Perry & Anor v Jawa Enterprise Pty Ltd
[2024] QCAT 20
•4 January 2024
QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL
CITATION:
Perry & Anor v Jawa Enterprise Pty Ltd [2024] QCAT 20
PARTIES:
SARAH PERRY
IAN PERRY(applicants)
v
JAWA ENTERPRISE PTY LTD (respondent)
APPLICATION NO:
MVL159-22
MATTER TYPE:
Motor vehicle matter
DELIVERED ON:
4 January 2024
HEARING DATE:
21 September 2023
HEARD AT:
Brisbane
DECISION OF:
Member Scott-Mackenzie
ORDER:
The respondent pay to the applicants $5,012.37 within twenty-one days of this order.
CATCHWORDS:
TRADE AND COMMERCE – COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION – CONSUMER PROTECTION – GUARANTEES, CONDITIONS AND WARRANTIES IN CONSUMER TRANSACTIONS – GUARANTEES, CONDITIONS AND WARRANTIES – where a camper’s suspension failed – where contract of purchase contained an express warranty – whether failure a structural failure – whether statutory warranties applied – whether camper was of acceptable quality – whether camper reasonably fit for purpose – whether failure a major failure – whether the applicants rejected the camper – remedies
Australian Consumer Law (Queensland), s 3, s 54, s 55, s 59, s 64, s 64A, s 260, s 261, s 262, s 263
Fair Trading Act 1989 (Qld), s 50, s 50A
Motor Dealers and Chattel Auctioneers Act 2014 (Qld), s 12
Queensland Civil and Administrative Rules 2009 (Qld), s 85
Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd [2020] FCA 1672
Jewson Ltd v Boyhan [2003] EWCA Civ 1030; [2004] 1 Lloyd’s Rep 505
Vautin v By Winddown, Inc. (formerly Bertram Yachts) (No 4) [2018] FCA 426; 362 ALR 702
APPEARANCES:
Applicants:
Self-represented
Respondent:
No appearance
REASONS FOR DECISION
Introduction
On 27 July 2022 the applicants made application to the Tribunal for payment to them by the respondent of the non-discounted price of a Trax-15 hybrid off-road camper trailer (camper) (application). The non-discounted price was $43,047.00 while the price paid by them to the respondent was $37,698.00.
Background
The parties entered into a contract for the sale of the camper by the respondent to the first applicant, Ms Perry, for $37,698.00 (contract). The contract is dated 5 August 2017, and includes several bonus inclusions and optional extras. The price is described as the ‘Toowoomba Show Demo Deal’.
The terms and conditions of the contract include a one-year limited warranty on parts and canvas and a five-year structural warranty on the drawbar and chassis. The terms of the warranty are spelt out in an on-line document a hard copy of which was filed by the applicants on 16 August 2022.
Parts considered consumables are not covered by the warranty, such as wheels, wheel bearings, tires, rust, lights, tent zippers, tent lights etc.[1]
[1]Clause 3 of the terms and conditions of the warranty.
The warranty expressly provides it covers factory faults only, but not damage caused by improper use. Nor does it cover damage due to any modification of design, accidental damage or collision, misuse, abuse, incorrect assembly, improper and irregular/inadequate maintenance.[2]
[2]Clause 4 of the terms and conditions of the warranty.
No warranty is offered on products sold at auction, ex demonstration, factory seconds, damaged or used products.[3] As mentioned earlier in these reasons for decision[4], the camper is described in the contract as ‘Toowoomba Show Demo Deal’. The evidence does not disclose whether the camper is ‘ex demonstration’ within the meaning of clause 5(b) of the terms and conditions of the warranty.
[3]Clause 4(b) of the terms and conditions of the warranty.
[4]See paragraph [2] of these reasons for decision.
Clause 6 of the terms and conditions provides:
Trailers must be returned to our factory for any warranty work. The warranty does not include pickup, or delivery from our factory.
Clause 7 provides:
Work performed under a warranty claim approved by Jawa Camper Trailers must be performed by an authorised representative of the Jawa Camper Trailers and only with the express written permission of Jawa Camper Trailers.
The camper was delivered by the respondent to the applicants on 30 August 2017. Thereafter, it was used extensively. Parts were repaired and replaced by the applicants.
On 3 January 2021, during a trip from Hughenden in Queensland to Cunnamulla also in Queensland, about 60 kilometres past St George, Ms Perry, travelling in a motor car behind the camper, observed smoke coming from the right-hand wheel. The suspension had cracked.
The applicants filed with that the application the following documents:
(a)Australian Securities and Investments Commission search of the respondent as at 28 July 2022;
(b)summary of the events surrounding the application;
(c)report by Walsh Engineering Solutions dated 15 February 2021 (engineering report). The contents of the report, and the conclusions reached, are summarised later in these reasons for decision under the heading Engineering report[5];
(d)quotation number 4469 RV Service Centre, QLD to Ms Perry dated 21 October 2021. The quotation is to replace the off-road suspension of the camper, the tyres, battery, and jockey wheel for $9,840.37;
(e)correspondence between Ms Perry and Jawa Offroad Camper Trailers, Ms Perry and lawyers for Jepolat Pty Ltd, the new owner of Jawa Offroad Camper Trailers, Ms Perry and the lawyers for the respondent, Ms Perry and the Australian Competition and Consumer Commission and Ms Perry and the Office of Fair Trading. The correspondence reveals Jepolat Pty Ltd purchased the business of Jawa Offroad Camper Trailers on 22 February 2019. Warranties under contracts entered into by the respondent prior to the purchase, however, it is asserted, remained with the respondent. The lawyers for the respondent denied liability on the ground the warranty is for one year, ignoring the five-year structural warranty on the drawbar and chassis.
[5]See paragraphs [20]-[22] of these reasons for decision.
On 16 August 2022, in accordance with directions given, the applicants filed in the Tribunal a copy of the terms and conditions of the warranty offered by the respondent. Subsequently, on 12 January 2023, they filed a statement of evidence. The statement contains:
(a)a copy of the contract;
(b)photographs of the camper taken after the suspension failed;
(c)estimate number 45,120 Maranoa Mechanical to Ms Perry dated 14 January 2021. The estimate is for towing the camper, diagnostic and fault finding and suspension repair, and totals $4,487.86;
(d)invoice number 45,020 Maranoa Mechanical to Ms Perry dated 9 February 2021. The invoice is for towing the camper and diagnostic and fault finding. It is for $934.00 and has been paid;
(e)correspondence previously filed; and
(f)invoices RV Service Centre QLD to Ms Perry for storage fees for September 2022 – December 2022.
The respondent failed to comply with directions given by the Tribunal on 3 August 2022 and 17 October 2022. In particular, it did not file a response to the application, a statement of evidence or statements of witnesses.
Hearing
The application was heard by the Tribunal on 21 September 2023.
The applicants appeared in person. There was no appearance by or on behalf of the respondent.
Evidence
The applicants gave evidence about the events leading up to the failure of the suspension on 3 January 2021. They made a claim under a policy of insurance. The claim, however, was refused on the ground the failure is a structural failure.
Ms Perry spoke to the respondent about a claim under the warranty.
The defect in the camper, she submitted, is a major defect. She is applying for replacement of the camper, or a refund of the price paid.
The camper, the applicants submitted, is not safe. She will accept a new camper.
Engineering report
Walsh Engineering Solutions was retained by the applicants to inspect the camper and report on the reason or reasons for the failure of the suspension. The inspection revealed the right-side trailing arm suspension had failed. The left side trailing arm was bent, and the shock absorber was disconnected and bent.
Part of the broken surface is rusty indicating the break occurred in the past. The freshly broken surface is without rust.
Walsh Engineering Solutions were unable to determine how or when the shock absorber separated from its support. It concludes the suspension failed as a result of structural fatigue induced by stress concentration consequent on welding in the vicinity of the sub-axle and the shock absorber mounts.
Applicants’ closing submissions
At the conclusion of the hearing, the applicants were directed to file any submissions in closing by 5 October 2023. They did so (applicants’ closing submissions).
The applicants rely on the consumer guarantees in the Australian Consumer Law (Queensland) (ACL). The failure to comply with the guarantees, they assert, is a major failure. The appropriate remedy is the cost to replace the camper, $67,000.00, together with the following (additional items):
Repairing the wiring harness and replacing
the Anderson plug $ 84.00
Replacing tyres $ 630.00
Replacing pop rivets $ 3.00
Replacing batteries, charger, and wiring $ 4,095.00
Replacing jockey wheel, hitch, and water pumps $ 789.85
Repairing faulty and installing new water pumps $ 200.00
Repairing tyre camber $ 169.50
Towing$ 934.00
Storage$ 3,690.00
Towing$ 550.00
Filing fee$ 379.50
Interest$ 3,596.19
$82,121.04
Alternatively, the applicants claim a refund of the purchase price, together with what is described as the reasonably foreseeable additional damages and losses sustained from the failure to meet the consumer guarantees.
Alternatively, the applicants claim the cost to repair the camper, $13,619.50, together with the costs set out in paragraph [24] of these reasons for decision and to remedy further defects identified, $3,500.00.
Legislation
Statutory guarantees
The statutory guarantees in section 54 of the ACL, the guarantee goods are of acceptable quality, and section 55, the guarantee goods are reasonably fit for any disclosed purpose and for any purpose for which the supplier represents they are reasonably fit, apply if a person supplies, in trade or commerce, goods to a consumer and the supply does not occur by way of sale by auction. Supplier in relation to goods has a meaning corresponding to supply, defined in section 2 to include supply (including re-supply) by way of sale, exchange, lease, hire or hire-purchase.
A person acquires goods as a consumer if, inter alia, the goods are of a kind ordinarily acquired for personal, domestic, or household use or consumption.[6]
[6]ACL, s 3(1)(b).
Acceptable quality
Goods are of acceptable quality if they are as:
(a)fit for all purposes for which goods of that kind are commonly supplied;
(b)acceptable in appearance and finish;
(c)free from defects;
(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 section 54(3).[7]
[7]Ibid, s 54(2).
The matters in section 54(3) are:
(a)the nature of the goods;
(b)the price of the goods (if relevant);
(c)any statements made about the goods on any packaging or label on the goods;
(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.[8]
[8]Ibid, s 54(3).
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.[9]
[9]Ibid, s 54(6).
Wheelahan J, in Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd[10], describes section 54 as providing a common standard of acceptable quality which goods are required to reach. He then continues:
It is necessary that goods have all the qualities referred to in s 54(2) in order to comply with the statutory standard: Vautin v By Winddown Inc (formerly Bertram Yachts) (No 4) [2018] FCA 426; 362 ALR 702 (Vautin) at [142] and [144] (Derrington J). The standards under s 54(2) include that goods will be fit for all purposes for which goods of that kind are commonly supplied. This general standard of fitness for purpose is not dependent upon the consumer communicating any intended purpose to the supplier, or relying upon the supplier’s skill or judgment. And, in relation to the general standard, it does not suffice that the goods will be fit for only some of those purposes.
The standard of acceptable quality in s 54(2) has as its reference point a construct, namely the objective standard of a reasonable consumer fully acquainted with the state and condition of the goods, including any hidden defects of the goods. The reasonable consumer sits with an array of other hypothetical persons who have been recruited by the law and by reference to whom objective standards are evaluated: see, Healthcare at Home Ltd v The Common Services Agency [2014] UKSC 49; 4 All ER 210 at [1]-[4] (Lord Reed JSC). Such a person has been described as an anthropomorphic conception of justice that is and must be the court itself: see Davis Contractors Ltd v Fareham Urban District Council [1956] AC 696 at 728 (Lord Radcliffe).
The hypothetical question whether the reasonable consumer would have regarded the quality of the goods as acceptable is to be determined at the time of supply. However, the reference in s 54(2) to hidden defects has the consequence that for the purposes of determining that question, the reasonable consumer may be acquainted with information known at the time of trial: cf, Medtel Pty Ltd v Courtney [2003] FCAFC 151; 130 FCR 182 at [70] (Branson J, Jacobson J agreeing). 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] 2 NZLR 830 at [95] (Miller J). The significance of the components of the guarantee of acceptable quality will therefore vary with the circumstances of each case.[11]
[10][2020] FCA 1672.
[11]Ibid, at [25]-[27].
FIT FOR PURPOSE
The guarantee in section 55 of the ACL is goods are reasonably fit for any disclosed purpose, or for any purpose for which the supplier represents they are reasonably fit. The meaning of disclosed purpose is found in section 55(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;
(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).
In Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd[12], Wheelahan J observed there is some conceptual overlap between the statutory guarantees in section 54(1) and section 55(1) to the extent that any disclosed purposes or represented purposes that engage section 55(1) may also amount to common purposes for the objective standard of acceptable quality under section 54(2)(a).[13]
[12]Ibid.
[13]At [29]. See Jewson Ltd v Boyhan [2003] EWCA Civ 1030; [2004] 1 Lloyd’s Rep 505, per Clarke LJ at [68], [71], and Sedley LJ at [77].
EXPRESS WARRANTY
The applicants rely on an express warranty, a five-year structural warranty on the drawbar and chassis. Relevantly, section 59(2) of the ACL provides there is a guarantee the supplier of the goods will comply with any express warranty given or made by the supplier in relation to the goods.
A structural failure, in my opinion, as the term is used in the contract and the terms and conditions of the warranty, refers to the loss of the structural integrity or the loss of the load-carrying capacity in either a structural component or the structure itself. In general terms, it is initiated when material is stretched beyond its strength limit, causing fracture or excessive deformation. I am satisfied the failure on 3 January 2021 was a structural failure within the meaning of the contract and the terms and conditions of the warranty. Further, I am satisfied the failure of the suspension was a factory fault engaging the provisions of the warranty.
This proceeding, however, is not a minor civil dispute for the reason explained in paragraph [40] of these reasons for decision. And an action under section 59(2) is not an action in respect of which the Tribunal is given jurisdiction by section 50A(2) of the FT Act. In any case, it is sufficient for present purposes to focus on the statutory warranty in section 54 of the ACL.
Fair Trading Act 1989 (Qld)
Section 50(1) of the Fair Trading Act 1989 (Qld) (FT Act) provides:
A proceeding for the purposes of a provision of the Australian Consumer Law (Queensland) listed in the table to this section must be heard in the tribunal or in a court having jurisdiction for the proceeding, having regard to:
(a) for the tribunal, whether the subject of the proceeding:
(i)would be a minor civil dispute within the meaning of the [Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act)]; or
(ii)would be a matter to which section 50A applies; or
(b) for a court - any civil jurisdictional limit, including any monetary limit, applying to the court.
The table to section 50(1) includes an action against a supplier of goods under section 259(2) of the ACL (to recover reasonable costs incurred by a consumer), section 259(3) (to recover compensation for the reduction in the value of the goods) and section 259(4) (to recover damages because of a failure to comply with a guarantee).
This proceeding is not a minor civil dispute within the meaning of the Queensland Civil and Administrative Act 2009 (Qld) (QCAT Act) because the amount claim is for payment of money of a value of more than the prescribed amount, $25,000.00, and for return of goods of a value more than the prescribed amount.[14] It follows the Tribunal’s jurisdiction in the circumstances here must be found in section 50A of the FT Act. The section provides a person may apply, as provided under the QCAT Act, to the Tribunal for an order mentioned in section 50A(2) for an action:
(a)under a provision of the ACL listed in the table to the section; and
(b)relating to a motor vehicle; and
(c)seeking an amount or value of other relief of not more than $100,000.00.
[14]See the definition of minor civil dispute in paragraph 1(b) in schedule3 to the QCAT Act.
Motor vehicle is defined in section 50A(4) of the FT Act to have the same meaning as defined in the Motor Dealers and Chattel Auctioneers Act 2014 (Qld) (MDCA Act). It includes a caravan.[15] The camper is a caravan and, hence, a motor vehicle within the meaning of section 50A of the FT Act.
[15]MDCA Act, s 12(1).
The table to the section is set out below:
| Provision of ACL | Name of provision | Nature of proceeding |
| Section 236(1) | Actions for damages | Action to recover amount of loss or damage |
| Section 259(2), (3) and (4) | Action against suppliers of goods | Section 259(2) - Action to recover reasonable costs incurred by consumer Section 259(3) - Action to recover compensation for reduction in value of goods Section 259(4) - Action to recover damages because of failure to comply with guarantee |
| Section 265(3) | Termination of contracts for the supply of services that are connected with rejected goods | Action to recover refund |
| Section 267(2), (3) and (4) | Action against suppliers of services | Section 267(2) - Action to recover reasonable costs incurred by consumer Section 267(3) - Action to recover compensation for reduction in value of services Section 267(4) - Action to recover damages because of failure to comply with guarantee |
| Section 269(3) | Termination of contracts for the supply of services | Action to recover refund |
| Section 271(1), (3) and (5) | Action for damages against manufacturers of goods | Action to recover damages from manufacturer |
| Section 274(3) | Indemnification of suppliers by manufacturers | Action against manufacturer for legal or equitable relief |
| Section 279(1) | Action by consumer to recover amount of loss or damage | Action to recover amount of loss or damage |
Remedies
If the failure to comply with a 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.[16]
[16]ACL, s 259(2).
The Tribunal has jurisdiction to make an order under the subsection.[17]
[17]FT Act, s 50A, and the table to the section.
If that the failure to comply with a 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.[18]
[18]ACL, s 259(3).
Once again, the Tribunal has jurisdiction to make an order under the subsection.
Section 259(3) of the ACL is engaged if the failure to comply with a guarantee cannot be remedied or is a major failure. A failure to comply with a guarantee in sections 54 and 55 is a major failure if, inter alia:
(a)the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure;
(b)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;
(c)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
(d)the goods are not of acceptable quality because they are unsafe.[19]
[19]Ibid, s 260(1).
A failure is also a major failure if:
(a)the failure is one of two or more failures to comply with a guarantee referred to in section 259(1)(b) that apply to the supply; and
(b)the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of those failures, taken as a whole.[20]
The multiple failures do not need to relate to the same guarantee.[21]
[20]Ibid, s 260(2).
[21]See the note to section 260(2) of the ACL.
A supplier of goods may comply with a requirement of a consumer to remedy a failure to comply with a guarantee referred to in section 259(1)(b) by:
(a)repairing the goods;
(b)replacing the goods with goods of an identical type; or
(c)refunding:
(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.[22]
[22]Ibid, s 261.
A consumer is not entitled, under section 259, to notify a supplier of goods the consumer rejects the goods if the rejection period for the goods has ended.[23] 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;
(b)the use to which a consumer is likely to put them;
(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.[24]
[23]Ibid, s 262(1).
[24]Ibid, s 260(2).
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.[25]
[25]Ibid, s 263(4).
An action for an order to replace the goods under section 261 or section 263 is not one of the actions under a provision of the ACL listed in the table to section 50A. It follows the Tribunal is without jurisdiction to make an order for the replacement of the camper.
In Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd[26], Wheelahan J expresses the view that, for the purposes of evaluating whether a failure is a major failure within the meaning of section 260(1)(a), a reasonable consumer who purchases a recreational vehicle is to be taken to have some degree of tolerance for certain types of failure because of at least three features:
[26]Ibid.
First, the legislation assumes that not every failure to comply with a guarantee will be a major failure. Section 259(2) of the ACL expressly contemplates that some failures to comply with statutory guarantees can be remedied within a reasonable time. Further, s 260(a) requires that consideration be given to the nature and extent of the failure in determining whether the reasonable consumer would not have acquired the goods, thereby indicating that the mere existence of any failure is not sufficient. Section 260(c) contemplates that goods that are substantially unfit for a common purpose might easily, and within a reasonable time, be remedied so as to make them fit for purpose, in which case there is no major failure on account of unfitness for a common purpose. Likewise, s 260(d), which relates to unfitness for a disclosed purpose, also contemplates that the goods might be remedied easily, and within a reasonable time, so as to make them fit for purpose.
Second, the nature of the goods is relevant. RVs, like many substantial consumer items such as motor vehicles, yachts, and even bicycles, are manufactured from a range of component parts, many of which may be capable of easy replacement or repair in the event of some fault. Some of the accessories, such as air conditioning units, televisions, or microwave ovens, may be manufactured by specialist suppliers of electrical appliances, and installed in the RV by the manufacturer or the supplier of the RV. Many of the component parts are designed for mechanical movement. RVs are intended to be towed. The process of towing will subject the RVs to stresses and flex. RVs will necessarily be exposed to weather. They are designed to be lived in, and otherwise to be used. Lids will be raised, and lowered. Doors will be opened, and shut. Drawers will be pulled out, and pushed in. RVs will be used by families with children, who sometimes lack fine motor skills when handling equipment. Surfaces may become scratched or chipped though normal use. An appliance installed in an RV, if found to be faulty, might be able to be easily repaired or replaced by a specialist supplier. Fuses may blow. Sometimes, just as in a household, the cause of an isolated occurrence of a blown fuse may not be apparent. Screws might have to be tightened. Doors might have to be straightened. These things are inherent in the nature of the goods. The reasonable consumer will tolerate some faults or breakages, and some need for adjustments of this type that are exposed by a period of initial use. The reasonable consumer will purchase an RV accepting that there is a reasonable prospect that some components of the RV may have to be adjusted, repaired, or replaced within a manufacturer’s warranty period. Putatively, if a reasonable consumer was fully acquainted with the nature and extent of a failure to comply with a statutory guarantee at the time of purchase, the reasonable consumer might nonetheless proceed with the purchase on the basis that the supplier, or the manufacturer, will remedy the failure within a reasonable time. On the other hand, it does not follow that merely because a failure to comply with a statutory guarantee is capable of being remedied, that a reasonable consumer fully acquainted with the nature and extent of the failure would acquire the goods. Whether that is so will depend upon the circumstances of each case.
Third, the reasonable consumer will accept that the process of production of certain complex goods, such as RVs, can never be perfect.[27]
Discussion
Statutory guarantees
[27]Ibid, at [38]-[41].
Do the statutory guarantees apply?
I am satisfied the sale of the camper by the respondent to the applicants was a supply of goods to consumers in trade or commerce, and so find. The guarantees in sections 54 and 55 apply to the sale.
Was the camper of acceptable quality?
The camper, in my opinion, was not of acceptable quality. In particular, as the engineering report makes clear, the camper was not fit for all the purposes for which campers are commonly supplied, was not free of defects, safe or durable as a reasonable consumer fully acquainted with the state and condition of the camper, including any hidden defects, would regard as acceptable having regard to the matters in section 54(3) of the ACL.
Sections 54(4) and (5) do not apply in the circumstances here.
The engineering report concludes the suspension failed because of structural fatigue. The camper is an offroad camper trailer. There is no evidence of abnormal use or lack of care or maintenance of the camper.[28] In my opinion, despite the passing of 4½ years since purchase, the camper should not have failed in the manner it did and when it did.
[28]ACL, s 54(6).
The defect in the suspension, resulting in its failure, was likely present at the time of purchase of the camper, and I so find. It was a hidden defect that would not have been revealed on examination at the time.[29] I so find.
[29]Ibid, s 54(7).
Was the camper fit for purpose?
The engineering report makes clear the camper was not reasonably fit for the purpose of a camper. I so find.
Was the failure of the camper a major failure?
A failure to comply with a guarantee referred to in sections 54 and 55 of the ACL is a major failure in the circumstances provided for in section 260 of the ACL. Given the nature and extent of the failure of the camper’s suspension, as detailed in that the engineering report, I am satisfied:
(a)the camper would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure;
(b)the camper was unfit for use as a camper; and
(c)the camper was not of acceptable quality because it was unsafe.
It follows the failure is a major failure within the meaning of section 260 and I so find.
Did the applicants reject the camper?
The failure to comply with the statutory guarantee, as I have found, was a major failure. It follows the applicants were entitled:
(a)subject to section 262 of the ACL, to notify the respondent they reject the camper and the grounds of the rejection; or
(b)by action against the respondent, recover compensation for any reduction in the value of the camper below the price paid by them for the camper.
The applicants do not claim a reduction in the value of the camper below the price paid.
They were not entitled to notify the respondent they rejected the camper if the rejection period had ended.[30] Here, the rejection period is the period from the time of the supply of the camper to the applicants within which it would be reasonable to expect the failure of the suspension to become apparent. As explained by Wheelahan J in Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd[31]:
... This is a reference to the failure to comply with the statutory guarantee becoming apparent, rather than any underlying defect becoming apparent, which may occur at an earlier point in time. In Nesbit v Porter [2000] NZCA 288; 2 NZLR 465 at [40], the New Zealand Court of Appeal explained in relation to the corresponding New Zealand provision:
In some instances the defect will be of a kind where it may be obvious that something is wrong with the goods but the supplier or someone else to whom the consumer turns for help may be in doubt about the exact nature of the problem and thus about how serious it is. For example, the operation of a motor vehicle may be affected by the failure of a small and comparatively obscure part, say, a waver spring in an automatic transmission; until the transmission is dismantled a mechanic cannot be sure what the defect is. Or the cause of malfunction, particularly one which occurs intermittently, may be hard to detect even upon inspection. It may be necessary to carry out a series of tests or even to wait and see what, if anything, develops. Or the repairer may think the fault has been identified and that the correct repair or adjustment has been made but this view may prove to be wrong and the problem may manifest itself again. … In all such cases, a reasonable period will not elapse before the consumer has had the opportunity to become properly informed about the nature of the defect and has also had a little time then to consider an appropriate decision, whether or not to reject the goods. It almost goes without saying that the period will be correspondingly longer where the supplier has taken steps which effectively conceal a defect or has withheld relevant information.
The Court in Nesbit v Porter at [41] went on to refer to the practical utility to a consumer of the right of rejection as informing what is a reasonable period within which to exercise a right to reject goods –
In considering what is a reasonable period in a particular case it is necessary also to bear in mind the practical utility to a consumer of the right of rejection given by s 18 of the [Consumer Guarantees Act 1993 (NZ)]. Ms Nield submitted persuasively that, although a right to damages survives the loss of the right to reject, in pursuing it the consumer may face substantial litigation costs where the claim is for a sum exceeding the jurisdiction of the Disputes Tribunal (now $7500, or $12,000 by agreement of both parties). Replacement (under s 19(1)(b)) or repair by or at the cost of the supplier or rejection of the goods, where that is available in terms of s 18, are more “user-friendly” solutions to a consumer’s problem with goods, although of course it may still prove to be necessary to litigate in order to recover all or part of the price.
[30]Ibid, s 262(1)(a).
[31][2018] FCA 426; 362 ALR 702, at [46]-[47].
Earlier, in Vautin v By Winddown, Inc. (formerly Bertram Yachts) (No 4)[32], Derrington J, at [265], said:
The use of the expression “become apparent” in s 262(2) is also problematical. Something is apparent when it meets the eyes or shows itself, is open to sight, visible or plainly seen (Oxford English Dictionary, online service). Or, as the Macquarie Dictionary defines the word, “capable of being clearly perceived or understood; plain or clear”, “ostensible” or “exposed to sight; open to view”. In other words, the section requires a sufficiently high level of certainty in relation to the knowledge of the relevant failure including its nature and extent and what it will cost to remediate it. If the level of knowledge required is as identified above, it follows that if there exists doubt about the consequences of a defect in an item and, therefore, the cost of repairing it, the failure of the statutory guarantee has not become apparent ...
[32]Ibid.
The camper’s suspension failed on 3 January 2021. The nature and extent of the failure was likely immediately apparent. If not, it was known by the applicants by about 15 February 2021, the date of the engineering report.
Maranoa Mechanical provided Ms Perry with an estimate to repair the suspension on about 14 January 2021.
It appears from the evidence that the applicants first contacted the new owner of Jawa Offroad Camper Trailers, Jepolat Pty Ltd, by telephone about two months after the suspension failed, on 27 March 2021. The explanation for the delay is no doubt they were awaiting the outcome of a claim under a policy of insurance.
The next day, 28 March 2021, Ms Perry sent to the new owner an email outlining the use of that the camper and faults, and referring to a quotation to repair the camper (said to be over $5,000.00), and several provisions of the ACL. The email concludes:
We are hoping that we can come to some kind of arrangement with JAWA. We love the freedom we have with our van and are rather upset that this is dragging on and on.
We look forward to your contact as soon as possible as we are wanting a solution as soon as possible.
The email, in my opinion, does not constitute notification of rejection of the camper. The content and tone of the email appears to contemplate an ‘arrangement’ or ‘solution’ involving repair of the camper.
The first contact by the applicants with the respondent, it appears from the evidence, was by email. On 30 June 2021, about six months after the suspension failed, Ms Perry sent to the respondent’s lawyers “... information for a warranty claim for you (sic.) clients.” The lawyers, on 12 September 2021, sent to Ms Perry an email rejecting the claim, erroneously on the ground it was outside the warranty period. The email concludes:
Please also be advised that our client is no longer in business and no longer has the capacity to perform any warranty claims even if the claim was valid.
The applicants did not reject the camper and I so find. If I am wrong and it might be inferred from the correspondence the applicants notified the respondent they reject the camper and the grounds of rejection, they did so, in my opinion, after the rejection period for the camper had ended.
It follows that the applicants are not entitled to recover the price paid for the camper ($36,698.00), the non-discounted price, the amount claimed in the application ($37,698.00), or the amount claimed in the applicants’ closing submissions ($67,000.00). However, they may recover damages for any loss or damage suffered by them because of the failure to comply with the statutory guarantees if it was reasonably foreseeable they would suffer such loss or damage as a result of such a failure.
Remedies
The applicants filed two estimates to repair the camper. The first estimate is that provided by Maranoa Mechanical.[33] It is dated 14 January 2021 and is for $3,711.39. The second estimate is that provided by RV Service Centre QLD. It is dated 21 October 2021 and is for $9,840.37. The opening words of the estimate read:
caravan has had a complete failure of suspension. the van has been sitting for some time causing the tyres and flat spot and the batteries has been run down to the point the are damaged. the jockey wheel was damaged when the unit was transported to our site
this quote is to replace the off road suspension, the tyres, batteries and the jockey wheel
[33]See paragraph [12] of these reasons for decision.
It is apparent from the opening words of the second estimate the camper has been damaged and allowed to deteriorate since the failure of the suspension necessitating additional repairs at additional cost. The reasonably foreseeable loss and damage suffered by the applicants because of the failure to comply with the statutory guarantees is the amount of the first estimate, $3,711.39. There will be an order that the respondent pay that amount to the applicants.
The applicants include in their closing submissions a claim for the additional items. The items, apart from towing and storage fees, whilst mentioned in correspondence as part of the factual matrix, are not in the evidence before the Tribunal. They may be put to one side.
The evidence shows the applicants paid to Maranoa Mechanical $621.47 for towing and $312.51 for diagnostic and fault finding. The evidence further shows the applicants paid to RV Service Centre QLD $1,380.00 for storing the camper in September 2022 – December 2022, long after the suspension failed. The amount includes late fees of $60.00.
The amounts claimed and in evidence paid by the applicants to Maranoa Mechanical for towing and diagnostic and fault finding, in my opinion, were reasonably foreseeable. The applicants are entitled to recover those amounts. The amount claimed and in evidence paid by the applicants to RV Service Centre QLD for storage fees, in the absence of an explanation for why the fees were incurred long after the camper’s suspension failed, were not reasonably foreseeable.
The Tribunal, in the circumstances here and by virtue of section 85 of the Queensland Civil and Administrative Rules 2009 (Qld), may order the respondent to pay to the applicants the fee on filing the application, $367.00. I will do so.
Summary of findings
In summary, I find:
(a)the failure on 3 January 2021 was a structural failure within the meaning of the contract and the terms and conditions of the express warranty;
(b)the sale of the camper by the respondent to the applicants was a supply of goods to consumers in trade or commerce;
(c)the guarantees in sections 54 and 55 of the ACL apply to the sale;
(d)the camper was not of acceptable quality;
(e)the camper was not reasonably fit for the purpose of a camper;
(f)the failure of the suspension was a major failure within the meaning of section 260 of the ACL;
(g)the applicants did not reject the camper. If I am wrong, they did so after the rejection period for the camper had ended; and
(h)the applicants are entitled to an order that the respondent pay to them $5,012.37, calculated as follows:
Repair of the camper $3,711.39
Towing$ 621.47
Diagnostic and fault finding $ 312.51
Filing fee$ 367.00
$5,012.37
Decision
The order of the Tribunal is that the respondent pay to the applicants $5,012.37 within twenty-one days of this order.
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