Lambert v Christchurch European Limited - Reference No. MVD 463/2023 [2024] NZMVDT 89 (28 May 2024)

Last Updated: 28 June 2024

IN THE MOTOR VEHICLE DISPUTES TRIBUNAL I TE RŌPŪ TAKE TAUTOHENGA Ā-WAKA MVD 463/2023 [2024] NZMVDT 089 BETWEEN NICOLA LAMBERT Applicant AND CHRISTCHURCH EUROPEAN LIMITED Respondent

HEARING at CHRISTCHURCH on 25 January, 4 April and 9 May 2024 (by audio-visual link) MEMBERS OF TRIBUNAL

D M Jackson, Barrister – Adjudicator S Cousins – Assessor

APPEARANCES

N Lambert, Applicant

N Mills, Director for the Respondent

DATE OF DECISION 28 May 2024

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DECISION OF THE TRIBUNAL

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A Mrs Lambert’s application to reject the vehicle is dismissed.

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REASONS

Introduction

[1] On 4 July 2023 Mrs Lambert purchased a 2014 Audi SQ5 from Christchurch European Limited (the Trader) for $39,995. The vehicle’s odometer read 115,000 kms at the time of purchase. By the time Mrs Lambert applied to the Tribunal on 2 November 2023, the odometer read 120,000 kms. However, on 15 May 2024 the vehicle’s odometer read 132,384 kms.
[2] This is the second vehicle supplied to Mrs Lambert by the Trader; the vehicle the subject of this proceeding was a replacement for an earlier vehicle which Mrs Lambert was dissatisfied with. She accepted the subject vehicle in return for the first vehicle and the Vehicle Offer and Sale Agreement (or VOSA) records the swap-out and a cash surplus payment to Mrs Lambert.
[3] Mrs Lambert complains that she has had an ongoing string of problems with the vehicle, which have caused her to lose all confidence in its ongoing reliability and performance. Mrs Lambert has run out of patience and wants to reject the vehicle and obtain a refund.
[4] The Trader states that it has provided Mrs Lambert with a remedy each and every time she has complained. It remains prepared to remedy any further defects, should they arise, but resists rejection.

The issues

[5] 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)?

Issue 1: Has the vehicle been of acceptable quality?

[6] 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”.
[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.

(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.

[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] Mrs Lambert outlined that within three weeks of purchase the (second) vehicle began to jolt during high-speed acceleration. She could smell a burning oil smell too. She complained to the Trader and a transmission service was carried out at its direction. This fixed the jolt and the burning smell.
[10] A few weeks later a red alternator battery light appeared on the vehicle’s dashboard. Mrs Lambert complained and the Trader asked her to visit a local repairer to check the alternator was charging. Before the warning light could be inspected, a further warning light appeared warning of a gearbox malfunction and that the alternator was not charging the battery. The vehicle was towed to a mechanic for inspection. A loan vehicle was provided to Mrs Lambert. A tappet cover was to be repaired but this took some time due to the Christmas holiday period and delayed parts arrival. Tappet gasket parts arrived in late January 2024 and the repair was completed.
[11] On 24 January 2024 the vehicle suffered a further problem and needed to be towed. There is video evidence of the vehicle being towed into a local car yard.
[12] In early March 2024, repairs remained uncompleted while the local repairer waited for parts. The engine oil warning light appeared, requiring Mrs Lambert to top the engine oil. Repairs were completed. However, in April 2024, Mrs Lambert complained that the vehicle’s steering wheel creaked while turning, which was getting louder over time. Mrs Lambert reiterated her desire to reject the vehicle.
[13] On 7 May 2024, at 131,687 kms the vehicle’s dashboard displayed a warning reading “underinflated rear left! Check all 4 tyres and reset TPMS in MMI”.
[14] In mid-May 2024 the engine oil light reappeared and Mrs Lambert complained that the vehicle’s engine noise became louder and the vehicle leaked oil onto her driveway. The oil light reads “Add oil, max1 l. You may cont. driv.” Mrs Lambert is frustrated that the Trader’s preferred local repairer has not completed an inspection and sign off as promised.
[15] On 21 May 2024 Mrs Lambert took the vehicle to a different local repairer who confirmed the vehicle makes a noise when turning and requires investigation. Mrs Lambert has been advised that that process might take up to six weeks. Mrs Lambert says the vehicle continues to shudder, the tyre warning lights keep reappearing, as does the engine oil warning light.
[16] Mr Mills for the Trader expressed his frustration that as far as he was concerned all problems were repaired (at the Trader’s expense). This included the alternator and rocker cover gasket repair and the replacement of some piping affected by the original problem. Mr Mills says any talk of shuddering is new and has not been raised with him before. He is prepared however to look into it. The tyre issue needs to be inspected and Mr Mills suspects it may be a TPMS sensor or monitoring fault.
[17] Mr Mills says the vehicle has travelled more than 15,000 kms since purchase which he submits takes it beyond the point of rejection.
[18] Mr Cousins, the Tribunal’s Assessor[1], reviewed all of the evidence and questioned Mrs Lambert about the ongoing driveability issues she complains of.
[19] Mrs Lambert described a shuddering concern which she experienced intermittently when cornering left or right at various speeds (although she did say at 40 km/h in her evidence but I took her to mean when slowing to turn a corner), She says the shuddering was accompanied by a clonking noise. At the time of the hearing, she had not had this concern inspected and to date has not supplied any evidence which confirms the root cause of this concern, a diagnosis of any kind or a quote to repair it, if required. Based on Mrs Lambert’s description of the shuddering concern, it is consistent with a normal characteristic of ABS/traction control operation, wherein a shudder and clonking type noise is experienced as the hydraulic modulator cycles individual brake circuit pressures on and off rapidly to prevent wheel slip and maintain traction at all four corners of the vehicle.
[20] Mr Cousins advises that cornering at speeds of 40 km/h around a 90-degree corner, for example, is highly likely to lead to intermittent intervention of the ABS/traction control system to aid continued control of the vehicle. This assessment is based solely on the evidence given by Mrs Lambert during the hearing. There has been no report, diagnosis or assessment of any kind conducted or provided to the Tribunal to help establish whether this is a fault with the vehicle or merely a normal characteristic of operation during tight cornering at elevated speed.
[21] Mrs Lambert explained she has been experiencing a tyre pressure warning illuminating intermittently. She supplied a photo including the warning message on the instrument cluster “Under Inflated Rear Left!”. Mrs Lambert explained this message may illuminate about once a month, which would prompt her to drive to Steve’s Tyre Service to have the tyre pressures set and the warning reset. It is unclear what the tyre pressures were at this time and no evidence has been supplied to verify this as a vehicle fault. Based on Mrs Lambert’s evidence of this concern it would appear the tyre pressures were simply low; whether punctured, damaged, the result or normal air permeation or even pressure fluctuation due to temperature change, with no evidence of a specific vehicle fault supplied. Mr Cousins opines that the causes mentioned constitute a normal part and potentially cost of expected vehicle maintenance for any motor vehicle of any age or milage.
[22] Further, Mr Cousins advises that when considered collectively it is worth noting that a vehicle’s ABS/traction control will intervene at a significantly lower threshold when the vehicle has a tyre which is low on pressure or flat. The ABS/traction control system (along with the engine and transmission) monitors individual wheel speeds to detect wheel slip and prevent lockup to maintain directional control of the vehicle. When one tyre is low on pressure it reduces that tyre’s rolling circumference and changes that tyre’s friction coefficient, this can cause the ABS/traction control to intervene unexpectedly, in particular, in a tight elevated speed cornering manoeuvre. Again, Mr Cousins highlights that no evidence or diagnosis has been supplied to substantiate these concerns, so this assessment is based solely on the evidence provided by Mrs Lambert when questioned during the hearing.
[23] Mrs Lambert additionally complained of a potential transmission fault, although was unable to elaborate on this in her evidence. Again, no assessment has been completed, nor was there video or other evidence to verify a concern with the transmission. As a result, Mr Cousins is unable to provide an assessment of this concern.
[24] Finally, Mrs Lambert explained that she had ongoing concerns with the oil light appearing, with a persistent oil leak. She supplied a photo of her driveway which depicts a thin oily film on a wet driveway. Mr Cousins advises me that, based on the photo it is very hard to tell whether this can be considered a new oil stain or an older oil stain which has been emphasized by the effect of a wet driveway. Based on this photo Mr Cousins notes that the stain and spread appears more consistent with the thin film interference effect seen with fuel rather than engine oil. Mr Cousins considers it appears the body of this spill was located in front of the vehicle, noting the dry outline witness area of the vehicles body against the surrounding wet driveway. Aside from this photo and a picture of the instrument cluster advising oil needs to be added supplied by Mrs Lambert, there has not been any evidence supplied to confirm the presence of a fault with the vehicle. Mrs Lambert has not supplied any diagnosis or inspection report which confirms the vehicle itself is leaking oil, or that a fault exists with the vehicle outside of what would be expected for a vehicle of this age and milage. Interim oil changes and top ups may be considered a part of normal maintenance, for a higher milage vehicle as this is. Based on the evidence supplied it cannot be determined whether the vehicle does or does not have a continued defect related to the engine oil, but in Mr Cousin’s opinion the photo of the driveway supplied does not confirm an oil leak from the vehicle.
[25] In summary, Mr Cousins opines that the steering noise or shudder which Mrs Lambert says she is experiencing while turning, may be the vehicle’s traction control system engaging. It is not clear, however, but he suspects the two problems complained of may be connected. Mr Cousins considers the engine oil light to be no more than can be expected of a 10-year-old European vehicle of this mileage. He opines that this particular make and model vehicle is renowned for oil consumption and topping up is, more or less, a maintenance issue (especially noting the transmission service appears to have resolved).
[26] The purchaser of a 10-year-old European vehicle with an odometer reading of more than 115,000 kms should have realistic expectations as to its quality and durability and should understand that the vehicle is likely to have pre-existing defects consistent with its age and mileage or can develop defects and require ongoing maintenance of a sometimes unplanned and expensive nature. This applies as much to a vehicle’s electrical componentry, sensors and computer, as much as it does to the engine and other component parts of the vehicle. They would also understand that a supplier’s obligations under s 6 of the CGA are finite and, at some point, the risk of the vehicle developing defects must transfer from the supplier to the purchaser. The point in time at which that risk transfers is determined with reference to the factors in s 7(1)(f) to (j) of the CGA.
[27] I agree with Mr Cousins that the key items raised by Mrs Lambert have been repaired by the Trader. To the extent that any further issues have arose, they are either unproven on the face of the evidence or are consistent with a European vehicle of this age and mileage. In any event, the alleged faults complained of are minor and they have arisen more than 15,000 kms into Mrs Lambert’s ownership of the vehicle.
[28] It follows that I find that Mrs Lambert has not proven a breach of the guarantee of acceptable quality on the balance of probabilities and that her claim must be dismissed.

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.