Griggs v Commissioner for Consumer & Business AFFS No. Scgrg-97-1218 Judgment No. S6408

[1997] SASC 6408

GRIGGS v THE COMMISSIONER FOR CONSUMER & BUSINESS AFFAIRS

Magistrates Appeal

Millhouse J

The Second Hand Vehicle Dealers Act 1995 continues the Second Hand Vehicle Compensation Fund set up previously by statute.  The Fund is one out of which people who have been cheated by a dealer and have no hope of recovering from the dealer may get compensation.

It is all set out in Schedule 3 to the Act.  The provisions relevant to this appeal are:-

"(3)  If the Magistrates Court, on application ............
is satisfied that -

(d)     the person has a valid unsatisfied claim against the dealer
arising out of or in connection with the transaction; and

(e)     the person has no reasonable prospect of recovering the amount
of the claim (except under this schedule),

the Court may authorise payment of compensation to that person out of the Fund."

The appellant fitted the requirements of (3) and a magistrate authorised payment of compensation.  The magistrate would not, as the appellant's counsel, Mr Hugh Abbott contended he should, add interest to the compensation.  Hence this appeal.

This is the ratio of the Magistrate's Reasons.

"     I note that the fund is not liable to pay, nor indeed is the fund able to pay to the applicant compensation for the loss on which the claim is based, until the court has authorised the payment of compensation.  If the fund cannot pay until the court order, it is hard to see how interest should run against the fund...........

Interest is awarded to put the plaintiff into the position that the plaintiff would be in had the contract been performed or had the tort not occurred.  That is not the purpose of the this fund.  This fund is to compensate for unpaid claims against dealers and what forms part of those claims will be interpreted expansively but will not include interest unless there is an entitlement for interest as a proper assessment of the original loss ............"

I agree with the Magistrate.

This is a statutory remedy.  Mr Abbott referred me to the unreported judgment of Lusher J in the Supreme Court of New South Wales, Sammut v The Commissioner of Consumer Affairs, delivered 12 December 1985.  The principle upon which Lusher J acted was that the policy of the Act and the structure of the compensation scheme had to be taken into account.  He was construing the Motor Dealers' Compensation Fund Act (NSW) which stipulated that the claimant had to take proceedings against the dealer before he could make a claim against the fund.  The judge held that the claimant was entitled, in addition to his claim, to have the costs of his proceedings against the dealer.  Although he thought there was no ambiguity he went on to consider the position if there had been and said:-

"......where the terms of the statute are ambiguous the policy dictating the statute is to be considered.  Here the policy is plain
enough, viz., to ensure the purchaser suffers no loss because of default by license holders and as a protection to the fund that legal avenues against the defaulter be exhausted before recourse is made to the fund."

In our Act there is, I suggest, no ambiguity and besides the question to be answered was a different one.  The Macquarie Dictionary defines, relevantly "compensation" as, "something given or received as an equivalent for .... loss ....."

Here the appellant's "loss" is what he lost over the transaction with the dealer.  Once the transaction was complete, the loss was quantified.

Parliament has not seen fit, as part of the statutory remedy which it has created, to add to it interest.  For the appellant to be entitled to interest would require clear words in the Schedule and there are no words at all.

I am fortified in this interpretation by Mr Abbott's obvious dilemma when I asked him at what rate the interest should be computed?   He made a couple of suggestions but could not be sure.  The statute gives no answer to the rate of interest because it gives no entitlement to interest at all.

The appellant has an authority for all the compensation to which he is entitled.

The appeal is dismissed.