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VIC Australian Consumer Law - Bought Car with Paint Issue from Dealer?

Discussion in 'Australian Consumer Law Forum' started by heb, 3 February 2016.

  1. heb

    heb Member

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    2 months ago, XXX of XXX sold me their company-owned car (It was built Nov 2013, but I was told that it used by a company executive. I was registered as the first owner - 11,000km on the clock). The sales rep said the only paint issue was a small dent/scrape near the boot which I saw & accepted.

    Then it was discovered by a car paint expert (post-delivery) that the car had iron filings/particles dropped onto the roof and bonnet of the car. The expert said that a pre-inspection would not have seen the iron filings/particles, and if left untreated would rust rapidly. It is now fixed.

    The dealer has said that because it looks environmental and not a manufacturer's defect, then it's not covered under warranty. "Go get a nice 'cut n polish'" was their recommendation.

    Given

    1. Section 32IA (of Fair Trade Agreement) implies a condition that the goods are reasonably fit for the particular purpose for which they are required.


    2. Section 32OA (of FTA) states that if a seller makes a statement to you about some existing or past fact concerning the car, and the statement both induces you to enter the contract and is untrue, the statement is called a misrepresentation. If a misrepresentation has been made, you can rescind the contract within a reasonable time after accepting the goods, or claim damages.

    What course of action should I take under Australian Consumer Law, considering (a) the inconvenience it has caused me and my family, (b) the devaluation of the resale value because of such as incident, (c) the worrying and expert monitoring of rust I now have to live with for the next ten years and (d) the negative impact of my influential opinion and view that I have of the prestige dealer

    What level of responsibility does the dealer wear in this instance - a new car or just not brand new. Is there legally a difference?
     
  2. Rod

    Rod Well-Known Member

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    You are unlikely to win under the 'fit for purpose' test. In all respects, except for iron filings, the car is fit for purpose. The court would likely say it is a warranty issue (ie dealer is to fix the car).

    Misrepresentation is a different story, as even innocent misrepresentation is still misrepresentation.

    BTW, what is the proper name of the law you are quoting? What you mentioned doesn't appear to be correct to me.
     
  3. heb

    heb Member

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    It's old 1999 laws. I think S54 of the ACL is where my sights should be.

    ie. acceptable quality, acceptable in appearance and finish, free from defect and the car must be durable.
     
  4. Rod

    Rod Well-Known Member

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    Old laws are no help to you :)

    ACL S54 is a guarantee section (i.e. dealer can elect to fix the problem).

    ACL S18 is about misrepresentation and may allow the contract to be voidable (ie money back). The longer you leave this, the harder it will be to convince a court to give you back your money.

    Convincing the dealer it is a serious problem without resorting to court is a tough one. You've had the car two months so you might need to move a little on price if you want another car.
     
  5. heb

    heb Member

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    Thanks, Rod!

    I don't think it's a serious problem, and so you might be right misrepresentation is a bridge too long to prove. But what are your thoughts about compensation for S45 and Statutory guarantee. Repair, replace, refund.

    1. Replace new for old. (Restoring faith in XXXX’ reputation of a quality product and exceptional experience) or:

    2a. Pay all costs associated with removal of the filings - using a vendor of my choice, and

    2b. Pay all costs associated with the applying of paint protection - using a vendor of my choice (approx $800 for a&b) and

    2c. Pay all costs associated with regular cleaning of the car and monitoring of the rust situation - through a vendor of my choice - for the life of ownership of the car (apprx $100/m) and

    2d. A one off $2,858 payment (5% of purchase price) to offset the expected loss due at the time of resale.
     
  6. Rod

    Rod Well-Known Member

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    This is now about negotiating. Depends on your negotiating skills. Cannot really comment on what is better for you.
     

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