QUEENSLAND CIVIL AND 
ADMINISTRATIVE TRIBUNAL

CITATION:	Laceur v Townsville Auto Group Pty Ltd & Anor [2021] QCAT 247	
PARTIES:	nathalie laceur	
	(applicant)	
	v	
	townsville auto group pty ltd	
	(first respondent)
FCA AUSTRALIA PTY LTD
(second respondent)	
APPLICATION NO/S:	MVL148-20	
MATTER TYPE:	Motor vehicle matters	
DELIVERED ON:	21 July 2021	
HEARING DATE:	20 July 2021	
HEARD AT:	Brisbane	
DECISION OF:	Member Cranwell	
ORDERS:	1.	Nathalie Laceur is required to return the motor vehicle the subject of these proceedings to Townsville Auto Group Pty Ltd within 14 days of the date of these orders.
2.	Townsville Auto Group Pty Ltd is required to pay to Nathalie Laceur the amount of $29,728 within 28 days of the date of these orders.	
CATCHWORDS:	TRADE AND COMMERCE – COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION – CONSUMER PROTECTION – GUARANTEES, CONDITIONS AND WARRANTIES IN CONSUMER TRANSACTIONS – GUARANTEES, CONDITIONS AND WARRANTIES – whether motor vehicle of acceptable quality – whether failure to comply with consumer guarantee a major failure – whether goods rejected during the rejection period – whether consumer entitled to refund
Australian Consumer Law, s 54, s 259, s 260, s 262, 
s 263, s 274
Competition and Consumer Act 2010 (Cth), Schedule 2
Fair Trading Act 1989 (Qld), s 50A
Treasury Laws Amendment (2020 Measures No. 6) Act 2020 (Cth)
Haisman v Drive (Aust) Pty Ltd  [2020] QCAT 44
Medtel Pty Ltd v Courtney (2003) 130 FCR 182
Morphy v Beaufort Townsville Pty Ltd [2018] VCAT 1520	
APPEARANCES & REPRESENTATION:	

Applicant:	
Self-represented	

Respondent:	
Self-represented	

REASONS FOR DECISION
[1]	On 2 July 2020, Nathalie Laceur (‘the applicant’) filed an Application – Motor Vehicle Dispute with the Tribunal.  The named respondents are Townsville Auto Group Pty Ltd (‘the first respondent’) and FCA Australia Pty Ltd (‘the second respondent’).
[2]	The applicant is the owner of a 2016 Fiat 500X Lounge (‘the motor vehicle’).  
[3]	The applicant purchased the motor vehicle from the first respondent on 3 July 2018 for $28,000. 
[4]	The applicant seeks relief under the Australian Consumer Law, which is Schedule 2 to the Competition and Consumer Act 2010 (Cth).  The relief sought by the applicant is a refund plus damages.
[5]	Section 50A of the Fair Trading Act 1989 (Qld) vests the Tribunal with jurisdiction in relation to motor vehicles in respect of certain actions under the Australian Consumer Law.
Australian Consumer Law provisions
[6]	Section 54(1) of the Australian Consumer Law provides that, where a person supplies goods in trade or commerce, the goods are guaranteed to be of ‘acceptable quality’.
[7]	The time at which goods are to be of acceptable quality is the time at which the goods are supplied to the consumer: Medtel Pty Ltd v Courtney (2003) 130 FCR 182 at [64] and [70].  However, information available after the time of supply may be taken into account in deciding whether the goods were of acceptable quality at the time of supply.
[8]	Sections 54(2) and (3) of the Australian Consumer Law define acceptable quality as follows:
(2)	 Goods are of acceptable quality if they are as:
(a) fit for all the purposes for which goods of that kind are commonly supplied; and
(b) acceptable in appearance and finish; and
(c) free from defects; and
(d) safe; and
(e) durable;
as a reasonable consumer fully acquainted with the state and condition of the goods (including any hidden defects of the goods), would regard as acceptable having regard to the matters in subsection (3).
(3) The matters for the purposes of subsection (2) are:
(a) the nature of the goods; and
(b) the price of the goods (if relevant); and
(c) any statements made about the goods on any packaging or label on the goods; and
(d) any representation made about the goods by the supplier or manufacturer of the goods; and
(e) any other relevant circumstances relating to the supply of the goods.
[9]	The Macquarie Dictionary defines the word ‘defect’ to mean ‘a fault’ or ‘imperfection’.  
[10]	The Macquarie Dictionary defines ‘durable’ as ‘having the quality of lasting or enduring of or relating to goods which will be good for some time, as opposed to those intended to be used or consumed immediately’.
Evidence
[11]	It is not in dispute that the applicant purchased the motor vehicle from the first respondent as an ex-demonstrator with an odometer reading of 7,508 km.
[12]	The applicant has provided evidence that the motor vehicle broke down shortly after purchase, and that she has had to return the motor vehicle to the first respondent 12 times in her first two years of ownership.
[13]	For convenience, I will deal with each of the applicant’s complaints about the motor vehicle in turn.
Breakdown
[14]	The applicant provided evidence that the motor vehicle broke down on 11 August 2018, and had to be towed to the dealership.
[15]	At the hearing, the first respondent advised that this was due to a battery issue.
[16]	In these circumstances, I accept there was an issue with the battery which led to the motor vehicle breaking down shortly after purchase.
Traction control/Electronic stability control
[17]	The applicant provided evidence that sometimes when she turns, the traction control (‘TC’) / electronic stability control (‘ESC’) kicks in.  She stated that:
[I]t feels like the engine shuts down for a few seconds during which I am unable to accelerate.  This happens randomly, without warning.
[18]	The applicant has kept a diary of the occasions when this happens.
[19]	The first respondent provided evidence that it was unable to replicate this fault. However, I note that the applicant provided an email from Belinda O’Neill, an employee of the first respondent, dated 11 March 2020 which stated:
The forward collision and traction control concerns have been rectified with a software update …
[20]	The second respondent provided evidence from Dale Cooper, regional technical specialist, that:
I can say that I was able to reproduce the traction control light illuminating on the dash at 1 intersection most of the time when I drove through it.  The actual traction control light comes on at very low speed while making a RH urn (sic) through the intersection …
I have raised a case to APAC for assistance as I don’t believe the light coming on is a mechanical or electrical fault.  I believe it may be a software issue given the low road speed at which the light illuminates.
[21]	The applicant provided evidence in reply that the issue has not occurred since the software update.
[22]	In those circumstances, I accept that there was an issue with the TC/ESC engaging, which has since been rectified by a software update.
Gearbox
[23]	The applicant provided evidence that the motor vehicle does not want to shift into second gear, and when it does so it happens very abruptly and with a shock.
[24]	The first respondent provided evidence that the motor vehicle tends to rev more highly in first gear when the engine is cold, however this recedes slightly when the engine is warmed up.  This was described as a Fiat transmission idiosyncrasy rather than a fault with the transmission system.
[25]	The second respondent provided evidence that there has not been any concern diagnosed in relation to the gearbox.
[26]	As the applicant has not provided any expert evidence in support of her claims, I do not accept that there is a fault with the gearbox.
Squealing brakes
[27]	The applicant provided evidence that the brakes on the motor vehicle have continued to squeal since the time of purchase.
[28]	The first respondent provided evidence that the brake discs were all machined and the brake pads were replaced.  After this work was done, no squealing could be found.  I note that the applicant provided an email from Belinda O’Neill, an employee of the first respondent, dated 26 November 2019 which stated:
The last inspection on the front brakes found slight scoring and a lip on the rotors, with the recommendation being a disc machine and replacement of the front brake pads using aftermarket brake pads.  They are generally of a harder compound than the genuine pads, and this can assist with glazing and subsequent brake noise.
[29]	The applicant provided evidence in reply that the brakes are still squealing.
[30]	The second respondent provided evidence from Mr Cooper that:
During driving I noted a slight squeal from the front brakes upon light application of the foot brake.
The rotors and pads aren’t particularly worn but it is a normal characteristic of wear.
[31]	In these circumstances, I accept that there was an issue with the brakes squealing at the time of purchase of the motor vehicle requiring machining of the brake discs and replacement of the brake pads.  As the applicant has not provided any expert evidence in support of her claims, I accept that this issue was rectified by the first respondent and that any ongoing issues are a ‘normal characteristic of wear’.
Door rattle
[32]	The applicant provided evidence that there is a rattle coming from the driver’s door and steering column.
[33]	The first respondent provided evidence that it was unable to replicate this fault.  However, the applicant provided an invoice from the first respondent which stated:
Lubricated RHF door rubber due to creaking during body flex.
[34]	The second respondent provided evidence from Mr Cooper that:
Upon investigation I found the door slightly out of adjustment which is allowing the door to flex.
While driving the door weather rubbers rub on each other.  In particular, where the rear door weather rubber meets the front drivers (sic) door.  The rear rubber is hardened from UV exposure and has started cracking.
[35]	In those circumstances, I accept that there was an issue with the driver’s door rattling as the result of a lack of durability with the door rubbers.  I accept that the door rubbers have since been replaced.
Tyre pressure monitoring system
[36]	The applicant provided evidence that the tyre pressure monitoring system (‘TPMS’) falsely indicates that the tyres were under-inflated.  The applicant stated that she verified the actual tyre pressure by checking at a service station.
[37]	The first respondent provided evidence that it was unable to replicate this fault.  However, the applicant provided an invoice from the first respondent which stated:
TPMS operates off wheel speed sensors, not sensors in the tyres.  This concern has potentially be (sic) rectified with ABS module update.
[38]	The applicant provided evidence in reply that the values for each tyre are not displayed on the onboard computer.  
[39]	The second respondent provided evidence from Mr Cooper that the motor vehicle is not fitted with sensors to record pressure and display on the dash.
[40]	In these circumstances, I accept that there was an issue with the TPMS. As the applicant has not provided any expert evidence in support of her claims, I accept that this issue was rectified by the first respondent with an ABS module update.
Forward collision system
[41]	The applicant provided evidence that the full brake control system (‘FBCS’) light would come on daily after starting the engine, meaning that the FBCS was not activated.  She would need to manually turn this back on using the onboard computer.  The applicant stated that the issue was resolved after one and a half years, following multiple attempts.
[42]	The first and second respondents provided no evidence in relation to this issue.
[43]	In those circumstances, I accept that there was an issue with the forward collision system, which has since been rectified by the first respondent.
Digital air conditioning temperature display
[44]	The applicant provided evidence that one of the numbers on the air conditioning display stopped working.  The applicant stated that the first respondent ordered parts, and this has been resolved.
[45]	The first and second respondents provided no evidence in relation to this issue.
[46]	In those circumstances, I accept that there was an issue with the digital air conditioning temperature display, which has since been rectified by the first respondent.
Further issues after application to Tribunal
[47]	For completeness, I note that the applicant claimed a number of other issues have arisen since the application was filed with the Tribunal.  These include an issue with lane side assist, which was accepted by the second respondent to have been caused by a malfunctioning indicator switch.  However, for the reasons which follow, it is unnecessary for me to consider these further issues.
Consideration
[48]	The first respondent has submitted that the faults reported by the applicant have either been easily and promptly remedied, or have been unable to be replicated.  It provided an email from Scott Griffin, workshop controller, which expressed the opinion that the motor vehicle was of acceptable quality.  It also provided an email from Simon Jansen, of the Automotive Repair Centre, which stated that no issues were apparent during his tests.
[49]	The second respondent has submitted that no fault alleged by the applicant has been confirmed to be outstanding.
[50]	For the reasons set out above, I accept that the following defects were present with the motor vehicle at the time of supply:
(a)	battery issue resulting in a breakdown;
(b)	TC/ESC engaging randomly and without warning;
(c)	squealing brakes;
(d)	door rattle;
(e)	TPMS providing false readings;
(f)	forward collision system not activating; and
(g)	digital air conditioning temperature display stopped working.
[51]	As set out above, I also accept that these defects have been rectified by the first respondent.  However, in the case of the TC/ESC, I note that the applicant provided evidence that it took 13 months for the issue to be rectified.  In the case of the forward collision system, it took 20 months for the issue to be rectified.
[52]	For completeness, I note that the only defect claimed by the applicant which I did not accept was the one relating to the gearbox.
[53]	Nevertheless, I find that a reasonable consumer fully acquainted with the state of the motor vehicle at the time of purchase, particularly having regard to:
(a)	the presence of defects which resulted in the motor vehicle being returned to the respondent on 12 occasions in the first two years of the applicant’s ownership; 
(b)	the purchase price of $28,000; and
(c)	the motor vehicle being almost new,
would not regard the motor vehicle as free from defects and durable.
Remedies 
[54]	The remedy available to the consumer against the supplier depends in the first instance on whether the failure is a ‘major failure’.  That term is defined in s 260 of the Australian Consumer Law to relevantly mean:
(1) A failure to comply with a guarantee referred to in section 259(1)(b) that applies to a supply of goods is a major failure if:
(a) the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; or
(b) the goods depart in one or more significant respects:
(i) if they were supplied by description—from that description; or
(ii) if they were supplied by reference to a sample or demonstration model—from that sample or demonstration model; or
(c) the goods are substantially unfit for a purpose for which goods of the same kind are commonly supplied and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or
(d)  the goods are unfit for a disclosed purpose that was made known to:
(i) the supplier of the goods; or
(ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the goods were conducted or made;
and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or
(e) the goods are not of acceptable quality because they are unsafe.
[55]	It has been held that an accumulation of individually minor defects can be aggregated to amount to a major failure giving rise to a right to reject the goods.  In Cary Boyd v Agrison Pty Ltd [2014] VMC 23 at [51], the Court held that:
[D]espite the use of ‘a’, to suggest the singular, ‘a major failure’ might be constituted by a series of specific and individual defects which taken as a whole constitute one major failure.  I also agree with this interpretation of s 260 of the ACL.
[56]	I note in passing that this position is now reflected in amendments to s 260 made by Treasury Laws Amendment (2020 Measures No. 6) Act 2020 (Cth).  Pursuant to s 303 of the Australian Consumer Law, these amendments apply in relation to goods supplied under a contract entered into on or after 1 July 2021.
[57]	I find the series of defects set out above, taken as a whole, are such that a reasonable consumer fully acquainted with the nature and extent of the failures, would not have acquired the motor vehicle.  A reasonable consumer would not expect to have to return a near new vehicle 12 times over a two year period in order for the defects which I have accepted to be remedied.  I emphasise that my finding is based on the series of defects taken together.  It may well be the case that none of the defects, individually, would in itself have amounted to a major failure.
[58]	I note that this conclusion is consistent with that reached by the Tribunal in many other cases, including Haisman v Drive (Aust) Pty Ltd [2020] QCAT 44, ACH Computing Pty Ltd v Austral Pty Ltd trading as Brisbane City Jaguar Land Rover [2020] QCAT 176, Foley v Westco Cairns Pty Ltd [2020] QCAT 345, Kablar Financial Services Pty Ltd v LSH Auto (Brisbane) Pty Ltd trading as Mercedes-Benz Brisbane [2020] QCAT 346, Sullivan & Anor v James Frizelle’s Automotive Group Pty Ltd [2021] QCAT 49 and Crawford v Sunco Motors Pty Ltd [2021] QCAT 183. 
[59]	Alternatively, s 259(2) of the Australian Consumer Law provides:
(2)  If the failure to comply with the guarantee can be remedied and is not a major failure:
(a)  the consumer may require the supplier to remedy the failure within a reasonable time; or
(b)  if such a requirement is made of the supplier but the supplier refuses or fails to comply with the requirement, or fails to comply with the requirement within a reasonable time—the consumer may:
(i)  otherwise have the failure remedied and, by action against the supplier, recover all reasonable costs incurred by the consumer in having the failure so remedied; or
(ii)  subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection.
[60]	I find that the TC/ECS, which took 13 months to be remedied, was not remedied within a reasonable time.  I also find that the forward collision system, which took 20 months to be remedied, was not remedied within a reasonable time.  Even if I am wrong in concluding that the failures taken as a whole constitute a major failure, the applicant would still have a right to reject the motor vehicle under s 259(2)(b)(ii).
[61]	In order to obtain a refund, the consumer is required to reject within the ‘rejection period’.  That term is defined in s 262(2) of the Australian Consumer Law to mean:
 (2) The rejection period for goods is the period from the time of the supply of the goods to the consumer within which it would be reasonable to expect the relevant failure to comply with a guarantee referred to in section 259(1)(b) to become apparent having regard to:
(a) the type of goods; and
(b) the use to which a consumer is likely to put them; and
(c) the length of time for which it is reasonable for them to be used; and
(d) the amount of use to which it is reasonable for them to be put before such a failure becomes apparent.
[62]	In Morphy v Beaufort Townsville Pty Ltd [2018] VCAT 1520 at [86], the Victorian Civil and Administrative Tribunal held that, while the rejection period did not necessarily correlate with the manufacturer’s warranty period, the warranty period was relevant in considering whether the rejection period had expired:
[A]t the time of the rejection, the motor car remained under a three year/100,000 kilometre manufacturer’s warranty. In determining if the rejection period has ended, the Tribunal is not bound by the warranty period given by an express manufacturer’s warranty. Nevertheless, the express warranty period is relevant evidence of the expected period of largely problem-free use of goods. 
[63]	I have treated the filing of the application with the Tribunal on 2 July 2020, in which the applicant sought a refund, as a rejection of the motor vehicle.  This was communicated to the first respondent by service of the application.
[64]	The applicant provided evidence that she waited two years before rejecting the motor vehicle because she was hoping for all the issues to be resolved before the expiry of the warranty period.  However, by the end of the two year period, she was concerned that additional issues still kept popping up.
[65]	In these circumstances, I am satisfied that the applicant rejected the motor vehicle within the rejection period.
[66]	In Haisman v Drive (Aust) Pty Ltd  [2020] QCAT 44 at [24], I found that the Tribunal has jurisdiction to make an order requiring the supplier to pay to the consumer a stated amount of money, namely the amount of the refund payable under s 263(4)(a).  In this case, the applicant has notified the respondent that the goods have been rejected in accordance with s 263(1) of the Australian Consumer Law.  I will give effect to the requirement in s 263(2) that the goods be returned by so ordering.  Upon the return of the motor vehicle, the applicant will be entitled to a refund pursuant to s 263(4).
Damages
[67]	The Tribunal is vested with jurisdiction in respect of actions under s 259(4) of the Australian Consumer Law, which provides:
The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee, if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.
[68]	In the application, the applicant made claims for expenses incurred for window tinting in the amount of $200 and paint protection in the amount of $1,528.  I consider that these expenses were reasonably foreseeable.  Indeed, they are services of a kind commonly offered by motor dealers.
Orders
[69]	For completeness, I note that the first respondent has not sought any relief against the second respondent pursuant to s 274 of the Australian Consumer Law.
[70]	The orders of the Tribunal are:
1.	The applicant is required to return the motor vehicle the subject of these proceedings to the first respondent within 14 days of the date of these orders.
2.	The first respondent is required to pay to the applicant the amount of $29,728 within 28 days of the date of these orders.