Key issues:
- On 1 September 2019, Queensland will be the first state in Australia to enact legislation that gives greater protection to buyers of defective motor vehicles.
- It will now be easier for consumers to pursue claims against motor vehicle dealers and manufacturers for defective motor vehicles (often known as ‘lemons’) in the Queensland Civil and Administrative Tribunal.
- Until the new laws are introduced, only consumers with vehicles worth $25,000 or less have access to the Queensland Civil and Administrative Tribunal. Motorists whose vehicles are worth more than $25,000 can only bring a claim in the Courts - a more costly, complicated and time consuming process.
Queensland is the first state in Australia to enact legislation that gives greater protection to buyers of defective motor vehicles (which includes cars, motorcycles, motorhomes and caravans).
It will now be easier for consumers to pursue claims against motor vehicle dealers and manufacturers for defective motor vehicles (often known as ‘lemons’) in the Queensland Civil and Administrative Tribunal (QCAT). The new laws, aptly dubbed the “lemon laws” were passed in Parliament in April 2019 and will come into effect from 1 September 2019.
The explanatory notes accompanying the lemon laws define the term “lemon” to include “new motor vehicles with numerous, severe defects that reoccur despite multiple repair attempts or where defects have caused a new motor vehicle to be out of service for a prolonged period of time”.
Motor vehicles fall within the ambit of the Australian Consumer Law (ACL) which contains various consumer guarantees and warranties for both new and used vehicles. The Motor Dealers and Chattel Auctioneers Act 2014 (MDCA Act) also contains a statutory warranty in relation to the sale of certain used motor vehicles by motor dealers or chattel auctioneers.
Although QCAT can currently hear disputes regarding consumer guarantees and statutory warranties for motor vehicles, until the new laws are introduced, only consumers with vehicles worth $25,000 or less have access to QCAT. As a result, motorists whose vehicles are worth more than $25,000 can only bring a claim in the Courts - a more costly, complicated and time consuming process than a QCAT application.
What are the amendments affecting motorists?
On 3 April 2019, the Queensland Government passed the Queensland Civil and Administrative Tribunal and Other Legislation Amendment Act 2019 (Qld). The changes brought about by this legislation are multifaceted.
The legislation amends the current Queensland Civil and Administrative Tribunal Act 2009 (Qld), most notably by lifting the jurisdictional limit of QCAT from $25,000 to claims of up to $100,000 for new and used motor vehicles in relation to:
- disputes under the ACL consumer guarantees for the supply of new and used motor vehicles; and
- claims relating to statutory warranties under the MDCA Act for used motor vehicles (excluding caravans or motorcycles).
The amendments will also restore statutory warranties for used vehicles (excluding caravans or motorcycles) that are more than 10 years old, or have 160,000km or more on the odometer (known as “class B warranted vehicles”). These statutory warranties provide consumers who have purchased a used vehicle fitting this description, with a warranty period of 1 month or 1,000km (which starts at the time they take possession).
How will these changes affect you?
Lifting the jurisdictional limit of QCAT has obvious advantages for consumers. Most significantly, consumers seeking damages of $25,000 or more for a claim for breach of a consumer guarantee or statutory warranty will now have access to QCAT without the need to go to Court. Consequently, it will be faster, cheaper and easier for consumers to commence legal proceedings against motor vehicle dealers and manufacturers. It is therefore extremely important for dealers and manufacturers to have a clear understanding of their obligations under the ACL so that they are in a better position to resolve disputes with customers who have purchased motor vehicles, before those disputes are escalated to QCAT.
The re-instatement of the “class B warranted vehicle” statutory warranty is an additional warning to motor vehicle dealers as consumers who purchase older second hand vehicles will now have an enforceable right against the dealer in respect of defects, should the vehicle turn out to be defective.
Queensland's Attorney-General and Minister for Justice Yvette D’Ath hopes that the new measures will “build levels of trust in the industry and benefit the majority of motor dealers who are doing the right thing by offering best practice in terms of refunds, replacements and repairs at no cost, when a vehicle is faulty.”
We will keep you updated on developments with the lemon laws once they come into effect. In the meantime, if you would like to discuss the upcoming changes in further detail, please contact Brett Bolton from the HopgoodGanim Lawyers’ Dispute Resolution team.