Marks v PT Wollongong Pty Ltd t/as Gateway Automotive

[2025] NSWCATCD 63

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Marks v PT Wollongong Pty Ltd t/as Gateway Automotive [2025] NSWCATCD 63

Hearing dates:

19 March 2025

Date of orders:

30 June 2025

Decision date:

30 June 2025

Jurisdiction:

Consumer and Commercial Division

Before:

P Boyce, Senior Member

Decision:

(1)   The second respondent’s name is amended from “Mitsubishi Motors Australia Ltd trading as Ralliart Australia” to “Mitsubishi Motors Australia Ltd”.

(2)   The applicant, Amanda Marks do all things necessary to transfer the ownership of and deliver the vehicle, Mitsubishi Outlander Exceed Tourer 2.5L CVT AWD registration number XXX (‘Vehicle’), to the first respondent, PT Wollongong Pty Ltd trading as Gateway Automotive, place of business at cnr Mount Ousley Road & Princes Highway Fairy Meadow, on or before 11 July 2025 during business hours.

(3)   Upon delivery of the Vehicle to the first respondent, PT Wollongong Pty Ltd trading as Gateway Automotive place of business at cnr Mount Ousley Road & Princes Highway Fairy Meadow, and no later than 11 July 2025, the first respondent, PT Wollongong Pty Ltd trading as Gateway Automotive, and the second respondent, Mitsubishi Motors Australia Pty Ltd, must pay to the applicant, Amanda Marks, to amount of $60,294.98.

Catchwords:

CONSUMER LAW — Motor Vehicle — Failure to comply with the guarantee as to acceptable quality — Major failure

Legislation Cited:

Fair Trading Act 1987 (NSW)

Australian Consumer Law

Competition and Consumer Act 2010 (Cth).

Motor Dealers and Repairers Act2013 (NSW)

Cases Cited:

Safi v HeartlandMotors Pty Ltd t/as Heartland Chrysler [2016] NSWCATAP 80

Frediani v Hall t/as Happy Camper Conversions [2024] NSWCATAP 134

Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd [2020] FCA 1672

Texts Cited:

None

Category:

Principal judgment

Parties:

Amanda Marks (applicant)
PT Wollongong Pty Ltd trading as Gateway Automotive (first respondent)
Mitsubishi Motors Australia Limited (second respondent)

Representation:

Applicant-self represented litigant
First respondent-Blaise Russo-Service manager
Second respondent-Faisal Islam-Australian legal practitioner in employ of Mitsubishi Motors Australia Limited

File Number(s):

2024/00310279

Publication restriction:

None

Judgment

1. The applicant, Amanda Marks, purchased a new Mitsubishi Outlander Exceed Tourer 2.5L CVT AWD registration number XXX for $61,633.98 (the “Vehicle”) from the first respondent PT Wollongong Pty Ltd trading as Gateway Automotive (“Gateway”) on 7 December 2022.

2. The applicant brings her claim and seeks orders against Gateway and the second respondent, Mitsubishi Motors Australia Limited (“Mitsubishi”) as manufacture of the Vehicle for compensation in the amount of the purchase price of $61,633.98 for the supply of the defective Vehicle.

3. This application is brought to the Tribunal in the Motor Vehicle List of the Consumer and Commercial Division.

Appearances and Evidence

4. The applicant appeared in person at the hearing.

5. Blaise Russo sought leave to appear and represent Gateway at the hearing. The Tribunal granted Mr Russo leave to appear on behalf of and represent Gateway.

6. Faisal Islam sought leave to appear and represent Mitsubishi at the hearing. The Tribunal granted Mr Islam leave to appear on behalf of and represent Mitsubishi

7. The applicant’s evidence is:

1. Exhibit A- bundle of documents filed on 21 October 2024

2. The sworn evidence of Amanda Marks.

And documents were marked:

a.   As MFI 1-Pedders Brakes, Steering and Suspension Check dated 25 November 2024.

b.   As MFI 2-Albion Park Mitsubishi Service Tax Invoice dated 12 December 2024

8. The respondents’ evidence is:

1. First respondent:   

1. Exhibit R1-bundle of documents filed on 15 November 2024.

2. Sworn and cross examined oral evidence of Blaise Russo.

2. Second respondent:

1. Exhibit R2-bundle of documents filed on 22 November 2024.

2. Affirmed and cross examined oral evidence of Shane David Cosgrove.

9. At the end of the hearing on 19 December 2024, the parties were directed by the Tribunal to file and serve submission regarding the tendering of MFI 1 and MFI 2 into evidence. The applicant made submissions in accordance with the directions on 7 January 2025. Mitsubishi made submissions on 28 January 2025. The submission was dated 21 January 2025, the date for compliance with the Tribunal directions. The submissions were filed after the time directed by the Tribunal by one week. It appears that the applicant received the submissions before they were received by the Tribunal. The applicant has filed submission in reply. It appears that no prejudice is claimed by the applicant for late filing. The Tribunal extends the time for compliance with the direction by the respondents until 28 January 2025. The applicant’s submissions in reply were filed in accordance with the directions of the Tribunal.

10. The applicant was given the opportunity to clarify the relevant consumer guarantee she relied upon and on 22 April 2025 made further submissions in regard to her reliance on the alleged breach of S. 54 of the ACL.

11. On 8 May 2025 the respondents filed their submissions in response.

12. After the hearing and the further submissions of the parties the Tribunal listed the proceedings for a further direction hearing on 12 May 2025 made further orders for the applicant to make further submissions by 19 May 2025 in reply to the respondents’ submissions filed on 8 May 2025.

13. The Tribunal has considered the evidence and the submissions of the parties.

Jurisdiction and legislation

14. For the provisions of the Fair Trading Act 1987 (NSW) (“FTA”) to apply the Tribunal must be satisfied that the application is a consumer claim for the purposes of the Act.

15. The Tribunal is satisfied that the applicant is a consumer.

16. The respondents are deemed to be suppliers as defined in s 79D of the FTA as they carry on, or purporting to carry on, a business, supplying new motor vehicles.

17. The Australian Consumer Law (“ACL”) is contained in Schedule 2 of the Competition and Consumer Act 2010 (Cth).

18. The provisions of the ACL apply in NSW by virtue of the provisions of its adoption by s28 of FTA.

19. The matter falls within the definition of “consumer claim” under s79E of the FTA.

20. The claim made by the applicant is under the Australian Consumer Law, the text of which is set out in Sch 2 of the Competition and Consumer Act2010 (Cth). The Australian Consumer Law, which is a law of the Commonwealth, applies in New South Wales as part of the Fair Trading Act1987 (NSW) (the FTA): Part 3 of the FTA, and particularly ss 27 to 32.

21. Section 32 of the FTA provides that the Australian Consumer Law (NSW) (referred to in these Reasons for Decision as the “ACL (NSW)”) applies to persons carrying on business in New South Wales, bodies corporate incorporated or registered under the law of New South Wales and persons ordinary resident in New South Wales or otherwise connected with New South Wales.

22. Section 3 of the ACL (NSW) provides the grounds on which a person is taken to have acquired goods as a “consumer”. Relevantly, certain remedies in the ACL (NSW), including those relating to consumer guarantees, are only available to consumers. There is no dispute before the Tribunal that the Tribunal has jurisdiction to hear this claim under the ACL (NSW).

23. Subdivision 2A, Division 1 of Part 3.2 of the ACL (NSW) provides for statutory guarantees in relation to the supply of goods. Relevantly, s 54 provides:

54   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.

24. Part 5.4 of the ACL (NSW) provides remedies for breach of the statutory guarantees.

25. Section 259(1) of the ACL (NSW) provides that a consumer may take action against a supplier if one of the guarantees that relates to the supply of goods is not complied with. If the failure to comply can be remedied and is not a major failure, the consumer may require the supplier to remedy the failure within a reasonable period (s 259(2)(a)). If the supplier refuses or fails to comply, the consumer may have the failure remedied and recover all reasonable expenses incurred by the consumer in having the failure so remedied or notify the supplier that the goods are rejected (s 259(2)(b)).

26. If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may notify the supplier that the consumer rejects the goods or, by action against the supplier, recover compensation for any reduction in the value of the goods below the price paid (s 259(3)).

27. Section 259(4) provides:

The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.

28. Given the dispute between the parties about whether there was a “major failure” in compliance with the guarantee under s 54, it is convenient to set out s 260, which provides follows:

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.

29. If a consumer requires the supplier to remedy a failure to comply with a guarantee, the supplier may repair the goods, replace the goods with goods of an identical type or by provide a refund for the goods (s 261).

30. Section 262(1) provides that a consumer may not reject the goods if the rejection period has ended, the goods are lost, destroyed or disposed of by the consumer, the goods were damaged after delivery for reasons not related to the state or condition of the goods at the time of supply or the goods have been attached to or incorporated into any other personal or real property and cannot be detached without damaging the goods. The “rejection period” 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 the factors enumerated in s 262(2).

31. Section 263 contains provisions concerning the consequences of a consumer rejecting goods. As already noted, there are two circumstances when a consumer will be entitled to reject goods. The first is where the supplier has refused or failed to remedy the failure in a reasonable period, or at all (see s 259(2)(b)(ii)). The second is where the failure cannot be remedied or is a major failure (see s 259(3)(a)). If goods are rejected the consumer must return the goods to the supplier and the supplier must refund the money to the consumer (s 263(4)(a)) or replace the rejected goods with goods of the same type, if such goods are reasonably available (s 263(4)(b)).

32. Section 263(5) provides:

The supplier cannot satisfy subsection (4)(a) by permitting the consumer to acquire goods from the supplier.

33. Section 271(1)(a) and (b) of the Australian Consumer Law (NSW) (“ACL”) provides:

  Action for damages against manufacturers of goods

(1)  If:

(a) the guarantee under section 54 applies to a supply of goods to a consumer; and

(b)  the guarantee is not complied with;

an affected person in relation to the goods may, by action against the manufacturer of the goods, recover damages from the manufacturer.

34. Section 273 of the ACL provides:

Time limit for actions against manufacturers of goods

An affected person may commence an action for damages under this Division at any time within 3 years after the day on which the affected person first became aware, or ought reasonably to have become aware, that the guarantee to which the action relates has not been complied with.

35. As noted in the Explanatory Memorandum to the Trade Practices Amendment (Australian Consumer Law) Bill (N0 2) 2012 (Cth) at [785], this section provides that:

If the consumer chooses a refund after rejecting goods, the supplier is specifically precluded from providing replacement goods to satisfy the requirement of a refund.

36. In addition to remedies under the ACL (NSW), there are remedies available to consumers under the Motor Dealers and Repairers Act2013 (NSW) (MDRA).

37. Under s 3 of the MDRA, the objects of the Act are to, amongst other things, “provide consumer protections and remedies for consumers who purchase motor vehicles from motor dealers or obtain motor vehicle repair services” (s 3(a)).

38. Division 4 of the MDRA contains provisions relating to defects in motor vehicles sold by motor dealers”. Section 67(1) provides that a “defective vehicle” means:

A motor vehicle that is in such a condition, or has such a defect, that the supply of the motor vehicle would constitute a breach of a guarantee (a consumer guarantee) that applies under sections 54‒57 of the Australian Consumer Law (NSW).

39. Section 68(1) provides that a motor dealer must, at its own expense, “repair or make good” a defective vehicle (the “dealer guarantee”). Section 71(1)(a) provides that the dealer guarantee is enforceable by the owner of the motor vehicle as if it were a term of the contract for sale. Section 77 provides that a person has who has enforced the dealer guarantee under Division 4 in respect of a dealer guarantee is not entitled to take action against a motor dealer in the ACL (NSW).

40. In this case, the applicant did not elect to enforce the dealer guarantee and pursued her remedies under the ACL (NSW).

41. The Vehicle was supplied to the applicant on or about 7 December 2022. The application was filed with the Tribunal on 22 August 2024. The Tribunal is satisfied that the cause of action arose within 3 years of the filing of the application.

42. Pursuant to section 79S(6)(a) there is no jurisdictional monetary limit for matters involving the supply of a new motor vehicle that is used substantially for private purposes within the meaning of the Motor Vehicles Taxation Act 1988.

43. The Tribunal is satisfied that it has jurisdiction under s79J of the FTA.

Facts found on the evidence

Admission of MFI 1 & 2 into evidence

44. The first issue to be determined is whether MFI 1 & 2 can be admitted into evidence.

45. At the hearing the applicant sought to rely on MFI 1 & 2. The respondents’ objected as the documents had not been served by the applicant before the hearing in accordance with the directions of the Tribunal. The Tribunal gave the parties the opportunity to make written submissions regarding whether the documents could be relied upon by the applicant.

46. The applicant’s submissions, filed on 7 January 2025, do not address the issue of whether the documents marked MFI 1 & 2 should be admitted into evidence. The submissions simply refer to inspections carried out by Peders and Albion Park Mitsubishi on 26 November 2024 and 12 December 2024 (“reports”). The applicant does not address the basis upon which the documents can be tendered when they were first presented to the respondents at the hearing.

47. Mitsubishi, in their submissions, address the issue of the reliance on the reports. Neither report had been given to the respondents or the Tribunal until at the hearing. Mitsubishi submits that to allow the tender of the reports would prejudice the respondents and be procedurally unfair. The respondents have not had an opportunity to review the reports nor were the authors of the reports present at the hearing to allow their cross examination. During the hearing the applicant referenced the reports and came to her own conclusions regarding the reports. The respondents did not have reasonable chance to test those conclusions. By doing so, the applicant caused disadvantage to the respondents. The applicant has not complied with the guiding principles of the Tribunal. As presented, the respondents submit that the reports should be considered as second hand hearsay evidence.

48. In the applicant’s submission in reply she states that the Tribunal should take the applicant’s limited legal understanding into account to give effect to s 36 and 38(4) of the Civil and Administrative Tribunal Act 2014.

49. The applicant submits:

1. Delay in obtaining the report from Albion Park Mitsubishi was caused by the unavailability of the business to carry out the inspection until 12 December.

2. That the Peder report confirms her observations and serves to verify those observations. The respondents are not prejudiced by such a report.

3. she was unaware that she was required to file the reports before the hearing and believed she could tender them at the hearing.

4. acknowledges the requirements of NCAT Procedural Direction 3 which directs parties to the requirements for expert witness reports but says that she was unaware of the specific requirements for admissibility as expert reports and any deficiency in the reports was caused by her lack of understanding of the requirements.

5. The Albion Park Mitsubishi report should be considered an expert report under s79 of the Evidence Act 1995 (NSW) and not classified as hearsay. Such an assertion is misguided. The expertise of the author of the report is not established to allow the report to be considered an opinion under s 79.

50. Having considered the submissions of the parties, the Tribunal will allow the applicant to rely on MFI 1 which will now be admitted as Exhibit B and MKI 2 within will be admitted as Exhibit C, but the Tribunal will discount the weight of that evidence given the respondents’ have not tested it having only received it at the hearing nor have the authors of the reports been identified nor the basis upon which the opinion are given set out. The Tribunal is not bound by the strict rules of evidence and may inform itself as to the real issues between the parties. The weight attributed to this evidence does not advance the applicant’s proof of her claim other than identifying and observing that there is an issue with a noise in the suspension, which is declared to not be a safety concern, and that the vehicle can continue to be used safely until repair is complete. Further, the grinding noise from the brakes. This is the extent of the utility of the reports. They are not expert reports.

Substantive claim

51. The applicant’s lay evidence is that since purchasing the Vehicle the applicant has experienced multiple defects. Those defects, both defects that have been resolved by the respondents, and unresolved defects. They include:

1. Resolved defects:

1. Dash not holding memory: repaired by Gateway after 14 months of ownership following 6 returns of the vehicle to Gateway;

2. Reversing camera blacking out: repaired after 3 attempts and returns;

3. Driver’s side mirror not retracting: repaired on second attempt by Gateway;

4. Tailgate allowing moisture penetration: resolved by Gateway on first attempt;

5. Clip holding driver’s side door seal missing, resulting in breach of seal: resolved on second attempt by Gateway;

6. Creaking in rear of vehicle: reported to Gateway and repaired on first attempt.

2. Unresolved defects:

1. Left and right struts making knocking sound when turning at or about 70-80% to full lock: this issue remains unresolved after two attempted failed repairs.

2. Damage caused by Gateway to heads up display screen causing a tear. The tear is behind the fixed glass of the screen in the dash.

3. Multiple scratches on the top rails of the car.

4. Scratches on the dash from the dash cluster removal, despite promises by the respondent to investigate, no action has been taken to remedy.

52. The applicant first became aware of the dash resetting in early 2023. On or about 11 April 2023 the applicant noticed that the dash delayed in setting up when the car was started.

53. The Vehicle was serviced and underwent investigations of the applicant’s complaints. The applicant’s evidence corroborated by the inclusion of service reports is that the vehicle was serviced by Gateway:

1. On 20 December 2022 for the 1500 kilometre service in which it is noted that the driver’s window tint was removed and replaced to rectify tint bubbling on front pass side window under warranty;

2. On 6 June 2023 for checking:

1. Resetting dashboard each time car starts back up;

2. Condensation staying in driver side brake light finding that seal perished causing allowance of condensation in assembly with taillight assembly removed and replaced under warranty; and,

3. carrying out of 15,000 kilometre service.

3. On 9 August 2023 checking for:

1. Driver’s side door rubber displacement;

2. Trip meter hold not resetting- remedied by resetting trip meter; and,

3. Fuel memory not resetting-remedied by resetting fuel meter.

4. On 31 October 2023 checking for:

1. Instrument cluster losing memory-found that cluster losing memory due to internal short and to rectify instrument cluster removed and replaced and recalibrated; and,

2. Driver side rear door rubber displaced-found that rubber had perished and remedied by replacing rubber.

5. On 31 January 2024 carrying out:

1. 30,000 kilometre service; and,

2. And checking grab handle being loose-remedied by removal of door trim, tightening four bolts and reassembling.

6. On 17 April 2024 checking:

1. report by applicant that knocking noise when turning the steering wheel-confirmed knocking noise when turning and remedied by removing and replacing both front springs, both front strut support bearings, both hub nuts and coil spring nuts;

2. report by applicant that steering rack clunking-found intermittent clunk when steering rack at full lock and remedied by removing and replacing power steering gear and link assembly and reprogrammed;

3. report by applicant about creak from rear of vehicle-found creak caused by retention of C piler and remedied by carrying out torque and retention as per warranty hotline; and,

4. report by applicant about dash cluster resetting-removed cluster and junction fuse box and transit use retention pin in fuse box and reinstalled transit fuse.

54. The applicant engaged with Mitsubishi as follows:

1. Sending an email on 11 March 2024 to Mitsubishi with a video recording of a knocking sound when turning the vehicle.

2. Receiving an email on 12 March 2024 from Mitsubishi referring the applicant back to Gateway as an authorised dealer to diagnose and repair the vehicle.

3. Receiving an email from Mitsubishi on 22 April 2024 requesting a video of the issue with the dash cluster.

4. Sending an email to Mitsubishi on 22 April 2024 with videos of the dash cluster and complaining about the blacking out of the reversing camera while reversing, intermittent failure of the driver’s side mirror when vehicle switched off, dash continuing to reset and two struts top bearing to be replaced (noting that the vehicle repair was scheduled for “next week”).

5. Sending email to Gateway on 26 April 2024 and 30 April 2024 complaining that the replaced dash cluster did not resolve the issues experienced by the applicant, with the reversing camera continuing to black out and complaining that it is unacceptable for the warranty faults to be unresolved after 1 year and 4 months since new. The issues of concern were that the dash was not holding memory, reversing camera continuing to be faulty after two repairs, both front left and right struts making knocking sounds, and drivers side mirror not retracting.

6. Sending an email to Gateway that the dash cluster failed again on 6 May 2024 and requested consideration of buy back of vehicle.

55. The applicant made her complaint to NSW Fair Trading on 7 May 2024 about the multiple faults that she had with the vehicle and the failure by the respondents to rectify those faults completely in the twelve times the vehicle was returned to Gateway in the 1 ¼ years of owning the new vehicle.

56. The applicant continued having problems with the resetting of the dash cluster and the applicant reported these problems to Gateway by email on 24 May 2024 and continuing until 14 June 2024 at least.

57. On 5 August 2024 the applicant sent a letter of demand to Gateway articulating the faults with the vehicle both resolved and unresolved and demanding a replacement vehicle due to defects with the vehicle not being repaired under warranty by the respondents.

58. The applicant filed her application with the Tribunal on 22 August 2024 claiming a major defect with the vehicle and seeking orders that the respondents pay the applicant the purchase price of the vehicle by way of compensation.

Was there a major failure

59. In Safi v HeartlandMotors Pty Ltd t/as Heartland Chrysler [2016] NSWCATAP 80 at [101] the Appeal Panel said where there is non-compliance with the guarantee of acceptable quality the relevant questions of whether this amounts to a “major failure” are:

Having regard to these cases and the commentary, where there is non-compliance with the guarantee of acceptable quality, as alleged in this case, we find that the following matters will be relevant to the question of whether this amounts to a “major failure” under s 260(a):

1.   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;

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

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

4.   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;

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

6.   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.

60. In Frediani v Hall t/as Happy Camper Conversions [2024] NSWCATAP 134 (“Frediani”) at [18] – [19] the Appeal Panel sets out the mandatory considerations to establish whether or not goods are of acceptable quality under s 54(2)(a)-(e) such as a reasonable consumer, would regard as acceptable quality:

18. The matters in s 54(3) are “mandatory considerations” to establish whether or not goods are not of acceptable quality under s 54(2)(a)-(e) such that a reasonable consumer, fully acquainted with the state and condition of the goods, would regard the goods as being of acceptable quality, determined at the date of the supply of the goods (Ford Motor Company of Australia Pty Ltd v Capic [2023] FCAFC 179 (Capic-Appeal) at [43] and [56]).

19. The principles applicable to s 54(2) of the ACL can be summarised as follows:

(1) The “reasonable consumer” in s 54(2) is assessed objectively, and idiosyncratic subjective views by the consumer about the state or condition of the goods or what is, or is not, acceptable, is irrelevant (Toyota Motor Corporation Australia Limited v Williams (2023) 296 FCR 514; [2023] FCAFC 50 (Williams-Appeal) at [42]-[43]).

(2) Section 54 of the ACL requires consideration of at least some knowledge acquired after supply, or else it would not be possible to hold that goods were not of acceptable quality by reason of a latent or hidden defect (Capic-Appeal at [57]).

(3) The statutory language of s 54(2) does not confine “acceptable quality” to “not potentially fatal” or “unusable” (Capic-Appeal) at [53].

(4)   The existence of a manufacturer’s warranty should generally have no bearing on the question of whether the goods comply with the statutory guarantees of acceptable quality (Capic-Appeal at [63], applying Jayco at [43]; and Toyota Motor Corporation Australia Limited v Williams (2023) 296 FCR 514; [2023] FCAFC 50 at [45]).

(5) The consumer guarantee in s 54 should not be “read down” because it could otherwise lead to a “disproportionate outcome” (Capic-Appeal at [75]).

(6) A reasonable consumer in the hypothetical circumstances in s 54 would be aware that motor vehicles are complicated pieces of machinery that may develop future problems that may require rectification by the vehicle’s manufacturer during its lifetime, and a merely speculative theoretical possibility of a future problem may not be regarded as unacceptable by a reasonable consumer (Dwyer v Volkswagen Group Australia Pty Ltd t/as Volkswagen Australia [2021] NSWSC 715 at [158]; Dwyer v Volkswagen Group Australia Pty Ltd [2023] NSWCA 211 at [154]-[156]).

(7)   A reasonable consumer being aware that motor vehicles are complicated pieces of machinery that may develop problems is different to a reasonable consumer accepting that a vehicle, because of a defect already present at the time of supply, cannot be used in a reasonable and normal way without malfunctioning and consequently exposing the vehicle one or more non-trivial adverse consequences (Williams v Toyota Motor Corporation Australia Limited [2022] FCA 344 at [198]; Capic v Ford Motor Company Pty Ltd [2021] FCA 715 at [636]).

61. The Appeal Panel in Frediani also considered the appropriate remedy under s 259 and 260 of the ACL where a consumer guarantee had not been complied with and at [22] summarised the principles to be applied:

22.   In summary, the following principles apply:

(1) The consumer has a right to claim damages under s 259(4) of the ACL against the supplier for reasonably foreseeable loss caused by breach of the consumer guarantee, irrespective of whether or not the breach is repairable, or is a “major failure”.

(2)   There are different remedies against the supplier available depending upon whether or not the goods are repairable or the goods have a “major failure” (s 259(2) and (3)).

(3)   If the goods cannot be repaired or have a “major failure”, the consumer may notify the supplier he or she rejects the goods and the grounds of rejection (s 259(3)(a)).

(4) If the goods have been rejected in compliance with s 262, the supplier must, in accordance with the election of the consumer, either: (a) provide a refund (being monies paid by the consumer to the supplier for the goods, and any amount equal to the value of any other consideration provided by the consumer for the goods); or (b) replace the goods with goods of the same type and of similar value that are reasonably available to the supplier (s 263(4)). The consumer must return the goods to the supplier in accordance with s 263(2) and (3) of the ACL.

62. In the current case, the applicant took the view that the Vehicle was not of acceptable quality because of the failure of respondents to completely rectify the multiple defects the applicant had identified.

63. Although the applicant has not adduced expert evidence, the applicant’s own evidence of defects occurring with the Vehicle within 4 months of purchasing the Vehicle and then continuing is accepted by the Tribunal as evidence of the defects complained of by the applicant. The documents admitted into evidence of the service records of Gateway corroborate the defects of the vehicle and the respondent’s attempts to rectify those defects.

64. The Tribunal is comfortably satisfied that the applicant, at times encountered limited response from Gateway to her complaints and follow ups regarding the resolution of the issues with the vehicle.

65. The applicant chose to reject the Vehicle on 5 August 2024 after suffering the inconvenience of having to return the Vehicle for repairs on at least 12 occasions and frustration caused by repeatedly having her vehicle undergoing rectification of the issues. The applicant received no response from the respondents and consequently commenced these proceedings on 22 August 2024.

66. Would a reasonable consumer given the option to acquire the Vehicle or an alternative Vehicle knowing the defect experienced by the applicant have proceeded to purchase the Vehicle? Notwithstanding the best intent with design and careful manufacture, the effect of modern mass-produced motor vehicles is that they may experience defects. Reasonable consumers are aware that new vehicles may experience teething problems. A reasonable new car buyer would under circumstances as experienced by the applicant be aware that the supplier of a vehicle has an obligation under the ACL and should be given an opportunity to rectify defects. The respondents were given every opportunity to rectify the defects without completely resolving the issues. The applicant reasonably gave the opportunity to the respondents to rectify the defects. They were not completely resolved.

67. The extent and multiplicity of defects amounts to a major failure and entitles the applicant to reject the vehicle within the rejection period.

68. Mitsubishi in their written submissions has addressed the claim as being the applicant’s complaint that there have been multiple minor failures resulting in a major failure or the minor failures have not been repaired in a reasonable time frame. Mitsubishi acknowledges that there were multiple repair attempts to rectify the dash issue which was ultimately identified as an issue with the connector in the fuse box. Mitsubishi relies on the fact that once the issue was resolved the cause was the applicant installing a dash camera in the fuse box. Mitsubishi gives no evidence that the installation of the dash camera in the fuse box caused the defect to support its assertion that it “may” have caused the defect.

69. Mitsubishi maintains that the front strut issue does not meet the threshold for being “substantially unfit for a purpose for which goods of the same kind are commonly supplied” and cites Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd [2020] FCA 1672 at [27] where it was found:

The standard of acceptable quality prescribed by s 54(2) is not absolute, or a standard of perfection. It is tempered by what a reasonable consumer would regard as acceptable having regard to the several matters in s 54(3). These matters render the standard of acceptable quality elastic, and context specific: Contact Energy Ltd v Jones [2009] NZLR 830 at [95] (Miller J). The significance of the components of the guarantee of acceptable quality will therefore vary with the circumstance of each case.

70. Mitsubishi has made submissions regarding the breach of the statutory guarantee under s 54.

71. The remedy in s 260 of the ACL for a major failure applies where there is a breach of Subdivision 2A, Division 1 of Part 3.2 of the ACL.

72. The applicant’s evidence is unchallenged as to the defects she identified, the number of times the vehicle was in Gateway’s service centre, the multiple attempts to rectify the defects and the issues that remain to be rectified. Adduced from the email contact by the applicant with Gateway, Gateway was at times unresponsive to the applicant’s enquiries about the progress of the rectification works on the Vehicle.

73. The evidence of the applicant is that there remains unresolved continuing noise in the front struts, heads up display screen damage, scratches caused by attempted repairs by Gateway to the top of the car and the top of the dash despite the respondents having the opportunity to make good such issues. These continuing issues along with the issues that the respondents has rectified over a period of some two years constitute a major failure for the purposes of the ACL.

74. The principles applicable to s 54(2) of the ACL set out at [19] in Frediani are satisfied by the applicant:

1. The identification of the defects by the applicant are not the “idiosyncratic subjective views” of a consumer. The defects were genuine defects that Gateway sought to rectify. The defects complained of were defects that a reasonable consumer would identify and expect to not be present in a new vehicle.

2. The defects were not apparent at the time of supply of the Vehicle but manifested themselves within a short period of time after the supply, The latent defects appeared after the Vehicle was put into use after the supply.

3. The defects are not potentially fatal or make the Vehicle unusable. The defects make the Vehicle not of acceptable quality as a reasonable consumer purchasing a new Vehicle for more than $60,000 would reasonably expect the vehicle to be free from defects such that they require the vehicle to be returned to the dealer on more than 12 occasions in the first year and a half since purchasing it.

4. The applicant could not use the Vehicle in a reasonable and normal way without defects being apparent that interfered with the applicant’s use of the Vehicle.

75. The applicant relies upon s 260(1)(a) and s 260(1)(c) of the ACL. The effect of the defects is such that a reasonable consumer fully acquainted with the nature and extent of the failure would be entitled to consider that the supply of the goods are a major failure and that the Vehicle is substantially unfit for the purpose for which it is commonly supplied. Gateway has sought to rectify the defects during the multiple times the Vehicle was returned to it for repairs and service and has been unable to rectify all the issues with the Vehicle.

76. The Tribunal is satisfied that the applicant was entitled to reject the Vehicle and the applicant did so within the rejection period under s 262(2), the respondents having been given the opportunity to rectify the defects and failed to resolve those issues completely.

77. The Tribunal is satisfied on the balance of probabilities that the applicant has established the grounds for her claim.

78. The applicant seeks orders that the respondents replace the Vehicle with a vehicle of the same make and model, free from defects. Alternatively, the applicant seeks an order that the respondents pay to the applicant the amount of $61,633,98 if a replacement vehicle cannot be provided by the respondents.

79. If an order is made for the Vehicle to be replaced by the respondents, the condition that the applicant seeks that the replacement vehicle be free from defects is not an order that the Tribunal can make. If an order is made for the respondents to supply a replacement vehicle the applicant has the same benefit of the statutory guarantees that she has under the ACL she has with the supply of Vehicle.

75. The Vehicle is a 2022 model. The model has been superseded by later year models. There is no evidence before the Tribunal of current models or their value. There is no evidence that a replacement vehicle of the same make and model is reasonably available (see s 263(4)(b) of the ACL). The Tribunal declines to make an order that the Vehicle be replaced with replacement vehicle of the same make and model as such an order would not be capable of being complied with.

76. The appropriate remedy is that Gateway and Mitsubishi compensate the applicant by paying to the applicant the cost of purchase of the Vehicle The invoice for the Vehicle included in the applicant’s evidence shows the price paid on or about 8 November 2022 as $61,633.98, apportioned:

(1)	Vehicle Price	$47,718.18,
(2)	Accessories	$1,192.27
(3)	Paint Protection Products	$1,627.27
(4)	Sub total	$50,537.72
(5)	Plus GST	$5,053.77
(6)	Sub total incl GST	$55,591.49
(7)	Other costs and charges
(a) Registration Fee (tax exclusive ‘TE’)	$388.00
(b) CTP-Alliance Insurance (TE)	$299.00
(c) Black & White Premium Plates (TE)	$125.00
(d) Dealer Delivery	$1,813.64
(e) AutoX Car Care 5 year	$1,177.27
(f) Stamp Duty (calc on $57,600)	$1980.00
(g) Total	$5,782.91

82. The Other Costs and Charges include registration and CTP insurance totalling $687.00 and AutoX Car Care for 5 years of $1,177.27. The AutoX was in place for a period from delivery of the Vehicle to the applicant on 7 December 2022 until the Vehicle was rejected by the applicant on 5 August 2024, being 607 days, approximately 1 year and 8 months, that is one third of the term of the AutoX Car Care. The registration and the CTP insurance were consumables relating to the applicant’s use of the Vehicle and are not repayable by the respondents. The AutoX Car Care was partly ‘consumed’ until 5 August 2024. The value of that ‘consumed’ component is one third of the cost of the AutoX Car Care being $392.42.

83. Accordingly, the amount to be paid by the respondents to the applicant is:

(1)	The subtotal at Paragraph 81(6) above (incl GST)	$55,591.49
(2)	Plus Other costs and charges	$5,782.91
less registration and CTP	$687.00
less AutoX Car Care	$392.42	$4,703.49
(3)	Total	$60,294.98

Orders

84. The Tribunal orders:

1. The applicant, Amanda Marks do all things necessary to transfer the ownership of and deliver the vehicle, Mitsubishi Outlander Exceed Tourer 2.5L CVT AWD registration number XXX (‘Vehicle’), to the first respondent, PT Wollongong Pty Ltd trading as Gateway Automotive, place of business at cnr Mount Ousley Road & Princes Highway Fairy Meadow, on or before 11 July 2025 during business hours.

2. Upon delivery of the Vehicle to the first respondent, PT Wollongong Pty Ltd trading as Gateway Automotive place of business at cnr Mount Ousley Road & Princes Highway Fairy Meadow, and no later than 11 July 2025, the first respondent, PT Wollongong Pty Ltd trading as Gateway Automotive, and the second respondent, Mitsubishi Motors Australia Pty Ltd, must pay to the applicant, Amanda Marks, to amount of $60,294.98.

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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: 20 August 2025