Useless Utes

What rights do you have if the motor vehicle you have bought turns out to be a lemon?

"You're looking very grumpy today Dad," Pebbles said to Farmer Freddy one night over dinner.

"I can't get the ute I bought to go. It's completely stuffed," Freddy replied.

"But you did buy it from a dealer?"

"I suppose Old Tom's a sort of a dealer. I mean, he hocks off the odd vehicle here and there."

"But now I want to know how I can get my money back? He said it went like a dream."

Pebbles said that if Freddy had bought the ute from a dealer, the Fair Trading Act and the Motor Vehicle Sales Act would apply, and possibly the Consumer Guarantees Act too.

The Fair Trading Act prevents people in trade from engaging in misleading or deceptive conduct. The Consumer Guarantees Act sets out guarantees in contracts for goods or services, including a guarantee that the goods are fit for purpose.

But it also only applies when the seller is in trade, not people who occasionally sell their old vehicles privately.

Even if Tom was in trade, the Consumer Guarantees Act might not apply because dealers can exclude the guarantees from contracts with businesses. Motor vehicle dealers must be registered under the Motor Vehicle Sales Act.

"But since Tom isn't a dealer Dad, you can't rely on these statutory protections," said Pebbles.

"Instead, you'd have to argue that it was a term of the contract that the ute goes like a dream. Or you could argue that Tom's claim that the ute went like a dream was false and that, by making that claim, Tom induced you to buy it. Then you might be able to cancel the contract, or claim damages.

"But it's much easier to prove a claim under the Consumer Guarantees Act or the Fair Trading Act by showing that the ute is not of acceptable quality, or that Tom engaged in conduct that was likely to mislead you."

"The best option is probably to make a claim in the Disputes Tribunal. You can make claims in that Tribunal of up to $15,000."

"Otherwise, you might just have to accept that your dream has turned into a nightmare."


The content of this document is necessarily general and readers should seek specific advice on particular matters and not rely solely on this document.
If you would like further information on any of the topics in this document, please contact your usual Auld Brewer Mazengarb & McEwen adviser.
Return to previous page Print