Bloom v Quay Cars 2008 Limited - Reference No. MVD [2024] NZMVDT 174 (30 September 2024)

Last Updated: 3 November 2024

IN THE MOTOR VEHICLE DISPUTES TRIBUNAL I TE RŌPŪ TAKE TAUTOHENGA Ā-WAKA MVD 284/2024 [2024] NZMVDT 174 BETWEEN MICHEL WILHELMUS BLOOM Applicant AND QUAY CARS 2008 LIMITED Respondent

HEARING at CHRISTCHURCH on 28 August 2024 (by audio-visual link) MEMBERS OF TRIBUNAL

D M Jackson, Barrister – Adjudicator S Cousins – Assessor

APPEARANCES

M W Bloom, Applicant

R Durry, Director for the Respondent

DATE OF DECISION 30 September 2024

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DECISION OF THE TRIBUNAL

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A The Applicant’s rejection of the vehicle is upheld.

2. Within ten working days of the date of this decision the Respondent is to pay the Applicant $13,494.

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REASONS

Introduction

• [1] On 18 August 2023, Mr Bloom purchased a 2011 Nissan Leaf (the vehicle) from Quay Cars 2008 Limited (the Trader) for $13,494.00. The vehicle’s odometer read 13,204 kms travelled at the time of sale and read 18,078 kms at the time of filing this application.
• [2] The vehicle’s battery has failed and requires replacement. Despite the Trader being given many opportunities to repair the vehicle, it has failed to do so, and Mr Bloom has had enough. He has given notice to the Trader that he rejects the vehicle.
• [3] The Trader resists rejection and says that it remains prepared to attend to the repair of the vehicle by the replacement of the battery.

The issues

• [4] 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 the Trader refused or failed to rectify the vehicle’s defects within a reasonable time?

(c) What remedy is Mr Bloom entitled to under the CGA?

Issue 1: Has the vehicle been of acceptable quality?

• [5] 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”.
• [6] “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.

(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.

(4) Goods will not fail to comply with the guarantee of acceptable quality if—

(a) the goods have been used in a manner, or to an extent which is inconsistent with the manner or extent of use that a reasonable consumer would expect to obtain from the goods; and

(b) the goods would have complied with the guarantee of acceptable quality if they had not been used in that manner or to that extent.

(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.

[7] 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.

• [8] There was no dispute between the parties that the vehicle’s battery requires repair or replacement. Whilst advertised as having a State of Health of 79.6 per cent, the battery’s performance deteriorated rapidly during March 2024 with a dramatic loss of range.
• [9] Initial testing suggested that the battery had two faulty cells and the Trader agreed to investigate its repair or replacement. There was no dispute before me that the battery required repair or replacement either.
• [10] Mr Cousins, the Tribunal’s Assessor^[1], advises me that the battery failure at such a low kilometre range (the vehicle has travelled less than 20,000 kms) confirms that there is something amiss and that it requires repair, more likely replacement.
• [11] I agree. I find that the battery has failed to meet the statutory guarantee of acceptable quality because the battery is not as durable as a reasonable consumer would expect of a vehicle of this price, age and low mileage.

Issue 2: Has the Trader refused or failed to rectify the vehicle’s defects within a reasonable time?

• [12] 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.

• [13] Section 18 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.

• [14] Mr Bloom produced a helpful ten-page brief of evidence, which sets out in careful chronological order his dealings with the Trader. Mr Bloom raised the poor battery performance with the Trader on 5 April 2024. His brief sets out his continued contact with the Trader and their respective efforts to diagnose and repair the faulty battery. By the end of May 2024, nothing had happened, and Mr Bloom gave notice by text message that he rejected the vehicle. Despite this, discussions continued about its repair until mid-June 2024.
• [15] Mr Bloom hand delivered a written letter of rejection to the Trader on 18 June 2024. The reason for rejection is the Trader’s failure to diagnose or repair the vehicle despite having it in its possession since 16 April 2024.
• [16] Mr Durry explained the circumstances and reasons for the delay; some of them are personal to him and will not be repeated here. Mr Durry delegated responsibility to arrange the repairs to others (including Mr Bloom to some extent). Despite this, a proper diagnosis and repair was not forthcoming, and I am satisfied that by 18 June 2024, Mr Bloom was entitled to reject the vehicle.
• [17] The Trader has not refused to repair here. Instead, it has failed to repair within a reasonable time having regard to all the circumstances.

Issue 3: What remedy is Mr Bloom entitled to under the CGA?

• [18] The relevant remedies are set out in s 18 of the CGA, which I have set out in full above.
• [19] The only remedy available here to Mr Bloom is a refund. Mr Bloom paid $13,494 for the vehicle, which he part-funded by way of trade in. There was no evidence as to whether the Trader had sold the trade-in vehicle or not. In the circumstances I will order the Trader to refund Mr Bloom in cash.
• [20] The Trader is to pay Mr Bloom $13,494 within ten working days of the date of this decision. No further orders are made as the Tribunal understands the vehicle is with the Trader or its agents. If that is incorrect and the vehicle is with Mr Bloom, then he is to make it available for uplift upon receipt of payment as ordered.

D M Jackson
Adjudicator

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^[1] Assessors are appointed by the Minister of Commerce and Consumer Affairs under s 88(2) of the Motor Vehicle Sales Act 2003, having regard to the Assessor’s personal attributes, qualifications and skills and knowledge of, or experience in, the different aspects of matters likely to come before the Tribunal. Under cl 10 of Sch 1 of the Motor Vehicle Sales Act, an Assessor sits as a member of the Tribunal and has a duty to assist the Adjudicator in the determination of the claim, although the Adjudicator alone determines the claim.