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Motor Vehicles Disputes Tribunal of New Zealand |
Last Updated: 25 January 2024
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BETWEEN ALAN BORICH & KERRYN BORICH
Applicant
AND AUCKLAND AUTO COLLECTION LTD
Respondent
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HEARING at AUCKLAND on 30 November 2023 (by audio-visual
link)
MEMBERS OF TRIBUNAL
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B R Carter, Barrister – Adjudicator
S Haynes – Assessor
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APPEARANCES
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A Borich and K Borich, the Applicants
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D Van Den Berg and R Cresswell for the Respondent
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DATE OF DECISION 12 December 2023
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_________________________________________________________________
DECISION OF THE TRIBUNAL
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A Alan and Kerryn Borich’s application to reject the vehicle is dismissed.
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REASONS
Introduction
[1] Kerryn and Alan Borich purchased a 2015 Ford Everest for $43,889 from Auckland Auto Collection Ltd trading as easyauto123 (AAC Ltd) on 22 November 2022. Mr and Mrs Borich now want to reject the vehicle, alleging that it has numerous faults, including extensive rust that AAC Ltd has failed to adequately remedy. AAC Ltd says that it has properly remedied the vehicle’s rust and it is prepared to perform other repairs to address the Borich’s concerns.
The issues
[2] The issues requiring the Tribunal’s consideration in this case are:
- (a) Has the vehicle been of acceptable quality for the purposes of s 6 of the Consumer Guarantees Act 1993 (the CGA)?
- (b) Has AAC Ltd failed to rectify the vehicle’s defects within a reasonable time?
- (c) What remedy are Mr and Mrs Borich entitled to under the CGA?
Relevant background
[3] Mr and Mrs Borich say that they noticed rust from seams in the roof at the rear of the vehicle before they purchased the vehicle. The parties agreed that AAC Ltd would remedy that rust.
[4] About one month after purchase, Mr and Mrs Borich say that they noticed that the rear liftgate door sensor was faulty, and the liftgate door would only open occasionally. Mr and Mrs Borich say that they also noticed that the rust in the roof around liftgate door was returning.
[5] Mr and Mrs Borich then had the vehicle assessed by Silverdale Ford, which is also owned by AAC Ltd. Silverdale Ford found rust at the rear of the vehicle and that the liftgate door opening mechanism appeared to be contaminated with water. Mr and Mrs Borich then left the vehicle with Silverdale Ford, which found corrosion on all five doors (including the liftgate door) and the bonnet.
[6] The vehicle remained subject to the five year manufacturer’s warranty, so AAC Ltd contacted Ford New Zealand to commence the required repairs. The vehicle was then sent to Allan Wakeling Panelbeaters Ltd, which replaced and, where appropriate, repainted all five door assemblies, the front and rear bumpers, and the interior quarter trims. It also repaired rust in the liftgate door aperture. That repair was completed by 4 July 2023. AAC Ltd says that all repairs were performed to an acceptable standard consistent with Ford New Zealand’s guidance for such repairs.
[7] Mr Borich says that he collected the vehicle from Allan Wakeling Panelbeaters. Mr and Mrs Borich say that the repair was substandard. Mr Borich says that he immediately noticed swarf on the roof and then discovered the repair to the rust in the roof seams at the rear of the vehicle was substandard. He says that, because there was rust in the seams, the seams needed to be opened and properly cleaned and treated. Mr and Mrs Borich are concerned that rust remains in the roof structure, which will become an issue in the future. Mr Borich also says that he spoke with a panelbeater from Allan Wakeling Panelbeater, who told him that he should consider selling the vehicle following the repairs.
[8] Mr and Mrs Borich say that the liftgate door and the liftgate door opening mechanism fault had not been repaired when the panelbeating repairs were completed. The liftgate door latch and cable have since been replaced. The liftgate door now opens as it should, but Mr and Mrs Borich say that a different fault has developed. Sometimes the liftgate door does not close.
[9] Mr and Mrs Borich also say that the front passenger door handle was broken following the panelbeating repair, and they have noticed wind coming through the rear passenger window surround while driving.
[10] Mr and Mrs Borich filed this claim in September 2023. They have since provided a report from Tucker Panelbeaters dated 19 October 2023, in which the writer of the report advises that the repair is substandard because:
- (a) There is no evidence to indicate that rust has been removed from the inner roof panels.
- (b) Cracks have appeared in the seams connecting the roof to where the previous repairs were performed.
- (c) The boot latch has “issues”.
- (d) Wind is entering the vehicle through the left rear window.
- (e) The front passenger door handle is broken.
- (f) There is evidence of overspray on the roof rails above the boot lid.
- (g) The windscreen is delaminating.
[11] Tucker Panelbeaters considers that the following remedial repairs are required:
- (a) All seat belts, kick panels, pillar trims, inner quarter panels must be removed and refitted.
- (b) The roof lining, roof rack rails, and tailgate must be removed.
- (c) All sealer that has been incorrectly applied must be removed to open up the rust-affected overlapping joins and those areas require sandblasting.
- (d) Those overlapping joints then need to be treated with epoxy, resealed and the affected areas repainted.
- (e) The front passenger door handle needs to be replaced, the cause of the wind through the rear passenger window needs to be remedied and the windscreen requires replacement.
[12] Mr and Mrs Borich have provided photographs taken by Tucker Panelbeaters of some of the affected areas.
Issue 1: Has the vehicle been of acceptable quality?
[13] 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”. “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.
[14] 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.
[15] The vehicle has not been of acceptable quality. It had rust in the roof seams and on all five doors. The liftgate door opening mechanism was also faulty. Those faults all mean the vehicle was not as free of minor defects or as durable as a reasonable consumer would consider acceptable.
[16] The front passenger door handle is also broken, and wind is entering the vehicle through the rear passenger side window surround. Those issues do not breach the guarantee of acceptable quality as those faults were caused by the rust repairs to the vehicle. They were not inherent defects with the vehicle.
[17] Nonetheless, because those defects were caused by a repair attempt, s 28 of the CGA applies. Section 28 requires that, where services (including repair services) are supplied to a consumer, there is a guarantee that the service will be carried out with reasonable care and skill. The broken door handle and wind ingress through the rear window are evidence that the repair was not performed with reasonable care and skill. Mr and Mrs Borich are therefore entitled to a remedy for those issues under s 32 of the CGA.
Issue 2: Has AAC Ltd failed to rectify the vehicle’s defects within a reasonable time?
[18] Section 18(2)(b)(ii) of the CGA enables a consumer to reject goods where a supplier has been required to remedy a failure but refuses, fails or does not succeed in doing so within a reasonable time.
[19] Section 18 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] AAC Ltd was required to remedy the defects that breach the guarantee of acceptable quality by returning the vehicle to an acceptable standard, taking account of factors such as the vehicle’s price, age and mileage. Mr and Mrs Borich allege that the vehicle has not been adequately repaired. They are particularly concerned that the rust in the roof seams has not been adequately treated.
The rust
[21] Mr and Mrs Borich have not proven that the AAC Ltd has not adequately rectified the vehicle’s rust. Mr and Mrs Borich have provided photographs of the affected areas taken both before and after the hearing. Those photographs show some minor cracking in the seams, but that is not unusual and is not evidence of significant underlying rust. The photographs also show a small rust spot in one of the repaired seams, but again that is not evidence of significant underlying rust or a poor repair.
[22] I therefore find that Mr and Mrs Borich have not proven that the rust repair was inadequate. Although the rust repair may not have been performed to the standards preferred by the Borich’s or their advisors, on the evidence presented the repairs appear to have been performed to the standard necessary to return the vehicle to an acceptable condition.
[23] In reaching this conclusion, I do note that if significant rust does reappear in the affected areas, Mr and Mrs Borich can bring a further claim under the CGA and the Tribunal can assess the rust at that time and determine whether the Borich’s are entitled to any remedy. However, because Mr and Mrs Borich have not proven that significant rust is currently present or that the rust has been inadequately repaired, they are not entitled to any remedy at this time.
The liftgate opening mechanism
[24] I am not satisfied that AAC Ltd has failed to remedy the liftgate door fault within a reasonable time. It has replaced the liftgate door latch and cable, and the liftgate door now opens as it should. A new fault has now developed, in that the liftgate door does not close sometimes. Given the different nature of this fault, I consider that AAC Ltd should be given a further opportunity to diagnose and remedy it.
Issue 3: What remedy is Mr and Mrs Borich entitled to under the CGA?
[25] Because AAC Ltd has not failed to remedy the vehicle’s defects within a reasonable time, Mr and Mrs Borich are not entitled to reject the vehicle. Instead, they are entitled to have the vehicle’s defects remedied within a reasonable time.
Outcome
[26] Mr and Mrs Borich’s application to reject the vehicle is dismissed and AAC Ltd shall, within a reasonable time from the date of this decision:
- (a) remedy the fault that affects the operation of the liftgate door;
- (b) replace the broken front passenger door handle; and
- (c) perform all repairs required to ensure that air does not enter the vehicle through the rear passenger window surround.
B R Carter
Adjudicator
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URL: http://www.nzlii.org/nz/cases/NZMVDT/2023/266.html