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Motor Vehicles Disputes Tribunal of New Zealand |
Last Updated: 19 July 2022
IN THE MOTOR VEHICLE DISPUTES TRIBUNAL
I TE RŌPŪ TAKE TAUTOHENGA Ā-WAKA
MVD
005/2022
[2022] NZMVDT 98
BETWEEN KRITIKA ENTERPRISES LIMITED
Purchaser
AND 2 CHEAP CARS LIMITED
Respondent
HEARING at Wellington on 3 and 11 May 2022
MEMBERS OF
TRIBUNAL
J S McHerron, Barrister – Adjudicator
A B Cate – Assessor
APPEARANCES (via Microsoft Teams)
K L Uniyal, Director of Purchaser
A Kapoor, Interpreter (3 May 2022)
P
Nand, Interpreter (11 May 2022)
D Howie, General Manager Operations for
Trader
C Roma, Customer Care Manager for Trader
S Hu, Wellington Branch
Manager of Trader (11 May 2022 only)
A Plaza, Finance and Sales Consultant
for Trader (11 May 2022 only)
DATE OF DECISION 27 May 2022
___________________________________________________________________
DECISION OF THE TRIBUNAL
___________________________________________________________________
___________________________________________________________________
REASONS
Introduction
[1] Does the fact that a car is purchased by a company for commercial use allow the trader which sold the car to avoid its obligations to the company under the Consumer Guarantees Act 1993 (the CGA)? This decision addresses that question.
[2] Kishori Lal Uniyal is a restaurateur in Newtown, Wellington. On 10 October 2021, through his company Kritika Enterprises Ltd, Mr Uniyal purchased a 2012 Toyota Aqua Hybrid car with 109,684 km on its odometer from 2 Cheap Cars Ltd. Mr Uniyal intended to use the car for his daily commute between his home in Johnsonville and work, and for some work deliveries.
[3] Just over two months after purchasing the vehicle, Mr Uniyal had it checked by AutoXpress because its check engine light was on. AutoXpress advised Mr Uniyal that the vehicle’s hybrid battery is faulty and needs to be replaced.
[4] Mr Uniyal complained to 2 Cheap Cars, which refused to assist him. Its reason for declining to assist is because the vehicle was purchased in the name of Kritika Enterprises Ltd and for commercial use. It says that Mr Uniyal was told at the time of sale that the rules under the CGA are different where a vehicle is used for commercial purposes. It says that Mr Uniyal signed the vehicle offer and sale agreement (VOSA) to acknowledge that he understood these implications.
[5] From this background, the following issues arise for the Tribunal to determine:
- (a) Did Kritika Enterprises and 2 Cheap Cars validly agree to contract out of the CGA?
- (b) Did the vehicle fail to comply with the guarantee of acceptable quality?
- (c) What, if anything, is the appropriate remedy?
Issue 1: Did Kritika Enterprises and 2 Cheap Cars validly agree to contract out of the CGA?
[6] 2 Cheap Cars Ltd argues that Kritika Enterprises purchased the vehicle for business purposes and so the CGA should not apply.
[7] The circumstances in which parties are permitted to contract out of the guarantees in the CGA are set out in s 43. The general rule is that contracting out is prohibited. However, a limited exception is offered where the requirements of subss (2) and (2A) are met:
- No contracting out except for business transactions
(1) Subject to this section and to sections 40, 41, and 43A, the provisions of this Act shall have effect notwithstanding any provision to the contrary in any agreement.
(2) However, despite subsection (1), parties to an agreement may include a provision in their agreement to the effect that the provisions of this Act will not apply to that agreement, provided that—
(a) the agreement is in writing; and
(b) the goods or services are, or (in connection only with the guarantee of acceptable quality in section 7A) the gas or electricity is, supplied and acquired in trade; and
(c) all parties to the agreement—
(i) are in trade; and
(ii) agree to contract out of the provisions of this Act; and
(d) it is fair and reasonable that the parties are bound by the provision in the agreement.
(2A) If, in any case, a court is required to decide what is fair and reasonable for the purposes of subsection (2)(d), the court must take account of all the circumstances of the agreement, including—
(a) the subject matter of the agreement; and
(b) the value of the goods, services, gas, or electricity (as relevant); and
(c) the respective bargaining power of the parties, including—
(i) the extent to which a party was able to negotiate the terms of the agreement; and
(ii) whether a party was required to either accept or reject the agreement on the terms and conditions presented by another party; and
(d) whether all or any of the parties received advice from, or were represented by, a lawyer, either at the time of the negotiations leading to the agreement or at any other relevant time.
[8] Subsections (2) and (2A) of s 43 were substituted for the former s 43(2), when it was repealed on 17 June 2014, to mirror the equivalent provision in the Fair Trading Act 1986.[1] The repealed former provision allowed a supplier to contract out of the provisions of the CGA in respect of “a consumer who acquires, or holds himself or herself out as acquiring...goods or services for the purposes of a business...”. The main differences between the pre and post-2014 amendment versions of s 43 are that, in the current provisions (as applied to motor vehicles):
- (a) The focus is now on whether the contracting parties are in trade and the vehicle was supplied and acquired in trade, rather than the old focus on whether the consumer acquired (or held their self out as acquiring) the vehicle for business purposes.
- (b) The agreement must always be in writing and the Tribunal needs to specifically consider whether the parties agreed to contract out of the CGA.
- (c) The Tribunal has to assess whether it is fair and reasonable that the parties are bound by the contracting out provision in the agreement, taking into account the factors in subs (2A).
[9] Unfortunately, it is this Tribunal’s experience that many motor vehicle traders are either still unaware that the law about contracting out was changed in 2014, or do not appear to have been properly advised how to apply the amended law in practice.
Application of the elements of s 43 of the CGA to the transaction between Kritika Enterprises and 2 Cheap Cars
[10] The first requirement for contracting out of the CGA is that the agreement must be in writing: s 43(2)(a).
[11] The VOSA signed by Mr Uniyal (on behalf of Kritika Enterprises) and Anne Plaza on behalf of 2 Cheap Cars contains the following standard form exclusion clauses:
THE PURCHASER
ACKNOWLEDGES AND CERTIFIES THAT:
The goods to be supplied are being
supplied and acquired in trade and accordingly the parties agree that the
provisions of the Consumer
Guarantees Act 1993 will not apply and that it is
fair and reasonable that the Purchaser is bound by this clause.
“Kishori Lal”
Signed:
________________________________________
IF CLAUSE APPLIES,
PURCHASER MUST SIGN
Consumer Guarantees Act 1993 The Consumer Guarantees Act 1993, applicable to this agreement provides the Purchaser with rights and remedies on the sale of new or used motor vehicles of a type ordinarily acquired for personal, domestic or household use. I agree that if I am acquiring this vehicle in trade in terms of section 1 and 43 of the Consumer Guarantees Act 1993, that the provisions of the Act will not apply accordingly.
[12] The first of these exclusion clauses was signed by Mr Uniyal. The second clause was one of a number of clauses under the heading “PURCHASER’S OFFER AND AGREEMENT” in small print at the foot of the VOSA, above the space where both Mr Uniyal and Ms Plaza signed.
[13] In respect of the first requirement for contracting out set out in s 43(2)(a) above, I consider that the agreement was in writing and signed by Mr Uniyal.
[14] Second, in terms of s 43(2)(b), the vehicle was supplied by 2 Cheap Cars, a registered motor vehicle trader, and was acquired by Kritika Enterprises Ltd. Mr Uniyal told the Tribunal he purchased the vehicle to use to commute between his home and work and for some work-related deliveries. On behalf of 2 Cheap Cars, its General Manager Operations, Dayton Howie, emphasised that, by purchasing the vehicle through Kritika Enterprises, there were tax advantages for that company such as the ability to claim a refund of the GST on the vehicle’s purchase price and to offset depreciation as an expense. I consider this combination of factors is enough to establish the requirement that the vehicle was both supplied and acquired in trade and that all parties to the agreement are in trade in accordance with s 43(2)(c)(i).
[15] Third, according to s 43(2)(c)(ii) it is necessary to ask whether all parties to the agreement agreed to contract out of the provisions of the CGA. This element requires consideration of:
- (a) the wording of the agreement, to evaluate whether it actually states that the provisions of the CGA will not apply to the agreement, or other wording clearly indicating that the parties are contracting out of the provisions of the CGA;
- (b) whether there are any factors suggesting that, despite the appearance of a signed agreement, the parties did not actually agree to contact out of the CGA.
[16] I am satisfied that the wording in the VOSA, as set out above at [11] clearly states that the parties have contracted out of the CGA.
[17] However, Mr Uniyal’s evidence was to the effect that he did not realise the effect of the agreement was that the CGA would not apply. He told the Tribunal that if he had been aware that the CGA’s provisions were excluded under the agreement, he would have purchased mechanical breakdown insurance, but that this was not offered to him.
[18] At the hearing I began to have some concerns that Mr Uniyal’s understanding of English may not have been adequate for him to understand what he was signing. My concern was based on the fact that Mr Uniyal used a Hindi interpreter for both Tribunal hearings. At the hearings, Mr Uniyal seemed dependent on the interpreter for translation of the words spoken. If Mr Uniyal could establish that he was misled about the meaning of the exclusion clauses and that this was compounded by his lack of understanding of English then that could provide a basis for arguing that Kritika Enterprises did not agree to exclude the provisions of the CGA.[2]
[19] Mr Howie’s response was that Mr Uniyal had a friend with him at the time of the vehicle sale, who was interpreting for him. Further, Mr Howie said that if Mr Uniyal knew about the availability of insurance then he was likely to know about the insurance products sold by 2 Cheap Cars.
[20] Overall, I do not think there was enough evidence to establish that Mr Uniyal did not understand the words that he was signing. On this basis, I do not think the evidence was sufficient to establish that Kritika Enterprises did not agree to contract out of the provisions of the CGA in terms of s 43(2)(c)(ii).
[21] Next, I turn to consider, in terms of s 43(2)(d), whether it is fair and reasonable that the parties be bound by their written agreement to contract out of the CGA. I will refer to each of the factors set out in subs (2A) (above).
The subject matter of the agreement
[22] The subject matter of this agreement is a Toyota Aqua Hybrid. This is a vehicle that is ordinarily acquired for personal, domestic or household use and may also be acquired for commercial use, as was the case in respect of Kritika Enterprises’ vehicle.
The value of the goods
[23] Kritika Enterprises paid $8,369 for the vehicle. This is a neutral factor in considering whether it is fair and reasonable that the parties should be held to have contracted out of the CGA.
Respective bargaining power of the parties...
[24] I consider that there was an imbalance in the bargaining power between Kritika Enterprises and 2 Cheap Cars. The VOSA was in 2 Cheap Cars’ standard form and its terms were not subject to negotiation. Moreover, 2 Cheap Cars is a registered motor vehicle trader of considerable size, whereas Kritika Enterprises, as a small restaurant business, does not have the same amount of experience in dealing with or negotiating motor vehicle sale and purchase contracts.
...including (a) the extent to which a party was able to negotiate the terms of the agreement
[25] Shudi Hu was 2 Cheap Cars’ salesperson in respect of the transaction with Kritika Enterprises. He was involved with the buying and selling of the car. He said that, once a deal was made, he handed the transaction over to Anne Plaza, the Finance and Sales Consultant, to do the paperwork. Mr Hu said that if Mr Uniyal had asked him about the application of the CGA, he would have explained. But as it was a long time ago, he could not remember having any specific conversation about the CGA with Mr Uniyal. Mr Uniyal’s evidence was that he had no recollection of any discussion about the CGA with Mr Hu.
[26] Ms Plaza’s evidence was that she told Mr Uniyal that, as the car was being purchased in his company’s name, he would need to sign the exclusion clause in the VOSA. Ms Plaza said she asked Mr Uniyal if he was sure he wanted to purchase the car in the name of the company because there were some disadvantages in doing so. She said that, to this extent she gave Mr Uniyal a choice: if he had purchased the vehicle in his own name, she would not have asked him to sign the exclusion clause. However, as Mr Uniyal wanted to purchase the vehicle in the name of Kritika Enterprises, Ms Plaza agreed Mr Uniyal had no choice, and that she told him he would need to sign the exclusion clause. Ms Plaza said she explained to Mr Uniyal that the effect of signing the exclusion clause was that there would be no cover, and Kritika Enterprises could not make a claim, under the CGA in respect of the vehicle. Ms Plaza said she offered Mr Uniyal the opportunity to purchase a mechanical breakdown insurance policy.
[27] Mr Uniyal agreed that Ms Plaza had offered him the opportunity to purchase a mechanical breakdown insurance policy. But he denied that Ms Plaza had told him the CGA would only apply if he agreed to purchase the vehicle in his own name rather than in the company’s name. He said that if she had explained this to him, he would have purchased mechanical breakdown insurance. Mr Uniyal said that, as far as he remembers, neither Ms Plaza nor Mr Hu (nor anyone else at 2 Cheap Cars) explained the application of the CGA to him. Ms Plaza just asked him to “sign here and here”. Mr Uniyal said he thought what he was signing was just standard paperwork.
[28] Based on this evidence, I conclude that Kritika Enterprises was not given any opportunity to negotiate the terms of the VOSA concerning the exclusion of the CGA, other than if Mr Uniyal had elected for Kritika Enterprises not to be a party to that agreement at all.
...including (b) whether a party was required to either accept or reject the agreement on the terms and conditions presented by another party
[29] The evidence of Ms Plaza and Mr Uniyal also leads me to conclude that Kritika Enterprises was required to accept or reject the agreement to purchase the vehicle on the terms presented by 2 Cheap Cars. It had no opportunity to negotiate whether or not the exclusion clauses in the VOSA should apply.
Whether the parties received legal advice or were represented by a lawyer
[30] There was no evidence that either party sought or received legal advice in respect of the transaction relating to the vehicle. Nor was there any evidence that 2 Cheap Cars encouraged Mr Uniyal to get legal advice before signing the first exclusion clause. 2 Cheap Cars knew of the existence and effect of the exclusion clauses contained in the fine print of the VOSA as part of the trader’s own standard form agreement. Kritika Enterprises did not have the same familiarity with the contents of the VOSA.
Other relevant circumstances – 2 Cheap Cars’ interpretation of s 43 is wrong
[31] The list of matters in subs (2A) is not exclusive. It is open to the Tribunal to consider additional relevant factors, consistent with the consumer protection purpose of the CGA, in determining whether it is fair and reasonable that the parties are bound by the exclusion clauses.
[32] An additional matter that I consider to be particularly relevant is the extent to which 2 Cheap Cars’ approach is based on an incorrect interpretation of s 43 of the CGA. 2 Cheap Cars is wrong about the extent to which it is allowed to contract out of the CGA’s provisions. From the submissions of Mr Howie and Ms Plaza’s evidence it was clear that 2 Cheap Cars wrongly assumes that if a company purchases a car from it, as opposed to a natural person, then 2 Cheap Cars is entitled to insist that the company signs its exclusion clause. This indicates that 2 Cheap Cars does not seem to realise that the law in respect of contracting out of the CGA was changed in 2014.
[33] 2 Cheap Cars’ attitude is reflected in the way each of the exclusion clauses in the VOSA (set out at [11] above) is drafted:
- (a) The use of the word “accordingly” in the first exclusion clause is consistent with 2 Cheap Cars’ approach, as described by Mr Howie and Ms Plaza. 2 Cheap Cars mistakenly considers that it follows automatically from the fact that the vehicle was purchased in a company name and for “commercial purposes” that the CGA does not apply.
- (b) The second exclusion provision states: “I agree that if I am acquiring this vehicle in trade in terms of section 1 and 43 of the Consumer Guarantees Act 1993 that the provisions of the Act will not apply accordingly.” Again, this provision indicates that 2 Cheap Cars mistakenly considers that if a purchaser is acquiring a vehicle in trade, then it automatically follows that the CGA does not apply.
[34] 2 Cheap Cars’ interpretation of the law is wrong. Apart from use of the words “in trade” instead of the former term “business purposes”, and the reference to it being “fair and reasonable” in the first, but not the second, clause, the exclusion provisions in the VOSA reflect the outdated pre-2014 wording of s 43. 2 Cheap Cars’ exclusion clauses do not account for the fact that s 43 no longer allows a trader to impose blanket exclusion of the CGA where a purchaser is acquiring a vehicle in trade. Ms Plaza’s description of the automatic consequences of Mr Uniyal’s decision to purchase the vehicle in the name of his company, and Mr Howie’s support for Ms Plaza’s practice, confirms that 2 Cheap Cars fundamentally misunderstands how s 43 is now (since the 2014 amendments) intended to operate.
[35] I consider that Kritika Enterprises was not given any opportunity to negotiate the terms of the agreement to the extent it purports to exclude the protections in the CGA. Given the consumer protection focus of the CGA, the imbalance in respective bargaining power of the parties, and the lack of evidence that Mr Uniyal knew the law gave Kritika Enterprises the ability to choose whether to agree to contract out of the provisions of the CGA, I consider that it is fair and reasonable for Kritika Enterprises to be entitled to the benefit of the protections of the guarantees in the CGA.
Conclusion
[36] I conclude that it is not fair and reasonable that the parties are bound by the contracting out provisions in the VOSA. The effect of that finding is that the requirements for contracting out of the CGA in s 43(2) have not been met. If follows that, according to s 43(1), the provisions of the CGA “shall have effect” notwithstanding the provisions to the contrary in the VOSA.
2 Cheap Cars has also breached the Fair Trading Act 1986
[37] Moreover, as 2 Cheap Cars has purported to contract out of the provisions of the CGA other than in accordance with s 43(2), it has, on the face of it, committed an offence under s 13(i) of the Fair Trading Act 1986.[3] Misleading consumers as to their rights under the CGA can cause them to suffer losses, for example:
- (a) by forcing consumers to pay for repairs to their vehicles that ought to be carried out at traders’ expense according to their obligations under the CGA;
- (b) by pressuring consumers to unnecessarily purchase mechanical breakdown insurance policies because they have been misled into thinking that the CGA’s provisions do not apply.
[38] It is disappointing that 2 Cheap Cars, which is a motor vehicle trader of considerable size, is attempting to rely on standard form contracting out provisions such as this, rather than negotiating any exclusions from the CGA on a case by case basis with its customers. Since s 43 of the CGA was amended in 2014, parties who are in trade, and agree to contract out of the provisions of the CGA will only have that agreement upheld if the Tribunal concludes it is fair and reasonable that the parties are bound by it. I agree with the following recent comments in this regard by the Motor Trade Association:[4]
The consequences of contracting out must be fully disclosed to the purchaser – with evidence in writing to that effect being useful – and ideally the consumer should be encouraged to seek legal guidance. Again, written evidence to that effect would be wise, and a separate form setting out all these steps would help.
[39] In my view, 2 Cheap Cars has misrepresented Kritika Enterprises’ rights under the CGA. It should not have told Mr Uniyal that his company had no rights under the CGA and that it was not liable for any repairs to the vehicle. Although Kritika Enterprises did not purchase mechanical breakdown insurance, conduct such as that of 2 Cheap Cars can influence customers to purchase such insurance and deters customers from returning to the trader when things go wrong with their vehicles. In both those senses, this sort of misrepresentation provides 2 Cheap Cars with opportunities to profit from avoiding its obligations under the CGA.
[40] I will refer this decision to the Commerce Commission for it to consider whether to prosecute 2 Cheap Cars under the Fair Trading Act 1986.
Conclusion
[41] The guarantees in the CGA apply to the transaction between Kritika Enterprises and 2 Cheap Cars involving the sale and purchase of the Toyota Aqua.
Issue 2: Did the vehicle fail to comply with the guarantee of acceptable quality?
[42] Section 6(1) of the CGA provides that “where goods are supplied to a consumer there is a guarantee that the goods are of acceptable quality”.
[43] “Acceptable quality” is defined in s 7 of the CGA (as far as is relevant) as follows:
- 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.
...
(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.
[44] 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.
[45] Before the vehicle sale, 2 Cheap Cars provided Mr Uniyal with a test report dated 30 September 2021 stating the vehicle had a “good battery”.
[46] There was no evidence that 2 Cheap Cars disclosed any defects with the vehicle’s hybrid battery to Kritika Enterprises on a written notice displayed with the goods (for the purposes of s 7(2) and (3) of the CGA (above)).
[47] There is no dispute that the vehicle’s hybrid battery is defective and needs to be replaced. Nor was it disputed that the defect arose just over two months after the date of purchase. The hybrid battery is a critically important part of the vehicle. Without a functioning hybrid battery, the vehicle cannot be driven with the performance and economy intended by the manufacturer.
[48] I consider that a reasonable consumer would not consider this vehicle’s lack of durability to be acceptable, having regard to the relevant circumstances of the supply of the vehicle, including its age, mileage and price, the short period before the defect arose, and the fact that the vehicle was expressly sold as having a hybrid battery that was in good condition.
Conclusion
[49] The vehicle purchased by Kritika Enterprises did not comply with the guarantee of acceptable quality.
Issue 3: What is the appropriate remedy?
[50] 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:
- 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.
[51] 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.
[52] Mr Uniyal says he has temporarily replaced the battery with one belonging to a friend, but he is seeking a permanent replacement battery to be installed so that he can give his friend’s battery back.
[53] Mr Uniyal says he was quoted $4,200 to replace the vehicle’s battery although he did not produce any written quote as part of his Tribunal application, even when asked to do so.
[54] On behalf of 2 Cheap Cars, Mr Howie provided evidence that it can be much cheaper to replace the battery with a reconditioned battery. 2 Cheap Cars had recently done so for $1,702 for another 2012 Toyota Aqua. The fully reconditioned battery that was supplied in that case came with a 12 month, 80,000 km warranty.
[55] In Mr Cate’s and my view, installing a fully reconditioned battery would be an acceptable repair of this fault, given the age and mileage of Kritika Enterprise’s vehicle. Requiring 2 Cheap Cars to install a new battery would result in betterment.
[56] As Kritika Enterprises did not provide its own quote for this work, and because 2 Cheap Cars may be able to access a trade discount, I consider it is appropriate to allow 2 Cheap Cars to arrange the repair.
[57] 2 Cheap Cars is also required to pay Kritika Enterprises $50 for the battery scan that was carried out by AutoXpress Wellington, under s 18(4) of the CGA.
[58] Accordingly, I make the following orders:
- (a) 2 Cheap Cars must replace the hybrid battery in Kritika Enterprises’ Toyota Aqua with a fully reconditioned hybrid battery, at 2 Cheap Cars’ expense. The replacement battery must have (at least) a 12 month/80,000 km warranty. All receipts for the repairs are to be provided to Kritika Enterprises. The repair must be carried out within four weeks of the date of this decision (unless an extension is granted by the Tribunal). 2 Cheap Cars should provide Kritika Enterprises with a suitable loan vehicle for the duration of the repair if requested.
- (b) 2 Cheap Cars must pay Kritika Enterprises $50 no later than 10 June 2022.
J S McHerron
Adjudicator
[1] Consumer Guarantees Amendment Act 2013, s 13.
[2] Such as on the basis of the doctrine of non est factum: see, for example, Golden Garden Ltd v Zhao [2017] NZCA 227.
[3] Consumer Guarantees Act 1993, s 43(4).
[4] Tony Everett, “Care needed when opting out of law” Autofile, September 2021, at 21.
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