Riley v Discount 4x4 Pty Ltd
[2012] QCATA 101
•28 March 2012
| CITATION: | Riley v Discount 4x4 Pty Ltd [2012] QCATA 101 |
| PARTIES: | William Frederick Riley (Applicant/Appellant) |
| v | |
| Discount 4x4 Pty Ltd (Respondent) |
| APPLICATION NUMBER: | APL326-11 |
| MATTER TYPE: | Appeals |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Richard Oliver, Senior Member |
| DELIVERED ON: | 28 March 2012 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | Leave to appeal granted and the Tribunal’s decision dated 16 August 2011 is set aside.1. The applicant is to provide an updated invoice from Newtown Towing for storage of the vehicle up to and including 5 April 2012 by 30 March 2012.2. The respondent must pay to Newtown Towing the cost of the storage by 5 April 2012.3. The respondent must pay to the applicant the sum of $16,000.00, less:4. (a) The cost of storage of the vehicle with Newtown Towing up to 5 April 2012; (b) The reasonable cost of transporting the vehicle from Toowoomba to Brisbane, which cost should not exceed $250.00; and (c) Compensation already paid to the applicant of $664.00, by 5 April 2012. |
| CATCHWORDS: | Minor Civil Dispute – refund of purchase price where refund is a remedy provided for in the definition of “minor civil dispute” – where ordered the applicant return the vehicle to the respondent for repairs – where failure to consider alternate remedy of refund was an error of law – where applicant sought refund after purchasing a defective vehicle – where respondent refused to refund the purchase price – where request for refund amounted to an election to rescind the contract – whether applicant affirmed the contract – where parties could be returned to their former positions – where refund is a remedy provided for in the definition – where circumstances permit substitution of the original decision Queensland Civil and Administrative Tribunal Act2009, ss 3, 12, 142(3), 146 QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41 Ivanof v Phillip M Levy Pty Ltd [1971] VR 1 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of Queensland Civil and Administrative Tribunal Act2009 (QCAT Act).
REASONS FOR DECISION
Discount 4x4 carried on business as a second hand motor vehicle retailer specialising in the sale of 4wd vehicles at 979 Beaudesert Road, Coopers Plains. On 20 January 2010 it entered into a written contract with Mr and Mrs Riley to sell to them a Nissan Patrol Station Wagon registration number 350 NTI for a total cost of $16,000. The Rileys took delivery of the vehicle on 22 January 2010. At the time of purchase the vehicle had an odometer reading of 310,453km.
Because the vehicle had an odometer reading in excess of 160,000km, it was sold subject to a “Class B” warranty pursuant to the provisions of the Property Agent and Motor Dealers Act 2000. The respondent also warranted that the vehicle had a current Safety Certificate.
Immediately after the purchase, Mr Riley found defects in the vehicle and wrote to the respondent on 22 January 2010 to complain about those defects. He had the good sense to have an independent safety inspection carried out by Mick Tighe Mechanical on 16 February 2010. This inspection confirmed that the vehicle was not roadworthy. On 1 February 2010 Mr Riley returned the vehicle to the respondent to carry out repairs and collected it on 12 February 2010. On each occasion he asked the respondent to take the vehicle back and give him a refund because it was not roadworthy and not fit for his purposes which was to tow a caravan.
He had ongoing problems with the vehicle and then decided to have it examined by a Department of Transport Officer Mr Shepherd. He conducted a comprehensive examination of the vehicle and found it had multiple defects and issued a defect notice on 26 February 2010. The defect classification was noted as “major”. Mr Riley, according to the defect notice, was required to produce the vehicle for a full certificate of inspection/safety certificate inspection at an approved inspection station. He was also required to present a Defect Clearance Declaration by 14 March 2010.
There were ongoing discussions between Mr Riley and the respondent about returning the vehicle, and then on 7 June 2010 the vehicle was collected from Toowoomba by a tow truck, and taken to Brisbane for repairs. It was returned to Mr Riley on 16 July 2010. Upon return of the vehicle, Mr Riley immediately had the RACQ undertake a Mastercheck of the vehicle only to find that the original defects complained of had not been repaired.
When Mr Riley tried to reregister the vehicle in August 2010, he was told by the Department of Transport that the vehicle could not be re-registered because it had at least one Outstanding Defect Notice. He was also advised that for it to be registered he was required “to action the Defect Notice” and contact Queensland Transport within 14 days of the date of the letter to ensure the registration of the vehicle could be processed. The vehicle remains unregistered.
Because he had received no satisfaction from the respondent, neither a refund nor having the defects attended to, Mr Riley commenced a minor civil dispute proceeding in the Tribunal on 14 October 2010 claiming a refund of the $16,000 he paid to the respondent, as well as other associated costs in respect of the roadworthy, the Mastercheck and the filing fee making the total claim of $17,585.50. He also claimed in the alternative, assuming his contention the contract had been validly rescinded was rejected, for an order that the respondent rectify the defects in accordance with the Department of Transport Notice issued on 26 February 2010.
To complicate matters further, as Mr Riley could not drive the vehicle nor, it can be reasonably inferred, did he want to do anything to affirm the contract by carrying out repairs, he has had to store the vehicle at Newtown Towing Service in Toowoomba. He and his wife are residents of a caravan park in Pittsworth and the conditions of residency at the caravan park exclude the storing of unregistered vehicles at the park. The cost of storage is $15 per day and has been accruing since 27 June 2011.
Eventually, the matter came on for hearing before a Tribunal Adjudicator on 20 July 2011. After hearing evidence from both parties, and the various witnesses the decision was reserved. The learned Adjudicator prepared written reasons for his decision and they were published to the parties on 16 August 2011. Orders were made that the respondent pay to Mr Riley $664 as compensation for expenses incurred by him for getting the Safety Certificate from Mick Tighe Mechanical ($60), RACQ ($110), RACQ Mastercheck ($249) and the application filing fee ($255). The learned Adjudicator also ordered that the vehicle be returned to the respondent and that it carry out repairs of defects identified in the Department of Transport and Main Road Defect Notice dated 26 February 2010 within 21 days.
From that decision, Mr Riley has filed an application for leave to appeal or appeal.
As this is an appeal from a minor civil dispute matter, leave to appeal is necessary.[1] The question whether or not leave to appeal should be granted is usually addressed according to established principles: Is there a reasonably arguable case of error in the primary decision?[2] Is there a reasonable prospect that the applicant will obtain substantive relief?[3] Is leave necessary to correct a substantial injustice to the applicant caused by some error?[4] Is there a question of general importance upon which further argument, and a decision of the appellate court or tribunal, would be to the public advantage?[5]
[1] QCAT Act, s 142(3).
[2] QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41.
[3] Cachia v Grech [2009] NSWCA 232 at 2.
[4] QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41.
[5]Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388 at 389; McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577 at 578, 580.
The learned Adjudicator’s reasons are extensive and informative. He carefully tracks the sequence of events subsequent to the Rileys purchasing the vehicle culminating in the return of the vehicle to the Rileys on 21 July 2010. He considered the evidence of the various witnesses who supplied statements of evidence and gave evidence during the course of the hearing. These include: relevantly, Mr Miszczuk who issued the first safety certificate at the time of purchase; Mr Tighe who issued the safety certificate identifying defects on 16 February 2010; and importantly, Mr Shepherd who issued the defect notice on 26 February 2010. The learned Adjudicator correctly identified the issues to be determined at the hearing as follows:
“The first issue to be determined is whether the vehicle was defective at the point of sale; secondly whether defects in terms of the statutory warranty were bought to the attention of the respondent within the statutory period; thirdly, was the respondent given an opportunity to affect repairs.”[6]
[6] Reasons dated 16 August 2011 paragraph 17.
Having considered the evidence of Mr Tighe and Mr Shepherd, in contrast to that of Mr Miszczuk, the learned Adjudicator made findings of fact that the vehicle was defective at the point of sale.[7] Having read the transcript and the various statements of evidence, including the documentary evidence there can be little doubt that the finding of fact was open on the evidence before the learned Adjudicator, and before this Appeal Tribunal.
[7] Reasons dated 16 August 2011 paragraph 19.
The learned Adjudicator then went on to consider whether or not the defects were brought to the attention of the respondent within the warranty period. He relied on the written notification of the defects by the applicant to the respondent when the vehicle was returned to it for repair on 1 February 2010. The vehicle then remained with the respondent until 12 February 2010 and a further written notification of defects was given to the respondent on 17 February 2010. From the day after taking delivery of the vehicle, the applicant continuously requested a refund due to the defects not being rectified or repaired. The learned Adjudicator accepted the Rileys’ evidence on these various points and concluded, once again as a matter of fact, that the defects were notified to the respondent within the warranty period.
With respect to the third issue, once again the learned Adjudicator relied on the evidence of Mr Shepherd and also the RACQ Mastercheck to come to the conclusion, as a matter of fact, that the defects had not been repaired by the respondent either in the February period, or in the July period when the vehicle was collected from Toowoomba by a tow truck arranged by the respondents. That conclusion of fact was open on the evidence.
In the respondent’s submissions in the appeal no issue is taken with the learned Adjudicator’s findings of fact on these three issues although it does reiterate that Mr Miszczuk did carry out repairs in accordance with a defect notice. The complaint from the respondent is that the applicant has not returned the vehicle in accordance with the orders made by the learned Adjudicator and therefore it has not had an opportunity to carry out rectification work to the satisfaction of the Department of Transport and Main Roads.
In my judgment there has been no basis established to interfere with the findings of fact made by the learned Adjudicator on the issues directly identified by him for determination in the original hearing.
Mr Riley contends however, on those findings of fact that the learned Adjudicator ought to have concluded, when determining what remedy should be afforded to Mr Riley having regard to the respondents conduct, fell into error in not ordering that the vehicle be returned and the purchase price be refunded to Mr Riley. The grounds of appeal are somewhat confusing in that it is contended that the learned Adjudicator did not place sufficient weight on the RACQ Mastercheck. He did not take into account cost of storage and the cost of towing the vehicle from Toowoomba to Brisbane.
In addition to asking the Appeal Tribunal to make an order that the purchase price be refunded to the applicant, he also, confusingly, asks that all defects listed in the RACQ Mastercheck be rectified plus all defects stated by DTMR. I say confusingly because the second order sought in the application is the same as what was ordered at the initial hearing. It seems to me that Mr Riley, as a self represented party, is confused about what relief he actually wants. It seems he is claiming relief in the alternative simply to safeguard his position.
In the written submissions in support of the appeal, Mr Riley seems to be expanding his claim to include mechanical faults that might have arisen since the vehicle was placed in storage in July 2010. He is also claiming the cost of that storage. He informs the Tribunal that the respondent’s current address is 24 Harries Road, Coorparoo and the vehicle has to be sent there by tow truck. He wants the respondent to pay for the towing charges.
Despite the remedy sought in the alternative, what Mr Riley wants, and has wanted from the very beginning after he realised the vehicle was not roadworthy, is a refund of his purchase price. The primary issue is whether, on a proper analysis of the learned Adjudicator’s reasons, and the evidence, a refund should have been ordered.
The learned Adjudicator did not address this primary remedy in his reasons. Having made the critical findings of fact which support his conclusion that the vehicle should be returned for repair, he did not go on to explain in his reasons why Mr Riley should not get the refund. Mr Riley was entitled to have both remedies considered and be given reasons why one was preferred to the other. By failing to address the primary remedy of a refund and give reasons for its rejection, the learned Adjudicator fell into error. The failure to give reasons is an error of law and Mr Riley should be given leave to appeal.
In determining the appeal, the Appeal Tribunal can set aside the decision and substitute its own decision.[8] Here there are sufficient facts established to allow me to do that and that is the most efficacious way to proceed to dispose of this appeal rather than remit it back for further consideration. The Tribunal is obliged to ensure that matters are dealt with in a way that is accessible, fair, just economical and quick in accordance with its objects.[9]
[8] QCAT Act, s 146.
[9] QCAT Act, s 3.
Had consideration been given to Mr Riley’s insistence for a refund, initially on 1 February 2010 when he returned the vehicle to the respondent by telling the respondent that the vehicle was a lemon and he wanted his money back, it would have been apparent that Mr Riley was effectively electing to rescind the contract because of the respondent’s misrepresentation as to the roadworthiness of the vehicle. It was sold with a safety certificate which warranted the vehicle was roadworthy.
He again asked for a refund when he collected the vehicle on 12 February 2010. The respondent refused to refund the money and accept a return of the vehicle. After it was confirmed beyond doubt by Mick Tighe Mechanical that the vehicle had a number of defects, Mr Riley again demanded a refund on 16 February 2010. He persisted with his demand for a refund until the time of filing his proceeding in the minor civil dispute jurisdiction of the Tribunal. He has maintained that position.
The definition of “minor civil dispute” confers jurisdiction on the Tribunal to determine a claim where the relief sought is “return of goods”.[10] In deciding whether the goods should be returned the Tribunal must make orders that are fair and equitable to the parties. To decide what is fair and equitable it is useful to consider the case in a broader legal framework. The conduct of Mr Riley in these circumstances is akin to him exercising a right to rescind the contract for misrepresentation. It is useful to have regard to those principles to determine if an order should be made for the return of the vehicle.
[10] QCAT Act, s 12.
Rescission for misrepresentation is available in circumstances where a party to a contract, the representee, relied on a representation that was material to the contract. Here the representation was that the vehicle was sold with a compliant safety certificate, meaning it was not defective, which was in fact not true. As the learned Adjudicator put it the vehicle was defective “at point of sale”. However for rescission to be effective the applicant must make an election firstly, to rescind, and secondly, must not do anything which might be said to be an affirmation of the contract.[11] Furthermore the parties should be able to be restored to their former positions.[12]
[11] Long v Lloyd (1958) 1 WLR 753.
[12] Alati v Kruger (1955) 94 CLR 216; Maguires v Makaronis (1996) 188 CLR 449.
Although Mr Riley retained control of the vehicle, he really had no choice in the matter because the respondent refused to accept Mr Riley’s rescission by asking for a refund. The facts as found by the learned Adjudicator establish that Mr Riley was ready and willing to return the vehicle at any time. It may be argued that Mr Riley by retaining the vehicle and driving it for his personal use are acts of affirmation. However, two things can be said about this: firstly, Mr Riley had no choice but to keep the vehicle in view of the position taken by the respondent. He also had to substantiate his claim of misrepresentation by having the vehicle inspected by authorised inspectors. Secondly, his use of the vehicle was unremarkable given the fact he lived in Pittsworth, some considerable distance from Brisbane, and the vehicle has not been operational since August 2010. The few thousand kilometres he has done in the vehicle is insignificant in its overall odometer reading.
I am satisfied that Mr Riley has, since the day after the delivery of the vehicle, maintained his position on rescission and return of the vehicle. His subsequent actions have not varied that position. Although he has not used legal terminology in his discussions with the respondent he has made his position very clear.
Having validly rescinded the contract for misrepresentation the parties should now be restored to their former positions. There will be an order that the vehicle is to be returned to the respondent and Mr Riley should be refunded the purchase price. Although Mr Riley has incurred expenses and storage costs, damages are not recoverable in circumstances where the contract has been validly rescinded for misrepresentation.[13] From the dealer’s perspective losses include a diminution in value of the vehicle.
[13] Ivanof v Phillip M Levy Pty Ltd [1971] VR 167.
To give effect to these reasons I will make the following orders.
1. The applicant is to provide an updated invoice from Newtown Towing for storage of the vehicle up to and including 5 April 2012 by 30 March 2012.
2. The respondent must pay to Newtown Towing the cost of the storage by 5 April 2012.
3. The respondent must pay to the applicant the sum of $16,000.00, less:
(a) the cost of storage of the vehicle with Newtown Towing up to 5 April 2012;
(b) the reasonable cost of transporting the vehicle from Toowoomba to Brisbane, which cost should not exceed $250.00; and
(c) Compensation already paid to the applicant of $664.00,
by 5 April 2012.
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