January 21, 2021

Used car dealer fined over ‘as is where is’ claims

Auckland motor vehicle trader, BNZ JP Euro Auto Parts Limited has been fined $67,500 for misrepresenting consumers’ rights under the Consumer Guarantees Act 1993 (CGA) and for failing to provide Consumer Information Notices (CINs).

BNZ JP Euro operates a car and truck wrecker business selling automotive parts in Papakura. At the time of the offending, it was also selling low-priced used motor vehicles, which were advertised on Facebook.

Vehicle dealer fined
Papakura vehicle dealer fined over ‘as is where is’ claims & CINs

The dealer offered vehicles for sale on an “as is where is” basis and asked purchasers to sign an agreement acknowledging there was “no warranty implied or given within it”.

According to Commerce Commission, the CGA, in fact, applies to used motor vehicles and dealers cannot get away by using ‘as is where is’ .

“Those statements were misleading, because they suggested that consumers had no rights if something went wrong with the vehicle when in fact the CGA applies to used motor vehicles. Traders cannot evade their responsibilities to provide guarantees and remedies under the CGA by using phrases such as ‘as is where is.’ Where consumers buy vehicles from traders, rather than private sellers, the purchase will always be covered by statutory guarantees, including that the vehicle is of acceptable quality and complies with its description,” said Commerce Commission Chair, Anna Rawlings.

Rawlings said “this trader’s conduct had real impacts on its customers…In four cases we know of, consumers purchased vehicles that required substantial repairs. In at least two of those cases the cost was nearly the same as the purchase price of the vehicle itself”.

BNZ JP Euro had earlier pleaded guilty to six representative charges under the Fair Trading Act 1986, mostly relating to the sale of 77 used motor vehicles between August 2017 and December 2018.

BNZ JP Euro never offered Consumer Information Notice (CINs) with the vehicles it sold.

All used motor vehicles must have an accurate and complete CIN when displayed for sale by a used motor vehicle trader. If buying online, the CIN must be displayed by the advertisement for that vehicle.