Slight Legal Question - Consumer Guarantees Act

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AidanS

458 posts

Ultimate Geek

#162201 1-Feb-2015 21:46

Hello,

I need a little bit of help with a situation.
So I'm buying this car from a car dealership, the car is second hand and is a fresh import from Japan.

Today I paid down a deposit and signed the "purchasing" agreement after I carefully read all of the "variable" sections of the agreement (the car model, make the rego and wof requirements and all the corrections we had agreed the dealer must make to the car before I took ownership of it). This was all good until I got home and actually read all the fine print on the agreement.

One of the clauses is that "I agree that I am purchasing the car for business purposes and that the Consumer Guarantees act will not apply to this purchase".

I didn't even read that and am a tad frustrated that I hadn't read it earlier. It's probably worth mentioning that at no stage did I mention I am purchasing the car for business purposes and I imagine this is common practise for all their invoices and agreements they make to their customers.

I've paid a $600 deposit today, and I am going to pay the remainder of the money owed ($8000) tomorrow and am going to collect the car tomorrow. Is there anything I can do to correct this? I realise I've already signed it, however the car won't be used for business purposes and it would be nice to be able to plea consumer guarantees act if anything major goes wrong in the first couple of years.

At the end of the day, it's not a huge deal for this transaction as the car "should" be fine (newer car with low KMs and VTNZ pre-purchase inspection + WOF) and the chance of claiming consumer guarantees act (hopefully) shouldn't come up.

Is this legal what they're doing? Is there anything I can do to take this clause out (obviously I can ask them to agree to remove it, which I doubt they will)?

Thanks guys, sorry for the bad wording had to get this out before bed.

Cheers.

gregmcc

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#1227346 1-Feb-2015 21:54

is it been paid for from your personal funds or business funds?, if personal then the CGA applies, if business then it doesn't.

EDIT after having another read of your question, a company cannot contract out of the CGA by inserting a clause like that, I would maybe point out to the car dealer that this clause is illegal, you may want to have a read of the CGA yourself and print out the relevant section.

mdf

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#1227350 1-Feb-2015 22:08

Usually not - section 43 of the Consumer Guarantees Act says this only works if all parties are in trade (technically it's an offence to try and do so).

BUT

What sort of car is it? The CGA doesn't apply to goods not "ordinarily acquired for personal, domestic, or household use or consumption", even if you aren't in trade/business. For example, if I (not in trade) buy an industrial forklift for my awesome personal toolshed + workshop (and please, let that statement be true someday), then the CGA still wouldn't apply even though it's for my personal use.

code15

198 posts

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#1227351 1-Feb-2015 22:08

As above, it's illegal to try and contract out of the CGA it is a business in trade and you are purchasing as a consumer.

sbiddle

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#1227352 1-Feb-2015 22:09

INAL but such a clause is probably illegal under the new CGA rules that came into play last year.

You can't have a generic clause exempting you from CGA obligations, but can certainly still have clauses around this.

mudguard

2114 posts

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#1227363 1-Feb-2015 22:36

I wouldn't have thought the CGA applies to used vehicles?

wasabi2k

2096 posts

Uber Geek

#1227369 1-Feb-2015 22:55

mudguard: I wouldn't have thought the CGA applies to used vehicles?

why not if purchased from a dealership "in trade". It's just a product they are selling.

mattwnz

20141 posts

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#1227370 1-Feb-2015 23:10

You should run that clause past the ministry of consumer affairs to see if it is right. not sure how resourced they are though to deal with it. The citizens advice bureau though should also know.

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dickytim

2514 posts

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#1227381 2-Feb-2015 06:23

Motor vehicles have their own act, best refer to that.

scuwp

3885 posts

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#1227395 2-Feb-2015 07:34

I would say it's just an oversight, a clause that the seller forgot to cross out. Why not just take the paperwork back to them, ask them to cross out and initial it, and then carry on with the sale.

Lazy is such an ugly word, I prefer to call it selective participation

jonathan18

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#1227408 2-Feb-2015 08:43

mudguard: I wouldn't have thought the CGA applies to used vehicles?

As someone who has benefited greatly from the coverage, I know well and good that it does!

Nearly four years ago we bought a car only after having it checked by an inspection service. Discovered after a few weeks it had a blown head gasket. The dealer replaced the engine (including shipping the replacement engine to a different city the other end of the island). A few months later the gears stopped working properly - again the dealer paid to have that fixed. Another problem I can't recall now either - again he had it fixed.

So, yes, a complete lemon and we've got rid of it since - and if the CGA hadn't applied I'd have had to pay for every single one of those faults to be fixed.

And this is the reason I'll never contemplate buying a s/h car privately (unless it is covered by a new car warranty).

As to the OP - agree chances are the clause's inclusion is just a mistake by the dealer, but would totally recommend that you request it be deleted prior to picking up the car and paying the balance owing. While it may not be legally enforceable by the dealer (ie, the inability to contract out), if the dealer's not willing to remove the clause now it may be an indication of how he may behave SHOULD you need to call on those CGA protections in the future. As my story shows, this can be invaluable.

itxtme

2102 posts

Uber Geek

#1227425 2-Feb-2015 09:12

If he indicates he doesnt want to do it, you may also want to point out that is is against the Fair Trading Act to misrepresent your legal rights. The airlines are one example that used to try and get away with no compensation, despite the aviation act requiring they do have to pay it.

richms

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#1227432 2-Feb-2015 09:31

Is it a car dealership you are buying from or a "wholesale direct importer" place?

If you start to say that you are wanting CGA coverage, they may then just say that they are a trade supplier and are not able to sell to you. Did that a few times at work when people who were not in the trade came in to buy things who were obviously clueless about what they were wanting to buy and not listening./

Richard rich.ms

heylinb4nz

656 posts

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#1227437 2-Feb-2015 09:46

jonathan18:
mudguard: I wouldn't have thought the CGA applies to used vehicles?

.....And this is the reason I'll never contemplate buying a s/h car privately (unless it is covered by a new car warranty)......

Sooo true, I got stung badly last year, 2 weeks ownership on a privately purchased car only to have a rod thrown through the block and a $6000 engine replacement...not a leg to stand on :(

AidanS

458 posts

Ultimate Geek

#1227776 2-Feb-2015 14:56

Thanks for the advice guys, I'm buying a 2006 Subaru Legacy. I will bring up the act with them and get the term altered for the agreement. They are a car importer, not a wholesaler (West Auckland)

Cheers,
Aidan.