NSW Consumer law warranties if dealership sells faulty car - "As is"

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jdogga

Well-Known Member
16 February 2024
25
1
121
Hello, I am trying to determine who is liable for car issues and whether a clause included by a dealership on purchase waives statutory warranties or guarantees under the ACL.


I purchased a 2012 Mazda cx5 diesel odometer around 114,500 from a second-hand car dealership in NSW in mid-January 2024. I live interstate and first saw the vehicle advertised on Carsales.

After some back and forth with the dealer, although the car had a full service history which the dealer provided me, I arranged an independent inspection of the car through a mechanic located in the same area. The mechanic advised me that the car needed new tyres and would likely need new brakes pads in the near future. Otherwise, there were no issues with the car. As the car had passed a mechanical inspection, I informed the dealership that I was happy to proceed with the purchase subject to them delivering the car to the mechanic prior to collection by me. The dealer agreed and I paid my deposit. As I had a 15-hour drive between the dealership and my home, I requested that the mechanic attend to both replacing the tyres and the brake pads. I paid for these repairs/replacements. The dealership had no involvement in booking this appointment but facilitated the delivery of the vehicle for the inspection and subsequent replacement of tyres and brake pads. I do not know if the dealer and mechanic knew each other.

I took a day off work the following Friday to fly to NSW and then travel a further 2 hours north (approx.) to regional NSW so I could collect the car on the following Saturday. I arrived to collect the car around midday. The dealer had asked that I pay a portion of the funds via cash which I understood was because I needed to collect that day.

When I arrived to collect the car, the dealer informed me that the car was in excellent condition but recommended I get it serviced soon. The tone of this suggesting was a bit off-putting, but I felt better knowing that I had completed a pre-purchase inspection which did not identify any issues other than those described above. I had planned to get the car serviced anyway by my local mechanic. Another employee at the dealership at the time said that the car was in excellent condition and, if she didn't have her current car, she would have purchased the one I was collecting. While I was signing the contract for sale, the dealership employee added into the contract that the car was being sold 'as is'. He said this was not an issue because the car came with a 12-month warranty through an independent provider. As I had completed the pre-purchase inspection and I was reassured about the 12-month warranty, I proceeded to sign even though I was not informed of this before arriving. I was worried that if I did not sign then the dealership would not allow me to purchase the car on the day. I had flown to NSW and planned to drive back to my residence over two days and I was in the difficult position of having to accept this or not have a vehicle to drive home with, particularly as I had no return flights booked. The return flights would have cost me a fortune last minute.

Just over four weeks later, I have been able to take the car in to be serviced. There are still around 1,000km until it is due for its next service, but I felt uneasy after the comments made by the dealership. I attended the mechanic this afternoon who informed me that the car has significant problems and may require a new head gasket costing $6-8k. The mechanic was relieved to hear that I had purchased the car from a dealer because he believes the car was sold with these defects known to them. I am in the process of getting advice about the car and any warranties, because the additional 12-month warranty the dealership provided and assured me of is capped at $1,000 for each type of repair meaning it would not cover a full replacement.

I am feeling very anxious as I cannot afford the repairs and I definitely would not have purchased the car if I had of known about this defect. I am a young female, not a car expert. I do not know whether the dealership or the mechanic who completed the pre-purchase inspection is at fault, or both. If I am required to return the car for a refund, I would also need to take time off to travel back to NSW which is also a difficulty and additional and unfair expense for me.
 

Tim W

Lawyer
LawConnect (LawTap) Verified
28 April 2014
4,939
820
2,894
Sydney
1. Did you buy the car in NSW? On Form 4, or Form 5?

2. Even if you bought it on Form 5, the ACL still applies.

3. In NSW, if a vehicle has done more than 160,000km, or is more then ten years old, then it is not warrantable. The only obligation the dealer has is for the vehicle to have clear title, and be roadworthy.

4. A vehicle can be sound, even roadworthy, even if many of its parts
are used/ worn and close to needing replacement,
but still "good enough" when inspected.
That can be enough to meet the "acceptable quality" criterion in the ACL.

5. The additional 12 month warranty is almost always an insurance product rather than an actual statutory warranty. And they typically come with arcane conditions about servicing which are usually used as a ground to deny a claim.
 

jdogga

Well-Known Member
16 February 2024
25
1
121
Hi Tim,

Thank you for your response. It is appreciated.

I purchased the car in NSW. It was registered in NSW also. It is on Form 5.

Is it the case in NSW that both the km and the age of the vehicle must meet those criteria? If only one is required, the vehicle is 2012 model and would then come under unwarrantable.
In the sale contract there is a statement that the sale is not subject to a guarantee under the Motor Dealers and Repairers Act 2013 and that a current inspection report must be provided at the time of purchase. I did not receive the inspection report at purchase.

Upon further review of the contract, now the anxiety is reduced, there is also a separate clause relating to the ACL and stating that the guarantees cannot be excluded until the ACL.
 

Tim W

Lawyer
LawConnect (LawTap) Verified
28 April 2014
4,939
820
2,894
Sydney
Hi Tim,

Thank you for your response. It is appreciated.

I purchased the car in NSW. It was registered in NSW also. It is on Form 5.

Is it the case in NSW that both the km and the age of the vehicle must meet those criteria? If only one is required, the vehicle is 2012 model and would then come under unwarrantable.
In the sale contract there is a statement that the sale is not subject to a guarantee under the Motor Dealers and Repairers Act 2013 and that a current inspection report must be provided at the time of purchase. I did not receive the inspection report at purchase.

Upon further review of the contract, now the anxiety is reduced, there is also a separate clause relating to the ACL and stating that the guarantees cannot be excluded until the ACL.
By "inspection report", think about a Pink Slip, and revisit item 4 above.
 

jdogga

Well-Known Member
16 February 2024
25
1
121
By "inspection report", think about a Pink Slip, and revisit item 4 above.
Thanks Tim. If I did not receive a copy of that though and it is stated to be completed 46 days before purchase, instead of the required 42 days, how does that impact the guarantee?
 

Tim W

Lawyer
LawConnect (LawTap) Verified
28 April 2014
4,939
820
2,894
Sydney
The ACL will apply no matter any failures or... misbehaviour... by the dealer.
 

jdogga

Well-Known Member
16 February 2024
25
1
121
The ACL will apply no matter any failures or... misbehaviour... by the dealer.
Thank you. I appreciate your response.