So you’ve finally managed to pay off your crippling student loan and you can now relieve your ageing faithful Toyota Corolla of its duties. After visiting a few dealers, you’ve found the perfect replacement - a brilliant red Suzuki Swift, so you swap cash for keys and you’re on your merry way. Two weeks down the track your heart sinks as you hear a thump from under the bonnet and see a stream of smoke wafting out from under the grill. Thankfully, you can breathe knowing the Consumer Guarantees Act (CGA) has you covered.
The CGA was established in 1993 to contribute to a trading environment in which the interests of consumers are protected, businesses compete effectively, and consumers and businesses can participate confidently.
What does this mean when buying a car?
If a vehicle is purchased for private use from a car dealer it must be of ‘acceptable quality’. This is defined by whether a reasonable person would find the car acceptable when taking into account: the type of vehicle sold, the price paid, information given from the dealer about the car, how the car was sold, and any other relevant circumstances, for example how soon after the purchase the problem developed.
While there is no actual time limit specified as to how long a vehicle must remain of acceptable quality, the CGA is at its strongest on the day of purchase.
A vehicle must also be ‘fit for purpose’ - either generally or must meet a specific purpose you told the dealer about before you purchased the vehicle. The vehicle must be ‘as described’ meaning it must match the description as advertised or anything the dealer says at the time.
The CGA is not applicable to every sale
The CGA does not apply in situations where the vehicle is purchased from a private seller, purchased for business use, or if the vehicle is bought for re-sale or supply in trade.
What can I do?
If you have an issue with the vehicle and believe the dealer should give remedy, make contact with the dealer ASAP and let them know you have a problem. Giving them first right of remedy will ensure the potential for a smooth repair process. After all, you can’t expect a dealer to pay for a repair they didn’t know about or authorise in the first place.
Can I just return the vehicle?
It’s not that easy and there are a few things that must be established first. The CGA states that the dealer will have the vehicle inspected and decide if the fault is minor or serious. According to Consumer Protection, there are remedies or options associated with both.
The dealer is required to complete repairs within a reasonable time period, so be sure to tell them when you need the car back by. Try your luck and ask for a courtesy car while the vehicle is getting repaired, although a dealer is not legally required to provide one.
If you agree to repairs and they don't fix the problem correctly, or the vehicle develops further faults, your rights continue. You can choose your remedy options again until your problem is sorted.
If the dealer refuses, fails to do the repairs, or doesn’t do them in a reasonable time, you can choose to have the vehicle repaired elsewhere and claim the cost back from the dealer, or reject the vehicle and claim a refund or a replacement of the same type and similar value if it is available in stock.
A problem is considered serious if it cannot be repaired or fixed, or the cost to repair to the vehicle is disproportionate to the purchase price. For example if the car was bought for $5000 and the cost to repair the fault is $4000.
If the problem is serious (such as a safety issue), you can reject the vehicle and claim a refund or a replacement of the same type and similar value if it is available in stock, or keep the vehicle and claim compensation for the drop in value.
If a dealer doesn’t agree that the fault is serious, get an independent mechanical report in writing and a quote for the repairs. If the report supports your claim that the fault is serious, go back to the dealer to reject the vehicle and choose a refund, replacement or repairs, plus compensation for the cost of your report.
If the issue is unable to be resolved by dealing directly with the seller, the Disputes Tribunal or Motor Vehicle Disputes Tribunal may be the next option.