Goldberg v Office of Fair Trading & Business [2000] VSC 85

"33A. Injunction to stop unlicensed trading (1) The Director may apply to the Magistrates' Court for an order requiring a person to stop trading in motor cars. (2) The Magistrates' Court may make the order if it is satisfied that the person is trading in motor cars and is not authorised to do so under this Act."

The Director there referred to is the Director of Consumer Affairs.

10. It is an offence for a person to trade in motor cars without being licensed to do so: see s.7 of the Act. The appellant is not licensed to trade in motor cars.

13. Trading in motor cars is defined in s.3 of the Act. It means "buying selling or exchanging motor cars, whether as principal or agent, and offering to buy sell or exchange motor cars, whether as principal or agent, and includes an advertisement or invitation to treat but does not include an exempt transaction under sub-section (3)".

16. For present purposes it is only necessary to note that an exempt transaction includes selling motor cars or offering to sell motor cars by any person to (i) licensed motor car traders; (ii) special traders; or (iii) employees of the person or, where the person is a body corporate, of a related company of the person.

19. Section 7A of the Act provides that persons doing certain things in relation to motor cars are deemed to be trading in them. The relevant sub-sections of the section for present purposes are sub-ss.(1), (2), (3), (4) and (5), which read:

"(1) A person who buys, sells or exchanges, or offers to buy, sell or exchange, 4 or more motor cars in any period of 12 months (whether as a principal or as an agent) is deemed to be a motor car trader carrying on a business of trading in motor cars. (2) Sub-section (1) does not apply if the person can prove that she, he or it did not, in that period, carry on the business of trading in motor cars and did not hold herself, himself or itself out as carrying on the business of trading in motor cars. (3) In counting the number of motor cars bought, sold or exchanged by a person, any purchase, sale or exchange - (a) that is an exempt transaction for the purposes of the definition of "trading in motor cars" is not to be counted; (b) that is from, to or with a licensed motor car trader is not to be counted. (4) In counting the number of motor cars offered for purchase, sale or exchange by a person, any offer - (a) that would result in an exempt transaction for the purposes of the definition of "trading in motor cars" if it was to be accepted is not to be counted; (b) that is made to a licensed motor car trader is not to be counted. (5) In this section an offer to sell includes an invitation to treat and the publishing (or authorising the publication) of an advertisement."

23. On 28 November 1999 the appellant was served with an application by the Director for an order pursuant to s.33A. The application came before the Magistrates' Court on 2 February last. The evidence called on behalf of the Director was that over the period from 22 March 1997 to 26 June 1999 the appellant had purchased some 20 damaged cars from Fowles Motor Auctions. Fowles Motor Auctions is a licensed motor car trader and those transactions, therefore, were exempt transactions. However, over the same period of time the appellant advertised for sale some 25 motor cars on some 59 separate occasions.

26. It is clear that the magistrate took the view that by advertising those cars for sale to the public the appellant was deemed to be trading in motor cars and made the order against him accordingly.

29. On 25 February the appellant made his application to the Master. In dismissing the application the Master noted, alongside the heading "Other Matters":

"The Master was satisfied that there was evidence before the Magistrate, of offers for sale of motor cars made by the Appellant to the public, which attracted the deeming provision in section 7A(1) of the Motor Car Traders Act 1986 and that it was open for the Magistrate on the evidence as he must have done to conclude that the Appellant had not, before the Court proved on balance of probabilities that he did not carry on the business of trading in Motor Cars (section 7A(2) of that Act)."

33. The argument advanced by the appellant - who, I might add, appeared before me in person - was that once he purchased a motor car from a licensed motor car trader, a transaction which is clearly an exempt transaction, then any transaction involving the car thereafter is also an exempt transaction.

36. In my opinion that is a misconception of the section. It is not the car which gains an exemption, it is the transaction itself. And so, if a person purchases a car from a licensed motor car trader, that transaction is exempt; but if he later offers the same car for sale to the public at large, that transaction is not an exempt transaction.

39. In my opinion the Master made no error in the matter. It was clearly open to the magistrate to find that in advertising the 25 cars for sale the appellant was deemed to be trading in motor cars and that the appellant had not proved that he had not.

42. This appeal to a judge of the court must therefore be dismissed with costs to be taxed and paid by the appellant.

46. HIS HONOUR: I will stay the order as to the costs of the Magistrates' Court proceeding and the costs of the appeal to a judge of the court for a period of one month.