Motor Vehicle Disputes Tribunal decisions – October

Both cases involved serious faults that made the vehicles unsafe or unusable. The Tribunal upheld the buyers’ right to reject and ordered major remedies.

Decision 1: Hernandez v AR Cars Limited t/a Auto Mates Cars [2025] NZMVDT 357

Vehicle: Chrysler Jeep Cherokee (2015)
Purchase price: $22,995

Summary of the issues

The complainant purchased the vehicle on finance in September 2024. 3 months later, the transfer box failed, leaving the vehicle undriveable.

Repair costs were quoted as being between $5,295.75 and $17,215.50. The complainant tried to reject the vehicle under the Consumer Guarantees Act (CGA).

The trader argued the failure was not present at sale and referred the complainant to his mechanical breakdown insurance.

Tribunal decision

The Tribunal found the vehicle did not meet the CGA guarantee of acceptable quality, given the short time between purchase and major failure.

The fault was serious enough that a reasonable consumer would not have bought the vehicle if they had known about it.

The trader also breached its obligation under the CGA to fix the problem when asked.

The Tribunal said the mechanical breakdown insurance did not affect the trader’s obligations under the Consumer Guarantees Act. Insurance cannot replace those obligations.

 The Tribunal upheld the rejection. The trader must:

• reimburse all principal payments under the finance agreement
• pay $4,942.36 in damages, including interest and diagnostic costs
• take over the complainant’s loan obligations.

Decision 2: Sprosen v A Grade Wholesales Limited [2025] NZMVDT 375

Vehicle: Honda Accord (2003)
Purchase price: $13,250

Summary of the issues

The complainant bought the vehicle on finance in June 2025. It had major faults, including structural damage, pulling to the right, worn tyres, illegally modified shocks, and tampered airbags.

The complainant tried to reject the vehicle. The trader did not attend the hearing. They claimed they were not the seller, even though the sale agreement named them.

Tribunal decision

The Tribunal found A Grade Wholesales was the supplier. The vehicle breached the Consumer Guarantees Act because it was unsafe and not durable.

The defects were so serious that a reasonable buyer would not have bought the vehicle. The buyer was right to reject it under the Act.

 The trader was ordered to:

• reimburse $2,105.53 for payments made under the finance agreement
• take over the buyer’s loan obligations.