Campbell v Caravan & RV Central Pty Ltd t/as Avan New South Wales & FCA Australia Pty Ltd - [2016] NSWCATCD 90

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation: Campbell v Caravan & RV Central Pty Ltd t/as Avan New South Wales & FCA Australia Pty Ltd [2016] NSWCATCD 90
Hearing dates: 29 August 2016
Decision date: 03 November 2016
Jurisdiction: Consumer and Commercial Division
Before: P French, General Member
Decision:
1. Pursuant to section 79N(h) of the Fair Trading Act 1987:

(a) the First Respondent, Caravan & RV Central Pty Ltd trading as Avan New South Wales, 2142-2150 Castlereagh Street Penrith NSW 2751 is to pay the Applicant, Frederick Joseph Campbell, 129 Lakeline Drive Kanahooka NSW 2530 the sum of $104,000.00 within twenty-eight (28) days of the date of these Orders; and

(b) the Applicant, Frederick Joseph Campbell, 129 Lakeline Drive Kanahooka NSW 2530 is to return the White Fiat Ovation C Class M3 Motorhome he purchased on 15 February 2013 to Caravan & RV Central Pty Ltd trading as Avan New South Wales 2142-2150 Castlereagh Street Penrith NSW 2751 within twenty-eight (28) days of the date of these Orders.
2. The Application is otherwise dismissed.
Catchwords: MOTOR VEHICLES - Motorhome - whether of acceptable quality – major failure – where motorhome is product of two manufacturing processes – where there is joint liability – order made against retailer
Legislation Cited: Fair Trading Act 1987
Civil and Administrative Tribunal Act 2013
Australian Consumer Law
Civil Procedure Act 2005
Cases Cited: Briginshaw v Briginshaw (1938) 60 CLR 336
Safi v Heartland Motors Pty Ltd trading as Heartland Crysler [2016] NSWAP 80
Bunnings Group Limited (formerly Bunnings Pty Ltd) v Laminex Group Limited [2006] FCA 682
Category: Principal judgment
Parties: Frederick Campbell (Applicant)
RV Central Pty Ltd trading as Avan New South Wales (First Respondent)
FCA Australia Pty Ltd (Second Respondent)
Representation: Ms Josephine Mason, authorised representative (Applicant)
Mr Antony Bitcom, Director (First Respondent)
Mr Terry Fitzpatrick, Senior Manager (Second Respondent)

File Number(s): MV 15/57005
Publication restriction: Nil

REASONS FOR DECISION

This is an application by Frederick Campbell (the Applicant) for an Order from the Tribunal pursuant to sub-section 79N(h) of the Fair Trading Act 1987 (FT Act) that will require either or both Caravan & RV Central Pty Ltd trading as Avan New South Wales (the First Respondent) and FCA Australia Pty Ltd (the Second Respondent) to accept the return of Fiat Ovation C Class M3 Motorhome (the “Motorhome”) he purchased from the First Respondent on 15 February 2013 and provide him with a full refund of its purchase price, which was $120,000.00. The First Respondent is the retailer of the Motorhome and the manufacturer of its living cabin. The Second Respondent is the manufacturer of the driver’s cabin and chassis of the Motorhome. This application was made to the Tribunal on 8 October 2015 (the Application).
For reasons that are set out following, the Tribunal has concluded that the First and Second Respondent failed to comply with the guarantee as to acceptable quality when the Motorhome was supplied to the Applicant, and that this failure was a major failure that entitles the Applicant to reject the Motorhome by returning it to the First Respondent an obtaining a refund of its purchase price (as adjusted to achieve equity between the parties).

Procedural history

The Application was first listed before the Tribunal for conciliation and hearing on 10 November 2015. The Applicant attended in person. A representative of the First Respondent whose identity is not recorded on the file, also attended. Efforts of the parties to resolve the dispute in conciliation with the assistance of a Tribunal conciliator were not successful.
When the parties returned to the hearing room, the Tribunal adjourned the application to a Directions Hearing. It appears that the applicant sought further time to obtain legal advice about his claim and to consider if he should join as a Respondent to his application the manufacturer of the chassis of the Motorhome. The Tribunal granted leave for the applicant to amend his claim by 7 December 2016, including by joining the manufacturer or importer of the Motorhome’s chassis.
By email to the Registry dated 7 December 2015, the applicant stated that he sought to join the (now) Second Respondent as a party to the proceedings. The application was not otherwise amended. It would appear that the Registry did not apprehend that the Applicant had already been granted leave to amend his claim by adding the manufacturer or importer as a party to the proceedings. In this respect, the Registry Officer replied to the Applicant’s email on 14 December 2015 as follows: [i]n order for the Tribunal to be satisfied that a party has sufficient interest in the proceedings and has been appropriately served, the joining of a party must be determined at a hearing.” As a result, neither the Application nor the Notice of the next Directions Hearing in the proceedings was served on the (now) Second Respondent.
The application was next listed before the Tribunal for a Directions Hearing on 2 February 2016. The Applicant attended that hearing by telephone and was represented by his partner, Ms Josephine Mason. Mr Antony Bitcon, Director of the First Respondent, attended the hearing in person. Following that hearing, on 4 February 2016 the Tribunal made an order joining the now Second Respondent as a party to the proceedings and directing the Registry to serve a copy of the Application and the directions made to date in the proceedings on the Second Respondent. It otherwise adjourned the application to another Directions Hearing.
The Application was next listed for a Directions Hearing on 10 March 2016. The Applicant attended that hearing by telephone with his authorised representative Ms Josephine Mason. Mr Bitcon again attended the hearing in person on behalf of the First Respondent. Ms Tamara Better, Legal and Aftersales – Resolution Specialist, attended the hearing by telephone on behalf of the Second Respondent. Although it is not entirely clear on the face of the record, it appears that the parties reached some form of agreement (but not a conciliated agreement) that the Applicant would allow both Respondents access to the Motorhome to inspect it. Apparently having regard to this agreement, the Tribunal adjourned the proceedings again to another Directions Hearing.
The matter next came before the Tribunal for Directions on 12 April 2016. As at the date of that hearing, the Motorhome remained with the Second Respondent for inspection. It appears from the Tribunal record that the parties were engaged in settlement discussions in an effort to resolve the dispute. Apparently, in order to allow further time for these discussions to take place, the Tribunal again adjourned the matter to a further Directions Hearing.
The matter was next listed before the Tribunal for directions on 2 June 2016. The Applicant attended the hearing in person with his authorised representative, Ms Josephine Mason. Mr Bitcon also attended the hearing in person on behalf of the First Respondent. Ms Better attended the hearing by telephone on behalf of the Second Respondent. It would appear from the Tribunal record that the parties informed the Tribunal that settlement discussions had not been successful The Tribunal therefore adjourned the proceedings for a formal hearing of the Application on the basis that it was a claim for “a full refund of the purchase price of the [Motorhome] and in the alternative a replacement car.” Directions were given for the filing and exchange of evidence prior to the hearing.
Pursuant to the orders made by the Tribunal on 2 June 2016, the matter came before the Tribunal for hearing on 29 August 2016. The Applicant attended the hearing in person with his authorised representative Ms Josephine Mason. Mr Bitcon attended the hearing in person on behalf of the First Respondent. Mr Terry Fitzpatrick, Senior Manager, attended the hearing by telephone on behalf of the Second Respondent.

Evidence before the Tribunal

The Applicant

Mr Campbell gave oral evidence under oath. Ms Mason also gave oral evidence under oath. The Applicant relied upon the contents of his application, a written statement made by him dated 23 June 2016; invoices/receipts issued to him by the First Respondent in relation to the purchase of the Motorhome which are dated 2 December 2012 and 15 February 2013; a copy of an undated “delivery receipt” that relates to the delivery of the Motorhome from the Second Respondent to the First Respondent which was attached to the keys of the Motorhome at the time possession of it was passed from the First Respondent to the Applicant; an invoice/receipt detailing repairs carried out on the Motorhome by Corban Automotive Group which is dated 26 June 2015; an invoice/receipt detailing repairs carried out by Longreach Motors Pty Ltd dated 1 August 2015; and an invoice/receipt issued to him by Illawarra Automotive Pty Ltd trading as Gateway Motor Group, dated 3 May 2016.

The First Respondent

Mr Bitcon gave oral evidence under affirmation. The First Respondent did not file or serve any evidence in the proceeding.

The Second Respondent

Mr Fitzpatrick gave oral evidence under affirmation. The Second Respondent also relied upon a submission filed with the Tribunal and served on the Applicant and the First Respondent which is dated 13 July 2016. The Second Respondent did not file or serve any evidence in the proceeding.

Material facts

The material facts to emerge from the evidence may be summarised as follows:

The Applicant is a retired person of 75 years of age. His partner, Ms Josephine Mason is a retired person of 80 years of age.

In the later part of 2012 the Applicant decided to sell his family home and purchase a motor home so that he and Ms Mason could spend some years traveling Australia together while they were able to do so. In or about December 2012 they attended the retail premises of the First Respondent and inspected the motorhomes on display. The Applicant contends, and it is not disputed, that he was provided with product descriptions and advertising materials associated with the motorhomes on display, including the Motorhome which is the subject of these proceedings, that warranted that the motorhomes were designed and were fit for the purpose the Applicant sought to acquire a motorhome. The Applicant also contends, and it is not disputed, that the First Respondent’s sales representatives made representations to the Applicant to the same effect.

Among the motorhomes on display was a 2012 model white Fiat Ovation M3 Motorhome, which is the Motorhome which is the subject of these proceedings. The Applicant inspected the Motorhome and determined to purchase it at a stated price of $120,000.00. The First Respondent deducted $11,000.00 from the purchase price which was a trade allowance offered either by the First or Second Respondents (it is not clear on the evidence which it was) as a sale incentive. The Applicant paid a deposit of $2,000.00, leaving a balance of $107,000.00 to be paid to complete the purchase.

Prior to this transaction the Applicant had made it known to the First Respondent that he would only be able to complete the purchase when funds became available from the sale of his family home (presumably the purchaser’s deposit). It appears that the Applicant’s home was listed to be sold by auction on 19 December 2016. The Applicant expected to be able to pay for and collect the Motorhome on 21 December 2012. The Applicant and the First Respondent agreed that the purchase was “subject to [the] house being sold on 19th -12-12” and “if not sold [the] deposit [is] refundable.” This agreement is annotated on the sales invoice/receipt issued to the Applicant by the First Respondent on 12 December 2012.

The Applicant’s home did not sell by auction on 12 December 2012. He was therefore not in a position to complete the purchase in December 2012 as planned. However, the First Respondent agreed to continue to hold the Motorhome to the Applicant’s account until he achieved the sale of his family home and had funds available to complete the purchase. It appears that the Applicant’s family home sold sometime during January or early February 2013 (the date is not in evidence).

On 15 February 2013, the Applicant attended the First Respondent’s retail outlet and completed the purchase by paying the balance owing on the purchase being $107,000.00. When he took possession of the Motorhome he was handed a copy of an undated “delivery receipt” attached to the keys which appears to be a record of the delivery of the Motorhome from the Second Respondent to the First Respondent. It records the Motorhome’s identification information (Engine Number, Chassis Number and Vin), the Order Number, the Shipping Address (being the First Respondent at its retail outlet) and the “Customer Name” against which is written “WATSON.” The Applicant attaches a particular significance to the customer name recorded on the delivery receipt to which I will return below.

The Motorhome is the product of two manufacturing processes. The Second Respondent is the manufacturer of the chassis (being the frame and vehicular working parts of the Motorhome) and its passenger cabin. The First Respondent is the manufacturer of the body (or home) of the Motorhome.

At the time it was purchased the Motorhome was the subject of a three year warranty provided by the First Respondent in relation to the body of the Motorhome. It was also subject to a three-year warranty provided by the Second Respondent in relation to the chassis. These warranties expired on 15 February 2016. In its submission to the Tribunal the Second Respondent has offered to extend that warranty for a further period of two years to 15 February 2018.

Immediately following completion of the purchase, the Applicant drove the Motorhome from the First Respondent’s retail outlet towards his home on the South Coast of NSW. Shortly after leaving the First Respondent’s retail outlet an amber light began to flash on the dashboard of the Motorhome apparently indicating a mechanical malfunction. The Applicant was obliged to stop and investigate. He consulted the Motorhome’s instruction manual which stated that the amber light indicated a malfunction of the Motorhome’s fuel management system. The instruction manual stated that in these circumstances the Motorhome should be driven at reduced speed to a place where it could be mechanically inspected.

The Applicant drove the Motorhome home to his home on the South Coast. The amber light persisted through the whole of the journey home and when the Motorhome was restarted after rest. On 16 February 2013, the Applicant booked the Motorhome in with a local mechanic (Pembers Dealership) for inspection and a full service on 20 February 2013 (the Pembers Dealership mechanic recommended that the Motorhome undergo a full service prior to being taken on a long trip notwithstanding that it had just been purchased new). The Pembers Dealership mechanic apparently performed some repairs to the fuel management system of the Motorhome (further details of this are not in evidence) which resulted in the amber warning light deactivating.

However, “a few weeks later” the amber warning light activated again. The Applicant took the Motorhome to the local mechanic who again undertook repairs which appeared to resolve the problem (again, further details of this are not in evidence).

In March 2013 the Applicant noticed that the floors of the body of the Motorhome had begun to rise at the joints.

In April 2013 the Applicant and Ms Mason set out in the Motorhome on a journey from the South Coast of NSW to the Flinders Ranges in South Australia. During the journey the condition of the floors of the Motorhome deteriorated to the point that the Applicant considered they required urgent repair. This resulted in the Applicant taking the Motorhome to Fiat outlet in Packenham in South-East Victoria en-route to South Australia where repairs were carried out (further details of these repairs are not in evidence).

However, the repairs to the floor did not last. The floor deteriorated again during the journey to and back from the Flinders Ranges. In May 2013, after his return home from his trip to the Flinders Ranges, the Applicant delivered the Motorhome to the First Respondent for an inspection of the floors. Following this inspection the First Respondent undertook to replace the whole of the floors. This work was carried out over a four day period in November 2013. These repairs were carried out under warranty.

In or about July 2013 the Applicant and Ms Mason set out in the Motorhome on a trip to Queensland. At some point along this route (which is not in evidence), while the Applicants were camping, they extended the Motorhome’s exterior awnings. However, when they attempted to decamp they could not get the awnings to retract. They could not drive the Motorhome with the awnings extended and so were obliged to stay in that location for “a couple of days” until help arrived (apparently in the form of other campers) who were able to help push the awnings back into the retractable position.

Upon return from this trip, apparently at some time in July of August 2013 (the date is not in evidence) the Applicant returned the Motorhome to the First Respondent for repairs to be done to the exterior awnings. The First Respondent repaired the awnings under warranty.

However, shortly after these repairs were carried out, the Applicant and Ms Mason travelled embarked on a journey around the South Coast area of NSW. When they camped at Ulladulla and attempted to activate the exterior awnings they would not extend. The Applicant took the Motorhome to an Avan dealership in Bomaderry for inspection. The Avan dealer told the Applicant that the awnings would need to be replaced. This required new awnings and related parts to be ordered in. The Applicant was apparently obliged to remain at the Ulladulla campsite until these parts arrived and these repairs could be performed. It is not clear in the evidence how long the Applicant was required to wait. It is clear that once the parts were available the necessary repairs were carried out promptly by the Bomaderry Avan dealership, again apparently under warranty.

In or about April 2015 the Applicant and Ms Mason decided to take the Motorhome on a trip from their South Coast address to Western Australia. After travelling a short distance as far as Berry on the NSW South Coast, a warning light and whistle activated on the dashboard of the Motorhome indicating a mechanical malfunction. The Motorhome also experienced an immediate loss of power which resulted in the Applicant only being able to drive the Motorhome at a speed of about 40 kilometres. As a result of this malfunction the Applicant was obliged to interrupt the journey and return home along the freeway. The Applicant and Ms Mason contend that the inability of the Motorhome to travel more than 40 kilometres an hour caused disruption and annoyance to other drivers resulting in abuse being yelled at them from overtaking traffic. They contend that this was a humiliating and distressing experience for them.

Upon their return home, the Applicant took the Motorhome to the Corban Automotive Group in Wollongong for inspection and repair. The Motorhome was released to the Applicant following repairs to the turbo-charger being carried out some seven weeks later on 26 June 2015. These repairs were carried out at no cost to the Applicant under warranty. When he collected the Motorhome, the Applicant says he was assured by the service manager that he would not experience any more problems with the Motorhome.

Two days later, on 28 June 2015, the Applicant and Ms Mason set out in the Motorhome on a journey from their South Coast home to Normanton in Far North Queensland. When they were at a distance of some 150 kilometres from Longreach in Central West Queensland the amber warning light on the dashboard of the Motorhome activated and the Motorhome lost power. It was only able to travel at a speed of about 40 kilometres per hour. The Applicant continued the journey to Longreach traveling at about 40 kilometres an hour. When they arrived at Longreach the Applicant took the Motorhome to Longreach Motors where it was inspected. The Longreach mechanic performed tests and diagnosed a malfunction of the Turbo charger. The Longreach mechanic did not (or could not) perform a repair and recommended the Applicant not travel any further in the vehicle towards Normanton due to the risk of breakdown in a remote area. He recommended the Applicant “head for the coast” and then home.

The Applicant took the Longreach mechanics advice. The Motorhome continued to experience power losses on the trip towards the coast and back to the Applicant and Ms Mason’s South Coast address. In the course of the journey, the Applicant converted the Motorhome from automatic to manual transmission, which appeared for a time to avoid power losses. However, late in the journey, on about 20 August 2015, the Motorhome also lost power under manual transmission. The Applicant and Ms Mason were again obliged to complete their journey home on the freeway travelling at 40 kilometres an hour causing disruption and annoyance to other fast moving traffic. This again resulted in other drivers yelling abuse at the Applicant and Ms Mason which they found humiliating and distressing.

Upon the Applicant’s return from this trip, in late August or September 2015 (the date or dates are not in evidence) the Applicant contacted the First Respondent to reject the Motorhome. He asked the First Respondent to accept its return on the basis that it was not roadworthy and refund to him its purchase price. At that time the Motorhome had travelled a total distance of 21,581 kilometres.

The First Respondent refused to accept the return of the Motorhome or to refund its purchase price. Instead, the First Respondent offered to offer the Motorhome for sale on consignment from the Applicant with an expected sale price of $90,000.00. After considering the First Respondent’s offer, the Applicant decided to reject it. He then lodged a complaint with NSW Fair Trading which did not result in a resolution of the matter. He then lodged this application with the Tribunal.

As noted above, on 10 March 2016 the Application came before the Tribunal with each party present either in person or by telephone. As a result of some discussion between the parties and the Tribunal the Applicant agreed to allow the Respondents to again inspect the Motorhome. To this end the Applicant took the Motorhome to the Corban Automotive Group for inspection on 15 March 2016. As a result of this inspection a decision was taken to replace the Turbo charger. However, the Motorhome continued to experience mechanical malfunctions after the Turbo charger was replaced. Upon further inspection, it was discovered that there was “bad corrosion in [the] plugs or the wiring loom” which was causing the malfunction. This affected area of the wiring loom was replaced and the Motorhome was certified as functioning normally. The Applicant collected the Motorhome from the Corban Automotive Group on 2 April 2016.

Notwithstanding the repairs carried out by the Corban Automotive Group, the Applicant continues to seek orders from the Tribunal that will require either or both Respondents to accept the return of the Motorhome and provide him with a full refund of its purchase price. The Applicant and Ms Mason contend they have lost all confidence in the Motorhome and refuse to take it on any long journeys because they fear it will again break down and leave them stranded, potentially in a remote location where no help is immediately available. In this respect, they contend that their retirement dreams have been shattered by their experience with the Motorhome.

The Applicant now contends that he was a victim of a fraud or misrepresentation by the First Respondent at the time the Motorhome was sold to him. He contends that this delivery receipt proves, because the Customer Name is listed as “Watson”, and not that of the First Respondent, that the Motorhome was actually second hand at the time of purchase but was passed off by the First Respondent as new. In further support of this contention the Applicant says that the Motorhome was supplied without a jack which would have been supplied if the Motorhome was new, that there were scratches to the glass tops of the sink and stove at the time of purchase indicating prior use, that the Tom Tom supplied with the Motorhome had saved pre-programmed destinations including for the Northern Territory, and that the chassis history shows a ‘first assignment date’ of 14 September 2011 whereas the Motorhome was sold to him as a 2012 model.

() Both Respondents reject the Applicant’s contention that the Motorhome was second hand at the time of purchase. Mr Bitcon denied that the Motorhome had ever been previously owned by or registered to any person prior to its sale to the Applicant. He told the Tribunal that the surname “Watson” which appears on the delivery receipt was that of an employee of the First Respondent who accepted delivery of the Motorhome to the First Respondent’s retail outlet. Mr Fitzpatrick denied that the chassis of the Motorhome had ever been used in any other motor vehicle prior to its use as the frame for the Motorhome. Mr Bitcon stated that at the time of purchase the Motorhome was a used as a “display stock” item at the First Respondent’s retail outlet. He contends that this would account for some light use marks evident to the interior of the Motorhome. Mr Bitcon contends that the omission of a jack from the Motorhome at the time of sale was a simple error which was corrected with the supply of a jack as soon as the Applicant reported the issue to the First Respondent. Mr Bitcon contended that he had no knowledge of the pre-programmed destinations in the Tom Tom supplied with the Motorhome.

() Apart from the matters outlined above, the Applicant contends that there were other defects in the Motorhome. As noted, he complains the Motorhome was supplied without a jack, that the TV was defective, that the passenger side door of the driver’s cabin would not open from the inside after it was locked requiring exit from the driver’s side, that the passenger side windscreen shade was broken, that three latches to the interior cabinetry of the home had to be replaced and the kitchen sink hose required repair. The First Respondent has attended to each of these issues under warranty.

() However, the Applicant contends that further repairs are required to defects in the passenger side windscreen shade (which have recurred), the cabinetry under the lounge of the Motorhome where two latches are missing or broken, to the outside door of the storage area, which will not stay up, to a leaking tap over the bathroom sink and to the greywater plumbing which malfunctions causing water to flow into the shower recess when the kitchen sink is emptied. The Applicant notified the First Respondent of these further repair issues when he rejected the Motorhome. Mr Bitcon said the First Respondent would attend to these repairs but had not been provided with any opportunity to do so.

() The Applicant told the Tribunal that as at the date of the hearing the Motorhome remains parked in a compound at his South Coast address. It has rarely been used since its 20 August 2015 and has an Odometer reading of approximately 22,000 kilometres.

Jurisdiction

I am satisfied that I have jurisdiction to deal with this Application under Part 6A of the FT Act (sections 79I and 79J) as a “consumer claim” as that term is defined in section 79E of the FT Act in that it is a claim for the payment of a specified sum of money and a claim for the return of specified goods (section 79E(1)(a) and (d) respectively) that arises out of the First Respondent’s supply of the Motorhome to the Applicant. By operation of section 79E(2) of the FT Act, the Applicant’s claim as against the Second Respondent as manufacturer of the chassis of the Motorhome is also a consumer claim even though the Second Respondent was not the direct supplier of the Motorhome to the Applicant because the Applicant’s claim arises from or in connection with the supply of the Motorhome to him by the First Respondent.
The Applicant is a consumer as that term is defined in section 79D of the FT Act (in that he is a natural person). No attempt has been made to prove the contrary (section 79H of the FT Act). The Motorhome provided by the First Respondent to the Applicant is “goods” as that term is defined in section 79D of the FT Act, in that it is a tangible thing that may be the subject of trade and commerce. The Motorhome was “supplied” to the Applicant in a manner required by section 79G of the FT Act in that it was provided for valuable consideration. The Motorhome was supplied to the Applicant in New South Wales as required by section 79K of the FT Act.
Section 79L of the FT Act provides that the Tribunal does not have jurisdiction to hear and determine a consumer claim, relevantly to this case, if the cause of action giving rise to the claim first accrued more than three years before the date on which the claim is lodged. The Applicant’s cause of action is discussed further below. However, the earliest date upon which any cause of action was capable of vesting in this case was 12 December 2012, which was the date the Applicant paid a deposit for the purchase of the Motorhome. As noted above, this Application was made to the Tribunal on 8 October 2015. Therefore on any analysis this action has been brought within the time period allowed by section 79L of the FT Act.
Part 6A of the FT Act came into force on 1 October 2015, just prior to the Applicant lodging his claim. Prior to that date, an equivalent jurisdiction existed under the Consumer Claims Act 1998 (CC Act). The CC Act thus applied for most of the period to which the Applicant’s claim relates. However, pursuant to Schedule 5, Part 6, Clause 29(1) of the FT Act, Part 6A of the FT Act extends to a consumer claim arising before the commencement of that Part unless it is a consumer claim that was subject to an existing claim made under the CC Act that had not been finally determined. The exception does not apply in this case.
Section 79S of the FT Act provides that the Tribunal does not have jurisdiction to make orders in any application in favour of an applicant that have a relevant total value that exceeds a prescribed monetary limit of $40,000.00. However, this is subject to exceptions. One of those exceptions is a claim that arises from the supply of a new motor vehicle that is used substantially for private purposes within the meaning of the Motor Vehicles Taxation Act 1988 (MVT Act) (subsection 79S(6)(a) of the FT Act).
The term “new motor vehicle” is defined in section 79S of the FT Act to mean “a motor vehicle that is not a second-hand motor vehicle within the meaning of the Motor Dealers and Repairers Act 2013 (MD&R Act). The term “second-hand motor vehicle” is defined in section 4 of the MD&R Act to “include a motor vehicle that, at any time before being offered or displayed for sale, or sold, has been registered to a person other than the purchaser, and includes a demonstrator motor vehicle.”
Section 61 of the MD&R Act contains the definition of a “demonstrator motor vehicle”:

61 Definition of “demonstrator motor vehicle”
In this Act:
"demonstrator motor vehicle" means a motor vehicle:
(a) that has been used only for a purpose connected with its manufacture or sale or for the purpose of demonstrating the motor vehicle, or a motor vehicle of that kind, to a potential purchaser, and
(b) that has not been sold to a person other than a motor dealer, and
(c) that has been registered only in the name of a motor dealer, a person on behalf of a motor dealer or another person in anticipation of the sale of the motor vehicle to that person.

In this case, the Applicant, perhaps contrary to his own interests, contends that the Motorhome was second hand at the time it was purchased and that it previously belonged to a person whose surname was “Watson” which is the name that appears on the delivery receipt that was attached to the keys when they were passed to him by the First Respondent on completion of the purchase. If this contention is proved, the Tribunal will not have jurisdiction to entertain the Applicant’s claim because it far exceeds the limit imposed by section 79S on the relevant total value of the Tribunal’s order making power, and it does not fall within the new motor vehicle exception.
Both Respondents reject the Applicant’s contention that the Motorhome was second hand at the time of its sale. Both Mr Bitcon and Mr Fitzpatrick gave evidence under affirmation that Motorhome was new at the time it was purchased by the Applicant. Consequently, the Applicant bears the onus of proving that he was a victim of a fraud perpetrated on him at the time of sale, which includes persuading the Tribunal that Mr Bitcon and Mr Fitzpatrick gave untruthful evidence to it about this at the hearing. Given the seriousness of such allegations, that onus is not discharged lightly.
The Applicant’s claim that the Motorhome was second hand at the time it was purchased is essentially speculative. There is no satisfactory evidence to support the claim. Mr Bitcon has given satisfactory explanations for the failure of the Motorhome to sold with a jack (a simple oversight), for the light wear marks in the cabin (the Motorhome was a stock display item prior to purchase) and for the name “Watson” appearing on the delivery receipt (the surname of the staff member who took delivery). There is no evidence before the Tribunal that establishes why the Tom Tom supplied with the Motorhome had pre-programmed destinations. However, while the pre-programming may be suggestive of the Tom Tom being subject to prior use, it is not capable of proving to the requisite standard that the Motorhome was second hand at the time of purchase.
For completeness, the Tribunal must also consider if the Motorhome should be classified a second hand motor vehicle on the basis that it was a “demonstrator motor vehicle” as that term is defined in section 61 of the MD&R Act. I am satisfied on the basis of Mr Bitcon’s evidence that although the Motorhome was a display stock item prior to its sale to the Applicant, it was not a “demonstrator motor vehicle” because it was never registered in the name of the First Respondent or a person on behalf of the First Respondent or any other person prior to it being sold to the Applicant and registered in the Applicant’s name.
To have jurisdiction to entertain the Applicant’s claim based upon the exception to the prescribed monetary limit on the Tribunal’s order making power, I must also be satisfied that the Motorhome is used substantially for private purposes within the meaning of the MVT Act. The term “private purposes” is defined in sub-section 3(2) of the MVT Act, relevantly as follows:

(2) For the purposes of this Act, a motor vehicle is not a motor vehicle used substantially for private purposes unless:
(a) …(e) …
(f) in any other case-it is used for social or domestic purposes or for pleasure,
and, in the opinion of the Authority, its use for any other purpose is minimal.

There is no dispute between the parties and the Tribunal is also satisfied on the evidence before it that the Motorhome was and is substantially used for private purposes as those are described in sub-section 3(2)(f) of the MVT Act.
For the foregoing reasons, the Tribunal is satisfied that the Motorhome was a new motor vehicle at the time it was purchased by the Applicant and that it was and is substantially used for private purposes. The Tribunal therefore has jurisdiction to entertain the Applicant’s claim pursuant to the ‘new motor vehicle exception’ to the monetary limit on the Tribunal’s order making power set out in set 79S of the FT Act.

Applicable law

At the time the Applicant purchased the Motorhome the provisions of the Motor Dealers Act 1974 (MD Act) applied to the transaction. This included the Dealer Guarantee contained in section 27 MD Act. Pursuant to section 27(1) and Schedule 1 of that Act, the First Respondent was required to repair or make good (or cause the repair of making good of) any defect appearing in the Motorhome so as to place the Motorhome in reasonable condition having regard to its age up to 20,000 kilometres or 12 months which ever occurred first. There is no issue in this case that the First Respondent complied with, or at least purported to comply with, this Dealer Guarantee. The section 27 Dealer Guarantee ceased to apply to the Motorhome on 15 February 2014. There is therefore no issue in this case arising from the MD Act or its successor, the MD&R Act.
Section 28 of the FT Act provides that the Australian Consumer Law (ACL) applies as a law of New South Wales and is a part of the FT Act. It is to be applied, as relevant, in the determination of a consumer claim brought under Part 6A of the FT Act.
The Applicant’s cause of action in this proceeding is an alleged contravention of a consumer guarantee incorporated into the contract or agreement for the purchase of the Motorhome by the ACL. The ACL commenced in NSW on 1 January 2011. It was thus in force at the time the Applicant purchased the Motorhome from the First Respondent.
The consumer claim jurisdiction under the ACL is narrower than that which pertains under the FT Act. Consequently, for the provisions of the ACL to apply, the Applicant’s claim must also fall within the perimeters of that jurisdiction. Essentially, this requires the Applicant to be a “consumer” as defined in section 3 of the ACL:

3. Meaning of consumer
Acquiring goods as a consumer
(1) A person is taken to have acquired particular goods as a consumer if, and only if:
(a) the amount paid or payable for the goods, as worked out under sub-sections (4) to (9), did not exceed:
(i) $40,000.00; or
(ii) if a greater amount is prescribed for the purposes of this paragraph – that greater amount; or

(b) the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption; or
(c) the goods consisted of a vehicle or trailer acquired for use principally in the transport of goods on public roads.

In this case, the Applicant paid $120,000.00 for the Motorhome so for the provisions of the ACL to apply in this claim the Motorhome must be a ‘good’ that is ordinary acquired for personal, domestic or household use or consumption (subsection 3(1)(b) of the ACL).
The legal test that applies in determining if goods are acquired for personal, domestic, or household use or consumption was reiterated by the Appeal Panel of this Tribunal in Safi v Heartland Motors Pty Ltd trading as Heartland Crysler [2016] NSWAP 80 at [62] to [65] relying on the decision of the Federal Court of Australia in Bunnings Group Limited (formerly Bunnings Pty Ltd) v Laminex Group Limited [2006] FCA 682 at [81] to [108]. It requires the Tribunal to consider, inter alia, what the goods are “commonly” or “regularly” used for, having regard to the “essential character” of the goods which should be determined objectively, but also “having regard to the design, marketing, pricing and potential uses to the type of goods in question.”
In this case the Tribunal is comfortably satisfied that a Motorhome is a good that is commonly acquired for personal and domestic use, being for the purpose of personal travel and providing a mobile residence. The provisions of the ACL therefore apply to the Applicant’s claim.
Section 54 of the ACL provides a guarantee as to acceptable quality which must not be contravened by a supplier of goods or services to a consumer:

Guarantee as to acceptable quality
(1) If:
(a) a person supplies, in trade or commerce, goods to a consumer; and
(b) the supply does not occur by way of sale by auction;
there is a guarantee that the goods are of acceptable quality.

(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.

(4) If:
(a) goods supplied to a consumer are not of acceptable quality; and
(b) the only reason or reasons why they are not of acceptable quality were specifically drawn to the consumer's attention before the consumer agreed to the supply;
the goods are taken to be of acceptable quality.

(5) If:
(a) goods are displayed for sale or hire; and
(b) the goods would not be of acceptable quality if they were supplied to a consumer;
the reason or reasons why they are not of acceptable quality are taken, for the purposes of subsection (4), to have been specifically drawn to a consumer's attention if those reasons were disclosed on a written notice that was displayed with the goods and that was transparent.

(6) Goods do not fail to be of acceptable quality if:
(a) the consumer to whom they are supplied causes them to become of unacceptable quality, or fails to take reasonable steps to prevent them from becoming of unacceptable quality; and
(b) they are damaged by abnormal use.

(7) Goods do not fail to be of acceptable quality if:
(a) the consumer acquiring the goods examines them before the consumer agrees to the supply of the goods; and
(b) the examination ought reasonably to have revealed that the goods were not of acceptable quality.

In summary, and relevantly, goods must be of acceptable quality in terms of being fit for the purpose for which they are commonly supplied, they must be acceptable in appearance and finish, they must be free from defects, and they must be safe and durable. The test for these qualities is an objective one. It is what a “reasonable consumer” fully acquainted with the state and condition of the goods (including any hidden defects) would regard of acceptable quality having regard to the nature of the goods, the price paid for them, any statements made about the goods in advertising materials, any representations made about the goods by the supplier or manufacturer of the goods and any other relevant factors.
Goods or services will not fail to be of acceptable quality if the supplier brought the relevant defect to the attention of the consumer before they were supplied, or if it is conduct by the consumer that causes the goods to become of unacceptable quality, or if the defect could have been discovered by the consumer upon reasonable examination.
Sections 259 to 262 of the Australian Consumer Law set out the remedies that may be available to a consumer if a supplier fails to comply with a consumer guarantee:

259 Action against suppliers of goods
(1) A consumer may take action under this section if:
(a) a person (the supplier ) supplies, in trade or commerce, goods to the consumer; and
(b) a guarantee that applies to the supply under Subdivision A of Division 1 of Part 3-2 (other than sections 58 and 59(1)) is not complied with.

(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.

(3) If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may:
(a) subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection; or
(b) by action against the supplier, recover compensation for any reduction in the value of the goods below the price paid or payable by the consumer for the goods.

(4) 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.
(5) Subsection (4) does not apply if the failure to comply with the guarantee occurred only because of a cause independent of human control that occurred after the goods left the control of the supplier.
(6) To avoid doubt, subsection (4) applies in addition to subsections (2) and (3).
(7) The consumer may take action under this section whether or not the goods are in their original packaging.

In summary, and relevantly, a consumer may take action against a supplier if the supplier contravenes the guarantee as to acceptable quality. If the failure to comply can be remedied and it is not a major failure the consumer may require the supplier to remedy the failure within a reasonable period. If the supplier refuses or fails to do so, the consumer may have the failure remedied elsewhere and recover all reasonable expenses they incur in doing so, or they may notify the supplier that they reject the goods. If the failure to comply cannot be remedied or the failure is a major failure, the consumer may notify the supplier they reject the goods, or take action against the supplier to recover compensation for any reduction in the value of the goods below the price paid. A consumer may also take action against a supplier to recover damages for any consequential loss they have incurred due to the failure to comply provided that loss was reasonably foreseeable.
Section 260 of the ACL sets out the circumstances in which a failure to comply with a consumer guarantee will be a major failure that entitles a consumer to reject goods:

260 When a failure to comply with a guarantee is a major failure
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.

In summary, a failure to comply with a consumer guarantee will be a major failure on one of the following alternative bases: if the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; if the goods depart in one or more respects from their description at the time of supply or from the sample of demonstration model the consumer relied upon when purchasing the goods; if 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; if the goods are unfit for a purpose the consumer disclosed to the supplier of the goods (or another relevant person) and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or, if because they are unsafe.
Section 261 sets out the methods by which a supplier may remedy a failure to comply with a consumer guarantee:

261 How suppliers may remedy a failure to comply with a guarantee
If, under section 259(2)(a), a consumer requires a supplier of goods to remedy a failure to comply with a guarantee referred to in section 259(1)(b), the supplier may comply with the requirement:
(a) if the failure relates to title--by curing any defect in title; or
(b) if the failure does not relate to title--by repairing the goods; or
(c) by replacing the goods with goods of an identical type; or
(d) by refunding:
(i) any money paid by the consumer for the goods; and
(ii) an amount that is equal to the value of any other

In summary, and relevantly, a supplier may repair the goods, replace the goods with goods of an identical type, or refund to the consumer any money they paid for the goods.
In this case, the Applicant asserts, in effect, that either or both the First and Second Respondents failed to comply with the guarantee as to acceptable quality in supplying the Motorhome to him and that this failure was a major failure that entitles him to reject the Motorhome and obtain a full refund of its purchase price.
Section 262 of the ACL limits the circumstances in which such a remedy is available:

262 When consumers are not entitled to reject goods
(1) A consumer is not entitled, under section 259, to notify a supplier of goods that the consumer rejects the goods if:
(a) the rejection period for the goods has ended; or
(b) the goods have been lost, destroyed or disposed of by the consumer; or
(c) the goods were damaged after being delivered to the consumer for reasons not related to their state or condition at the time of supply; or
(d) the goods have been attached to, or incorporated in, any real or personal property and they cannot be detached or isolated without damaging them.

(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.

In summary, and relevantly to this case, such a remedy will not be available if the rejection period for the goods has ended. The rejection period is the period from the time of supply of the goods to the consumer within which it would be reasonable to expect the relevant failure to comply with a consumer guarantee to become apparent, having regard to the type of goods, the use to which the consumer is likely to put them, the length of time for which it is reasonable for them to be used; and, the amount of use to which it is reasonable for them to be put before such a failure becomes apparent.
Section 263 of the ACL sets out the consequences that follow for the consumer and the supplier if the consumer rejects goods with the rejection period specified in section 262 of the ACL:

263 Consequences of rejecting goods
(1) This section applies if, under section 259, a consumer notifies a supplier of goods that the consumer rejects the goods.
(2) The consumer must return the goods to the supplier unless:
(a) the goods have already been returned to, or retrieved by, the supplier; or
(b) the goods cannot be returned, removed or transported without significant cost to the consumer because of:
(i) the nature of the failure to comply with the guarantee to which the rejection relates; or
(ii) the size or height, or method of attachment, of the goods.

(3) If subsection (2)(b) applies, the supplier must, within a reasonable time, collect the goods at the supplier's expense.
(4) The supplier must, in accordance with an election made by the consumer:
(a) refund:
(i) any money paid by the consumer for the goods; and
(ii) an amount that is equal to the value of any other consideration provided by the consumer for the goods; or

(b) replace the rejected goods with goods of the same type, and of similar value, if such goods are reasonably available to the supplier.

(5) The supplier cannot satisfy subsection (4)(a) by permitting the consumer to acquire goods from the supplier.
(6) If the property in the rejected goods had passed to the consumer before the rejection was notified, the property in those goods revests in the supplier on the notification of the rejection

In summary, and relevantly, the consumer must return the goods to the supplier, or in certain circumstances the supplier must collect the goods from the consumer at its own expense, and the supplier must refund the purchase price paid by the consumer or replace the goods with goods of the same type or similar value if such goods are reasonably available to the supplier. If the consumer chooses a refund the supplier is precluded from supplying replacement goods to satisfy the requirement for a refund.
In determining any remedy that may be available to the Applicant under Part 6A of the FT Act the Tribunal must also have regard to the requirements of section 79U(1) of the FT Act which requires the Tribunal to be satisfied that the orders it makes are fair and equitable to all the parties to the claim.
This is a case where there are two Respondents to the claim each of which has been involved in the supply of the Motorhome to the Applicant. The First Respondent is the retail supplier and the manufacturer of the body of the home. The Second Respondent is the manufacturer of the chassis of the Motorhome. Section 79V of the FT Act is therefore applicable in these circumstances. It provides that section 95 of the Civil Procedure Act 2005 (CP Act) applies to and in respect of an order of the Tribunal under Part 6A of the FT Act as if such an order were a judgement of the Supreme Court. Section 95 of the CP Act provides:

95 Joint liability
(1) If two or more persons have a joint liability and, in any proceedings, judgment on the liability is given against one or more but not all of them:
(a) the liability of the other or others of them is not discharged by the judgment or by any step taken for the enforcement of the judgment, and
(b) after the judgment takes effect, those of them against whom the judgment is given and the other or others of them become liable, as between those of them against whom the judgment is given on the one hand and the other or the others of them on the other hand, severally but not jointly, and
(c) if there are two or more such persons against whom the judgment is not given, they remain, after the judgment takes effect, jointly liable amongst themselves, and
(d) if the judgment is satisfied wholly or in part by payment or by recovery under execution, the liability of the persons against whom the judgment is not given is taken also to have been satisfied in the amount of the payment or recovery.

(2) This section does not affect a person’s right to contribution or indemnity in respect of the person’s satisfaction, wholly or in part, of a liability that the person has (whether jointly or severally or jointly and severally) with any other person.
(3) This section does not apply to a judgment to which section 5 (1) (a) of the Law Reform (MiscellaneousProvisions) Act 1946 applies.
(4) In this section,
"liability" includes liability in contract, liability in tort and liability under a statute.

(The Tribunal notes that the exception specified in sub-section 95(3) of the CP Act relates to damages in tort and does not apply in this case).

In summary, if one or more persons (legal entities) have joint liability and the Tribunal gives judgement against one such person but not others who are also liable, the others remain jointly liable after judgement is given, and they may be pursued by the party against whom judgement is given.
In order to succeed in his Application, the Applicant bears the onus of establishing his factual contentions to the civil standard of proof. He must prove these facts to the comfortable satisfaction of the Tribunal on the balance of probabilities: Briginshaw v Briginshaw (1938) 60 CLR 336.

Consideration

Having regard to the applicable law, the questions that the Tribunal must determine in order to establish if the Applicant is entitled to the remedy he seeks are as follows:

in supplying the Motorhome to the Applicant, did the First and/or Second Respondent fail to comply with the guarantee as to acceptable quality provided in section 54 of the ACL?

if there was a failure on the part of the First and/or Second Respondents to comply with the guarantee as to acceptable quality, was this a major failure that would entitle the Applicant to reject the Motorhome and obtain a refund of its purchase price?

if the failure to comply with the guarantee was a major failure, did the Applicant reject the Motorhome within the ‘rejection period’ allowed by section 262 of the ACL?

If there was a failure of the First and/or Second Respondent to comply with the guarantee as to acceptable quality, but this was not a major failure, has this failure been remedied by the actions taken by the First and/or Second Respondent to date, and if not, what further action, if any, by way of remedy is required?

If the Applicant is entitled to a remedy, what if anything, is necessary, to ensure that any orders made are fair and equitable to each of the parties?

If the Applicant is entitled to a remedy, should orders be made requiring one or other or both of the Respondents to provide that remedy?

Was the Motorhome of acceptable quality?

The test that determines if goods are of acceptable quality within the meaning of the ACL is provided in subsection 54(2) of that law. Goods are of acceptable quality if they possess each of five characteristics listed in that sub-section. The matters that must be taken into account in determining if goods are set out in subsection 54(3) of the ACL. The acceptable quality test is that of the “reasonable consumer” fully acquainted with the state and condition of the goods (including any hidden defects). It is an objective test.
The goods at the centre of this dispute is a Motorhome. A motorhome is a mobile dwelling commonly used for long-distance recreational travel. In this case the evidence establishes that this was the purpose for which the Applicant acquired and attempted to use the Motorhome. He and Ms Mason wanted to travel around Australia from their South Coast home, including to remote locations in Western Australia and to Normanton in remote Far North Queensland. I am satisfied that prior to and up to the time of the purchase, the product descriptions and advertising materials that were associated with the Motorhome, and the representations made by the First Respondent’s sales representatives warranted to the Applicant that the Motorhome was designed and fit for this purpose. I am satisfied that a reasonable consumer would be entitled to expect that the Motorhome would be safe for such a purpose.
The Motorhome was purchased for $120,000.00 (or $109,000.00 after the trade allowance was applied to the transaction). The Motorhome is thus a high cost/value item. In determining if the Motorhome was of acceptable quality at the time it was supplied to the Applicant, the Tribunal must take into account the high price he paid for it. A reasonable consumer would be entitled to expect that such a high cost item would be of very good quality. A reasonable consumer would also be entitled to expect that such a high cost item would be durable, being capable of safe and effective use over a number of years (or at least many thousands of kilometres).

It is clear on the evidence before the Tribunal that the Applicant has experienced various serious problems with the Motorhome since taking delivery of it, some of which first manifested immediately following delivery. Some of these problems continued or recurred up to late August or September 2015 when the Applicant contacted the First Respondent to reject the Motorhome and request a refund of its purchase price. Indeed, it is clear on the evidence that some of these problems continued or recurred after September 2015 up until March and early April 2016 when the Motorhome was returned for inspection by the Respondents while these proceedings were on foot.
The most significant of those problems have been:

a malfunction of the Motorhome’s fuel management system which required repairs to be conducted on two occasions within the first month after purchase;

defects in the floor of the Motorhome requiring urgent repairs to be completed in April 2013 (within 2 months of purchase) and the whole floor removed and replaced in November 2013 (within 8 months of purchase);

defects in the exterior awnings of the Motorhome which required repairs to be carried out in July or August 2013 and then the awnings to be replaced shortly afterwards;

malfunctions of the Turbo charger of the Motorhome in April 2015, then again in June 2015, then again in August 2015, and then again in March 2016 requiring the repair and finally replacement of the Turbo charger; and

serious corrosion of the wiring loom requiring its replacement in March 2016.

It is also clear on the evidence before the Tribunal that these defects have seriously interfered with the Applicant and Ms Mason’s use and enjoyment of the Motorhome. There is a degree of uncertainty in some aspects of the evidence, but on any view of it, the Motorhome has been off the road and under repair for at least 12 to 15 weeks since its purchase. On at least two occasions the Applicant and Ms Mason have planned long trips away on holiday (to Western Australia and to Normanton) which have had to be abruptly aborted due to the malfunction of the Motorhome. The Applicant and Ms Mason have been ‘stranded’ on two occasions by malfunctions to the exterior awning mechanism. On one occasion this was in a remote location where it was two days before assistance arrived.
The Applicant and Ms Mason contended that the experience of the Motorhome losing power particularly when they were on long journeys and in remote locations was distressing and even frightening for them. They contended that it was also frustrating and humiliating for them to have to drive long distances very slowly along freeways amidst fast moving traffic.
The Applicant and Ms Mason also contended that they have experienced little enjoyment of the Motorhome since its purchase and that their retirement plans to travel and see Australia are have been shattered. They contended that their repeated experiences of the Motorhome malfunctioning mean that they no longer feel safe in it. I accept their evidence as truthful and compelling.
In their evidence to the Tribunal, both Mr Bitcom and Mr Fitzpatrick contended that the problems the Applicant experienced with the Motorhome to date have been repaired at no cost to him. They contend that the Applicant has failed to file any expert or other evidence to prove that as at the date of the hearing there is any outstanding problem with the Motorhome that requires attention. In his oral evidence and submission to the Tribunal, Mr Fitzpatrick contended that the mechanical problems the Applicant has experienced with the Motorhome since its purchase are “minor.” Mr Fitzpatrick specifically rejects the Applicant’s contention that the Motorhome is unsafe and not fit for its purpose.
The Tribunal accepts that the First and Second Respondent have carried out repairs to the Motorhome under warranty. However, the fact that defects can be repaired, and have been repaired, does not establish that the First and/or Second Respondent complied with the guarantee as to acceptable quality in supplying the Motorhome to the Applicant. Nor would the fact that there is currently no outstanding problem with the Motorhome, if that were to be established on the evidence, mean that the guarantee as to acceptable quality had been complied with at the time the Motorhome was supplied to the Applicant. These issues go to the remedy that may be available to the Applicant; they do not go to either Respondent’s compliance with the guarantee at the time of supply.
I cannot accept the contention of either Respondent that the mechanical problems that have beset the Motorhome since its purchase by the Applicant are “minor issues” requiring “simple repairs.” If that were so it is difficult to understand how or why the problems with the fuel management system, Turbo charger and/or wiring loom have persisted. It appears to me manifest that these mechanical problems have been very serious in terms of the operation of the vehicle, in their duration and recurrence, and in terms of their impact on the Applicant and Ms Mason. There is an unreality about the Respondents’ contentions to the contrary.
Turning specifically to the characteristics of acceptable quality specified in sub-section 54(2) of the ACL, it is manifest that the Motorhome was not free from defects when it was supplied to the Applicant. As outlined above there were several significant latent mechanical defects that emerged shortly after purchase, some of which have continued or recurred up to March 2016. I do not accept that the Motorhome was safe at the time of supply or afterwards. The evidence establishes that it was prone to mechanical malfunctions and that these could and did occur in remote locations where assistance was not readily available to the Applicant and Ms Mason. The Motorhome was designed for the purpose of long distance recreational travel commonly undertaken by older persons in their retirement. The Motorhome was not fit for this purpose due to its recurring mechanical and other problems. Further relevant evidence of this is the low kilometreage travelled by the Motorhome, which was approximately 21,000 kilometres at the time the Applicant rejected it and approximately 22,000 kilometres at the date of the hearing. This supports the Applicant’s contention that he has not and does not feel it is safe to use the Motorhome for the purpose for which it was supplied.
I am also comfortably satisfied on the evidence before me that the mechanical defects in the Motorhome were not drawn to the Applicant’s attention at any time prior to its purchase. Nor could these defects have been reasonably discovered by the Applicant on examination prior to the purchase. I am satisfied that the Applicant did not at any time engage in any conduct which caused the Motorhome to become of unacceptable quality.
For the foregoing reasons, having regard to nature of the Motorhome, the purpose for which it was acquired, the price that the Applicant paid for it, the statements made about the Motorhome’s fitness for the purpose for which the Applicant acquired it in the advertising materials provided to the Applicant by the First Respondent at the time of purchase, and the representations to the same effect made by the First Respondent’s sales staff to the Applicant prior to purchase on the one hand, and the mechanical difficulties that have beset the Motorhome since its purchase, and the impact of these difficulties on the Applicant’s use and enjoyment of the Motorhome on the other, I am comfortably satisfied that the First and Second Respondents failed to comply with the guarantee as to acceptable quality in supplying the Motorhome to the Applicant. I am comfortably satisfied that a reasonable consumer fully acquainted with state and condition of the Motorhome would not consider it to be of acceptable quality.

Was the failure to comply with the guarantee as to acceptable quality a major failure?

Section 260 of the ACL sets out the characteristics that must be satisfied for a failure to comply with a consumer guarantee to constitute a major failure. After reviewing the relevant authorities in this and other jurisdictions the Appeal Panel of this Tribunal concluded in Safi v Heartland Motors Pty Ltd trading as Heartland Crysler [2016] NSWAP 80 at [101 and [102] that the following principles are relevant in determining if a failure to comply with the guarantee as to acceptable quality is a major failure:

a major failure may be constituted by one defect or a series of specific or individual defects which, when taken as a whole, constitute a major failure;

the test of whether goods “would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure” is an objective one;

a “reasonable consumer” would expect teething problems, even in a new vehicle;

the question to ask is whether the reasonable consumer, given the option of acquiring that particular good or alternatively purchasing either nothing or a different model would not have acquired the good;

defects which result in goods failing to comply with the guarantee as to acceptable quality will not invariably be a major failure and it will depend on the nature and extent of the failure;

the cost of repair, in proportion to the purchase price, and the question of whether the defects can be remedied easily in a timely manner are relevant considerations; and

the purchase price for the goods and the nature of the defect are also relevant considerations for a “reasonable consumer”.

In this case it is clear that there have been multiple defects in the Motorhome, some of which relate to the mechanical function of its chassis and others which relate to the living cabin. The mechanical malfunctions in the chassis were first experienced immediately after purchase in February 2013 and recurred up to March 2016. These mechanical malfunctions have required repairs to be carried out on five occasions. These repairs have required the Motorhome to be off the road for various periods of up to seven weeks. I am comfortably satisfied that these mechanical problems extend well beyond “teething problems.” They have proved not to be capable of easy and timely remedy. If that were the case, they would not have recurred. As I have outlined above, these defects have had a serious impact on the Applicant and Ms Mason’ use and enjoyment of the Motorhome.
I am comfortably satisfied that a reasonable consumer fully acquainted with these defects would not have acquired the Motorhome. A reasonable consumer would not acquire a motorhome specifically designed for long distance recreational travel if they knew that it would be prone to mechanical malfunctions and breakdowns that had the potential to leave them stranded. A reasonable consumer would not acquire a motorhome that would require repeated repairs, sometimes taking it off the road for a considerable period of time. A reasonable consumer would not acquire a motorhome with multiple defects in its mechanical operation and in the functioning of its living cabin. Equipped with the knowledge that the Motorhome had these defects, I am comfortably satisfied that a reasonable consumer would have chosen a different motorhome or not purchased a motorhome at all.
I accept that the necessary repairs to the Motorhome have to date been carried out by both Respondents promptly and without argument under warranty at no cost to the Applicant. However, the warranties provided by both Respondents have now lapsed. The Second Respondent has submitted that it is willing to extend the warranty over the chassis and drivers cabin for a further two years to February 2018. However, in the absence of that occurring it is likely that further repairs of the type required to date, if required in future, will be costly for the Applicant. The Applicant paid a high price for the Motorhome. In these circumstances, a reasonable consumer would be entitled to expect the relatively problem-free operation of the Motorhome, apart from minor teething problems.
As has been noted, both Respondents are critical of the Applicant’s evidence for its failure to include any expert report to prove that at the date of the hearing there are any “outstanding issues” requiring repair or otherwise affecting the quality of the Motorhome. As I have also stated above, this misapprehends the facts to be proved by the Applicant, which is that either or both Respondents failed to comply with the guarantee as to acceptable quality at the time of supply. The ACL is beneficial legislation designed to protect the reasonable interests of consumers in consumer transactions. The Applicant bears the onus of proving his claim on the balance of probabilities. Ultimately, if he is to succeed, this requires him to place evidence before the Tribunal that is sufficiently probative of the issues to be determined.
As proof of his claim, the Applicant has chosen to rely upon his own experience in the use and operation of the Motorhome since its purchase, about which there is really no dispute (save for the Second Respondent’s characterisation of these problems as “minor issues” which I do not accept). In this case, despite the absence of expert evidence, I am satisfied Applicant’s evidence is sufficiently probative of the issues to be determined to safely found a conclusion that there was a failure to comply with the guarantee as to acceptable quality at the time of supply due to the latent defects in the Motorhome’s chassis and living cabin, and that this was a major failure. I also note that while it is the Applicant that bears the onus of proving the Motorhome is not of acceptable quality, neither Respondent has produced any objective evidence, expert or otherwise, to rebut the Applicant’s claim that the Motorhome was and is not of acceptable quality. This is despite both Respondents being provided with access to the Motorhome in March 2016 when it was returned to their agent for inspection, apparently for this purpose.
For the foregoing reasons, I am satisfied that the Respondent’s failure to comply with the guarantee as to acceptable quality in supplying the Motorhome to the Applicant was a major failure of compliance. Pursuant to section 261 of the ACL the Applicant was and is entitled to reject the Motorhome provided he has done so within the time period permitted by section 262 of the ACL.

Did the Applicant reject the Motorhome within the ‘rejection period’ allowed by section 262 of the ACL?

Subsection 262(2) of the ACL defines the “rejection period” within which a consumer is entitled to reject goods as the “period from the time of supply of the goods to the consumer within which it would be reasonable to expect the relevant failure to comply with a guarantee [in this case the guarantee as to acceptable quality] to become apparent”. It sets out the matters to be considered in ascertaining what this period ought reasonably to be.
There is no dispute that the Applicant first sought to reject the Motorhome by returning it to the First Respondent and obtaining a refund of its purchase price in late August or September 2015 (the precise date not being in evidence). This was approximately 27 months after he purchased of the Motorhome. At that time the Motorhome remained subject to the three year warranties provided by the First and Second Respondents. In determining if the rejection period has ended the Tribunal is not bound by a warranty period given by a retailer or manufacturer. However, warranty periods are relevant evidence of the expected period of relatively problem-free use of goods. In this case the defects in the Motorhome that I have determined constitute major failures to comply with the guarantee as to acceptable quality have all occurred within the warranty periods, with the possible exception of the corrosion of the wiring loom which was identified just outside the warranty period but which appears likely to have been present much earlier than the time of its discovery.
I also take into account the following matters. The Motorhome is a high cost item that a reasonable consumer would expect to last for many years and be capable of safe and effective use for many thousands of kilometres. At the time the Applicant sought to reject it, the Motorhome had been subject to limited use, having travelled only approximately 21,000 kilometres.
For the foregoing reasons I am comfortably satisfied that the rejection period had not ended when the Applicant sought to reject the Motorhome in August or September 2015.

What, if anything, is necessary, to ensure that any orders made are fair and equitable to each of the parties?

Section 263 of the ACL sets out the consequences of a consumer rejecting goods. In this case, the Applicant presses a refund and does not want the Motorhome replaced with an equivalent motorhome. Nor does he want to accept by way of remedy any further repairs to the Motorhome should they become necessary, including under any extended warranty period the Second Respondent is willing to provide. The Respondents are compelled to accept the Applicant’s election. The Applicant must therefore return the Motorhome to the First Respondent and one or both Respondents must refund to the Applicant the purchase price he paid for it.
However, the Tribunal is required pursuant to section 79U(1) of the FT Act to be satisfied that its Orders in disposing of a consumer claim under Part 6A of the FT Act are fair and equitable to all parties to the claim. In this respect, in the circumstances of this case, it is necessary to take into account two matters in order to do justice between the parties. First, although the Applicant contends that he paid $120,000.00 for the Motorhome this is the stated retail price at the time of sale only. In fact, the Applicant paid $109,000.00 for the Motorhome after an $11,000.00 “trade allowance” was discounted from the purchase price. The Applicant is not entitled to recover from the First and/or second Respondent more than he actually paid for the Motorhome.
Second, while the problems the Applicant has experienced in the use of the Motorhome were serious and protracted, he has nevertheless had some limited use and enjoyment of the Motorhome since its purchase. As has been noted, as at the date of the hearing, the Applicant has travelled approximately 22,000 kilometres in the Motorhome. It is therefore appropriate to allow some value to the Respondents for the Applicant’s use and enjoyment of the Motorhome up to the date of these Orders. As I have no evidence that would allow me to calculate this with any precision, this will be a notional reasonable allowance. I will allow $5,000.00.
It follows from these reasons that the amount to be refunded to the Applicant by the Respondents upon the return of the Motorhome to the First Respondent is $104,000.00.

Should orders be made requiring one or other or both of the Respondents to provide this remedy?

As has been noted above, the Motorhome is the product of two manufacturing processes. The First Respondent is the retail supplier of the Motorhome and the manufacturer of its living cabin. The Second Respondent is the manufacturer supplier of the chassis and drivers cabin of the Motorhome. It is clear on the evidence and as a matter of law that the First and Second Respondents are jointly liable under Part 6A of the FT Act and the ACL for the failure to comply with the guarantee as to acceptable quality. Pursuant to section 79V of the FT Act, section 95 of the Civil Procedure Act 2005 applies in these circumstances.
Section 95 of the Civil Procedure Act 2005 provides that the Tribunal may, in the circumstances, make an order requiring either or both Respondents to provide the Applicant with the remedy to which he is entitled. If it makes an order against one Respondent the other Respondent continues to be jointly liable for satisfaction of the judgement as between the Respondents. The question is therefore whether the Tribunal should make an order requiring one or both Respondents to provide the Applicant with the refund of the purchase price for the Motorhome (as adjusted).

The Tribunal has no power to apportion liability between the Respondents. Having regard to this fact, and the complexity that arises from the Motorhome being the product of two manufacturing processes, the Tribunal is of the view that its Orders ought to require the First Respondent, as the retailer of the Motorhome, to provide the Applicant with the refund. The Second Respondent will remain jointly liable for this judgement after it is given, but this will be a matter for the First and Second Respondent to resolve between themselves.

Conclusion

For the foregoing reasons, the Tribunal is comfortably satisfied on the evidence before it that the First and Second Respondents failed to comply with the guarantee as to acceptable quality when the Motorhome was supplied to the Applicant in February 2013. It is also satisfied that this failure was a major failure to comply with the guarantee as to acceptable quality. The Applicant rejected the Motorhome at some time in August or September 2015. He did so within the rejection period permitted by the ACL.
By way of remedy, the Applicant seeks to return the Motorhome and obtain a refund of the purchase price he paid for it. He does not seek by way of remedy any further repair of the Motorhome or its replacement with an equivalent motorhome. In these circumstances the Respondents are compelled to provide the Applicant with the remedy he seeks.
However, the Applicant is only entitled to recover the actual amount he paid for the Motorhome (rather than its stated retail price) and the Respondents ought to be allowed a reasonable sum for the (albeit limited) use and enjoyment the Applicant has had of the Motorhome since its purchase.
As a matter of fact and law both Respondents are liable for the failure to comply with the guarantee as to acceptable quality. However, the Tribunal does not have the power to apportion liability between them. To avoid unnecessary complexity, the Tribunal has determined to order the First Respondent, in its capacity of the retailer of the Motorhome, to provide the Applicant with a refund of the purchase price he paid (as adjusted). The Second Respondent will remain jointly liable for this judgement after it is given, but this will be a matter for the First and Second Respondent to resolve between themselves.

P French

General Member

Civil and Administrative Tribunal of New South Wales

3 November 2016

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 05 January 2017

Medium Neutral Citation:	Campbell v Caravan & RV Central Pty Ltd t/as Avan New South Wales & FCA Australia Pty Ltd [2016] NSWCATCD 90
Hearing dates:	29 August 2016
Decision date:	03 November 2016
Jurisdiction:	Consumer and Commercial Division
Before:	P French, General Member
Decision:	1. Pursuant to section 79N(h) of the Fair Trading Act 1987: (a) the First Respondent, Caravan & RV Central Pty Ltd trading as Avan New South Wales, 2142-2150 Castlereagh Street Penrith NSW 2751 is to pay the Applicant, Frederick Joseph Campbell, 129 Lakeline Drive Kanahooka NSW 2530 the sum of $104,000.00 within twenty-eight (28) days of the date of these Orders; and (b) the Applicant, Frederick Joseph Campbell, 129 Lakeline Drive Kanahooka NSW 2530 is to return the White Fiat Ovation C Class M3 Motorhome he purchased on 15 February 2013 to Caravan & RV Central Pty Ltd trading as Avan New South Wales 2142-2150 Castlereagh Street Penrith NSW 2751 within twenty-eight (28) days of the date of these Orders. 2. The Application is otherwise dismissed.
Catchwords:	MOTOR VEHICLES - Motorhome - whether of acceptable quality – major failure – where motorhome is product of two manufacturing processes – where there is joint liability – order made against retailer
Legislation Cited:	Fair Trading Act 1987 Civil and Administrative Tribunal Act 2013 Australian Consumer Law Civil Procedure Act 2005
Cases Cited:	Briginshaw v Briginshaw (1938) 60 CLR 336 Safi v Heartland Motors Pty Ltd trading as Heartland Crysler [2016] NSWAP 80 Bunnings Group Limited (formerly Bunnings Pty Ltd) v Laminex Group Limited [2006] FCA 682
Category:	Principal judgment
Parties:	Frederick Campbell (Applicant) RV Central Pty Ltd trading as Avan New South Wales (First Respondent) FCA Australia Pty Ltd (Second Respondent)
Representation:	Ms Josephine Mason, authorised representative (Applicant) Mr Antony Bitcom, Director (First Respondent) Mr Terry Fitzpatrick, Senior Manager (Second Respondent)
File Number(s):	MV 15/57005
Publication restriction:	Nil