Author	CourtKeys.com
Published	9 December 2017
Jurisdiction	New Zealand
Website	www.CourtKeys.com

On this page:

• Motor Vehicle Disputes Tribunal Jurisdiction
• Claims and remedies under the Sale of Goods Act 1908
• Claims and remedies under the Fair Trading Act 1986
• Claims and remedies under the Consumer Guarantees Act 1993
• Claims and remedies under the Contractual Remedies Act 1979
• Extending Jurisdiction

The Motor Vehicle Disputes Tribunal deals with civil disputes that:

1.  are about vehicles that have some kind of engine and are ordinarily for personal, domestic and household use; and

2.  are to do with either the Sale of Goods, the Fair Trading, the Consumer Guarantees or the Contractual Remedies Acts; and

3.  involve a “motor vehicle trader”; and

4.  do not involve a claim for more than $100,000 (or more if all parties agree in writing).

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The jurisdiction of the Motor Vehicle Disputes Tribunal and the limitations on that jurisdictions are set out at sections 89 and 90:

89 Jurisdiction of Disputes Tribunal

(1) A Disputes Tribunal has jurisdiction, on the application of any party, to –                      

(a) inquire into and determine any application or claim, as the case may be, under any of the following Acts if that application or claim is in respect of the sale of any motor vehicle:

(i) the Sale of Goods Act 1908:

(ii) the Fair Trading Act 1986:

(iii) the Consumer Guarantees Act 1993:

(iv) the Contractual Remedies Act 1979; and

(b) make any order that a court or a Disputes Tribunal constituted under the Disputes Tribunals Act 1988 may make under, –

(i) in the case of proceedings under the Sale of Goods Act 1908, section 53 of that Act; or

(ii) in the case of proceedings under the Fair Trading Act 1986, section 43(2) of that Act; or

(iii) in the case of proceedings under the Consumer Guarantees Act 1993, section 39 or 47 of that Act; or

(iv) in the case of proceedings under the Contractual Remedies Act 1979, section 9 of that Act.

90 Limits on jurisdiction of Disputes Tribunals

(1) A Disputes Tribunal has jurisdiction only if –

(a) one party, but not both parties, to the application or claim is a motor vehicle trader; and

(b) the total sum of the application or claim does not exceed $100,000.

(2) Despite section (1)(b), the parties to the application or claim may consent in writing to the determination of the application or claim by the Disputes Tribunal.

Section 6 of the Motor Vehicle Sales Act 2003 defines “motor vehicle” as follows:

motor vehicle –

(a) means any of the following:

(i) a road vehicle that is drawn of propelled by mechanical power and is of a kind ordinarily acquired by consumers for personal, domestic or household use:

(ii) a vehicle of any other class or description declared by the Governor-General, by Order in Council, to be a motor vehicle for the purposes of this Act; but

(b) does not include any of the following:

(i) [Repealed]

(ii) a moped:

(iii) a motor cycle, the total cylinder capacity of which does not exceed 60 cubic centimetres:

(iv) a tractor or farm machinery:

(v) a trailer:

(vi) a vehicle of any other class or description declared by the Governor-General, by Order in Council, not to be a motor vehicle for the purposes of this Act:

(vii) a vehicle that the Director has declared is not a motor vehicle under section 168A of the Land Transport Act 1998:

(viii) a mobility device

A “motor vehicle trader” is defined at section 7 of the Motor Vehicle Sales Act 2003:

In this Act, motor vehicle trader –

(a) means any person who carries on the business of motor vehicle trading (whether or not that person carries on any other business); and

(b) includes –

(i) [Repealed]

(ii) an importer:

(iii) a wholesaler:

(iv) a car auctioneer:

(v) a car consultant.

Section 8 of the Motor Vehicle Sales Act 2003 is titled “Who is treated as a motor vehicle trader”:

(1) A person is treated as carrying on the business of motor vehicle trading for the purposes of this Act if –

(a) the person holds out that the person is carrying on the business of motor vehicle trading; or

(b) in any specified period, the person sells more than 6 motor vehicles, unless that person proves that those motor vehicles were not sold for the primary purpose of gain; or

(c) in any specified period, the person imports more than 3 motor vehicles, unless that person proves that those motor vehicles were not imported to be sold for the primary purpose of gain.

(2) For the purposes of subsection (1)(a), a person holds out that the person is carrying on the business of motor vehicle trading if that person –

(a) advertises or notifies or states that the person carries on the business of motor vehicle trading; or

(b) in any way represents that the person is ready to carry, or is carrying, on the business of motor vehicle trading.

(3) Subsection (1)(b) does not apply to any trustee corporation (within the meaning of section 2(1) of the Trustee Act 1956) acting in the capacity of executor, administrator, trustee, guardian, committee, manager, agent, attorney, or liquidator, or in any fiduciary capacity, unless the trustee corporation is acting on behalf of the same person or estate.

If you have some kind of issue that falls outside the jurisdiction of the Motor Vehicle Disputes Tribunal then you may have to raise that in the Disputes Tribunal, District or High Court instead. An example of a motor vehicle dispute that falls outside the jurisdiction of the Motor Vehicle Disputes Tribunal would be where you bought a defective vehicle from an ordinary person instead of a “motor vehicle trader”. Disputes Tribunal has jurisdiction up to $15,000 or $20,000 if the parties agree to that. The District Court can hear claims up to $200,000. The High Court is a court of “unlimited jurisdiction”. There is no limit on the value of the claims that the High Court can deal with. See the CourtKeys.com chapters on the Disputes Tribunal, District Court, and High Court for more about those particular forums.

Claims and remedies under the Sale of Goods Act 1908

The Sale of Goods Act 1908 contains several provisions that can be quite important to motor vehicle buyers. Section 14 provides:

14 Implied undertaking as to title, etc

In a contract of sale, unless the circumstances of the contract are such as to show a different intention, there is –

(a) an implied condition on the part of the seller that in the case of a sale he has a right to sell the goods, and that in the case of an agreement to sell he will have a right to sell the goods at the time when the property is to pass:

(b) an implied warranty that the buyer shall have and enjoy quiet possession of the goods:

(c) an implied warranty that the goods are free from any charge or encumbrance in favour of any third party, not declared or known to the buyer before or at the time when the contract is made.

Section 16 of the Sale of Goods Act 1908 implies conditions as to quality and fitness for purpose into contracts for goods:

16 Implied conditions as to quality or fitness

Subject to the provisions of this Act and of any statute in that behalf, there is no implied warranty or condition as to the quality or fitness for any particular purpose of goods supplied under a contract of sale, except as follows:

(a) where the buyer, expressly or by implication, makes known to the seller the particular purpose for which the goods are required, so as to show that the buyer relies on the seller’s skill or judgment, and the goods are of a description which it is in the course of the seller’s business to supply (whether he is the manufacturer or not), there is an implied condition that the goods shall be reasonably fit for such purpose:     

provided that in the case of a contract for the sale of a specified article under its patent or other trade name, there is no implied condition as to its fitness for any particular purpose:

(b) where the goods are bought by description from a seller who deals in goods of that description (whether he is the manufacturer or not), there is an implied condition that the goods shall be of merchantable quality:

provided that if the buyer has examined the goods, there shall be no implied condition as regards defects which such examination ought to have revealed:

[…]

Provisions relating to sales by sample could also apply to some motor vehicle contracts. Section 17 of the Sale of Goods Act 1908 provides:

17 Sale by sample

(1) A contract of sale is a contract for sale by sample where there is a term in the contract, express or implied, to that effect.

(2) In the case of a contract for sale by sample there is an implied condition –

(a) that the bulk shall correspond with the sample in quality;

(b) that the buyer shall have a reasonable opportunity of comparing the bulk with the sample; and

(c) that the goods shall be free from any defect, rendering them unmerchantable, which would not be apparent on reasonable examination of the sample.

Section 53 of the Sale of Goods Act 1908 provides for the remedy of specific performance. Fundamentally, specific performance requires a party to a contract to do what they agreed to do rather than, say, paying compensation for not doing it. The section provides:

53 Specific performance

(1) In an action for breach of contract to deliver specific or ascertained goods the court may, if it thinks fit, on the application of the plaintiff, by its judgment direct that the contract shall be performed specifically, without giving the defendant the option of retaining the goods on payment of damages.

(2) The judgment may be unconditional, upon such terms and conditions as to damages, payment of the price, and otherwise, as the court deems just; and the application by the plaintiff may be made at any time before judgment.

The applicability of the Sale of Goods Act 1908 may be limited or excluded altogether if the buyer and seller agree to that. Some specific provisions will also be excluded automatically where the Consumer Guarantees Act 1993 applies. Those exclusions are set out in section 56A of the Sale of Goods Act 1908.

Claims and remedies under the Fair Trading Act 1986

The Fair Trading Act 1986 contains various provisions concerning misleading and deceptive conduct, unfair practices, consumer information standards, layby sales, uninvited direct sales, extended warranties and auctions. Provisions of particular relevance:

9 Misleading and deceptive conduct generally

No person shall, in trade, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

10 Misleading conduct in relation to goods

No person shall, in trade, engage in conduct that is liable to mislead the public as to the nature, manufacturing process, characteristics, suitability for a purpose, or quantity of goods.

17 Offering gifts and prizes

No person shall, –

(a) in connection with the supply or possible supply of goods or services or with the promotion by any means of the supply or use of goods or services; or

(b) in connection with the sale or grant or the possible sale or grant of an interest in land or with the promotion by any means of the sale or grant of an interest in land, –

offer gifts, prizes, or other free items with the intention of not providing them or of not providing them as offered.

36U Disclosure requirements relating to extended warranty agreements

(1) A warrantor must ensure that –

(a) every extended warranty agreement –

(i) is in writing; and

(ii) is expressed in plain language; and

(iii) is legible; and

(iv) is presented clearly; and

(v) complies with the requirements of subsection (2); and

(b) a copy of the agreement is given to the consumer at the time the consumer purchases the extended warranty.

(2) The requirements referred to in subsection (1)(a)(v) are that –

(a) the following information is set out on the front page of the agreement:

(i) a summarised comparison between the relevant Consumer Guarantees Act 1993 guarantees and the protections provided by the extended warranty agreement; and

(ii) a summary of the consumer’s rights and remedies under the Consumer Guarantees Act 1993; and

(iii) a summary of the consumer’s right to cancel the agreement under section 36V; and

(iv) the warrantor’s name, street address, telephone number, and email address; and

(b) all the terms and conditions of the agreement are included in the agreement, including –

(i) the rights and obligations of the warrantor and the consumer; and

(ii) the duration and expiry date of the agreement (including whether or not the agreement expires when a claim is made); and

(c) the total price payable under the agreement is disclosed in the agreement; and

(d) the agreement is dated.

(3) In addition to the requirements for written disclosure under subsections (1) and (2), the warrantor must, where reasonably practicable (for example, where the agreement is entered into between a warrantor and consumer in each other’s presence or by telephone), give the consumer oral notice, before the agreement is entered into, of –

(a) the consumer’s right to cancel the agreement within 5 working days; and

(b) how the consumer may cancel the agreement.

Remedies under the Fair Trading Act 1986 are set out at section 43 of that Act. Those remedies include:

1.   a declaration that a contract and any collateral contract, such as a collateral credit agreement, is void;

2.  an order varying a contract;

3.  an order for a refund of money;

4.  an order for payment of damages;

5.  an order to repair;

6.  an order to provide parts; and

7.  an order to provide certain services.

Section 43(4) of the Fair Trading Act 1986 defines a “collateral credit agreement” as follows:

(4) In subsection (3)(a) to (d), collateral credit agreement, in relation to a contract for the supply of goods, means a contract or an agreement that –

(a) is arranged or procured by the supplier of the goods; and

(b) is for the provision of credit by a person other than the supplier to enable person A to pay, or defer payment, for the goods.

“Person A” is defined elsewhere in section 43 as someone who “has suffered, or is likely to suffer, loss or damage by conduct of another person”.

Claims and remedies under the Consumer Guarantees Act 1993

Part 1 of the Consumer Guarantees Act 1993 provides various guarantees for the supply of goods. These are often called “consumer protection provisions” because they are there to protect buyers against suppliers of unsatisfactory goods.

The sections under part 1 of the Consumer Guarantees Act 1993:

5          Guarantees as to title

5A        Guarantee as to delivery

6          Guarantee as to acceptable quality

7          Meaning of acceptable quality

7A        Guarantee of acceptable quality in supply of gas and electricity

7B        Relationship of section 7A with rest of Act

8          Guarantees as to fitness for particular purpose

9          Guarantee that goods comply with description

10        Guarantee that goods comply with sample

11        Guarantee as to price

12        Guarantee as to repairs and spare parts

13        Express guarantees

Applied to motor vehicles, these guarantees require, among other things, that:

1.  vehicles are of “acceptable quality” at the time they are sold;

2.  vehicles are fit for any particular purposes represented by the motor vehicle trader or communicated to the trader at or before the time of sale;

3.  vehicles correspond with any description given at or before the time of sale;

4.  vehicles correspond with any sample or demonstration model shown at or before the time of sale; and

5.  manufacturers will ensure there are spare parts and facilities available to repair the vehicle for a reasonable time after the vehicle is supplied.

If a vehicle does not comply with a guarantee then, under section 18 of the Consumer Guarantees Act 1993:

(1) Where a consumer has a right of redress against the supplier in accordance with this Part in respect of the failure of any goods to comply with a guarantee, the consumer may exercise the following remedies.

(2) Where the failure can be remedied, the consumer may –

(a) require the supplier to remedy the failure within a reasonable time in accordance with section 19:

(b) where a supplier who has been required to remedy a failure refuses or neglects to do so, or does not succeed in doing so within a reasonable time, –

(i) have the failure remedied elsewhere and obtain from the supplier all reasonable costs incurred in having the failure remedied; or

(ii) subject to section 20, reject the goods in accordance with section 22.

(3) Where the failure cannot be remedied or is of a substantial character within the meaning of section 21, the consumer may –

(a) subject to section 20, reject the goods in accordance with section 22; or

(b) obtain from the supplier damages in compensation for any reduction in value of the goods below the price paid or payable by the consumer for the goods.

(4) In addition to the remedies set out in subsection (2) and subsection (3), the consumer may obtain from the supplier damages for any loss or damage to the consumer resulting from the failure (other than loss or damage through reduction in value of the goods) which was reasonably foreseeable as liable to result from the failure.

A case could come before the Motor Vehicle Disputes Tribunal where there is some dispute about whether a vehicle complies with a guarantee or the appropriate remedy for non-compliance.

As to the orders that the Motor Vehicle Disputes Tribunal may make, section 39 of the Consumer Guarantees Act 1993 provides:

(1) Where a consumer cancels under this Act a contract for the supply of services, a court or a Disputes Tribunal, in any proceedings or on application made for the purpose, may from time to time if it is just and practicable to do so, make an order or orders under this section.

(2) An order under this section may –

(a) vest in any party to the proceedings the whole or any part of any real or personal property that was the subject of the contract or was the whole or part of the consideration for it:

(b) direct any party to the proceedings to transfer or assign to any other such party or to give him or her the possession of the whole or any part of any real or personal property that was the subject of the contract or was the whole or part of the consideration for it:

(c) without prejudice to any right to recover damages, direct any party to the proceedings to pay to any other such party such sum as the court or Tribunal thinks just:

(d) direct any party to the proceedings to do or refrain from doing in relation to any other party any act or thing as the court or Tribunal thinks just:

(e) permit a supplier to retain the whole or part of any money paid or other consideration provided in respect of the services under the contract.

[…]

The reference to “consideration” in that section is a reference to the promised value of a contract. For instance, where a seller is to transfer a vehicle to a buyer in return for $10,000: The seller’s consideration is the vehicle and the buyer’s consideration is the purchase price.

Section 47 of the Consumer Guarantees Act 1993 makes clear that the District Court and Disputes Tribunal can only make awards under that Act so long as they do not exceed their jurisdictions.

Claims and remedies under the Contractual Remedies Act 1979

Section 9 of the Contractual Remedies Act 1979 gives the Motor Vehicle Disputes Tribunal the power to:

(a) vest in any party to the proceedings, or direct any such party to transfer or assign to any other such party or to deliver to him the possession of, the whole or any part of any real or personal property that was the subject of the contract or was the whole or part of the consideration for it:

(b) subject to section 6, direct any party to the proceedings to pay to any other such party such sum as the court thinks just:

(c) direct any party to the proceedings to do or refrain from doing in relation to any other party any act or thing as the court thinks just.

The power to make orders under section 9 is discretionary, but the discretion only becomes available once a contract is cancelled. So a claim for a remedy under the Contractual Remedies Act 1979 would have to be about a contract that has been cancelled.

Section 7 of the Contractual Remedies Act 1979 deals with cancellation:

(1) Except as otherwise expressly provided in this Act, this section shall have effect in place of the rules of the common law and of equity governing the circumstances in which a party to a contract may rescind it, or treat it as discharged, for misrepresentation or repudiation or breach.

(2) Subject to this Act, a party to a contract may cancel it if, by words or conduct, another party repudiates the contract by making it clear that he does not intend to perform his obligations under it or, as the case may be, to complete such performance.

(3) Subject to this Act, but without prejudice to subsection (2), a party to a contract may cancel it if –

(a) he has been induced to enter into it by a misrepresentation, whether innocent or fraudulent, made by or on behalf of another party to that contract; or

(b) a term in the contract is broken by another party to that contract; or

(c) it is clear that a term in the contract will be broken by another party to that contract.

(4) Where subsection (3)(a) or subsection (3)(b) or subsection (3)(c) applies, a party may exercise the right to cancel if, and only if, –

(a) the parties have expressly or impliedly agreed that the truth of the representation or, as the case may require, the performance of the term is essential to him; or

(b) the effect of the misrepresentation or breach is, or, in the case of an anticipated breach, will be, –

(i) substantially to reduce the benefit of the contract to the cancelling party; or

(ii) substantially to increase the burden of the cancelling party under the contract; or

(iii) in relation to the cancelling party, to make the benefit or burden of the contract substantially different from that represented or contracted for.

[…]

Extending jurisdiction

The jurisdiction of the Motor Vehicle Disputes Tribunal can be extended beyond $100,000 so long as all parties agree to that in writing. Extending jurisdiction can be a cost-effective option because the filing fee for making a claim is just $50 and lawyers are not allowed to represent parties except in some limited circumstances. Those limited circumstances are where the lawyer is a party to the dispute or where the lawyer is a majority shareholder of a company that is a party to the dispute.

You could discount your claim to bring it within the $100,000 threshold if parties do not agree to extend jurisdiction. Otherwise you would need to make your claim in the District Court or High Court. See those chapters of CourtKeys.com dealing with District Court claims and High Court claims for more on those kinds of claims.

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