Kadiroglu v Australian Motor Homes Pty Ltd and Knotts Investment Pty Ltd t/a Avida RVs
[2018] NSWCATCD 21
•19 June 2018
Civil and Administrative Tribunal
New South Wales
Medium Neutral Citation: Kadiroglu v Australian Motor Homes Pty Ltd and Knotts Investment Pty Ltd t/a Avida RVs [2018] NSWCATCD 21 Hearing dates: 19 June 2018 Date of orders: 19 June 2018 Decision date: 19 June 2018 Jurisdiction: Consumer and Commercial Division Before: Senior Member K Ross Decision: (1) Knotts Investments Pty Ltd t/as Avida RV is to pay Kaan Kadiroglu the sum of $2544.00 on or before 30 June 2018.
(2) Knotts Investments Pty Ltd t/as Avida RV and Australian Motor Homes Pty Ltd are to undertake the following work to the caravan, in a proper and workmanlike manner, on or before 14 July 2018: replace the boot seal, undertake such work to the cupboards to ensure they do not continue to work loose during travel.
(3) The applicant is to collect the van from Australian Motor Homes Pty Ltd on or before 15 July 2018.
(4) The balance of the application is dismissed.
Catchwords: Acceptable quality, Fitness for disclosed purpose, major failure to comply with consumer guarantees Legislation Cited: Fair Trading Act 1987
Civil and Administrative Tribunal Act 2013
ACL (NSW)Category: Principal judgment Parties: Kaan Kadiroglu (Applicant)
Australian Motor Homes Pty Ltd (Respondent)
Knotts Investment Pty Ltd t/as Avida RV (Respondent)Representation: The applicant in person
Ron Warden for the respondent
File Number(s): MV 17/46596 Publication restriction: Unrestricted
REASONS FOR DECISION
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The applicant seeks the following orders:
An order that the respondents repay the purchase price of the motor home ($73820.00 plus $28.70 credit card fee),and the charge for repair of the door lock $44.00, and
an order for consequential loss of $17624.78 and
damages for "cutting short our Australian dream."
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The respondent opposes the orders sought.
Applicant’s evidence
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The applicant gave sworn evidence. He relied upon a bundle of documents including witness statements, copies of the contract for the purchase of the caravan, photographs, copies of diary entries, a copy of an extract from the Avida website, and emails between the parties. He also made submissions in writing.
Respondents’ evidence
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The respondents relied upon evidence given on oath by representatives of both the first and second respondents, a series of photos with commentary, invoices, and a report of an inspection carried out on 19 December 2017.
Findings
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Much of the evidence was not contested and the Tribunal makes the following findings:
On or about 18 August 2016 the applicant entered into an agreement with Australian Motor Homes Pty Ltd (“the supplier” or “AMH”) for the purchase of a new Avida CV 7236 BB2 Emerald tourer manufactured by the second respondent (“the manufacturer” or “Avida”). He took delivery of the van on 1 November 2016.
The purchase price was $77320.00. The applicant paid a deposit of $3500.00 when he ordered the van and the balance of $73820.00 on collection of the van.
In purchasing the van the applicant relied upon representations made by Avida on its website, including representations that the construction “offers strength and durability second to none”. The applicant also relied upon representations made orally and in writing that there is a network of service facilities throughout the country. The applicant advised the supplier that he and his wife intended to take the van around Australia for 12 months.
The applicant ordered an electric entry step and advised AMH that he was doing so because of his wife’s leg stability issues.
The applicant took delivery of the van on 1 November 2016 and was given an induction. During the induction the Avida representative discovered that one of the drawer handles had come loose. It was rectified.
The applicant took the van to Shoal Bay Caravan Park. On arrival the applicant noted that a number of door handles were loose. He phoned AMH but was advised that they were booked out for a month. He was advised to take the van to Avida at Emu Plains.
On or about 22 November 2016 the applicant contacted Avida to report the issues with the drawers, and that the side of the caravan was bowing out, and the step cover was lifting. In addition there were issues with braking. He was advised to take the van to Inverell for service of the chassis and brakes. The rest of the issues were to be attended to at Emu Plains on 6 December 2016.
The braking issues and service of the chassis were attended to in Inverell and the issues rectified.
The applicant attended the manufacturer’s premises in Emu Plains on 6 December 2016. The service manager advised that they could not service the van that day and the applicant should take the van to the supplier. The applicant advised that he could not do so because he was travelling around Australia and the supplier was booked out. The service manager went away. He returned and advised the applicant that he had booked the van in for repair in Bomaderry on 12 December 2016 and undertook to send the necessary parts.
The applicant took the van to Bombaderry. Upon arrival he was told that the van had not been booked in for service. The service manager told the applicant that he had spoken to Avida Head office and had advised them that he could not fit the van in for service.
The applicant and his family continued on their holiday. Further issues began to emerge. In particular water began to leak into the caravan from a crack in the rear spoiler. The caravan door began to jam.
The applicant continued to complain to Avida. He was told to take the caravan to Adelaide Service Centre on 24 January 2017. The applicant was told by Avida Head office that they would ensure that the parts were in Adelaide by that date.
The applicant took the caravan to Adelaide but was advised by the Adelaide Service Centre that the parts had not arrived. The applicant and his family waited. Some parts arrived and the caravan was booked in on 10 February 2017. However the applicant was advised that the wrong parts had been sent. The Service centre attended to the issues they could. Their invoice shows that they adjusted the hinges on cupboard doors, sealed a crack in the rear spoiler, repaired a wiring fault in the 12 v water pump, adjusted the striker on the screen door and refitted the rubber seal on the rear boot. They sent an email to Avida requesting that Head Office send the correct parts (1 back rear spoiler, 1 back stepwell and 1 grey sullage hose) to Merredin Caravans.
Eight days later Avida advised that Merriden Caravans was no longer operating. The applicant booked the van into Countrytime Caravans in Grealdton on 16 March 2017, and on 3 March 2017 sent an email to Avida requesting that they contact “Channy”. However no contact was made and no parts arrived in Geraldton.
Avida then told the applicant to take the van to Avida’s service centre in Broome. The applicant did so in early April 2017. However again the parts had not arrived. He waited in Broome until some of the issues were attended to.
The applicant says that by this stage the family (and particularly his wife) was having difficulty getting in and out of the van because of the step, and because the door was jamming. In addition the floors were saturated, and the TV was not working. He alleges that the walls were bowing. The fridge was moving around in the cavity and became broken. He lost confidence in the van and decided to return home. However there were tenants in his house so he had to wait until they moved out.
In mid July 2017 the applicant took the van to the service centre on the Gold Coast. What happened there is dealt with below.
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There were some issue where the parties disagreed:
Avida says that the TV was replaced in Broome. The applicant denies that it was. Avida relies upon the invoice from the repairer in Broome. The invoice lists the attempts made to rectify the issue – carry out tests on the TV reception, checked connections, tried new antenna, tested coax, TV to wall plate and wall plate, “found TV not sending strong enough signal for Broome area (new TV)”. Whilst it is possible that this indicated that a new TV was fitted, it is also possible that it meant that a new TV was required. The Tribunal accepts the applicant’s evidence that a new TV was not in fact fitted in Broome.
When the applicant took the van to Avida’s service centre on the Gold Coast in mid July 2017, Avida say that the service centre reported to them that the van was in poor condition, and told them that the damage to the fridge and the door was caused because the van had been driven on rough roads. The applicant denied driving on rough roads. The service centre also said that the van was filthy. The applicant said that as they had difficulty getting in and out of the van it was difficult to clean it but denied that it was as bad as the service centre claimed.
The invoice from the service centre however states “stove and fridge unit loose in cabinetry”. They were refitted “using necessary mounts”. The fridge shelf was said to be broken as a result of the fridge moving in the cabinetry. This is consistent with the applicant’s evidence – that the units moved because they had not been properly secured.
Jurisdiction
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The Tribunal is satisfied that the Applicant is a “consumer” within the meaning of Section 79D of the Fair Trading Act 1987, (the Act) and the claim is a “consumer claim” within s79E of the Act. The Respondents are each suppliers within the meaning of s79G of the Act.
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The caravan falls within the definition of a new motor vehicle and was supplied to the applicant to be used substantially for private purposes within the meaning of s79S (6) of the Act. The monetary limit on the Tribunal’s jurisdiction does not apply in these circumstances.
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The goods were supplied in NSW. The proceedings have been commenced within 3 years of the date the cause of action first accrued (s79L).
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The Tribunal accordingly has jurisdiction to hear and determine the claim.
The application of the ACL (NSW)
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The Australian Consumer Law applies in NSW (“the ACL (NSW)”) through its adoption in the Act (s28). The applicant is a “consumer” within the meaning of s3 of the ACL (NSW).
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The ACL (NSW) provides consumers with a number of consumer guarantees. In particular goods are required to be of acceptable quality (s 54), and fit for any disclosed purpose (s 55). The manufacturer of the goods must comply with any express warranty given or made by the manufacturer in relation to the goods.(s59).
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In respect of each of the guarantees:
Acceptable quality (s 54)
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Section 54 provides that
“(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.”
Was the caravan fit for all the purposes for which goods of that kind are commonly supplied?
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The Tribunal is satisfied that the purposes for which a caravan of this kind would be commonly supplied include extended holidaying around Australia. The applicant used the caravan for that purpose. The caravan developed some faults. The applicant refers to a structural fault, being the bowing of the walls. However he provides no expert evidence to support his assertion in this regard. He said that there was extensive water damage, but again supplies no expert evidence to support that assertion. In these circumstances the Tribunal can make no finding that the caravan had any structural defects.
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The respondents argued that some of the defects complained of were the result of the way in which the caravan was used. However the Tribunal finds that a caravan designed to be towed around Australia for an extended holiday ought to be capable of withstanding some rough roads. With the exception of those defects the caravan was fit for purpose.
Was the caravan acceptable in appearance and finish?
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The Tribunal is satisfied that the caravan was generally acceptable in appearance and finish. The defects in the cupboards, requiring continuing adjustment of the cupboard doors, are an exception.
Was the caravan free from defects?
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The caravan was not free from defects. The defects included faults in the step, in the rear spoiler and in the securing of the fridge and stove. There were also defects in the affixing of cupboard handles. There were defects in the wiring of the pump and in the grey water hose. There were defects in the TV.
Was the caravan safe?
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The defects in the step compromised the safety of egress and ingress. There is no evidence that the caravan was otherwise unsafe.
Was the caravan durable?
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The issues complained of (with the exception of the alleged bowing of the walls, which has not been proven) are relatively minor issues. Some of the seals required replacement on more than one occasion, and the cupboard doors required refitting. These items were not durable. However the Tribunal is satisfied that the caravan itself was otherwise durable.
Fit for any disclosed purpose (s 55)
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Section 55 provides as follows:
Guarantee as to fitness for any disclosed purpose etc.
(1) If:
(a) a person (the supplier ) 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 reasonably fit for any disclosed purpose, and for any purpose for which the supplier represents that they are reasonably fit.
(2) A disclosed purpose is a particular purpose (whether or not that purpose is a purpose for which the goods are commonly supplied) for which the goods are being acquired by the consumer and that:
(a) the consumer makes known, expressly or by implication, to:
(i) the supplier; or
(ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the goods were conducted or made; or
(b) the consumer makes known to the manufacturer of the goods either directly or through the supplier or the person referred to in paragraph (a)(ii).
(3) This section does not apply if the circumstances show that the consumer did not rely on, or that it was unreasonable for the consumer to rely on, the skill or judgment of the supplier, the person referred to in subsection (2)(a)(ii) or the manufacturer, as the case may be.
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The Tribunal accepts the applicant’s evidence that he made known to the respondent the use to which he intended to put the caravan – that is, to use it for holidaying around Australia, and in particular for a 12 month holiday where he would be staying on occasions in off road free camps. He relied upon the skill and judgement of the supplier and/or the manufacturer. The problems with supply of spare parts made this use difficult, although the Tribunal does not accept that there was any need for the applicant to cancel his holiday. He did so without advising either of the respondents. The reason – his assertion in particular that the walls were bowing and the floor saturated – is not supported by any expert evidence or observation of any of those who inspected the van and worked on it.
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The Tribunal accepts that the applicant made known his wife’s requirements for an electric step. The fault in the step was not rectified in a timely manner, making the step not fit for its disclosed purpose.
Remedies available
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Sections 259 – 263 of the ACL set out the remedies available where goods fail to comply with a consumer guarantee. If the failure to comply with the guarantee can be remedied and is not a major failure (s 259 (2)):
(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.
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If the failure to comply with the guarantee cannot be remedied or is a major failure (s 259 (3)) 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.
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The failure to comply with the guarantee is a major failure if (s 260):
(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.
Is the failure to comply with the guarantees a major failure?
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The test as to whether the failure to comply with the guarantees is a major failure is an objective test. Would the goods have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure? Where the goods are unfit for the disclosed purpose, can they easily and within a reasonable time be remedied to make them fit for such a purpose? Are the goods not of acceptable quality because they are unsafe?
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The issues complained of by the applicant and proven in these proceedings are relatively minor in nature. The Tribunal is satisfied that they are things which can easily and within a reasonable time be remedied. Many of the matters have been addressed. The fact that the respondents did not fix the issues whilst the applicant was travelling around Australia had to do with timing and efficiency, but is not evidence that the matters cannot be remedied reasonably easily and in a reasonable time. In respect of the cupboard doors, this will require that appropriate fixings be used to ensure that the doors remain in place during travel and do not require major adjustment at frequent intervals. The step has been replaced and was the only matter affecting the safety of the van.
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The Tribunal notes that the applicant gave evidence that he would not have purchased the caravan if he had known of the failures to comply with the guarantees. However it seems to the Tribunal that the applicant was prepared to have the matters addressed as maintenance issues. The failure which lead to the applicant losing faith in the caravan was the failure to repair the issues in a timely manner when they arose whilst he was travelling.
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The Tribunal is not satisfied that the failure to comply with the guarantees is a major failure.
Can the failure to comply with the guarantees be remedied?
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All of the defects complained about by the applicant can be remedied. The Tribunal accepts the respondents’ evidence that most of them have been. There needs to be some further work on the seal around the boot and the cupboard doors to prevent them from working loose during travel.
What remedy is the applicant entitled to?
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Under s 262:
(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.
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The applicant says that he returned the van to AMH for repairs on 4 August 2017, but the repairs were not completed within a reasonable time. AMH says that the applicant told them he was not in a hurry. The Tribunal accepts the respondent’s evidence in that regard. The applicant says that on 9 September 2017 he was advised by an employee of the respondent that the problems were structural, and that he should demand his money back. However the applicant does not provide any statement from that person, did not issue a summons for that person to give evidence, and does not provide any evidence to support a claim that there are structural issues with the caravan. Furthermore, there is no evidence that he communicated rejection to the respondents at that time.
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The applicant’s evidence is that he rejected the caravan on 10 November 2017, advising the respondent that he did not want the caravan back. There is no evidence that he had communicated any dissatisfaction with the length of time the repairs were taking. He said that he rejected the van because they had taken too long, he no longer had a vehicle to tow the van, and the registration had run out. By the time the applicant rejected the van the repairs had been substantially completed.
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The Tribunal is not satisfied that the applicant was entitled to reject the van at the time he did. He had elected to have the repairs carried out. He had not imposed or communicated any requirement as to when they should be done. The repairs had been carried out by the time he communicated the rejection. The applicant said that he was rejecting the goods because of the delay but in the circumstances the Tribunal is not satisfied that rejection was reasonable.
Is the applicant entitled to compensation and damages?
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The applicant also makes an application under s 259 (4) for the loss and damage which he says he has suffered as a consequence of the failure to comply with the guarantees. He claims:
Interest $1607.12 for the period the van was with the respondent for repair
Insurance for 87 days $291.45
Rent foregone on house rental (“because we had to come back early”) $6966.21
Loss of contents falling from fridge $1200.00
Cost because unable to stay in free sites $7560.00
Damages for cutting short “my Australian dream holiday”
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He also claims reimbursement of a charge made for repair of the door lock $44.00.
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In respect of each claim:
Interest $1607.12 for the period the van was with the respondent for repair and Insurance for 87 days $291.45
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The applicant told the respondent that he was in no hurry to have the van back. In these circumstances it would not be equitable to require the respondent to reimburse the applicant for interest or insurance costs..
Rent foregone on house rental (“because we had to come back early”) $6966.21
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The applicant says that he had to come back early but the Tribunal has found that there was no proper basis for that decision. In addition the applicant did not communicate his intention to do so to either of the respondents. He gave evidence that the tenants were seeking to break the lease, and he negotiated to enable them to do so. There is no evidence that they would have left unless the applicant had indicated a willingness for them to go. In these circumstances the Tribunal is not satisfied that the loss claims flows from the failure to comply with the guarantees.
Loss of contents falling from fridge $1200.00
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The applicant provides no substantiating evidence to support this claim. It was open to him to take steps to prevent food falling from the fridge (eg using tape to prevent the door from opening). The Tribunal is not satisfied that the applicant has proven an entitlement to the amount he claims.
Cost because unable to stay in free sites $7560.00
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The applicant says he could not free camp because of the issues with the grey water hose, but there is no evidence of when he says he was unable to do so, and no details of the costs incurred over the costs which would have been incurred. At no time did the applicant advise the first or second respondents that the problems with the grey water hose were causing economic loss. The Tribunal is not satisfied that the applicant has proven an entitlement to compensation in the amount claimed.
Damages for cutting short “my Australian dream holiday”
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The Tribunal does not accept that the applicant was forced to cut his holiday short. However the Tribunal accepts that he and his family suffered some loss of amenity because of the failure of the respondents to ensure a proper supply of spare parts and to repair the issues as they arose. The applicant and his family were forced to wait for longer than they might otherwise have done in some locations. There is no evidence as to what effect this had on the costs being incurred. However the Tribunal will allow compensation for this loss of amenity in the sum of $2500.00.
Reimbursement of a charge made for repair of the door lock $44.00.
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The Tribunal is satisfied that the applicant is entitled to a refund of the charge made for fixing the lock ($44). This ought to have been paid by the manufacturer. The Tribunal allows the amount claimed.
Orders
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Knotts Investments Pty Ltd t/as Avida RV is to pay Kaan Kadiroglu the sum of $2544.00 on or before 30 June 2018.
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Knotts Investments Pty Ltd t/as Avida RV and Australian Motor Homes Pty Ltd are to undertake the following work to the caravan, in a proper and workmanlike manner, on or before 14 July 2018: replace the boot seal, undertake such work to the cupboards to ensure they do not continue to work loose during travel.
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The applicant is to collect the van from Australian Motor Homes Pty Ltd on or before 15 July 2018.
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The balance of the application is dismissed.
K Ross
Senior Member
Civil and Administrative Tribunal of NSW
19 June 2018
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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 September 2018
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