Boers v Blue Star Auto Sales Pty Ltd & Anor [2021] QCAT 17

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Boers v Blue Star Auto Sales Pty Ltd & Anor [2021] QCAT 17 PARTIES: TIMOTHY BOERS (applicant) v BLUE STAR AUTO SALES PTY LTD (first respondent) MV AUTO WORKSHOP (second respondent) APPLICATION NO/S: MVL081-20 MATTER TYPE: Motor vehicle matter DELIVERED ON: 19 January 2021 HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Member Kanowski ORDERS: The name of the first respondent is amended from Blue Star Auto Sales to Blue Star Auto Sales Pty Ltd. Blue Star Auto Sales Pty Ltd must pay Timothy Boers by 2 February 2021: (a) $1,034.77; plus (b) $123.20 in costs. The application against MV Auto Workshop is dismissed. The application for miscellaneous matters filed by Timothy Boers on 17 December 2020 is refused. 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 buyer purchased used vehicle from motor dealer – whether defects covered by statutory warranty – whether particular losses and costs recoverable Motor Dealers and Chattel Auctioneers Act 2014 (Qld), Schedule 1 s 15, s 18 -- 1 of 10 -- 2 Motor Dealers and Chattel Auctioneers Regulation 2014 (Qld), s 47 APPEARANCES & REPRESENTATION: Applicant: Self-represented Respondents: Nil This matter was heard and determined on the papers pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’) REASONS FOR DECISION Introduction On 11 December 2019 Mr Boers purchased a 2009 BMW sedan from ‘Blue Star Auto Sales’. He says the car was defective. In this proceeding, he seeks an order for $3,126.40 for what he says were resulting losses and costs. The respondents Mr Boers’ Application - Motor Vehicle Dispute was filed on 27 March 2020. He named the respondents as Blue Star Auto Sales and MV Auto Workshop. However, these are business names, not legal persons. ‘Blue Star Auto Sales’ was the name given as the licensed motor dealer who sold the car on the sales contract and associated forms. MV Auto Workshop had provided the safety certificate for the vehicle prior to the sale. With his application, Mr Boers filed a company extract indicating that the legal entity trading as Blue Star Auto Sales is Blue Star Auto Sales Pty Ltd. He also filed a business names extract showing that the legal entity holding the business name MV Auto Workshop is the trustee for Singh Family Trust. It is open to an applicant who brings a proceeding against an entity in relation to a business carried on by the entity under a name registered on the business names register, to start the proceeding against the registered business name.1 This facilitates the starting of a proceeding where the entity may not be known to the applicant. However, it will be usual for an applicant to seek in due course an amendment of the name of the respondent to the name of the entity. This is because any order against a mere business name will be unenforceable. Mr Boers has provided evidence that he has given notice of the proceeding to the entities behind the business names. I am satisfied that he has done so, and tribunal records indicate that representatives of the entities attended an unsuccessful mediation in the proceeding on 3 June 2020. However, neither entity has filed a response or any evidence. In circumstances where Mr Boers has filed evidence of the entities, the entities have been notified of the proceeding, and Mr Boers is self-represented, it may be appropriate for the tribunal, on its own initiative, to amend the names of the 1 Queensland Civil and Administrative Tribunal Rules 2009 (Qld), s 14. -- 2 of 10 -- 3 respondents to the names of the relevant entities. I am inclined to do so in relation to Blue Star Auto Sales but not in respect of MV Auto Workshop. This is because, as will be explained, I am satisfied that Mr Boers has established a claim in respect of the dealer, but not in respect of the safety certificate issuer. Accordingly, I will amend the name of the first respondent from Blue Star Auto Sales to Blue Star Auto Sales Pty Ltd. Hearing on the papers On 16 July 2020, the tribunal made directions for the parties to file material, and then submissions as to whether the application could be determined on the papers or by a telephone hearing. Mr Boers complied, filing a statement dated 30 July 2020, and later filing a submission by email indicating that the application should be determined on the papers. The respondents filed neither material nor submissions. On 3 September 2020 the tribunal directed that the application be determined on the papers on a date to be fixed. Nature of the application, and the relevant law Mr Boers indicated in his application that it is brought under section 14 of Schedule 1 to the Motor Dealers and Chattel Auctioneers Act 2014 (Qld) (‘Motor Dealers Act’). Schedule 1 to the Motor Dealers Act is headed ‘Statutory warranty provisions’. The vehicle in question is a ‘class B warranted vehicle’, as defined in section 3B, both because the odometer reading was over 160,000 km at the time of purchase, and because the car had been built a little over ten years before the purchase. The statutory warranty scheme operates as follows, subject to some exceptions and variations which do not arise in this case. The ‘warrantor’ is the licensee who owns the vehicle immediately before the buyer takes possession under the contract for purchase.2 A warranted vehicle has a ‘defect’ if part of the vehicle does not perform its intended function, or if part of the vehicle has deteriorated to the extent where it cannot reasonably be relied on to perform its intended function.3 However, certain types of defects can be excluded from the statutory warranty scheme by regulation.4 Of current relevance, ‘a defect in … a light other than a warning light or a turn indicator light used as a hazard light’ is not covered by the statutory warranty.5 The statutory warranty period starts at the time of the buyer taking possession and ends when the first of the following happens or is reached: (a) the vehicle travels 1,000 km; 2 Motor Dealers Act, Schedule 1 s 1 (definition of ‘warrantor’). 3 Ibid, Schedule 1 s 2. 4 Ibid, Schedule 1 s 8(c). 5 Motor Dealers and Chattel Auctioneers Regulation 2014 (Qld), s 47. -- 3 of 10 -- 4 (b) 5.00 pm one month after the date of taking possession.6 However, the warranty period is extended for each day or part of a day that the vehicle is being repaired by the warrantor under the statutory warranty.7 The warrantor warrants that the vehicle is free from defects at the time of taking possession and for the warranty period, and that defects reported during the warranty period will be repaired by the warrantor free of charge.8 If the buyer believes the vehicle has a defect covered by the warranty, the buyer must give a written defect notice to the warrantor, and deliver the vehicle to the warrantor for repair.9 The warrantor must then advise the buyer in writing whether the warrantor accepts or refuses to accept that the defect is covered by the statutory warranty. If the warrantor fails to do so within five business days, the warrantor is taken to have accepted that the defect is covered by the statutory warranty.10 If the warrantor accepts that the defect is covered by the statutory warranty, the warrantor must repair it within 14 days.11 The buyer may apply to the tribunal for an order if the warrantor has accepted that the defect is covered by the statutory warranty but has failed to repair the defect, or failed to repair it such that the defective part can be reasonably relied on to perform its intended function.12 The orders that the tribunal may make are set out in Schedule 1 section 15: 15 Orders QCAT may make (1) In a proceeding under section 14, QCAT may make only the following orders— … (d) an order requiring a party to the proceeding to pay a stated amount to a stated person; … (2) Without limiting subsection (1)(d), QCAT may make an order that the warrantor pay to the buyer a stated amount QCAT decides is the reasonable cost of having a defect repaired if— (a) the warrantor has, by warranty advice or otherwise, refused to accept that the defect is covered by the statutory warranty; and (b) the buyer has had the defect repaired by another person; and (c) QCAT decides that the defect was one to which the statutory warranty applied. 6 Motor Dealers Act, Schedule 1 s 4(2). 7 Motor Dealers Act, Schedule 1 s 4(3). 8 Ibid, Schedule 1 s 7(1). 9 Ibid, Schedule 1 s 9(1). 10 Ibid, Schedule 1 s 11. 11 Ibid, Schedule 1 s 12. 12 Ibid, Schedule 1 s 13, s 14. -- 4 of 10 -- 5 Costs are dealt with in Schedule 1 section 18: 18 Costs QCAT may make an order under section 102(1) of the QCAT Act against a party to a proceeding under section 14— (a) only if the party is a respondent against whom QCAT has made a final decision; and (b) only to order the party to pay to the applicant the amount of any prescribed fee paid by the applicant on filing the application for the proceeding. Findings The only evidence that has been provided comes from Mr Boers, but he appears to have set out a comprehensive account of his dealings with Blue Star Auto Sales Pty Ltd. I note that Blue Star Auto Sales Pty Ltd has not responded to or otherwise challenged the evidence. I find the following facts, which are apparent from the papers: (a) Mr Boers purchased the vehicle on 11 December 2019 from a licensed dealer, Blue Star Auto Sales Pty Ltd; (b) the total purchase price was $7,775, comprising: (i) vehicle price of $7,112.96; (ii) stamp duty of $213.39; (iii) registration of $400; and (iv) transfer fee of $28.65; (c) the odometer reading at that time was 183,615 km; (d) the entity trading as MV Auto Workshop had issued a safety certificate for the vehicle on 7 December 2019; (e) Mr Boers took the car to Accelerate Automotive for assessment on 16 December 2019 and 9 January 2020; (f) the odometer reading (noted by Accelerate Automotive) as at 9 January 2020 was 184,631 km; (g) Mr Boers sent emails on various dates between 16 December 2019 and 14 February 2020 to Blue Star Auto Sales Pty Ltd outlining problems that he was having with the car, and requiring repairs under the statutory warranty or a refund; (h) Blue Star Auto Sales Pty Ltd had the car back in its possession for repairs in the periods 18 to 28 December 2019 (though Mr Boers did not pick it up until 30 December 2019 because he had been away) and 13 to 20 January 2020; (i) on 23 January 2020 Mr Boers had repairs carried out at RXA Automotive at a cost of $616, relating to ‘coolant loss issue and oil leak’, and including replacement of O-rings to Vanos Solenoids; and (j) on 18 March 2020, Blue Star Auto Sales Pty Ltd purchased the car back from Mr Boers for $7,500. -- 5 of 10 -- 6 It is unnecessary to set out extensive details of the email correspondence between December 2019 and February 2020. Suffice it to say that Mr Boers’ emails set out the problems in some detail, and/or attached documents from Accelerate Automotive indicating the problems. For example, the email of 7 January 2020 discussed excessive oil loss, excessive coolant loss, and transmission and emission problems. Further, the emails made clear Mr Boers’ view that the problems constituted defects under the Motor Dealers Act, which Blue Star Auto Sales Pty Ltd was obliged to repair under the statutory warranty. Blue Star Auto Sales Pty Ltd emailed a number of responses to Mr Boers. These were considerably shorter. They were generally to the effect that liability was doubtful – for example it was suggested that Mr Boers or Accelerate Automotive had caused various problems – but that Blue Star Auto Sales Pty Ltd would inspect the car when Mr Boers dropped it back in and repair any defects for which it was liable. Blue Star Auto Sales Pty Ltd did not later follow up with any emails that could amount to notice that it refused to accept that particular defects were covered by the statutory warranty. It is common ground that some repairs or attempted repairs were carried out by Blue Star Auto Sales Pty Ltd during the two periods when it had possession of the car for repairs, though Mr Boers’ position is that these efforts fell well short of what was needed to properly fix the larger problems. I do not have the benefit of independent expert evidence, but I accept that RXA Automotive carried out repairs intended to address the problems. However, these too proved insufficient. After Mr Boers made a complaint to the Office of Fair Trading, Blue Star Auto Sales Pty Ltd decided to buy the vehicle back from Mr Boers in March 2020. It is not necessary to explore other assertions made by Mr Boers, such as that there was deceptive and misleading conduct. Such matters do not affect the operation of the statutory warranty scheme. Operation of the statutory warranty scheme in this case I am satisfied that the problems identified by Mr Boers in his emails – apart from one which will be discussed later – constituted defects for the purposes of the statutory warranty. They did not render the car undrivable, but they did prevent the performance of function in a broader sense. In relation to the coolant and oil problems, for example, a car excessively losing oil or coolant for an unidentified reason might drive just as well as one that is not, in the short term at least. However, it is not functioning as intended because it is not a normal expectation of the functioning of the car that the oil or coolant must be frequently topped up. Further, I am satisfied that Mr Boers gave adequate written notice of the defects to Blue Star Auto Sales Pty Ltd within the warranty period. There was a series of relevant email notices sent by Mr Boers within the warranty period, which at its earliest would have ended on 8 or 9 January 2020. Blue Star Auto Sales Pty Ltd did not give notice that it refused to accept that the defects were covered by the statutory warranty. Accordingly, it is taken to have accepted that the defects were covered by the statutory warranty. Blue Star Auto Sales Pty Ltd made some efforts to address the problems, but the repairs it carried out were not adequate. It therefore failed to adequately repair the -- 6 of 10 -- 7 defects within 14 days, which gave Mr Boers the right to apply to the tribunal for orders against Blue Star Auto Sales Pty Ltd. However, there is nothing in the statutory warranty scheme that would make someone in the position of the person or entity operating MV Auto Workshop a warrantor for the purposes of the statutory warranty. As discussed above, ‘warrantor’ is the licensee who owns the vehicle immediately before the buyer takes possession under the contract for purchase. The warrantor in this case is Blue Star Auto Sales Pty Ltd, not MV Auto Workshop. Accordingly, there is no basis for an application under the statutory warranty provisions against MV Auto Workshop. I will therefore dismiss, as misconceived, the application against MV Auto Workshop. This is under section 47 of the QCAT Act. Sums sought by Mr Boers Mr Boers seeks an order for payment to, in effect, compensate him for losses and outgoings for which he says he was not compensated in the buy-back. I note that Blue Star Auto Sales Pty Ltd has not provided evidence or submissions to counter Mr Boers’ contentions in this respect. However, I must assess whether each of the sums can properly be ordered under section 15 of Schedule 1 to the Motor Dealers Act. That section does not describe the bounds of what amounts can properly be ordered under it. However, of course, it is relevant to have regard to the purpose of the statutory warranty scheme, as any sums ordered would have to bear a proper relationship to that purpose. The evident purpose of the scheme is to ensure the repair of particular defects. It is not a general redress scheme for all losses that a purchaser might sustain in purchasing a vehicle. Orders for payment, then, should relate to, or at least be closely connected with, the repair of a defect covered under the scheme or the warrantor’s failure to repair such a defect. It must also be borne in mind that any costs ordered are capped, by section 18 of Schedule 1 to the Motor Dealers Act, at the amount of the prescribed application filing fee, which was $123.20 at the time of filing. Mr Boers has provided a breakdown of the various amounts claimed, and he has provided receipts or bank records for the outgoings claimed. I have decided to allow some claims and costs, but to disallow others, as set out below. Claims allowed I am satisfied that the following amounts claimed should be allowed: (a) $17.49, $42.77, $34.99, and $83.99 for the purchase of coolant on various dates, and $93.99 for a coolant expansion tank (totalling $273.23), on the basis that there was an ongoing defect associated with the loss of coolant, which necessitated this expenditure; (b) $65.49 for the purchase of oil, on the basis that there was an ongoing defect associated with the loss of oil, which necessitated this expenditure; and (c) $616.00 for the work carried out by RXA Automotive, on the basis that this was expenditure incurred to address problems which Blue Star Auto Sales Pty Ltd had not been successful in fixing. Mr Boers claims $80.05 for fuel because, he says, the car was driven several hundred kilometres, without explanation, when it was in the possession of Blue Star Auto Sales -- 7 of 10 -- 8 Pty Ltd for repairs in December 2019. I allow this amount because of its close connection with the first unsuccessful repair attempt. The total of the claims allowed is therefore $1,034.77. Costs Mr Boers claims the filing fee, which was $123.20. He also claims the following, which in my view are properly categorised as costs in that they are expenses or losses incurred in pursuing the application: (a) $52.00 for company or business name searches; (b) $43.44 for flash drives and copy paper; and (c) $750.00 described as ‘Admin, Doc Prep for Office of Fair Trading and [QCAT], Court Time, Mech Reports … Coordination by T. Boers approx 30 Hrs @ $25.00.’ However, costs are capped at the amount of the filing fee. Even then, costs are not automatic, as ordinarily each party to a proceeding must bear the party’s own costs.13 However, where the interests of justice require it, a costs order made be made.14 Factors that may be considered in this context include the relative strengths of the claims made by each party.15 Here, Blue Star Auto Sales Pty Ltd filed nothing to resist Mr Boers’ application. Even though Mr Boers does not succeed in all of his claims, he succeeds in several. In such circumstances, he should be awarded the cost of the filing fee. Accordingly, I award $123.20 in costs. Claims not allowed Mr Boers claims $70.45 for ‘Windscreen Top Rubber Seal’, but this item was not included in the defect notices. Accordingly, it is not covered by the statutory warranty scheme. Mr Boers claims $113.98 for ‘Head Light Repair Kit’, but a defect in such a light is excluded: see paragraph 15 above. Mr Boers claims $20.48 for a taxi fare from his home to the car yard on the date of purchase, and $275 for vehicle stamp duty. It is not apparent why the stamp duty sum differs from the sum shown on the contract. However, in any event, I do not consider that these have sufficient connection with particular repairs to be the subject of an order. Mr Boers also claims $363.28 and $280.00 for the inspections carried out by Accelerate Automotive. I do not consider that they are amounts for which awards should be made. They were, essentially, for diagnostic assessments. There is no requirement for a buyer to obtain an expert assessment in order to issue a defect notice. A defect, as defined in the scheme, is indicated by impairment of function rather than by way of underlying cause. The buyer does not have to diagnose the cause. If a buyer 13 QCAT Act, s 100. 14 Ibid, s 102. 15 Ibid, s 102(3)(c). -- 8 of 10 -- 9 chooses to obtain an assessment, that is not a cost which should be passed on to the dealer. Application for miscellaneous matters On 17 December 2020 Mr Boers filed an application for miscellaneous matters seeking two things. First, he requested that the case be decided as a matter of urgency. Second, he requested that orders be made not only against the respondents but also against Mr Mohammad Rezaeian, who is the director of Blue Star Auto Sales Pty Ltd, and Mr Sarbijit Singh Jakhu whom Mr Boers says is the director of MV Auto Workshop. In support of these requests, Mr Boers says, in summary: (a) Blue Star Auto Sales Pty Ltd has ceased to trade as Blue Star Auto Sales and is now trading as Auto Bargain Centre; (b) Blue Star Auto Sales Pty Ltd’s registration date expires with the Australian Securities and Investment Commission on 13 March 2021; (c) the Office of Fair Trading has advised that it is unlikely that Blue Star Auto Sales Pty Ltd’s motor dealer’s licence will be renewed in 2021; and (d) MV Auto Workshop issued a false safety certificate for the vehicle. However, in my view, these propositions are variously misconceived or immaterial. First, the trading name of Blue Star Auto Sales Pty Ltd is immaterial. Second, the company registration documents that Mr Boers has supplied show 13 March 2021 merely as the ‘next review date’ for Blue Star Auto Sales Pty Ltd. Third, any order that Blue Star Auto Sales Pty Ltd pay a sum of money applies whether or not the company remains licensed. Fourth, whether MV Auto Workshop issued a false safety certificate – a question which I have not decided – is immaterial to Mr Boers’ rights against Blue Star Auto Sales Pty Ltd. As I will dismiss the application against MV Auto Workshop, there is no basis for an order against any individual associated with that business. There is also no basis for an order against Mr Rezaeian. He is neither a party to the proceeding nor the warrantor under the statutory warranty scheme. The warrantor was the licensed dealer, Blue Star Auto Sales Pty Ltd, and so any orders should be made against the company. In relation to the request for urgency, I appreciate that the matter is important to Mr Boers. He feels very aggrieved, and he has put a lot of effort into preparing his case. However, the tribunal has many cases to deal with, each of them important to the parties concerned, which it must deal with in an orderly way. No basis for special urgency in this case is evident. Accordingly the application for miscellaneous matters will be refused. Conclusion Mr Boers has established that the car had some defects covered by statutory warranty, which Blue Star Auto Sales Pty Ltd failed to satisfactorily repair. For the reasons explained above, it is appropriate that Blue Star Auto Sales Pty Ltd be ordered to pay him $1,034.77 plus $123.20 in costs. I will allow two weeks for payment, which is -- 9 of 10 -- 10 sufficient in my view given that Blue Star Auto Sales Pty Ltd must have anticipated, when it chose not to file any material, the distinct possibility of an order against it. The other orders will be to amend the name of the first respondent, to dismiss the application against MV Auto Workshop, and to refuse the application for miscellaneous matters. -- 10 of 10 --