Edwards v Caravan & RV Central Pty Ltd [2022] NSWCATCD 26 | Case summary

NCAT Consumer and Commercial|2021-10-06

Relevant legal principles

The Applicants' case is that the Respondent in supplying the Caravan to them contravened the consumer guarantees in s 54 and s 55 of the ACL NSW. Those sections state, relevantly: 54 Guarantee as to acceptable quality (1) If: (a) a person supplies, in trade or commerce, goods to a consumer; and (b) … there is a guarantee that the goods are of acceptable quality. (2) Goods are of acceptable quality if they are as: (a) fit for all the purposes for which goods of that kind are commonly supplied; and (b) acceptable in appearance and finish; and (c) free from defects; and (d) safe; and (e) durable; as a reasonable consumer fully acquainted with the state and condition of the goods (including any hidden defects of the goods), would regard as acceptable having regard to the matters in subsection (3). (3) The matters for the purposes of subsection (2) are: (a) the nature of the goods; and (b) the price of the goods (if relevant); and (c) any statements made about the goods on any packaging or label on the goods; and (d) any representation made about the goods by the supplier or manufacturer of the goods; and (e) any other relevant circumstances relating to the supply of the goods. (4) … (5) … (6) Goods do not fail to be of acceptable quality if: (a) the consumer to whom they are supplied causes them to become of unacceptable quality, or fails to take reasonable steps to prevent them from becoming of unacceptable quality; and (b) they are damaged by abnormal use. (7) … 55 Guarantee as to fitness for any disclosed purpose etc. (1) If: (a) a person (the supplier ) supplies, in trade or commerce, goods to a consumer; and (b) … ; there is a guarantee that the goods are reasonably fit for any disclosed purpose, and for any purpose for which the supplier represents that they are reasonably fit. (2) A disclosed purpose is a particular purpose (whether or not that purpose is a purpose for which the goods are commonly supplied) for which the goods are being acquired by the consumer and that: (a) the consumer makes known, expressly or by implication, to: (i) the supplier; or (ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the goods were conducted or made; or (b) ... (3) This section does not apply if the circumstances show that the consumer did not rely on, or that it was unreasonable for the consumer to rely on, the skill or judgment of the supplier, the person referred to in subsection (2)(a)(ii) … , as the case may be.
The principles to be applied in determining whether goods are of an acceptable quality were succinctly stated by Derrington J in Vautin v By Winddown (No 4) [2018] FCA 426; (2018) 362 ALR 702 as follows: "[142] Mr Vautin asserts that the existence of the construction defects in the sandwich core panels of Revive means that the vessel is not of an "acceptable quality" within the meaning of the guarantee imposed by s 54 of the ACL. In determining whether the guarantee in that section is contravened the following matters are relevant: (a) The test as to whether goods are of an "acceptable quality" is an objective one; being taken from the perspective of a "reasonable consumer" (APS Satellite Pty Ltd (formerly known as Sky Mesh Pty Ltd) v Ipstar Australia Pty Ltd [2016] NSWSC 1898 (APS Satellite Pty Ltd) at [57]; Merck Sharp & Dohme (Australia) Pty Ltd v Peterson (2011) 196 FCR 145; 284 ALR 1; [2011] FCAFC 128). (b) The question for the "reasonable consumer" is whether the goods in question have the identified qualities enumerated in 54(2) to an "acceptable standard". This requirement is derived from the words "as a reasonable consumer … would regard as acceptable". (c) The "acceptable standard" is used as the yardstick against which the qualities of the goods are to be measured. It is ascertained by a consideration of the matters referred to in s 54(3); the nature of the goods, their price, any statement made about the goods on packaging or labels, any representations made about the goods by the supplier or manufacturer, and any other circumstance relating to their supply. (d) It is necessary the goods have all of the qualities identified in s 54(2) to the ascertained acceptable standard. Those qualities are that the goods are fit for all the purposes for which goods of that kind are commonly supplied, acceptable in appearance and finish, free from defects, safe and durable. (e) In the assessment of whether the goods meet that relevant standard, the reasonable consumer is taken to be fully acquainted with the state and condition of the goods (including any hidden defects of the goods). (f) If the goods supplied do not have all of the identified qualities to the acceptable standard, they will not be of an "acceptable quality". [143] In compendious terms, the issue is whether, objectively, the goods supplied (when taking into account their actual quality including any latent defects) are, to an acceptable standard, fit for all the purposes for which goods of that kind are commonly supplied, acceptable in appearance and finish, free from defects, safe and durable when measured by a standard which reflects the nature of the goods, their price, statements about the good as per their packaging, representations made about the goods and any other relevant circumstance. In Prestige Auto Traders Australia Ltd v Bonnefin [2017] NSWSC 149 at [132] N Adams J identified the manner in which s 54 should be applied in the following way: "The relevant test in s 54(2) of the ACL (NSW) of whether or not goods are of "acceptable quality" is an objective one based on whether a reasonable consumer who was aware of the "defects" in the goods at the time of the supply would have considered them to be of acceptable quality. There was no issue taken that the determination of what is objectively reasonable for a consumer to expect is to be made taking into account the relevant information known as at the time of the trial, including "after-acquired knowledge": Medtel Pty Ltd v Courtney (2003) 130 FCR 182; 198 ALR 630; [2003] FCAFC 151 at [66] and [70].'"
Also, in Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd [2020] FCA 1672 Wheelahan J said: "[25] … The standards under s 54(2) include that goods will be fit for all purposes for which goods of that kind are commonly supplied. This general standard of fitness for purpose is not dependent upon the consumer communicating any intended purpose to the supplier, or relying upon the supplier's skill or judgment. And, in relation to the general standard, it does not suffice that the goods will be fit for only some of those purposes. [26] The standard of acceptable quality in s 54(2) has as its reference point a construct, namely the objective standard of a reasonable consumer fully acquainted with the state and condition of the goods, including any hidden defects of the goods. The reasonable consumer sits with an array of other hypothetical persons who have been recruited by the law and by reference to whom objective standards are evaluated: see, Healthcare at Home Ltd v The Common Services Agency [2014] UKSC 49; 4 All ER 210 at [1]-[4] (Lord Reed JSC). Such a person has been described as an anthropomorphic conception of justice that is and must be the court itself: see Davis Contractors Ltd v Fareham Urban District Council [1956] AC 696 at 728 (Lord Radcliffe). [27] The hypothetical question whether the reasonable consumer would have regarded the quality of the goods as acceptable is to be determined at the time of supply. However, the reference in s 54(2) to hidden defects has the consequence that for the purposes of determining that question, the reasonable consumer may be acquainted with information known at the time of trial: cf, Medtel Pty Ltd v Courtney [2003] FCAFC 151; 130 FCR 182 at [70] (Branson J, Jacobson J agreeing). The standard of acceptable quality prescribed by s 54(2) is not absolute, or a standard of perfection. It is tempered by what a reasonable consumer would regard as acceptable having regard to the several matters in s 54(3). These matters render the standard of acceptable quality elastic, and context specific: Contact Energy Ltd v Jones [2009] 2 NZLR 830 at [95] (Miller J). The significance of the components of the guarantee of acceptable quality will therefore vary with the circumstances of each case."
A failure to comply with a consumer guarantee in Part 3-2 (other than s 66(2)) is not taken to constitute a contravention of the ACL NSW: s 15 of the ACL NSW.
The general remedial provisions of the ACL NSW as set out in Part 5-2 including s 237 depend in most instances on there being a contravention of designated Parts of the ACL NSW. Because of s 15, a respondent's failure, for instance, to comply with the consumer guarantees in s 54 and s 55 in respect of the supply of the Caravan, does not constitute a contravention which attracts the general remedial provisions of the ACL NSW found in Part 5-2, ss 224 - 253.
The ACL NSW's remedial provisions which pertain to a respondent's failure to comply with the consumer guarantees as to acceptable quality (s 54) and as to fitness for any disclosed purpose (s 55), are contained in Part 5-4, ss 259 - 277.
Section 259 establishes that a consumer can, where applicable consumer guarantees have not been complied with, require a supplier to remedy the failure, recover by action certain amounts in various circumstances or reject the goods in certain circumstances. The section states: "259 Action against suppliers of goods (1) A consumer may take action under this section if: (a) a person (the supplier) supplies, in trade or commerce, goods to the consumer; and (b) a guarantee that applies to the supply under Subdivision A of Division 1 of Part 3-2 (other than sections 58 and 59(1)) is not complied with. (2) If the failure to comply with the guarantee can be remedied and is not a major failure: (a) the consumer may require the supplier to remedy the failure within a reasonable time; or (b) if such a requirement is made of the supplier but the supplier refuses or fails to comply with the requirement, or fails to comply with the requirement within a reasonable time--the consumer may: (i) otherwise have the failure remedied and, by action against the supplier, recover all reasonable costs incurred by the consumer in having the failure so remedied; or (ii) subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection. (3) If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may: (a) subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection; or (b) by action against the supplier, recover compensation for any reduction in the value of the goods below the price paid or payable by the consumer for the goods. (4) The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure. (5) Subsection (4) does not apply if the failure to comply with the guarantee occurred only because of a cause independent of human control that occurred after the goods left the control of the supplier. (6) To avoid doubt, subsection (4) applies in addition to subsections (2) and (3). (7) The consumer may take action under this section whether or not the goods are in their original packaging."
A failure to comply with consumer guarantee(s) may be a "major failure" for the purposes of s 259 for at least five (5) different reasons: "260 When a failure to comply with a guarantee is a major failure A failure to comply with a guarantee referred to in section 259(1)(b) that applies to a supply of goods is a major failure if: (a) the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; or (b) the goods depart in one or more significant respects: (i) if they were supplied by description--from that description; or (ii) if they were supplied by reference to a sample or demonstration model--from that sample or demonstration model; or (c) the goods are substantially unfit for a purpose for which goods of the same kind are commonly supplied and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or (d) the goods are unfit for a disclosed purpose that was made known to: (i) the supplier of the goods; or (ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the goods were conducted or made; and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or (e) the goods are not of acceptable quality because they are unsafe."
For there to be a 'major failure' it is not necessary for an applicant to establish each of the five matters (a) to (e) as set out in s 260 of the ACL NSW. Establishing one is sufficient.
Subsection (d) of s 260, where goods are unfit for a disclosed purpose, only applies when there have been specific negotiations about purpose between a consumer and a supplier. Subsection 260(b) does not apply in the circumstances of this case, as the Caravan was not supplied by description; nor was the Caravan a sample or demonstration model.
Subsections (a) and (e) of s 260 are linked to the consumer guarantee as to acceptable quality (s 54); whereas subsection (c) is apposite to the consumer guarantee of fitness for purpose (s 55) as well as s 54. Relevantly, s 54 requires that, among other things, goods be "fit for all the purposes which goods of that kind are commonly supplied", "free from defects" and "safe". These standards are to be regarded by the "reasonable consumer fully acquainted with the nature and extent of (any) failure" of the goods.
The authorities consistently establish that the "reasonable consumer" for the purposes of s 260 is assessed as an objective test. In Safi v Heartland Motors t/as Heartland Chrysler [2016] NSWCATAP 80 (11 April 2016) (Safi v Heartland Motors), the Appeal Panel, after reviewing relevant authorities in Australian and New Zealand courts and tribunals on the question of how s 260 (or its NZ equivalent) is to be interpreted and applied, said: "98 In our view, Goldiwood and Stephens v Chevron go too far insofar as they find that the failure to comply with the guarantee of acceptable quality will always be a major failure (or failure of substantial character). While there are similarities in the legislative tests to be applied, whether non-compliance is a major failure will depend on the nature and extent of the failure. For instance, it is possible that goods may not be of acceptable quality at a given point of time, either because they are not fit for purpose or have defects, but they may be capable of becoming acceptable because the defects can be remedied easily and in a timely manner. Non-compliance would therefore not amount to major failure because a reasonable consumer would be prepared to accept teething problems that can be fixed under warranty. 99 This was the approach taken in Norton v Hervey Motors Ltd [1996] DCR 427. In this case the court held that the "reasonable consumer" should be assessed as a purely objective test. It was also noted that a reasonable consumer would expect there would be some problems with a motor vehicle but would be unlikely to acquire a defective vehicle if they knew at the time of purchase another identical vehicle was available for purchase. This was discussed by K Tokeley, Consumer Law in New Zealand, (2nd ed 2014, Lexis Nexis NZ Limited) at 102-103, as being unduly narrow. The author posited an alternative formulation as follows: Therefore when applying s 21(1)(a) it makes more sense to ask whether reasonable consumers, given the option of acquiring that particular good or alternatively purchasing either nothing or a different model, would have acquired the good if they had been aware of the nature and extent of the failure. In this way the focus is on whether the failure was so bad that the consumers would never have bought the good if they had been aware of it, or whether the failure is less significant and consumers would have been prepared to accept the good even knowing its faults. 100 We accept that this is a more common sense approach particularly given the ACL (NSW) is beneficial legislation. 101 Having regard to these cases and the commentary, where there is non-compliance with the guarantee of acceptable quality, as alleged in this case, we find that the following matters will be relevant to the question of whether this amounts to a "major failure" under s 260(a): (1) A major failure may be constituted by one defect or a series of specific or individual defects which, when taken as a whole, constitute a major failure; (2) The test of whether the goods "would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure" is an objective one; (3) A "reasonable consumer" would expect teething problems, even in a new vehicle; (4) The question to ask is whether the reasonable consumer, given the option of acquiring that particular good or alternatively purchasing either nothing or a different model, would not have acquired the good; (5) Defects which result in goods failing to comply with the guarantee of acceptable quality will not invariably be a major failure and it will depend on the nature and extent of the failure; and (6) The cost of repair, in proportion to the purchase price, and the question of whether the defects can be remedied easily in a timely manner are relevant considerations. 102 In our view, the purchase price for the goods and the nature of the defect are also relevant considerations for a "reasonable consumer"."
Being a civil case, factual disputes in this case are to be resolved on the balance of probabilities.

The Applicants' Evidence

I shall now set out the evidence that was adduced by the parties, interspersed from time to time with agreed or incontrovertible facts; or findings as to contested matters, where convenient to do so.
Mr and Mrs Tony and Lynette Edwards provided written evidence by way of joint affidavit sworn 19 July 2021, containing 35 Annexures TLE 1 - 35 (Applicants' Affidavit).
The Applicants' Affidavit contained at pages 83 - 86, as Annexure TLE - 32, a copy of a report dated 10 March 2021 of consultant engineer, Rana Everett of Everett Consulting NT Pty Ltd (Everett Report).
Both Mr and Mrs Edwards also gave affirmed oral evidence subject to cross examination by the Respondent's solicitor. The parties' legal representatives made available to me with their closing written submissions, a transcript of the affirmed oral evidence given by Mr and Mrs Edwards in the Applicants' case, and by Mark Lyons (Mr Lyons) in the Respondent's case, at the hearing on 6 October 2021(Transcript).
The Respondent's solicitor objected to the admission into evidence of the Everett Report. The Everett Report does not comply with NCAT Procedural Direction 3 as to the Expert Witness Code of Conduct and Ms Everett was not available to give oral evidence at the hearing. Nevertheless, referring to s 36 and s 38 of the NCAT Act and consistently with the approach taken by the Appeal Panel in Safi v Heartland Motors at [80], I admitted the report subject to its relevance and the weight I should attach to it: Transcript, pages 5 & 6.
The Everett Report contains photographs of the Caravan as follows: 1. Figure 1 - Subject Caravan; 2. Figure 2 - Floorboard crack. View from under the Caravan. 3. Figure 3 - Bracing installed to support the floorboard. 4. Figure 4 - Gap at bottom of cupboard, filled with sealant.
The Report signed by Ms Everett and which is Annexure TLE - 32 of the Applicants' Affidavit bears date 10 March 2021. The Applicants' Affidavit states at [123] - [124] that the Applicants contacted Ms Everett on 13 February 2021 about an inspection of the Caravan in Darwin. At the hearing, Mr Edwards gave oral evidence that the Applicants' purchase of a new caravan from Jayco Darwin, as referred to in Invoice No 2226 (which bears date 22 February 2021), was finalised on or about 8 March 2021: see Transcript, page 39, lines 23 & 24. Given that evidence, which I accept, it follows that the Applicants' disposal of the Caravan by way of a trade-in to Jayco Darwin also took place on or about 8 March 2021. In those circumstances, I find that Ms Everett must have inspected the Caravan and taken the photographs (Figures 1 - 4) sometime after 13 February 2021, but prior to 8 March 2021.
In referring to "facilities … reported to be poorly fitted" and to other information provided to her by the Applicants, Ms Everett's Report does not disclose an independent assessment of whether the Caravan meets the standards of acceptable quality and fitness for purpose as per the consumer guarantees in s 54 and s 55 of the ACL NSW. The Applicants' legal representative conceded in her closing written submission received on 5 November 2021 at [12] (appropriately in my view), that some statements in Ms Everett's Report go beyond Ms Everett's expertise and tend to the tone of an advocate rather than that of an independent expert. Accordingly, I am not persuaded that the Everett Report assists me in determining whether or not the Respondent contravened the consumer guarantees in s 54 and s 55 of the ACL NSW.
Nevertheless, in the context of the Applicants seeking a remedy by way of compensation (ACL NSW, s 259) in light of their contention that there are failures in the Caravan which cannot be remedied, I find that parts of the Report as well as the photographs depicted in Figures 2, 3 and 4 have probative value, and that they should be accorded weight in the Tribunal's determination of the appropriate remedy for the Applicants, so long as I am satisfied on evidence, other than the Everett Report, that the Respondent contravened the consumer guarantees in the ACL NSW by its supply of the Caravan in 2018 to the Applicants. The parts of the Report which I consider have probative value are: The crack in the floor (figure 2) is evident when looking underneath the caravan from outside. The sunken floor board section was originally designed with a span of 2.3 m between cross members and 1.53m between chassis rails. The bracing installed by Darwin Caravan and RV Centre, has reinforced one half of the sinking floorboard section using 2 steel channel sections (figure 3). The bathroom vanity has been fitted out of alignment with the shower frame. This is evident by the 8mm gap at the bottom of the cupboard and meeting of the frame at the top (figure 4). The present temporary fix is a waterproof sealant to prevent water ingress and further damaging the vanity cupboards and associated fittings. … The floorboard has been partially braced and the supported section will likely continue to degrade as the caravan is frequented over time. … The floorboard is showing signs of early degradation and may not withstand further travel and movement before becoming unsafe, and the misalignment of the bathroom vanity is noticeable to an unwitting person. The caravan is 2 and a half years old and would be expected to last a further 20 years if well cared for. In its current condition, with this extraordinary amount of issues and those unresolved thus far, this caravan's serviceable life is significantly reduced and its value is heavily depreciated.
The lay evidence in the Applicants' case was from Mr Tony Edwards and Mrs Lynette Edwards. They were cross examined on their joint affidavit sworn 19 July 2021 by the Respondent's legal representative and I also asked questions of them. I am satisfied that the Applicants were credible and reliable witnesses of fact.
I make the following findings of fact based on the written and oral evidence of the Applicants: 1. On or about 29 April 2018, they both attended the Sydney Caravan and Camping Show which was held at Rosehill, Sydney. At that time they spoke with a salesman who was the manager of Avan Brisbane but whose name they cannot recall. They expressed interest in the Caravan but prior to their purchase of it, the Applicants made known to the representative that they required a caravan which could be towed by a vehicle in remote 'outback' regions of Australia such as the Oodnadatta Track, Gibb River Road, Savannah Way and Birdsville Track, and the representative told them that the Caravan would be suitable for those routes as long as the Applicants drove the vehicle towing the Caravan to the conditions with extra care and attention on rutted, corrugated or uneven surfaces, or words to that effect. 2. At the same time, the Applicants were provided with a flyer which outlined the capabilities of the Caravan (Annexure TLE - 2 of the Applicants' Affidavit) which included statements that the Caravan had features to allow it to be "self-sufficient for longer giving you access to more remote locations". 3. Further, the Applicants informed the representative that they wanted to 'free camp' for periods of up to two weeks at a time and they were advised to purchase extra solar panels and a battery to do this because that would be enough to operate a compressor fridge. 4. The Applicants also asked the representative whether they would be able to attend authorised repairers at distant locations should repairs to the Caravan be required and they were told that this would be possible as there was a national network of authorised repairers, although they may have to travel to "a major town closest … at the time the repair was needed" or words to that effect. 5. On 29 April 2018, the Applicants paid to the Respondent a deposit of $500. 6. On 5 September 2018, the Applicants paid to the Respondent a balance deposit of $4,500. 7. On 26 October 2018, the Applicants paid the balance of the purchase price to the Respondent (i.e. in total paying $63,075). 8. When the Applicants took delivery of the Caravan on or about 26 October 2018, they encountered an issue in relation to the entry door sticking and were told that this issue "would ease over time" or words to that effect. 9. The Applicants also acted on the representative's pre-sale advice and purchased extra solar panels and a battery. 10. During the first two years of their ownership of the Caravan, the Applicants experienced various problems more particularly described in Annexure TLE - 5 of the Applicants' Affidavit, including: 1. Issues with the external door, including cracks and difficulties opening and closing the door; 2. Issues with the power, fridge and heater; 3. Issues with the hot water system; 4. Water leaks in the shower, under the bed and into the cupboards; 5. The water flow meter being incorrectly installed; 6. Various fixed items being incorrectly affixed; 7. Cracks in the welding; 8. Cracks in the bathroom wall; 9. Softened floors requiring replacement/bracing. 1. The Applicants traded in the Caravan and acquired a new caravan from Jayco Darwin on 8 March 2021. 2. During their period of ownership of the Caravan: 1. The Applicants could not use the Caravan as they had intended; 2. They did not have the freedom and ability to travel freely and independently for extended periods of time and without being restricted to the availability of external amenities (i.e. they were unable to 'free camp' for periods of up to 2 weeks); 3. They were able to travel for 5 months only before the fridge and power issues became unmanageable and they were required by the Respondent to return to Penrith NSW from Perth WA to have defects repaired; 4. They were then unable to travel freely in 'outback' areas because the Caravan did not have a manageable fridge. 1. Although some remedial work was undertaken on the Caravan by the Respondent at its Penrith NSW premises in the periods 19 December 2019 to 30 December 2019, 17 February 2020 to 20 March 2020, and 23 June 2020 to 26 June 2020, this did not address adequately or at all issues such as the external door, the gap in the bathroom wall, the 'spongy' floor in front of the kitchen sink, the scraping sound opening and closing the Pop Top roof, and the bathroom door not closing properly. 2. The Applicants continued to experience serious and recurring issues with the Caravan up until late 2020 when the Applicants put the Caravan into storage in Darwin NT where it remained until disposed of by the Applicants' trade-in for a new caravan with Jayco Darwin. 3. The serious and recurring issues which then prompted the Applicants to bring their original application (file no MV 20/43242) to the Tribunal on 13 November 2020 included the defects in the external door which required bracing, the defective operation of the Caravan's power and fridge (i.e. meaning that the Caravan's amenities in 'free camp' conditions could not be used for extended periods), and the defects in the bathroom door requiring the bathroom door to be refitted and then continuing problems with water leaking after bathroom use.

The Respondent's Evidence

The evidence in the Respondent's case was the written and oral evidence of Mr Lyons, the General Manager of the Respondent's Penrith retail outlet. At all material times, his role as General Manager embraced dealing with service and repair issues. He is not a trained motor mechanic and he has no engineering qualification. He has worked in the caravan industry since about April 2017.
Mr Lyons' written evidence is contained in his affidavit sworn 2 August 2021. Mr Lyons gave affirmed oral evidence at the hearing on 6 October 2021 and was cross examined by the Applicants' counsel. I also asked him questions particularly as to the value of the Caravan at the time the Applicants disposed of it.
Mr Lyons was not involved in the pre-sale discussions for the Caravan during 2018: Transcript page 54, line 25 - page 55, line 19. He was not working for the Respondent at the time of the handover of the Caravan to the Applicants in October 2018. In fact, he became an employee of the Respondent, albeit for a 'second time' during 2019, but he could not recall the "exact dates" of his first time employed by the Respondent: Transcript page 48, lines 23 - 39.
His evidence was on the occasions in or about December 2019 and in or about February 2020 that he had managed repairs of the Applicants' Caravan at the Respondent's Penrith NSW outlet, the Caravan had presented to the workshop in very poor condition. He observed the Caravan as being covered in red dust including in areas such as the fridge cavity and hot water system, and also noticed cracked welds and screws rattling loose in the microwave supports and fire extinguisher holder. He saw that the Applicants had filled the cavity under the bed with their personal possessions which, in his opinion, had a detrimental effect on the power supply to the Caravan. He concluded that the Caravan had been misused by the Applicants and that contrary to the Caravan's "Savannah Warranty" (Warranty) the Applicants had not towed the Caravan in a vehicle driven to the conditions of the roads travelled upon.
Mr Lyons also said that many of the repairs carried out to the Caravan by the Respondent in late 2019 and 2020 were normal wear and tear (not warranty) issues and had been done by the Respondent as a gesture of goodwill. He referred as well to work carried out on the Caravan by (unauthorised) third party repairers and said referring again to the Warranty, that the Respondent was not responsible for any issues arising from that work.
In light of the Applicants' evidence as to the trade-in allowance ($29,300) the Applicants had received from Jayco Darwin in or about March 2021 when the Applicants disposed of the Caravan, and the Applicants' depreciation allowance of 15% having regard to the fact that the Caravan was about two and a half years old when they had disposed of it, I asked Mr Lyons some questions about the value of the Caravan: Transcript pages 83 - 87. He was adamant that the amount of $29,300 was not a fair market value for the Caravan in or about March 2021 and that 10% (not 15%) was a more reasonable depreciation allowance for a caravan of the make and model of the Caravan over a period of use of about 30 months. While unable to provide written evidence to substantiate the sale price, Mr Lyons gave oral evidence that a used caravan of the same make and model as the Caravan had sold in Port Kennedy WA for a price of $55,000.

The consumer guarantees in s 54 and s 55 of the ACL NSW

On the available evidence, I find that in its supply of the Caravan to the Applicants, the Respondent did not comply with the consumer guarantees as to acceptable quality and fitness for disclosed purpose.
As regards s 55 of the ACL NSW, I accept the Applicants' evidence as to there being a disclosed purpose made known to the Respondent's representative at the Sydney Caravan and Camping Show during the discussions which led to the Applicants' purchase of the Caravan in 2018. I am satisfied that the Respondent was aware that the Applicants required the Caravan for extended holidays around Australia travelling on certain tracks such as the Oodnadatta Track, Gibb River Road, Savannah Way and Birdsville Track and that the Caravan was required by the Applicants during their travels as self-contained accommodation or as a means of 'free camping' for periods of up to 2 weeks. I find that the Respondent made representations to the Applicants that the Applicants could use the Caravan in a manner consistent with the Applicants' disclosed purpose and that the Applicants relied upon those representations in proceeding to purchase the Caravan from the Respondent. There was no evidence adduced which contradicted the evidence of the Applicants that they had told the sales person at the Caravan Show that they wanted to free camp. In fact, Mr Lyons who initially said that the Respondent's sales people are not trained to make such representations to customers, accepted that he was not present during the Applicants' conversation with the Respondent's sales person and that the representations in response to the Applicants' disclosed purpose could have been made to the Applicants: Transcript page 54, line 35 - page 55, line 19.
The Respondent relied on the terms of the Warranty which states, relevantly: G WHAT YOU ARE NOT COVERED FOR IN YOUR GOLF NEW VEHICLE WARRANTY - Repairs and Servicing required use due to misuse (off-road use of the vehicle, overloading, careless driving on unmade road etc), negligence, water ingress, salt water, improper adjustment or repairs by a non-approved Golf repairer, alterations, tampering, disconnection, accident or modifications; - Scratches or surface corrosion caused by normal wear and tear caused by stone or other chips to panels, window surfaces, undercarriage or running gear. Also, damage or breakage of the windows caused by normal wear and tear, such as stone impacts; - Tyres (refer to paragraph E); - Environmental damage, such as hail, storm, fire, flooding, lightning, or airborne fallout (chemicals, tree sap, bird and insect droppings etc) or damage arising to tenting, curtains or plywood/veneer finish from condensation remaining untreated; - Any damage or defect caused by the fitting of a non 'Golf' approved part or accessory, or add on parts; - Damage arising from improper or lack of maintenance or servicing; - Normal wear and tear including fading or deterioration of fabrics, flooring, sealants and other materials (these are warranted only against defective workmanship or material); - Fading, soiling, shrinkage, softening, tears or punctures to fabric items including cushions, curtains, drapes, mattress covers, canvass, canopies and vinyl and window screenings; - Damage to and/or soiling of fabrics and internal fittings arising from dust and other airborne substances; - Water damage arising from creek crossings or flooding; - Damage arising from movement of appliances and fittings resulting from use on corrugated or uneven surfaces; - All damage arising from use on roads defined below as unsuitable; - Any vehicle used for rental purposes; - Premature wear and tear where the vehicle is used for permanent residential purposes (Vehicles have been designed for recreational purposes); - Impact damage, whether static or in transit; - Normal deterioration due to exposure or fair wear and tear; - Any promises, warranties or undertakings made by any person beyond those set out in this warranty and not subsequently endorsed in writing by the manufacturer (Golf); and - Consequential damage - That is, further damage caused by your failure to report and have remedied a fault at the earliest opportunity. For example, a water leak could cause further considerable damage to the RV interior if not attended to promptly. H UNSUITABLE ROADS Recreational vehicles are not designed to travel on rough or corrugated roads and damage caused by vibration resulting from inappropriate driving on rough or corrugated roads is not covered by your warranty. This includes the Savannah and 'Bush Challenger' range. GOLF'S 'OFF ROAD' POLICY Golf's Savannah and Bush Challenger range of RVs have been designed and manufactured to give you added ground clearance and added physical strength. This allows you limited unsealed road usage. Golf's standard model, Savannah and the Bush Challenger range are not designed for going cross country or for use on 4WD-only tracks. When towing you are strongly advised to travel at a speed suited to the conditions and with extra care and attention on rutted, corrugated or uneven surfaces. The RVs should not be towed on rough or badly corrugated roads at all. Neither the Savannah nor the Bush Challenger range are designed for hard impact or bumps on rutted roads or tracks. If you find yourself with no alternative, slow your speed to a minimum and if necessary, reduce your tyre pressures. This will help minimize any damage and any expensive repair bills. Gas Regulations relating to vents and other construction rules restrain the effectiveness of RVs against ingress of dust and water. Your RV should not be exposed to water at crossings or above floor level under any circumstances. The following damage is not covered under the Savannah or Bush Challenger warranty or the standard warranty: - Water damage owing to exposure from below, e.g. water crossings, floods etc. - Dislodgment and/or damage to appliances or fittings arising from impact, hard knocks etc, rutted roads or tracks. - Damage to body, chassis or running gear arising from impact, stones etc. - Damage to and/or soiling of fabrics and internal fittings arising from dust and other airborne substances. - Any other damage caused by or arising from general misuse of the RV.
In determining the contested issues in these proceedings, I have taken into consideration all of the terms of the Warranty, but I have recognised that the Respondent cannot exclude the benefits conferred on the Applicants as consumers by the ACL NSW. Nothing contained in the Warranty restricts or modifies the Applicants' rights and the Respondent's obligations, respectively, in respect of the consumer guarantees in the ACL NSW.
I do not find on the available evidence that the Applicants breached the Warranty.
To the extent the Respondent put a case that the Applicants had breached the Warranty by travelling on unsealed surfaces, during his cross examination (Transcript pages 66 - 69), Mr Lyons conceded that the Warranty document in fact allowed for the Caravan to be towed by a vehicle driven on corrugated and rutted roads as long as it was driven to the conditions.
Moreover, the Respondent's submission that the Caravan is commonly supplied for 'casual and recreational use, and not for use as a permanent residence or long extended trips which required traversing rough or unsealed terrain across country' (Respondent's closing written submissions dated 17 November 2021 at [18]) does not have an evidentiary foundation. The Respondent's submission does not reflect what is stated in the Warranty. It is not the case on the available evidence that the Applicants' use of the Caravan while they were away from their permanent place of residence in Victoria constituted, in any way, a breach of the Warranty.
For reasons given later in the context of the allegations that the Applicants misused the Caravan (i.e. the defence available to a supplier of goods of unacceptable quality if it is found that the damage evidencing unacceptable quality arose from abnormal use by a consumer - s 54(6)(b) of the ACL NSW), I do not find that the Applicants, at any material time, towed the Caravan using a vehicle which was not driven to the conditions or otherwise in a manner which did not comply with the terms of the Warranty as to 'Unsuitable Roads'.
As indicated, I accepted Mr and Mrs Edwards as credible witnesses of fact. I find that the representations were made by the Respondent's representative in response to the Applicants' disclosed purpose.
The representations made by the Respondent's representative are also in line with the Respondent's own document at the time of the pre-sale discussions, being a flyer or brochure which outlined the capabilities of a Savannah caravan: see annexure TLE - 2 of the Applicants' Affidavit. This document stated, amongst other matters, that a Savannah caravan was equipped with features which: "would permit (it) to be self-sufficient for longer giving you access to more remote locations". When his attention was directed to this document during cross examination, Mr Lyons conceded that the flyer or brochure provided to the Applicants at the time of sale would lead a reasonable person to believe that the Caravan could be towed by a vehicle driven "off the tar road": Transcript page 63, lines 14 - 18.
I find that in contravention of the consumer guarantee in s 55 of the ACL NSW, the Applicants could not use the Caravan for the disclosed purpose they had made known to the Respondent before proceeding with their purchase of the Caravan. In this regard, I accept the Applicants' evidence as regards their issues with the power and the fridge which meant that they were unable to use the Caravan as self-contained accommodation during their travels in remote areas because they could not keep food which was required to be refrigerated. Further, I am satisfied that when the Applicants were experiencing issues with the supply of power in the Caravan, they were unable to free camp because they had to be in the proximity of an independent power source for the Caravan's amenities.
The evidence referred to in the prior paragraphs also supports the Applicants' case that in contravention of the consumer guarantee as to acceptable quality, the Caravan was not fit for all purposes for which goods of that kind are commonly supplied: s 54(2)(a), ACL NSW.
I am also satisfied on the available evidence that the Caravan was not free from defects (s 54(2)(c)), that the Caravan was not safe (s 54(2)(d), and that the Caravan was not durable (s 54(2)(e)).
I find that the issue with the external door of the Caravan was a matter of safety, specifically in circumstances where it was the Applicants' evidence that in order to egress from the Caravan the Applicants would have to use force to open the door due to it sticking (i.e. jamming). While it was put to the Applicants in their cross examination at the hearing that they had broken the door through the use of unreasonable force, it was the Applicants' evidence, which I accept, that that they had used reasonable force and that they did not crack the door. The Respondent did not provide any independent evidence that the door cracked due to the use of unreasonable force by the Applicants.
In determining that the Caravan was in contravention of s 54 of the ACL NSW, not of acceptable quality, I have considered the purchase price of the Caravan, the nature and extent of the defects in the Caravan as reported by the Applicants and as referred to in the Everett Report, as well as the safety matters as stated in the prior paragraphs. Having purchased the Caravan for the price of $63,075, I find that a reasonable consumer would not have regarded the Caravan to be of acceptable quality in light of the various and frequently occurring problems in the Caravan as recounted in the Applicants' Affidavit and in their oral evidence subject to cross examination.
I accept the Applicants' evidence that if they had been told prior to purchasing the Caravan that towing it driving a vehicle on unsealed road surfaces would likely result in a series of problems such as the dislodgment of fixtures (e.g. equipment), power failures, lack of refrigeration capacity and water leaks, they would not have proceeded to purchase the Caravan.
Part of the Respondent's case was that the Applicants had encountered no more than 'teething issues' with the Caravan and that the Respondent had done everything in its power to fix those matters which it said were covered by the Warranty and had even (as a gesture of goodwill) performed services and provided parts for no consideration in respect of matters not covered by the Warranty, all in an effort to resolve the Applicants' concerns. The Respondent submitted that had it been afforded a 'proper opportunity' to repair the Caravan, any 'apparent issues' with the Caravan 'could have been resolved in an easy and timely manner': see Respondent's closing written submissions received 5 November 2021 at [27(d)] and [27(e)].
I do not accept the Respondent's submissions. I do not agree that the problems with the Caravan as recounted in the Applicant's evidence are 'teething issues'. While some of the problems with the Caravan may have been fixed under the Warranty, it is also the case that other problems became ongoing and unresolved issues and further, that problems which may have been rectified under warranty work by the Respondent reoccurred over time: see the email correspondence annexed to the Applicants' Affidavit. For instance, the Applicants first brought the attention of the Respondent to the issue of the 'spongy' floor in the kitchen on 31 August 2019 and yet it is clear that the issue with the floor had re-occurred and had been ongoing over several months from November 2020: see annexure D of Mr Lyons' Affidavit. Accordingly, I find that the Applicants' evidence establishes on the balance of probabilities that there were major issues with the Caravan, and that these issues were ongoing and unresolved when the Applicants disposed of the Caravan in or about March 2021.
I also find that the Applicants afforded the Respondent various opportunities to respond effectively to the issues with the Caravan which the Applicants experienced during their two and half years ownership of the Caravan.
The Applicants' evidence, which I accept, is that they received no satisfactory response in respect of the various matters as to the power and fridge issues (Applicants' Affidavit [18] - [58]), as to the Caravan's external door (Applicants' Affidavit [59] - [83]), as to the Caravan's hot water system (Applicants' Affidavit [84] - [93]), as to water leaks from the Caravan's shower (Applicants' Affidavit [94] - [107]), and as to the Caravan's heater (Applicants' Affidavit [108] - [121]).
Mr Lyons admitted in his oral evidence that the first phone call he had with the Applicants was following the Applicants' formal complaint about defects and other issues in the Caravan made on 9 October 2019 to NSW Fair Trading. Although Mr Lyons could not recall the exact date, he conceded that it was sometime in or about October 2019 when he first made contact with the Applicants. He said prior to that, the Applicants had been dealing with other employees such as Danie Johanson, the previous service manager and Shane Adamson who took over from Danie Johansen: Transcript pages 58 - 60. No other employees or former employees of the Respondent gave evidence in the Respondent's case.
There is also the parties' exchange of email correspondence during September 2020 (see annexures TLE - 28 and TLE - 29 of the Applicants' Affidavit) which evidences the Applicants' account of the ongoing defects and the recurring issues that they were experiencing with the Caravan even after the work undertaken on the Caravan by the Respondent at its Penrith premises during December 2019, February/March 2020 and June 2020, and the Respondent's reply denying any responsibility for the ongoing defects and the recurring issues which the Applicants were experiencing with the Caravan.
I find that the Respondent did not address adequately or at all the various defect issues in the Caravan as set out in the Applicants' Affidavit. In all of the circumstances, the Applicants cannot be stigmatised as having denied 'proper' opportunities to the Respondent to repair the Caravan. I am satisfied that from time to time the Applicants simply had to engage third party contractors to carry out repairs (sometimes urgent repairs without the Respondent's co-operation) on the Caravan during their travels.
I am also unpersuaded by the Respondent's allegations that the Applicants complain of defects in the Caravan which were in fact caused by their own misuse of the Caravan. These allegations which bear upon the Respondent's submission that s 54(6)(b) of the ACL NSW applies, lack a proper evidentiary foundation.
It was put to the Applicants during their cross examination at the hearing that the Caravan's repair issues (i.e. the matters the subject of the Applicants' complaint) were in fact the consequence of the Applicants' mistreatment of the Caravan, or to put it in the context of the consumer guarantee, that any 'unacceptable quality' found in the Caravan was the Applicants' responsibility because they had damaged the Caravan through 'abnormal use' (ACL NSW s 54(6)(b)). The Applicants vehemently denied the allegations of misuse. The Respondent provided no independent evidence that the issues with the Caravan were due to mistreatment by the Caravan's owners. Further, none of the contemporaneous correspondence attached to the parties' written evidence contained reference to misuse of the Caravan.
There was a specific allegation at [5(f)] of Mr Lyons' affidavit in response to [26] and [27] of the Applicants' Affidavit that the cavity under the bed had been filled by the Applicants with their personal possessions, which were 'in and around the wiring' and that this had 'a detrimental effect on the power supply to the Caravan'. However, in his cross examination, Mr Lyons could not substantiate that 'the entire cavity under the bed full of [the Applicants'] personal possessions' was in fact a matter of concern and that it was the cause of the problem with the Caravan's power as identified by the Applicants when they were travelling during the day in full sunlight and which they had reported to the Respondent. Mr Lyons accepted that there were no warnings, notifications or otherwise which would demonstrate that the Applicants were aware, or at least ought to have been aware, that storing possessions under the bed could lead to issues with wiring. I am unpersuaded by Mr Lyons' view that not putting personal possessions in the cavity under the bed was simply a matter of common sense.
To support its case generally as to alleged misuse of the Caravan by the Applicants, the Respondent relied on Mr Lyons' oral and written evidence. There was no independent evidence to substantiate this aspect of the Respondent's case; for instance, to establish that the Applicants had not driven to the conditions as is required by the Warranty when their vehicle was towing the Caravan. In justifying his assertions of mistreatment of the Caravan by the Applicants, Mr Lyons referred to his experience in the caravan industry but on his own admission that experience dated back to 2017 only. Mr Lyons does not have training as a motor mechanic or an engineering qualification. Other than his experience as a manager with the Respondent, he could not point to any particular qualifications which would enable him to make informed determinations in regard to whether the issues reported with the Caravan were due to the Applicants' misuse of the Caravan.
Where there is a contest of matters of fact between Mr and Mrs Edwards, on the one hand, and Mr Lyons, on the other hand, I prefer the Applicants' evidence. I am satisfied on the available evidence that the Applicants' own experience of their use of the Caravan and the issues (including defects) which they encountered throughout their period of ownership of the Caravan are sufficiently probative to establish the Respondent's contravention of the consumer guarantees in its supply of the Caravan to the Applicants in 2018.

Remedies

Having found that there was a failure to comply with the consumer guarantees in s 54 and s 55 of the ACL NSW, it does not matter, in my view, whether or not there was a major failure to comply with the guarantees. That is because the ACL NSW in s 259 provides for three scenarios, each of which leads to the same result in this case. The three scenarios are: a major failure, failures that cannot be remedied, and failures that can be remedied.
If the failures to comply with the consumer guarantees amount to a major failure the Applicants were entitled to reject the Caravan per s 259(3) of the ACL NSW. If the failures cannot be remedied the Applicants were entitled to reject the Caravan per s 259(3). If the failures can be remedied but the Respondent failed to do so, and the evidence is the Respondent had the opportunity to but did not remedy the failures, the Applicants were entitled to reject the Caravan per s 259(2)(b).
If goods are rejected by a consumer the remedy provided in s 263 of the ACL NSW is the return of the goods. In this instance, the goods are the Caravan. The remedy is then carried into effect either by way of a refund to the consumer of the purchase price, or by way of the replacement of the rejected goods with goods of the same type, and of similar value, provided such goods are reasonably available to the supplier.
However, the remedy provided in s 263 of the ACL NSW does not apply. Whether or not the "rejection period" for the purposes of s 262 of the ACL NSW had passed is no longer to the point. In the events which have occurred in this case, the Applicants did not elect to reject the Caravan. In fact, they disposed of the Caravan to a third party by trade in as part of their acquisition of another new caravan; although this circumstance had not occurred at the time of the hearing of the original proceeding and therefore it was not considered in the original proceeding.
While the trade in of the Caravan to Jayco Darwin in or about March 2021 is not referred to, at least expressly, by the Appeal Panel in its Appeal Decision, the Appeal Panel did direct consideration at the remitted hearing to Ground 5 of the Appeal, which is as regards the interpretation and the application of s 262(1)(a) of the ACL NSW. This was because the Member hearing the original application found that the "rejection period" had passed. In circumstances where the Appeal Panel had set aside the orders made at the hearing of the original proceeding and had then remitted the case for determination (including as to the appropriate remedies) by the Tribunal, differently constituted, I must take into consideration all facts and matters including that the Applicants had disposed of the Caravan by trade in. I find that the application of s 263 of the ACL NSW to the consideration of the appropriate remedies in the Applicants' case is no longer required in the circumstances.
In my opinion, the Applicants' remedies for contravention of the consumer guarantees are payment of specified amounts of money by way of compensation on the basis provided in s 259(3) (b) of the ACL NSW (Reduction in Value Compensation) and by way of damages for foreseeable loss on the basis provided in s 259(4) of the ACL NSW (Damages for Foreseeable Loss). As s 259(6) of the ACL NSW makes clear, Damages for Foreseeable Loss under s 259(4) are available to a consumer in addition to Reduction in Value Compensation under s 259(3)(b).
The further legal basis for the remedies is in s 79N(a) of the FT Act.

Reduction in Value Compensation

The remedy provided in s 259(3)(b) of the ACL NSW is compensation for the reduction in the value of the Caravan below the price paid by the Applicants. I appreciate that s 259(3) is expressed in terms of alternative remedies to be chosen by the consumer, but as I have found that the Applicants' evidence supports a finding that the Respondent's failures to comply with consumer guarantees cannot be remedied, it is simply not apposite in the circumstances of this case to order a remedy other than payment of a specified amount of money. Furthermore, and as referred to previously, s 79N of the FT Act provides power to the Tribunal to grant other remedies (such as compensation) in relation to consumer claims brought before it, of which this case is one, and I regard compensation to be assessed on the basis set out in s 259(3) as being the appropriate remedy.
The parties' evidence as to the quantum of the 'reduction in value' of the Caravan as a consequence of the failures to comply with the consumer guarantees was not particularly extensive, but when I made that observation at the commencement of the hearing on 6 October 2021 (Transcript page 4, lines 30 - 40) I was then assured by the parties' legal representatives that all of the written evidence as to quantum to be relied upon had been filed and served and that appropriate submissions as to quantum would be made. The hearing proceeded on that basis.
There was no independent valuation evidence from either the Applicants or the Respondent. Mr Lyons gave oral evidence that another caravan had sold in or about April 2021 for $55,000, but this evidence carried no weight. It was not supported by written confirmation of such sale price and the condition and history of use of the caravan sold in WA in April 2021 (even if of similar age and make as the Caravan) is not known.
The Applicants' evidence was that they received $29,300 as a trade in for the Caravan: see Annexure TLE - 35 (page 100) of the Applicants' Affidavit and further, that the trade in occurred not at the date of the Invoice as shown on Annexure TLE - 35, but on 8 March 2021 which was when the Applicants took delivery of a new caravan from Jayco Darwin: Transcript page 39, lines 23 and 24. The Applicants argued (see Applicants' Affidavit at [151]) that a reduction in the value of the Caravan is calculated by using the difference amount, which is $33,775, between the purchase price of the Caravan in 2018 ($63,075) and the trade in allowance obtained in 2021 ($29,300), and then taking account of the fact that the Caravan was about 30 months old at the time of the Applicants' disposal of it, deducting (as a 'depreciation allowance') from the amount of $33,775 a further amount of $9,461.25 (being 15% of the purchase price) to obtain a compensation figure of $24,313.75.
The Respondent's primary position in response to the Applicants' quantum of compensation evidence was that any reduction in the value of the Caravan during the period from October 2018 to March 2021 which is beyond the usual depreciation allowance (around 10% of the purchase price, in the Respondent's submission) was caused by the Applicants, and that in any event, even if there were defects in the Caravan (which the Respondent denied), the trade-in value ($29,300) the Applicants received for the Caravan in 2021 was still 'deflated … unreasonably'.
In its closing written submissions received on 17 November 2021, the Respondents put a further submission on quantum suggesting that the value of the Caravan at the time it was disposed of was $41,431.20. This submission was made referring to, but without providing a copy of, a ruling TR2021/3 of the Australian Taxation Office (ATO Ruling) on depreciation of assets. While the ATO Ruling may provide some guidance as to an appropriate rate of depreciation of assets for income tax purposes, as well as some information as to an effective life of a caravan (12 years, according to the ATO Ruling), I am not persuaded that the ATO Ruling assists in determining the value of the Caravan in this case.
While recognising there are limits to the lengths to which the Tribunal may go in 'doing the best it can' to assess compensation or damages and that guesswork which goes beyond a rational assessment of value cannot be made (see, for example, Troulis v Vamvoukakis [1998] NSWCA 237 per Gleeson CJ, as his Honour then was, with whom Mason P and Stein JA agreed), in this instance weighing the available evidence, I am satisfied that it is sufficient for me to complete the task of assessing compensation by reason of a reduction in value of the Caravan for the purposes of s 259(3)(b) of the ACL NSW.
I accept the method of calculation which is put in the Applicants' evidence. For the reasons already given, I reject the key propositions in the Respondent's case that any reduction in value beyond a usual depreciation allowance is attributable to the Applicants' misuse of the Caravan and so the Respondent cannot be held liable to the Applicants. Also for the reasons given earlier, I accept the Everett Report to the extent it substantiates the Applicants' case that the failures in the Caravan were not remedied by the Respondent and that further rectification work is required on the Caravan to remediate ongoing and recurring issues. I can reasonably infer that the Caravan would require further rectification work at a not inconsiderable cost beyond the usual depreciation allowance on a caravan of the age and make of the Caravan and that the trade in allowance obtained by the Applicants in March 2021 in fact reflects a reasonable value of the Caravan, that is a value which is commensurate with the cost of the further rectification work required to make the Caravan free of defects.
Ms Everett suggests in her Report that the expected life of the Caravan, if well cared for, would be 20 years; whereas the ATO Ruling suggests the expected life of caravans generally, at least for income tax depreciation purposes, is 12 years. One might reasonably expect fair wear and tear to become more readily apparent and for the life expectancy of a caravan to be lesser if it is used extensively for travel in the remote 'outback' regions of Australia. Ms Everett also qualified her view of a life expectancy of 20 years for the Caravan with the words "if well cared for". In circumstances where the Respondent's own evidence suggested a depreciation allowance of 10% for the Caravan, I am satisfied that there is a rational basis to conclude that a depreciation allowance of 15% is appropriate in the circumstances of this case.
Given those findings, I conclude that the compensation amount for the purposes of the assessment made under s 259(3)(b) of the ACL NSW is $24,313.75.

Damages for Foreseeable Loss

A remedy to the Applicants also lies by way of damages for its foreseeable loss as a result of the Respondent's failure to comply with the consumer guarantees: s 259(4) of the ACL NSW.
The Applicants seek damages for their foreseeable loss up to a sum total of $19,576.31 as itemised in the Table comprising 20 items which is Annexure A to the Applicants' closing written submissions received on 5 November 2021. There must, of course, be a proper evidentiary foundation to award damages in the various amounts for the 20 items totalling a sum of $19,576.31 as sought by the Applicants.
Furthermore, the loss and damage claimed must be "reasonably foreseeable". The test for reasonable foreseeability is that the loss or damage arising from a contravention of the consumer guarantee must ordinarily or naturally flow from the contravention (the first limb), or the loss or damage must reasonably be supposed to have been in the contemplation of the parties at the date of the supply of the Caravan as a probable result of the contravention of the consumer guarantee (the second limb): see Hadley v Baxendale [1854] EngR 296; (1854) 9 Exch 34 (Hadley v Baxendale).
As well, I am required by the FT Act in s 79U to make orders which will be fair and equitable.

Item 1 - Avan Pakenham VIC (Travel) - Amount claimed $367.20

The Applicants' evidence is that they drove to and from Pakenham in 2019 (a round trip of about 540kms from their Victorian residence) to collect the Caravan from a service. The Caravan may not have been ready for pick up but I am not satisfied that any travel cost incurred was as a result of the Respondent's contravention of the consumer guarantees.
There is also no invoice or other contemporaneous record of this claim. I am not satisfied that a 'per kilometre rate' from the ATO of 68c/km is sufficient to prove the claim.
I reject the Applicants' claim in Item 1.

Item 2 - On/Off switch for Ecotherm heater installed and fridge locked fitted - Wagga Caravan Centre Wagga Wagga NSW - Amount claimed $181.50

I have considered the Invoice in Annexure TLE - 7 of the Applicants' Affidavit. This appears to be a claim for reimbursement of add-on parts installed in 2019.
I am not persuaded that this is a cost incurred as a result of the Respondent's contravention of the consumer guarantees.
I reject the Applicants' claim in Item 2.

Item 3 - Plumbing, wiring and replaced battery charger - JC's Caravan Repairs Alice Springs NT - Amount claimed $1,425

Having considered the Invoice which supports this claim (Annexure TLE - 9 of the Applicants' Affidavit), I am satisfied that the costs incurred ($1,425) in 2019 in respect of the loose wiring and crimping, the replacement and fitting of a battery charger and the labour for electrical and plumbing work, were incurred as a result of the Respondent's contravention of the consumer guarantees.
For this item, I allow the amount of $1,425 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Item 4 - Fridge Repair - replacing fan - Pro Cool NT Darwin NT - Amount claimed $242

Having considered the Invoice which supports this claim (Annexure TLE - 10 of the Applicants' Affidavit), I am satisfied that the costs incurred ($242) in 2019 in respect of removing and replacing the condenser fan motor and wire up, were incurred as a result of the Respondent's contravention of the consumer guarantees.
For this item, I allow the amount of $242 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Item 5 - Welding of stabiliser and repairs to plumbing - Pratt NT Darwin NT - Amount claimed $216

Having considered the Invoice which supports this claim (Annexure TLE - 30 of the Applicants' Affidavit), I am satisfied that the costs incurred ($216) in 2019 in respect of replacing the broken fittings on the water tank and having the back stabiliser repaired, were incurred as a result of the Respondent's contravention of the consumer guarantees.
For this item, I allow the amount of $216 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Item 6 - Re-gas and check fridge - Pro Cool Darwin NT Darwin NT - Amount claimed $330

Having considered the Invoice which supports this claim (Annexure TLE - 11 of the Applicants' Affidavit), I am satisfied that the costs incurred ($330) in 2019 in respect of re-gassing and checking the fridge, were incurred as a result of the Respondent's contravention of the consumer guarantees.
For this item, I allow the amount of $330 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Item 7 - Replacement of batteries, wiring and battery monitor - Outback Batteries Darwin - Amount claimed $1,700

I am satisfied that the costs incurred ($1,700) in 2019 and as set out in the copy Invoice which supports this claim (Annexure TLE - 12 of the Applicants' Affidavit) in respect of replacement of batteries, wiring and monitor and associated battery costs, were incurred as a result of the Respondent's contravention of the consumer guarantees.
For this item, I allow the amount of $1,700 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Item 8 - Fridge repair replacing fan and purchase of spare fan - Flick Refrigeration Kununurra WA - Amount claimed $220

There is no invoice which details the work performed and the manner of charging for the work said to have been performed. I am not satisfied that the banking record provided (Annexure TLE - 14 of the Applicants' Affidavit) is sufficient to prove the cost incurred.
I reject the Applicants' claim in Item 8.

Item 9 - Cupboard Repairs - Kununurra WA - Amount claimed $40

There is no invoice which details the work performed and the manner of charging for the work said to have been performed.
I reject the Applicants' claim in Item 9.

Item 10 - Returning to Kununurra for cupboard repair - 400 km round trip - Bungle Bungles to Kununurra - Amount claimed $272

This appears to be an expense of maintaining and operating the Caravan and was undertaken by the Applicants at a time of their choosing and when it was not urgent to do so. In the circumstances, I am not satisfied that any travel cost incurred was reasonably foreseeable, or that it was incurred as a result of the Respondent's contravention of the consumer guarantees.
There is also no invoice or other contemporaneous record of this claim. I am not satisfied that a 'per kilometre rate' from the ATO of 68c/km is sufficient to prove the claim.
I reject the Applicants' claim in Item 10.

Item 11 - Buy Briggs and Stratton Generator due to power system failure - Bunnings Albany WA - Amount claimed $1,244.98

There is no invoice. I am not satisfied that the banking record provided (Annexure TLE - 17 of the Applicants' Affidavit) is sufficient to prove the fact of purchase of a Briggs and Stratton Generator and the cost incurred.
I reject the Applicants' claim in Item 11.

Item 12 - Return to Penrith NSW from Stirling Ranges WA 3783km (if direct route taken) - Amount claimed $595

I am not satisfied that the loss said to have been incurred was reasonably foreseeable as a result of any contravention of the consumer guarantees. I find that the Applicants had to attend NSW as there were no service technicians available in the Stirling Ranges WA area due to the time of year. The travel to NSW was a cost incurred in maintaining and operating the Caravan.
There is also no invoice or other contemporaneous record of this claim. I am not satisfied that a 'per kilometre rate' from the ATO of 68c/km is sufficient to prove the claim.
I reject the Applicants' claim in Item 12.

Item 13 - Penrith to Melbourne (Travel - 19/12/2019) - Amount claimed $595

I am not satisfied that the loss said to have been incurred was reasonably foreseeable as a result of any contravention of the consumer guarantees. The travel to Melbourne was a cost incurred in maintaining and operating the Caravan.
There is also no invoice or other contemporaneous record of this claim. I am not satisfied that a 'per kilometre rate' from the ATO of 68c/km is sufficient to prove the claim.
I reject the Applicants' claim in Item 13.

Item 14 - Excess Accommodation as a result of delays in fitting an external door - Mercure Parramatta NSW - Amount claimed $250.20

I am not satisfied that any accommodation cost incurred was reasonably foreseeable, or that it was incurred as a result of the Respondent's contravention of the consumer guarantees
There is no invoice. I am not satisfied that the banking record provided (Annexure TLE - 24 of the Applicants' Affidavit) is sufficient to prove the cost incurred.
I reject the Applicants' claim in Item 14.

Item 15 - Welding of suspension - Dominic Wright Cooma NSW - Amount claimed $100

There is no invoice which details the work performed and the manner of charging for the work said to have been performed and no record of payment.
I reject the Applicants' claim in Item 15.

Item 16 - Replacement Batteries - Battery Power Centre Darwin NT - Amount claimed $649.99

I am satisfied that the costs incurred ($649.99) in 2020 and as set out in the copy Invoice which supports this claim (Annexure TLE - 20 of the Applicants' Affidavit) in respect of replacement of batteries and installation costs, were incurred as a result of the Respondent's contravention of the consumer guarantees.
For this item, I allow the amount of $649.99 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Item 17 - Fix door and minor repairs and assessment of spongy floor, crack in bathroom wall and scraping awning - Pratt NT Darwin NT - Amount claimed $1,000

There are matters attended to as noted in the Invoice (Annexure TLE - 27 of the Applicants' Affidavit) supporting the claim for $1,000 which appear to be normal servicing or maintenance costs and in fact some were found to be working properly (e.g. hot water unit 'working ok', water pump lights 'couldn't find any faults', suspension and bolts 'fine just had dust in nylon bushes', water tanks 'fine'); but there are other significant matters (I would say about one half to two thirds of the 22 matters on the invoice) such as spongy floor report, bathroom door, and sealing top of door with silicone which I find relate to costs incurred as a result of the Respondent's contravention of the consumer guarantees.
For this item, therefore, I allow $600 being 60% of the claimed amount of $1,000 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Item 18 - Airport Car and RV Storage Darwin NT - Amount claimed $1,000

I do not find that any of the storage costs incurred were reasonably foreseeable within either of the first or second limbs of Hadley v Baxendale. I am also not satisfied, on the balance of probabilities, that the storage costs were incurred as a result of the Respondent's contravention of the consumer guarantees.
Moreover, I am not satisfied that the Invoices relied upon (Annexure TLE - 33 at pages 189 and 190 of the Applicants' Affidavit) evidence that storage costs of up to $1,000 were incurred by the Applicants.
For these reasons, I reject the Applicants' claim in Item 18.

Item 19 - Accommodation while caravan was in storage - Discovery Holiday Park Darwin NT - Amount claimed $6,650

I understand that the Applicants may have incurred costs of renting alternative accommodation in Darwin NT from in or about October 2020 through to in or about January 2021, but that appears to have been their choice and it is not fair or reasonable that the expense be visited upon the Respondent. It is certainly not clear on the available evidence why it was necessary to incur the rental costs in Darwin over an extended period even allowing for the fact that the Applicants could no longer stay with their daughter and also in circumstances where the Caravan had been placed in secure storage and the Applicants could have returned to live in their permanent place of residence in Victoria, while at the same time pursuing the proceedings in the Tribunal. In all of those circumstances, I do not find that any of the accommodation costs incurred by the Applicants in the Discovery Holiday Park in Darwin were reasonably foreseeable within either of the first or second limbs of Hadley v Baxendale, or even that those costs were incurred as a result of the Respondent's contravention of the consumer guarantees.
Moreover, I am not satisfied that the Invoices relied upon (Annexure TLE - 33 at pages 182 - 188 of the Applicants' Affidavit) evidence that accommodation costs of up to $6,650 were incurred by the Applicants.
For these reasons, I reject the Applicants' claim in Item 19.

Item 20 - Reimbursement of Costs Incurred with Darwin Caravan & RV Service Darwin NT on 3/02/21 - comprising Refit awning and add screws to top shield (Amount claimed $90), Seal Bathroom Wall (Amount Claimed $90), Wiring (Amount claimed $135), Seal around Floor (Amount claimed $90), Repair bedside table drawers (Amount claimed $60) and Tank shields put on (Amount claimed $75)

I am satisfied that all of these costs in a sum totalling $540 and as set out in the copy Invoice being Annexure J of the Affidavit of Mr Lyons' Affidavit were incurred by the Applicants on 3 February 2021 as a result of the Respondent's contravention of the consumer guarantees and further that the costs incurred evidence damages which were reasonably foreseeable within either of the limbs of Hadley v Baxendale.
For this item 20, I allow the amount of $540 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.

Sum total of the damages allowed under s 259(4) of the ACL NSW

Accordingly, I have rejected Items 1, 2, 8, 9, 10, 11, 12, 13, 14, 15, 18 and 19; but I have allowed in part Item 17 (as to $600) and I have accepted Items 3, 4, 5, 6, 7, 16, and 20 as damages for the Applicants' foreseeable loss under s 259(4) of the ACL NSW.
In total, the amount of s 259(4) damages allowed is $5,702.99.

Orders (including costs)

The Applicants therefore have established a case for compensation and damages respectively in the amount of $30,016.74.
The Respondent should have credit for the amount of $4,000 it has already paid to the Applicants under the order made on 26 February 2021 in the original proceeding. This was pointed out in the Respondent's closing written submissions dated 17 November 2021 at [41]. As the Applicants made no submission in response to that point in their written submissions in reply dated 24 November 2021, I can reasonably infer that the Applicants also accept that the Tribunal should allow a credit of $4,000 in its order for the payment by the Respondent of a specified sum of money.
The parties' written submissions did not address the issue of costs, which is to be expected as the parties would reasonably prefer to make submissions after I have published my Reasons for Decision on the substantive issues in the proceedings. The matter of any orders for costs in the proceedings is an issue upon which I would expect the parties, and their legal representatives (consistent with their statutory obligation in s 36(3) of the NCAT Act to liaise cooperatively in an attempt to reach compromise and agreement.
However, if the parties are unable to reach agreement on the issue of costs, or there are circumstances of which I am unaware, I have made further directions to deal with that issue.
The Tribunal's orders are: 1. (1) The Respondent, Caravan & RV Central Pty Limited is to pay to the Applicants, Tony Edwards and Lynette Edwards, within 28 days of the date of these orders, the sum of $26,016.74. 2. (2) If a party seeks an order for costs leave is granted to file and serve a short written submission (no more than 5 A4 size pages) on that issue only within 28 days of the date of these orders. 3. (3) Leave is granted to the other party to file and serve a short written submission in reply (no more than 5 A4 size pages) within a further period of 28 days. 4. (4) Any reply submissions of the costs applicant (no more than 3 A4 size pages) are to be filed and served within a further 14 days. 5. (5) In any such submissions the parties are to address the matter of whether pursuant to the provisions of the Civil and Administrative Tribunal Act 2013 NSW, s 50(2), the Tribunal should dispense with a hearing on the issue of costs so that the issue is decided on the papers lodged with the Tribunal and with appearances

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 21 March 2022

Motor Dealers and Repairers' Act 2013(NSW)

Edwards v Caravan & RV Central Pty Ltd

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Cases Cited (12)