Fraser v Motor Group Canberra Pty Ltd T/as Mates Rates Cars

Procedural history

1. The application was first listed before the Tribunal for Conciliation and Hearing in a Group List on 31 May 2018. The applicant attended that listing of the application in person. Mr Rahul Anand, Sales Manager of the respondent, attended on its behalf. In accordance with the Tribunal's usual practice where both parties are present in person, prior to the case being called, the parties were provided with an opportunity to attempt to resolve the dispute in conciliation with the assistance of a Tribunal conciliator. Those efforts were not successful. When the parties returned to the hearing room following conciliation, the Tribunal adjourned the application for a special fixture hearing and issued directions to the parties for the filing and exchange of the documentary evidence that they intended to rely upon at that hearing.

Evidence

1. Both parties have complied with the Tribunal's directions for the filing and exchange of their documentary evidence. The applicant's bundle was admitted into evidence and marked Exhibit A1. The respondent's bundle was admitted into evidence and marked Exhibit R1. Mr Fraser attended the hearing by telephone and gave oral evidence under oath. He called as a witness his partner, Ms Karena Macmillan, who also attended the hearing by telephone and gave oral evidence under oath. Mr Rahul Anand again attended the hearing on behalf of the respondent. He also gave oral evidence under oath. The applicant and Mr Anand had the opportunity to present their cases, to ask each other and Ms Macmillan questions, and to make final submissions to the Tribunal. The evidence of the parties will be referred to where relevant in the reasons that follow.

Material facts and contentions of the parties

1. The dispute arises from the contract for sale of a used Holden Colorado RG LT Utility, Registration No DPV 02T, which the applicant purchased from the respondent on 7 March 2018. The applicant gave evidence that he purchased the motor vehicle primarily for use by Ms Macmillan. Ms Macmillan was the instrumental party behind and during the purchase. She gave evidence that she and her daughter are horse enthusiasts and that she wanted the motor vehicle to be capable of towing a horse float to gymkhanas and the like, as well as for use for other daily family and household tasks. She says that when the registration of motor vehicle was transferred to Mr Fraser, it was registered for personal, not business, use.
2. Ms Macmillan gave evidence that she first came across the motor vehicle advertised for sale on the website CARSALES.COM on or about 26 February 2018. She rang the contact telephone number listed on that advertisement to inquire about the motor vehicle and reached Mr Anand at Mates Rates Cars. She contends that after she confirmed her interest in the motor vehicle, and Mr Anand confirmed that it remained available for sale, Mr Anand asked her if she required finance to purchase the motor vehicle. Ms Macmillan says that she advised Mr Anand that she did, but that it would be Mr Fraser who would be the party to any loan contract.
3. It is not in dispute that Mr Anand then sent Ms Macmillan a form by email to complete which was for the purpose of obtaining basic background and contact information and a privacy release to enable him to refer her and Mr Fraser to a finance broker, Mr Adam Boyk, who works for an entity which apparently trades under the name of Credit Partners Australia. Ms Macmillan and Mr Fraser immediately completed and returned this form and supplied other documents requested on the form, by email. Later that same day Mr Anand forwarded these documents to Mr Boyk at Credit Partners Australia.
4. Mr Anand gave evidence that Mr Boyk of Credit Partners Australia is a finance broker with whom his dealership has a substantial relationship, in that it frequently refers prospective motor vehicle purchasers who require finance to purchase a motor vehicle to him to assist them in obtaining such finance.
5. On 28 February 2018 Mr Fraser and Ms Macmillan paid the respondent a holding deposit of $295.00 to remove the motor vehicle from sale while their loan application was processed. On that day Mr Anand drew up and printed a Contract for the Purchase of a Used Car and signed and dated the front page of that document.
6. On or about the next day, Mr Boyk sent Mr Fraser and Ms Macmillan a loan application form by email which Mr Fraser completed and returned to Mr Boyk. That loan was approved by a financial institution trading as Macquarie Finance to which Mr Boyk had referred the application on or about 1 March 2018. Mr Boyk then sent a Macquarie Finance loan contract to Mr Fraser for signature. Mr Boyk received the hard copy signed loan contract back from Mr Fraser on or about 4 March 2018 which he then submitted to Macquarie Finance for settlement. Settlement was completed on 6 March 2018 which resulted in the loan proceeds being received by the respondent on 7 March 2018.
7. On 7 March 2018 Ms Macmillan travelled by train to the dealership from hers and Mr Fraser's home in the upper Hunter Valley to complete the sale contract and collect the motor vehicle. She arrived at the dealership at approximately 4:00pm and met with Mr Anand. She signed a standard form Contract for the Purchase of a Used Car (contract) in respect of the motor vehicle and then took delivery of the motor vehicle and left the dealership for the journey home about 5:00pm.
8. Incorporated into the contract were certain attached "terms and conditions. " Clause 7 of those terms and conditions incorporates into the contract the cooling off period required by section 80 of the MDR Act, which was in the following terms (relevantly): 7. If the customer is entitled and duly elects to terminate this Contract under the Cooling Off right: 7.1 The Customer is liable to the Dealer for any damage to the motor vehicle while it was in the Customer's possession, other than fair wear and tear; 7.2 … 7.3 The Customer (if the Customer has accepted delivery of the motor vehicle before termination) must return the motor vehicle to the Dealer unless the Customer is not able to return it because of a defect in the motor vehicle, not caused by the Customer that has rendered the motor vehicle incapable of being driven or unroadworthy in which case the Customer must permit, and the Dealer must arrange for, the collection of the motor vehicle; and 7.4 any 'tied loan contact' within the meaning of the Consumer Credit (New South Wales) Code is terminated and sectioned 125(2)-(6) of the code applies to that termination as if it were a termination referred to in at section. (sic).
9. There are two signature points on the contract. On the front page of the contract a representative of the dealer, Mr Anand, has signed and dated the contract on 28 February 2018 (as noted above), and Ms Macmillan has signed and dated it 7 March 2018 on behalf of Mr Fraser. At the end of the terms and conditions the following words appear above a signature panel: -IMPORTANT- READ THIS DOCUMENT CAREFULLY BEFORE YOU SIGN THIS DOCUMENT BECOMES A LEGALLY BINDING CONTRACT UPON ACCEPTANCE BY THE DEALER
10. Ms Macmillan has signed and dated the signature panel 7 March 2018. A representative of the dealer, Mr Anand, has also signed and dated the signature panel 7 March 2018. At the time of the sale the applicant also issued the Ms Macmillan with a tax invoice in relation to the purchase, which is dated 7 March 2018.
11. The Form 5 Dealer's Notice of Motor Vehicles issued to the applicant when she signed the contract reports that the motor vehicle had a date of manufacture of November 2012 and an odometer reading of 116,000kms. It thus was sold with the Dealer Guarantee for Defective Vehicles incorporated into the contract for purchase by operation of section 68 of the MDR Act, subject to the limitation period imposed by subsection 69(5) of that Act, which is three months or 5,000kms travelled, whichever is reached first.
12. At the time of purchase, the motor vehicle was registered until 25 March 2018. It had last passed an e-Safety Check on 2 March 2018 having initially failed that test due to the rear shackle brushes in the steering suspension being worn.
13. Ms Macmillan gave evidence that she did not carry out any detailed inspection of the motor vehicle before taking delivery of it. She says that she relied upon the description of the motor vehicle on CARSALES.COM and Mr Anand's assurances which she says were to the effect that the motor vehicle was in good, roadworthy condition.
14. Ms Macmillan says that after leaving the dealership on her 3.5hour trip home, once she reached the M1 Motorway and attempted to travel at a speed of 80kms or more, the steering wheel and the motor vehicle itself began to shake seriously, leading her to fear for her safety. She says that she also found the brakes to be very "spongy". She claims that she had to depress the brake pedal three or four inches before the brakes would activate, which led her to believe that there was little of the brake pads left. She gave evidence that by this time it was after 5:30pm and she believed the dealership would be closed. On that basis, she believed it was too late to return the motor vehicle that day, so she completed the journey home.
15. Mr Fraser gave evidence that when Ms Macmillan arrived home he tested the motor vehicle and was also very concerned about the shaking in the steering wheel and body of the motor vehicle and its spongy brakes. He also noticed that the roof of the cabin had a large dent in it, and that the rear tyres had very little tread left on them. He has submitted into evidence photographs of the dent in the cabin roof and of the bare tread on the back tyres he took at that time (or the following morning). Ms Macmillan says she was unable to see the dent in the cabin roof when she collected the motor vehicle because she is of shorter stature than Mr Fraser.
16. After talking the matter over, and consulting with a NSW Fair Trading advisor, Ms Macmillan and Mr Fraser decided they would return the motor vehicle to the dealership within the cooling off period to which they believed they were entitled under the contract. Ms Macmillan gave evidence that she attempted to contact Mr Anand repeatedly during the morning of 8 March 2018, however, he did not answer the calls. She says that she left two messages on Mr Anand's voicemail, which were not returned. She says that in the early afternoon she blocked her number and placed a call which did not display her telephone number, which resulted in Mr Anand answering immediately.
17. Ms Macmillan says that she told Mr Anand that she and Mr Fraser were very unhappy with the motor vehicle and wanted to return it to the dealership within the cooling off period. She says that Mr Anand offered to carry out repairs to the motor vehicle to deal with her concerns. However, she advised him that she no longer had confidence in the motor vehicle and just wanted to return it. By this time it was latter afternoon, and it was too late for Ms Macmillan to travel to Sydney and reach the dealership before it closed at 5:00pm.
18. Consequently, in order to exercise his cooling off right Mr Fraser wrote a letter which is signed and dated 8 March 2018, which was then scanned and sent to Mr Anand by email. That letter states as follows (relevantly): TO MATES RATES CARS, PARRAMATTA I MICHAEL FRASER AM UTILISING THE COOLING OFF PERIOD AS PER THE FAIR TRADING ACT FOR CONSUMERS. I AM GIVING YOU NOTICE IN WRITING THAT I AM TERMINATING THE CONTRACT. REGARDS, MICHAEL FRASER
19. There is no dispute that Mr Anand received this letter at the dealership by email before 5:00pm on 8 March 2018
20. On the morning of the following day, 9 March 2018, Mr Fraser and Ms Macmillan returned the motor vehicle to the dealership. They met with Mr Anand and handed him the keys to the motor vehicle. They discussed with him their concerns about the shaking in the steering wheel and body, brake pads, wear on the rear tyres and the dent in the cabin roof. They say in their evidence that they left the dealership believing that Mr Anand had accepted their termination of the contract within the cooling off period and the return of the motor vehicle.
21. Mr Fraser gave evidence that sometime in the morning of 9 March 2018 he notified a representative of Macquarie Finance that the contract had been terminated within the cooling off period, which was accepted by the representative, who advised that the loan would remain valid for the purchase of an alternative motor vehicle. After returning the motor vehicle to the dealership, Mr Fraser and Ms Macmillan then went to inspect alternative motor vehicles for purchase elsewhere.
22. On 13 March 2018 Ms Macmillan sent a text message to Mr Anand asking him to confirm that the loan proceeds had been refunded to the Macquarie Finance. Mr Anand replied stating that the motor vehicle had been repaired and was now ready for collection by Mr Fraser and Ms Macmillan.
23. Mr Fraser and Ms Macmillan refused to accept the return of the motor vehicle asserting their right to terminate the contract within the cooling off period. Mr Anand has refused to accept their right to do so. The motor vehicle remains at the dealership. The proceeds of the loan have been retained by the dealership. Macquarie Finance has placed a temporary freeze on interest and payments due under the loan until this dispute is resolved. The intervention of a NSW Fair Trading Investigation Officer has not resulted in the parties resolving the matter.
24. Mr Anand contends that the cooling-off period mandated by section 80 of the MDR Act does not apply in this case because a Holden Colorado RG LT is a type of vehicle used for commercial or business purposes, and because Credit Partners Australia and Macquarie Finance are not credit providers linked with the dealership. He contends that, in any event, the contract was not terminated within the cooling off period, because the contract was made when he signed it on 28 February 2018. He argues that the motor vehicle was of acceptable quality and that the applicant is therefore not entitled to return it and obtain a refund, simply because he has changed his mind.
25. Mr Anand now also contends before the Tribunal that Mr Fraser and Ms Macmillan damaged the motor vehicle while it was in their possession, causing or permitting the dent to the cabin roof, and by "rough" driving the motor vehicle so as to cause excessive wear to the tread of the rear tyres and wear out the brakes. These allegations are strongly denied by Mr Fraser and Ms Macmillan.

Jurisdiction

1. I am satisfied that I have jurisdiction to deal with this application as a consumer claim under Part 6A of the FT Act. The applicant is a consumer and the respondent is a supplier of goods within the meaning of that Part. The goods in dispute (the motor vehicle) was supplied in the course of trade and commerce and it was supplied in New South Wales. The applicant has applied to the Tribunal within the limitation period applicable for a consumer claim and the claim is within the monetary limits that apply to such claims.
2. The applicant's cause of action is in contract. He alleges a breach by the respondent of his right to terminate the contract for the sale of the motor vehicle within the cooling off period inserted into the contract by operation of sections 80 and 81of the MDR Act.

Applicable law

1. Part 4, Division 5 of the MDR Act deals with the rights and obligations of motor dealers and consumers in relation to dealer financed purchases. Division 5 applies to the purchase of a motor vehicle from a motor dealer if the purchaser obtains credit for the purpose of financing the whole or part of the purchase from the motor dealer or a person who is a linked credit provider of the motor dealer: subsection 78(1). In this respect there is no issue in these proceedings that the motor vehicle is a motor vehicle and the dealership is a motor dealer to which the MDR Act applies.
2. The term "linked credit provider" is defined in section 4 of the MDR Act to have the same meaning as it has in the National Credit Code. The National Credit Code is found in schedule 1 of the National Consumer Credit Protection Act 2009. The definition of "linked credit provider" is found in clause 127 of that Code: 127 Linked credit providers and tied credit contracts (1) For the purposes of this Code, a linked credit provider of a supplier means a credit provider: (a) with whom the supplier has a contract, arrangement or understanding relating to the supply to the supplier of goods in which the supplier deals, relating to the business carried on by the supplier of supplying goods or services or relating to the provision to persons to whom goods or services are supplied by the supplier of credit in respect of payment for those goods or services; or (b) to whom the supplier, by arrangement with the credit provider, regularly refers persons for the purpose of obtaining credit; or (c) whose forms of contract or forms of application or offers for credit are, by arrangement with the credit provider, made available to persons by the supplier; or (d) with whom the supplier has a contract, arrangement or understanding under which contracts or applications or offers for credit from the credit provider may be signed by persons at the premises of the supplier.
3. Division 5 does not apply to or in respect of certain excluded motor vehicle sales. Relevantly to the contentions of the respondent in this case, it does not apply to the sale of a motor vehicle intended to be used predominately for business or other commercial purposes: subsection 78(2)(c). Nor does it apply where the provision of credit by a linked credit provider of the motor dealer to the purchaser is not arranged or facilitated by the motor dealer: subsection 78(2)(d).
4. Section 80 of the MDR Act mandates a cooling off period for dealer-financed purchases. The "cooling off period" of a motor vehicle is defined to be the period commencing when the purchaser enters into the contract for the purchase of the motor vehicle from the motor dealer and ending either (a) at 5pm on the next day that the motor dealer carries on business with the public or (b) if the motor dealer closes for business before 5pm on that day, at the close of business on the next day that the dealer is open for business following that day.
5. A purchaser's right to terminate a contract during the cooling off period is set out in section 81 of the MDR Act which is incorporated into the contract for a dealer-financed sale of a motor vehicle by operation of subsection 81(4) and Regulation 51 of the Motor Dealers and Repairer's Regulation 2014. A purchaser may terminate a contract for the purchase of a motor vehicle to which this Division applies by notice in writing given to the motor dealer during the cooling off period for the purchase: subsection 81(1). Despite any other law, the purchaser is not entitled to possession of the motor vehicle during the cooling off period, unless the purchaser and dealer otherwise agree: subsection 81(2). However, the right to terminate a contract may be exercised even though the purchaser has taken delivery of the motor vehicle concerned: subsection 81(3). A notice of termination by a purchaser must be signed by the purchaser or the purchaser's Australian legal practitioner: subsection 81(5). The cooling off period may be extended by a provison in the contract of sale or by agreement with the motor dealer: subsection 81(6).
6. Section 82 of the MDR Act deals with the waiver of a cooling off period. A purchaser may waive a right to terminate a contract if (a) the purchaser signs a waiver in the form prescribed by the regulations, and (b) any applicable requirements of the regulations are complied with: subsection 82(1).
7. Section 84 of the MDR Act sets out the obligations of a motor dealer on the termination of a dealer-financed sale contract within the cooling off period. On the termination of such a contract the motor dealer must (relevantly) pay to the purchaser all money received by the motor dealer under the contract less any money the purchaser is liable to pay by operation of section 85: subsection 84(1).
8. Section 85 of the MDR Act sets out the obligations of a purchaser on the termination of a dealer-financed sale contract within the cooling off period. On the termination of such a contract the purchaser must (relevantly) pay to the motor dealer $250.00 or 2% of the purchase price, whichever is the lesser: subsection 85(1) A purchaser who has accepted delivery of the motor vehicle before termination is liable to the motor dealer for any damage to the motor vehicle while it was in the purchaser's possession, other than fair wear and tear: subsection 85(2).
9. Section 87 of the MDR Act deals with the termination of tied loan contracts if a purchaser terminates a dealer financed sale contract within the cooling off period. On termination of such a contract, any tied loan contract is terminated: subsection 87(1). In this respect, the term "tied loan contract" is defined in section 79 to have the same meaning that is has in the National Credit Code. The definition of "tied loan contract" is also found in section 127 of that Code. It is a credit contract (other than a continuing credit contract) entered into between a credit provider and a debtor where (a) the credit provider knows or ought reasonably to know that the debtor enters into the credit contract wholly or partly for the purposes of payment of goods or services supplied by a supplier, and (b) at the time the credit contract is entered into the credit provider is a linked credit provider of the supplier: subclause 127(3).

Consideration

1. Having regard to the applicant's cause of action, the applicable law, the material facts, and the contentions of the parties, the questions the Tribunal must pose and answer in order to determine the outcome of this application may be stated as follows: 1. Was the contract for the sale of the motor vehicle a contract to which the cooling-office period contained in section 80 of the MDR Act applies? 2. If so, did the applicant effectively exercise his right to terminate the contract within the cooling-off period? 3. If so, what are the respondent's obligations on the termination of the contract? and 4. If so, what are the applicant's obligations on the termination of the contract?

Does the cooling-off period apply?

1. As noted above, the respondent contends that despite the fact that the cooling-off period mandated by section 80 of the MDR Act is incorporated into clause 7 of the contract for sale of the motor vehicle it does not apply in this case for two reasons. First, because the motor vehicle is of a type that is excluded from the operation of the cooling off period by subsection 78(2)(c) because it is a vehicle intended to be used primarily for business of commercial purposes. Second, because it was not sufficiently involved in the financing arrangement for the motor vehicle to result in the sale being a dealer financed purchase within the meaning of Part 4 Division 5 of the MDR Act.
2. The applicant gave evidence that he purchased the motor vehicle principally for use by Ms Macmillan. Ms Macmillan gave evidence that she wanted to use the motor vehicle for basic household and family activities. She told the Tribunal she purchased a vehicle of this type because it had the power to tow a horse float which was necessary because she and her daughter are horse enthusiasts and frequently travel to participate in gymkhanas and the like. Mr Fraser told the Tribunal that when registration of the motor vehicle was transferred to him it was registered for personal, not business, use. Mr Anand did not challenge any of this evidence.
3. Mr Anand's put the respondent's case on this issue on the basis that a Holden Colorado Ute is a type of motor vehicle ordinarily used for business and commercial purposes. He contended that the advertising of the motor vehicle on the manufacturer's website emphasises its use as a "work vehicle". The respondent did not submit into evidence any examples of this advertising, or any other documentary material, to support this contention.
4. The question for the Tribunal to determine is therefore whether the phrase "a sale of a vehicle intended to be used predominantly for business or other commercial purposes" as used in section 78(2)(c) of the MDR Act, requires it to ascertain, objectively, the predominate intended use of a motor vehicle of that type, without reference to the particular or actual purpose for which the applicant purchased it, or whether those words direct the Tribunal's inquiry to the particular or actual purpose for which the applicant purchased the motor vehicle. There does not appear to be any prior published decisions of the Tribunal or of a Court that have considered the meaning to be given to the phrase. In any event I was not taken by the parties to any authority on this point.
5. In Bunnings Group Limited (formerly Bunnings Pty Ltd) v Laminex Group Limited [2006] FCA 682 the Court was required to determine according to the Trade Practices Act 1974 if the goods in question were "of a kind ordinarily acquired for personal, domestic or household use or consumption". Young J (as he then was) observed, after reviewing cases that had considered analogous expressions, that it is preferable to pose the statutory question as a composite question rather than a two stage inquiry as to the genus of the goods, then whether that kind of goods is ordinarily acquired for domestic or household use or consumption [at 82]. He also observed that, depending upon the precise statutory question and the circumstances of the particular case, it will be relevant to inquire into the essential character of the goods in question, which should be determined objectively, but also having regard to a broader inquiry into the evidence concerning the design, marketing, and potential uses of the type of goods in question [at 83 to 86]. He concluded that the result is ultimately a question of fact and degree [at 87].
6. His Honour then went on to state that the language of the Trade Practices Act 1974, which focused on what goods of a kind are ordinarily acquired for, not ordinarily used for, invites attention to "design features and purposes, cost, quality and pricing considerations, and the range of uses and applications for the goods that have been targeted in advertising and promotional material" [at 107]. However, it would be a mistake to become too focused on these questions so as to identify the goods "so narrowly that it amounted to little more than a description of particular goods" [at 108].
7. By contrast with the statutory language the Court was dealing with in Bunnings Group Limited, the words of subsection 79(2)(c) direct attention to the predominate intended use of the motor vehicle, not the purpose for which it is ordinarily acquired. To some extent, this still begs the question: intended by whom - the manufacturer, or the specific purchaser? Although not beyond doubt, I am satisfied that the phrase directs the Tribunal's attention to the purchaser's intended use of the motor vehicle. In this respect the phase appears to me to refer to a specific motor vehicle that is the subject of the contract, and the use to which the purchaser intends to put that motor vehicle at the time of the sale. It does not appear to me to be referring to a general type or class of motor vehicle and the predominate purpose for which such motor vehicles are manufactured in the abstract. In this respect, there is no contest that the applicant did not purchase the motor vehicle for business or another commercial purpose, and nor was it registered for business use.
8. Even if I am wrong in this construction of section 78(2)(c), applying an objective test would not lead to a different result in this case. Apart from Mr Anand's oral evidence, which is his opinion, there is no other evidence before the Tribunal that is capable of proving that a Holden Colorado Ute is a type of motor vehicle predominately manufactured and sold for business and commercial purposes. I accept that it is a heavy duty vehicle, but there are all manner of personal and domestic pursuits that may require acquisition and use of a motor vehicle with such an engine capacity. One such use, which requires no stretch of the imagination, is to tow a horse float, which was a primary motivating factor behind the purchase in this case. Using the language of the Court in Bunnings Group, the evidence before the Tribunal does not establish that a Holden Colorado is of a "genus" or has an "essential character" or "design features and purposes" that could lead to an objective conclusion that its predominate use is for business or other commercial purposes.
9. I am therefore comfortably satisfied that the contract did not involve the sale of a motor vehicle intended to be used predominately for business and commercial purposes. The contract is thus not excluded from the operation of Part 4, Division 5 of the MDR Act on that account.
10. The respondent contends that the contract for the sale of the motor vehicle was not a dealer financed purchase within the meaning of Part 4, Division 5 of the MDA Act because apart from referring the applicant to Mr Boyk of Credit Partners Australia, the respondent played no part in the loan application and approval process, which was completed directly between the applicant, Credit Partners Australia and Macquarie Finance.
11. As set out above, a "dealer-financed purchase" for the purpose of Part 4, Division 5 of the MDR Act is the purchase of a motor vehicle from a motor dealer by a purchaser with finance provided by a credit provider linked to the motor dealer. Clause 127(1)(a) of the National Credit Code defines a "linked credit provider" to include a credit provider with whom the supplier has an arrangement or understanding relating to the provision to persons to whom goods are supplied by the supplier of credit in respect of payment of those goods. Clause 127(1)(b) defines a "linked credit provider" to mean a credit provider to whom the supplier, by arrangement with the credit provider, regularly refers persons for the purpose of obtaining credit. Clause 127(1)(c) defines a "linked credit provider" to also include a credit provider "whose forms of contract or forms of application or offers of credit are, buy arrangement with the credit provider, made available to persons by the supplier.
12. On the evidence before me I am comfortably satisfied that the contract for sale of the motor vehicle was a dealer-financed purchase on the basis it involved a linked credit provider as defined by clause 127(1)(a), (b) and probably also (c) of the National Credit Code. There is no issue in this case that Credit Partners Australia is a finance broker with which the respondent has a substantial referral relationship. Mr Anand told the Tribunal he regularly and routinely refers customers requiring finance to purchase motor vehicles to Credit Partners Australia to obtain finance. In turn, Credit Partners Australia brokers finance from a range of lenders to fund these motor vehicle purchases. The respondent obtains information from a prospective customer to assist it in referring the customer to Credit Partners Australia. The form on which this information is collected is not in evidence, so it is not possible for the Tribunal to know what information is specifically collected. However, it is clear that it involves the collection of some personal information and associated documentation because it requires the applicant to sign a release authorising the disclosure of this information to Credit Partners Australia. It is also clear that it is the respondent who provides Credit Partners Australia, and though that entity, the lending institution information about the motor vehicle that will be the subject of the loan. Once the loan is approved by the financial institution, its proceeds are paid directly to the respondent and not the purchaser.
13. In all of these respects it is clear that Credit Partners Australia, and through that entity, Macquarie Finance, are linked credit providers and that the loan agreement in respect of the purchase of the motor vehicle is a tied loan contract for the purpose of Part 4, Division 5 of the MDR Act. The respondent's contentions to the contrary must be rejected.
14. For completeness, I note that there is no issue that the applicant did not waive his right to a cooling-off period in accordance with section 82 of the MDR Act.
15. I am thus satisfied that the cooling off period mandated by section 80 of the MDR Act, and incorporated into the contract for the sale of the motor vehicle by clause 7 of its Terms and Conditions applies in this case.

Did the applicant effectively exercise his right to terminate the contract within the cooling-off period?

1. The respondent contends that the applicant failed to exercise his right to terminate the contract within the cooling-off period because the contract was made on 28 February 2018 when the applicant paid the $295.00 holding deposit and Mr Anand drew up, signed, and dated the front page of the contract for sale.
2. This argument cannot succeed. A contract is formed (relevantly) by offer and acceptance and the passing of consideration according to the terms of the contract: see generally, Carlill v Carbolic Smoke Ball Company [1892] EWCA Civ 1. In this case the respondent made an offer to sell the motor vehicle to the applicant for a total price of $24,785.00, which the applicant wanted to, but could not, accept until he was able to pay the purchase price for the motor vehicle. He could not do so until the proceeds of his loan from Macquarie Finance were paid to the respondent, which was approximately mid-day on 7 March 2018. It was on that date, in the later afternoon, that Ms Macmillan attended the dealership to sign the contract and collect the motor vehicle. It was at the time she and Mr Anand both signed the contract on that date that the contract was made and became binding upon the parties. Prior to that point the respondent's offer to sell the motor vehicle to the applicant was a non-binding invitation to treat: see generally, Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd [1953] EWCA Civ 6. There were no binding legal relations between the parties prior to that point.
3. In the circumstances of this case, the cooling-off period therefore ended at 5:00pm on 8 March 2018. In order to effectively exercise the right to terminate the contract within the cooling-off period, the applicant had to notify the respondent in writing in document signed by him that he terminated the contract before 5:00pm on 8 March 2018. There is no issue that he did so. The applicant was not required to return the motor vehicle to the respondent by 5:00pm on 8 March 2018, but did so on the morning of 9 March 2018.
4. The respondent has also sought to argue that the applicant was not entitled to return the motor vehicle within the cooling-off period because he has failed to establish that the motor vehicle was not of acceptable quality, and has simply changed his mind. This contention is misconceived. The law permits the applicant to terminate the contract for sale within the cooling off period for any or no reason. It is not necessary for the applicant to prove that he was entitled to do so because the motor vehicle was not of acceptable quality. In fact, the purpose of the cooling-off right is to permit a purchaser in a dealer-financed purchase of a motor vehicle to change their mind.
5. For the foregoing reasons, I am satisfied that the applicant has effectively exercised his right to terminate the contract within the cooling-off period.
6. I note for completeness that the tied loan contract between the applicant and Macquarie Finance was therefore also effectively terminated on 8 March 2018 by operation of section 87 of the MDR Act.

What are the respondent's obligations on the termination of the contract?

1. That being the case, the respondent's obligation, as mandated by section 84 of the MDA Act was to pay the purchaser all money received by the motor dealer under the contract less any money the purchaser is liable to pay by operation of section 85 of that Act. The money received by the motor dealer in respect of the contract was a total of $24,785.00, which is constituted by the purchase price of the motor vehicle, the dealer administration fee, and the cost of a retail warranty.
2. Although not express in the legislative scheme, on a contractual basis it is also clear that the respondent has the obligation to accept the return of the motor vehicle.

What are the applicant's obligations on the termination of the contract?

1. Although not express in the legislative scheme, on a contractual basis it is also clear that termination of the contract required the applicant to return the motor vehicle to the respondent, as he had taken possession of it during the cooling-off period. As noted above, he did so on the morning of 9 March 2018. The applicant must also do all things necessary to transfer ownership of the motor vehicle back to the motor dealer.
2. By operation of subsection 85(1) of the MDR Act, the applicant must also forfeit to the motor dealer the sum of $250.00 or 2% of the purchase price for the motor vehicle, whichever is the lesser. In this case, the lesser amount is $250.00.
3. The applicant is also liable to the respondent for compensation for any damage that occurred to the motor vehicle while it was in his possession, other than fair wear and tear. In this respect, Mr Anand contends that the roof of the cabin of the motor vehicle was damaged while in the applicant's possession and that the applicant caused or permitted the rear tyre tread and brakes to wear away by driving the motor vehicle "rough" in an attempt to render it not of acceptable quality so that its return could be justified.
4. The respondent bears the onus of establishing these contentions to the civil standard of proof, which is the balance of probabilities: Briginshaw v Briginshaw (1938) 60 CLR 336. This standard of proof was described by Lord Denning in Miller v Minister for Pensions [1947] 2 All ER 372 [at 374] as requiring the Tribunal to be satisfied that an alleged fact was "more probable than not". However, the Tribunal must "feel an actual persuasion of [the alleged fact's] occurrence or existence before it can be found. It cannot be found as a result of a mere mechanical comparison of probabilities independently of any belief in its reality" … [the occurrence or existence of the fact must be established]… to the reasonable satisfaction of the Tribunal": Briginshaw [at 361-2].
5. The respondent has advanced no objective evidence to prove the condition of the motor vehicle prior to its delivery to Ms Macmillan on 7 March 2018, other than the e-Safety Certificate completed on 2 March 2018. The e-Safety Certificate sheds no light on the condition of the cabin roof at that time. It does however suggest that the tyres and brakes were in roadworthy condition, although there is nothing that records their specific condition.
6. The respondent has also submitted a copy of an invoice and description of work for repairs carried out on the motor vehicle at a cost of $435.50 by a motor repairer trading as Parramatta Automotive Services, which is dated 9 March 2018. The following description of the work done appears on that invoice: Labour to perform vehicle inspection, checked vehicle exterior found new damage to the rear of the roof and slight paint scratches to the front bumper bar which was not evident on the previous inspection, checked vehicle interior, normal, wear and tear as per age of vehicle, front tyres are new, rear tyres are near minimum tread but still roadworthy, will need replacing in approx. six months, front brake pads are low, rear brake shoes are approx. 40% remaining, perform diagnostic scan test found no fault codes, checked engine checked out as normal for the vehicle's age, perform road test Labour to remove and replace both front brake pads, lean and lubricate caliper slides
7. That description does suggest that there had been a change in the condition of the cabin roof since it was last inspected. However, there is no clear evidence as to when it was last inspected, and it is impossible to isolate the period in which any new damage occurred to the less than 24 hour period the motor vehicle was in Mr Fraser and Ms Macmillan's possession. The description of work also does not bear out the allegation that Mr Fraser and Ms Macmillan caused or permitted the tyres and brakes significant wear by driving the motor vehicle "rough." No departure from the previously inspected condition is reported.
8. There is an inherent unlikelihood that the applicant and Ms Macmillan would set out to sabotage a motor vehicle they had just purchased by causing or permitting damage to its roof. It is even less likely in my assessment that they would deliberately set out to sabotage its tyres and brakes, especially whilst they were still obliged to drive it at their own risk. What possible motive could they have had for doing so? The evidence establishes that Ms Macmillan wanted and needed the motor vehicle, and that she still does want and need a motor vehicle of this type. Mr Fraser's loan over the motor vehicle was approved and he seeks to utilise this loan approval to purchase another suitable vehicle. He does not seek to escape from the loan obligation. Ms Macmillan travelled to collect the motor vehicle from some distance and at some inconvenience. Mr Fraser and Ms Macmillan vehemently deny causing or permitting any damage to the motor vehicle. Their oral evidence was internally consistent, consistent with the objective facts, and otherwise persuasive.
9. On the evidence before me, the respondent has not established to the requisite standard of proof that the applicant caused or permitted any damage to the motor vehicle during the period it was in his possession for which the respondent is entitled to be compensated. However, even if I had found the contrary, the respondent has placed no evidence before me as to any cost of repairs to the cabin roof that could provide the basis for an order as to compensation.
10. For these reasons the applicant has no liability to the respondent for any damage to the motor vehicle while it was in his and Ms Macmillan's possession.

Conclusion

1. For the foregoing reasons, the applicant is entitled to orders that will require the respondent to accept the return of the motor vehicle and refund to the applicant $24,535.00, which is constituted by the purchase price he paid for the motor vehicle, plus the related dealer administration charges, and the cost of the warranty, less the $250.00 the applicant must forfeit because of the operation of subsection 85(1)(a) of the MDR Act. This payment must be made within 14 days of the date of these orders.

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: 17 October 2018