Brand-New Car Giving You Nightmares? CPA to the Rescue

Brand-New Car Giving You Nightmares? CPA to the Rescue

“The Consumer Protection Act 68 of 2008 (CPA) establishes a broad and comprehensive scope for consumer protection. Its purview includes developing and maintaining a consumer market in such a way as to ensure fairness, accessibility, effectiveness, sustainability and responsibility for the benefit of consumers” (Extract from judgment below)

You drive your brand-new car home, eager to take the family out for a first spin. Happiness! Until suddenly the car won’t start, or you notice a funny rattling noise, or you notice rust, or … it could be anything, because although “brand new” should in theory mean “free of defects”, that’s not always so in the real world.

You return to the dealership and demand a refund, or a replacement, or at least a courtesy car and a repair. “Nope, sorry” says the dealership, “there’s nothing wrong with it/the warranty doesn’t cover it/it’s not our problem/blah blah blah” – what can you do?

Step One: Exhaust the CPA’s dispute resolution processes
  • A motorist’s brand-new VW Polo Vivo wouldn’t start after it was delivered to her. It was towed to the dealership which reported that it was in working order and not defective.
  • A few days later it again wouldn’t start, instead making a “clack clack noise”. The problem was diagnosed as a loose fuse pin and fixed, but the buyer refused to take the car back and gave notice of cancellation of the sale.
  • She then lodged a complaint with the Motor Industry Ombudsman of South Africa, which said it couldn’t support her expectation that the supplier must cancel the deal. Off to the High Court went the buyer.
  • The Court refused her application for a new car or a refund on the basis that she hadn’t first exhausted all “internal remedies” before approaching a court. Specifically, she should have followed the comprehensive dispute resolution mechanisms set out in the Consumer Protection Act (CPA) – sure, she had approached the applicable industry Ombud, but she hadn’t lodged a complaint with the National Consumer Commission, nor had she approached a Consumer Court, the National Consumer Tribunal or an authorised alternative dispute agent.
  • The lesson: Exhaust all other remedies as set out in the CPA before going to court!
Step Two: Heigh Ho Heigh Ho It’s Off to Court We Go

Finding extensive rust in his brand-new Ford Everest, the buyer demanded that the dealership repair it. The dealership refused, claiming that the buyer had spilt pool acid in the car. After unsuccessfully approaching the Motor Industry Ombud (unsuccessful because the dealership declined to cooperate with the Ombud’s investigation), the buyer ended up before the National Consumer Tribunal, which ordered the dealership to remove the rust.

In this case it was the dealership and not the buyer that went to court, with the dealership appealing the Tribunal’s order in the High Court.

The Court rejected the appeal and upheld the Tribunal’s rust removal order on the basis that –

  • The CPA gives every consumer the right to receive goods that “are of good quality, in good working order and free of any defects”.
  • The vehicle was defective at date of sale, and it was irrelevant that the vehicle was still functional and fulfilling its intended purpose of transporting the buyer “from Point A to Point B”– which it had successfully done for 3 years and 170,000 km before this case reached court. As the Court put it, “it is not meant to have a rusting or corrosion on any of its parts as a new vehicle … one can say that the vehicle is less acceptable and unsafe than people generally would reasonably be entitled to expect from the goods of that type, a brand-new car. This indicates a defect in the vehicle.”
  • It is for you as buyer in such a case to prove that the defect existed at the time of the sale and that you were unaware of it. In this case, the rust was a latent defect (being hidden under a carpet) and as the buyer was no car expert, it was irrelevant that he had signed a pre-delivery inspection form confirming that there was no problem with the car.
  • The Court accordingly found that the buyer had succeeded in proving what he needed to, and the dealership must “remove the rust and repair the Respondent’s car back to the standard it should have been if there was no rust”.

Insist that your brand-new car is free of defects and remember we can help you with specific advice and assistance if it isn’t.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

Buying a Used Car – Your Rights

Buying a Used Car – Your Rights

“The buyer needs a hundred eyes, the seller but one” (Old proverb)

You buy a “pre-loved” vehicle which turns out to be a complete dud. You go back to the dealership which says “sorry, you bought it as is, not our problem”. What are your rights?

Buying from a private seller

When we discuss the CPA (Consumer Protection Act)’s consumer protections below, note that the CPA only applies to dealerships and to other sellers acting “in the ordinary course of business”. Private sales won’t fall under the CPA and any savvy private seller will sell subject to an “as is” or “voetstoots” clause, which will be valid and means that unless you can prove fraud on the part of the seller in concealing defects from you, the risk is on you. Bottom line – have the vehicle fully checked out before you pay a cent!

Buying from a dealership – CPA to the rescue!

Dealership sales are another matter entirely. The CPA provides that –

  • Goods must be “reasonably suitable for the purposes for which they are generally intended … of good quality, in good working order, and free of any defects … will be useable and durable for a reasonable period of time, having regard to the use to which they would generally be put and to all the surrounding circumstances of their supply”.
  • You are automatically given an implied warranty of quality that goods comply with those requirements and standards.
  • If the goods fail to meet this standard, you can return them (at the seller’s risk and expense) within 6 months of their delivery and then the seller must – at your direction, the choice is yours – either
    • Repair or replace the goods, or
    • Refund you in full.

Note that the defects complained of cannot be just cosmetic or inconsequential. As the SCA (Supreme Court of Appeal) has put it: “Not every small fault is a defect as defined. It must either render the goods less acceptable than people generally would be reasonably entitled to expect from goods of that type, or it must render the goods less useful, practicable or safe for the purpose for which they were purchased.”

Four cases in point…

The National Consumer Tribunal deals with a large number of consumer complaints, and many of them relate to used car disputes. If you complain, it will be for you to prove that the dealership is in breach of the CPA, and if you succeed in doing so the Tribunal can impose administrative fines on the dealership as well as help you get redress. Let’s have a look at a few recent Tribunal judgments to see how that works in practice –

1. A breakdown after four months

A couple bought a Mercedes Benz 220 CDI Automatic motor vehicle for R225,900. Four months later they suffered a breakdown, and were quoted R47,782 for repairs. The dealership replied that it was not liable because the issue was wear and tear, the buyers knew of the vehicle’s high mileage and they had declined to buy a warranty.

Declining a “goodwill” offer of R10,000 from the dealership, the buyers referred the matter to the Motor Industry Ombudsman and thence it found its way to the Tribunal. The Tribunal, finding that the dealership had failed to make out a case that the damaged parts was a wear and tear issue, held the dealer guilty of prohibited conduct in terms of the CPA and ordered the dealership to refund the buyers in full.

2. Wrong tyres fitted – ordered to replace and to pay a R50k administrative fine

A consumer bought a 2015 Mercedes Benz C200 Bluetec Avantgarde A/T motor vehicle for R300,469 and two days later established that its tyres were standard, and not run-flat per the manufacturer’s specifications. That meant there was no room in the vehicle for a spare wheel, plus she was told that this could result in her insurers repudiating any claims made.

The dealer refused to act, claiming that the standard tyres were “100% according to specification and road legal as per roadworthy”. The Tribunal however held the dealership in breach of the CPA, ordered it to replace the tyres with run-flat tyres, and imposed a R50,000 administrative fine.

3. Continuous breakdowns and a R100k fine

A 2015 model Toyota Avanza vehicle, with 172,475 kilometers on the odometer, kept breaking down and being repaired by the dealership. Eventually, three months after purchase, the buyer had had enough and told the dealer to take the vehicle back and refund him. The dealer however insisted on repairing the vehicle once again, and held the buyer liable for a R6,000 shortfall on a warranty policy repair, plus R58,000 in storage charges. He was unable to pay, plus he ran into arrears on his financing agreement and the financing bank repossessed and sold the vehicle.

The dealership claimed that the buyer had acknowledged that the vehicle was in good condition by signing a checklist to that effect and argued that the buyer “purchased the vehicle pursuant to his satisfaction thereof”. Finding on the facts however that the dealership was guilty of conduct prohibited by the CPA, the Tribunal imposed an administrative fine of R100,000 on the dealership. The buyer can now claim his damages in the High Court with a certificate issued by the Tribunal confirming its findings.

4. Undisclosed accident damage reduces a vehicle’s value by R110k

Bought for R342,900, a 2015 model Isuzu KB300 turned out to have been involved in a major collision before it was sold to the buyer, and to have a trade value of only R230,900. Finding that the material fact of the collision was not disclosed to the buyer at the time of sale, the Tribunal held the dealer to have engaged in prohibited conduct which caused the buyer financial prejudice, entitling him to compensation. He now has a Tribunal certificate to that effect and can pursue his damages claim accordingly.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

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