNAL

I TE RŌPŪ TAKE TAUTOHENGA Ā-WAKA

MVD 454/2021
[2022] NZMVDT 58

BETWEEN GRANT JOHN STRINGFELLOW

Purchaser

AND STEPHEN HILL MOTORS (NAPIER) LIMITED

Trader

ON THE PAPERS
MEMBERS OF TRIBUNAL

J S McHerron, Barrister – Adjudicator
A B Cate – Assessor

DATE OF DECISION 8 April 2022

___________________________________________________________________

DECISION OF THE TRIBUNAL

___________________________________________________________________

Grant Stringfellow’s application is dismissed

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REASONS

Introduction

[1] On 22 July 2021, Grant Stringfellow purchased a 2012 HSV Clubsport R8 Tourer with approximately 103,000 km on its odometer for $64,490 from Stephen Hill Motors (Napier) Ltd. With the vehicle, Mr Stringfellow also purchased an Autosure mechanical breakdown insurance policy for an additional $1,895. Mr Stringfellow purchased the vehicle sight unseen.
[2] The vehicle was delivered to Mr Stringfellow on 26 July 2021. Mr Stringfellow said that, when it arrived, the vehicle was in an “unfit state”. Mr Stringfellow was unhappy with some repainting that had been done on the vehicle’s left side. The parties have since negotiated between themselves an apportionment of the repainting costs. Mr Stringfellow indicated that he is not seeking any further reimbursement of his costs incurred for repainting the vehicle.
[3] On 23 September 2021, Mr Stringfellow had the vehicle checked over at AutoCity Hāwera at a cost of $185.20. Several issues were identified. Mr Stringfellow seeks reimbursement for certain repairs that he has arranged to be carried out since he purchased the vehicle. As well, there are also some outstanding repairs for which Mr Stringfellow says Stephen Hill Motors should pay.
[4] From this background, the following issues arise for the Trbunal to determine:

• (a) Did the vehicle fail to comply with the guarantee of acceptable quality?
• (b) What, if any, remedy is available?

Hearing on the papers

[5] The issues in Mr Stringfellow’s application are relatively straightforward and so I formed the view that, subject to the parties’ agreement, it was appropriate to determine the proceeding on the papers.[1] I gave the parties a reasonable opportunity to comment on whether the proceeding should be dealt with in that manner. Both Mr Stringfellow and Stephen Hill Motors confirmed their agreement.

Issue 1: Did the vehicle fail to comply with the guarantee of acceptable quality?

[6] Section 6(1) of the Consumer Guarantees Act 1993 (the CGA) 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 CGA, “goods” includes vehicles.
[7] “Acceptable quality” is defined in s 7 of the CGA (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.

...

[8] 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.
[9] AutoCity Hāwera’s report dated 23 September 2021 states as follows:

Looks like brake master is leaking.

Rear washer not spraying.

Left front spot light cracked.

Front right side lower control arm housing bent.

Right side brake hose locking tab broken.

Recommend front strut mounts.

[10] AutoCity Hāwera also provided a quote for repairs to these items in the sum of $4,660 plus GST. However, this was later corrected because the cost of one of the parts (the spotlight cover) was misquoted so, as I understand it, the true quote for repairs was $2,810 plus GST.
[11] In addition to these items, Mr Stringfellow says that:

• (a) the right “cell guard” needs repairing;
• (b) the vehicle needed a new radiator cap; and
• (c) the windscreen wiper blades were perished and needed to be replaced.

Tribunal’s assessment

[12] My tentative view, based on the evidence supplied including the report from Auto City and various photographs attached to Mr Stringfellow’s application, is that the vehicle was supplied with several minor defects that a reasonable consumer would not regard as acceptable having regard to its age, mileage and price.
[13] The reason that I have only expressed this as a tentative view is because I am conscious of the fact that Stephen Hill Motors has not been given an opportunity to assess the alleged defects for itself, despite having asked Mr Stringfellow for an opportunity to do so on several occasions.
[14] While the evidence suggests the vehicle failed to comply with the guarantee of acceptable quality, it was only in relatively minor respects. The evidence does not indicate there was a failure of a substantial character.[2]

Issue 2: What is the appropriate remedy?

[15] The remedies available to a consumer where a vehicle does not comply with the guarantee of acceptable quality are set out in s 18 of the CGA which provides:

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—

(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.

[16] The primary remedy available to a consumer where a vehicle fails to comply with the guarantee of acceptable quality is set out in s 18(2)(a) and allows the consumer to require the supplier to remedy the failure within a reasonable time.
[17] It appears that it was not until November 2021, approximately six weeks after the vehicle was checked by AutoCity, that Mr Stringfellow advised Stephen Hill Motors that he had concerns about the various defects outlined above.
[18] On 10 November 2021, and again on 26 November 2021, Stephen Hill Motors offered to pick up the vehicle from Hawera where Mr Stringfellow lives and take it on a transporter to Stephen Hill Motors in Napier for assessment and repairs. Stephen Hill Motors pointed out Mr Stringfellow’s obligation to give it the opportunity to repair or replace anything not fit for purpose.
[19] It appears there has been difficulties obtaining a correct part for the spotlight cover which needs replacing, and it was not clear based on the evidence whether this difficulty has been resolved or what further steps need to be taken.
[20] Notwithstanding Stephen Hill Motors’ willingness to assess and repair the vehicle, Mr Stringfellow has gone ahead and arranged for repairs to the brake master cylinder, the front strut mounts, a wheel alignment and a replacement radiator cap at his own expense. For these repairs, Mr Stringfellow seeks reimbursement. Mr Stringfellow also said he had fixed the windscreen wipers but there was no specific claim for reimbursement for that repair.
[21] The outstanding matters are:

• (a) the broken right side brake hose locking tab;
• (b) the bent front right side lower control arm housing;
• (c) the damaged right cell guard;
• (d) the spotlight cover; and possibly
• (e) the back window washer.

[22] Mr Stringfellow seeks for these matters to be repaired at Stephen Hill Motors’ expense, including for any replacement parts required.
[23] Mr Stringfellow acknowledges that Stephen Hill Motors has agreed to fix these matters. However, Mr Stringfellow is reluctant to send the vehicle on a 700 km round trip to and from Stephen Hill Motors when he is unclear what repairs will be done or whether Stephen Hill Motors will reimburse him for repairs that have been done already.

Tribunal’s assessment

[24] As the learned authors of Gault on Commercial Law state:[3]

Where a consumer exercises rights under s 18(2), he or she is required to first give the supplier the opportunity to remedy the defect in the goods. As well as the practicality of this remedy, the supplier is able to assess whether the goods have been subjected to unreasonable use, whether the defect has caused the problem, and, in particular, to control the quality of the remedy, which would not necessarily be the case if repairs were carried out by an unauthorised repairer. The supplier is also in a better position than a third party repairer to negotiate its own remedy with the manufacturer.

[25] This passage of commentary was sighted with approval by the High Court in Acquired Holdings Ltd v Turvey.[4] In that case, the Court outlined the policy underlying the Act: that suppliers are liable to give remedies, not because of their own default, but because suppliers and not consumers should bear the risk where goods and services fail to comply with consumers’ reasonable expectations. The Court said, at [14]:

Given the burden this places on the supplier, it is only reasonable that the legislation requires the consumer to first allow the supplier to remedy the defect.

[26] In Acquired Holdings Ltd v Turvey, the Court refused to allow the consumer to recover money he had spent on repairs because he had not given the supplier of a motor vehicle the opportunity to remedy defects.
[27] Indeed some overseas cases have gone further, holding that a consumer who refuses access to the supplier might lose all rights for breach of the guarantee.[5]
[28] These cases reinforce the need for a purchaser of a defective motor vehicle to co-operate with the trader in permitting the trader to remedy the defect.
[29] Furthermore, the scheme of the Motor Vehicle Sales Act 2003 encourages parties to try to resolve disputes between themselves before invoking the Tribunal’s processes.
[30] Based on this judicial authority, and the CGA itself, it is clear that Mr Stringfellow is not entitled to reimbursement for expenses he has incurred in relation to the repairs already carried out on the vehicle. That is because, in respect of those repairs there is no evidence that Mr Stringfellow gave Stephen Hill Motors an opportunity to remedy the failures, as he was required to do under s 18 of the CGA. Mr Stringfellow acknowledged in his Tribunal application that he knows he “should have sent all this information [about the repairs needed] to Stephen Hill” as AutoCity Hāwera said he should do. Mr Stringfellow says the reason why he did not and went ahead with some of the repairs himself is because he had “lost all trust and confidence” in them.
[31] But Mr Stringfellow’s loss of trust and confidence is not enough to give him the right to circumvent the process required by the CGA. Under s 18, a pre-emptive repair by a purchaser is only permitted “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.”[6] On the evidence seen by the Tribunal, none of these prerequisites for a pre-emptive repair exists.
[32] The remedy that Mr Stringfellow now has in relation to the outstanding issues on the vehicle, namely the brake hose, the front right side lower control arm housing, the right cell guard and the broken spotlight cover, as well as possibly the back window washer, is to allow Stephen Hill Motors to assess and make any necessary repairs. It has repeatedly offered to do so, including by means of providing transportation for the vehicle on a transporter at its cost, and providing Mr Stringfellow with a courtesy vehicle for the duration of the assessment and any repairs. This is the remedy that Mr Stringfellow has under the CGA and I encourage him to allow Stephen Hill Motors to proceed with what it has offered him.
[33] Parties to a Tribunal application are required to attempt to settle their dispute. Mr Stringfellow’s rancorous communications to representatives of the trader, before and during his Tribunal proceeding, have not helped to achieve settlement. I encourage him to adopt a more constructive approach to his future dealings with Stephen Hill Motors. I also encourage Stephen Hill Motors to carefully and professionally address all of Mr Stringfellow’s reasonable concerns about the vehicle.

Conclusion

[34] For the reasons above, Mr Stringfellow’s application is dismissed.

J S McHerron
Adjudicator

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[1] Motor Vehicle Sales Act 2003, sch 1, cl 9A.

[2] Consumer Guarantees Act 1993, s 21.

[3] David Blacktop and others Gault on Commercial Law (online ed, Thomson Reuters) at [CG18.06].

[4] Acquired Holdings Ltd v Turvey [2007] NZHC 1251; [2007] 8 NZBLC 102,107 (HC) at [13].

[5] Pasiechnik v Yellowhead Enterprises Inc QB NO 658 of 1982, 30 January 1987 (QB), a case under the Saskatchewan Consumer Products Warranties Act 1977, cited in Gault on Commercial Law (above 2) at [CG18.07].

[6] Consumer Guarantees Act 1993, s 18(2)(b).