O'Neill v Country Motor Company - [2018] NSWCATCD 76 - NSWCATCD 2018 case summary — Zoe

NSWNSWCATCD

O'Neill v Country Motor Company

[2018] NSWCATCD 76

NCAT Consumer and Commercial|2018-09-13

View original source

At a glance

Source facts

Court

NCAT Consumer and Commercial

Decision date

2018-09-13

Source

Original judgment source is linked above.

Judgment (42 paragraphs)

[1]

Background

A little should be said by way of introduction about the history of this matter.
This application was filed in the Tribunal on 2 May 2017. The application sought orders for payment to the applicant of the sum of $78,751.74 in respect of an allegedly defective caravan supplied by the respondent to the applicant. Another almost identical application had previously been filed by the applicant on 8 October 2014 but was withdrawn on 2 March 2015 after three appearances in the Tribunal.
At the initial hearing on 14 June 2017 both parties attended by telephone. At the request of the respondent, Knott Investments Pty Ltd t/as "AVIDA Recreational Vehicles", the manufacturer of the caravan, was joined as a respondent to the proceedings and directions were made for exchange of documents to be relied on at the hearing.
The matter was set down for a three hour hearing on 6 September 2017. At that hearing Mr O'Neill was present in person and was accompanied by Ms T Leigh. Both respondents were represented by employees of those companies. On the applicant's request the application was adjourned and further orders were made for exchange of documents. One day was allocated for hearing the matter on the next occasion and the application was listed for hearing on 22 January 2018.
On 19 October 2018, on request of Ms Leigh, purporting to be acting as the representative of the applicant, the period of time for filing and serving of documents was varied. On 27 October 2017 the hearing scheduled for 22 January 2018 was vacated on request of the second respondent and the parties were directed to provide unavailable dates for February, March, April and May 2018.
On 6 November 2017 the Tribunal directed that the matter be listed for a short hearing on 23 November 2017 to determine whether the second respondent should be removed, to consider the applicant's request to be represented by Ms Leigh and to prepare the matter further for formal hearing. Prior to that hearing the matter was again referred to the Tribunal who directed that the applicant's request to serve evidence by email was refused and directed compliance with earlier directions for exchange of documents.

[2]

Jurisdiction

The parties filed an agreed statement of facts to the following effect: 1. The parties entered into a contract on 28 April 2014 for the supply by the respondent to the applicant of the subject caravan and the caravan was supplied by the respondent on 23 May 2014, 2. The contract was for the "supply" of "goods" within the meaning of the Fair Trading Act 1987 (FTA) Part 6A, 3. The contract was made in New South Wales and the supply took place within New South Wales, 4. The applicant and respondent are respectively a "consumer" and a "supplier" within the meaning of Part 6A of the FTA, 5. The application is a "consumer claim" within the meaning of Part 6A and was brought within time, 6. The applicant was the first registered owner of the caravan.
A further fact that was not in dispute was that the caravan actually supplied by the respondent to the applicant was manufactured in 2013 and was the caravan that had been on display at the Rosehill Caravan and Camping Show on 28 April 2014.
The FTA s 79S(1) provides The Tribunal has no jurisdiction to make, in respect of a particular consumer claim, an order or orders in favour of the claimant (or, where there are two or more claimants, in favour of those claimants) if the relevant total under or because of the order or orders would exceed the prescribed amount.
The amount for which the applicant sought orders in this matter was $78,751.74. The prescribed amount for the purpose of s 79S (1) is $40,000 (s 79S (7)) and it would therefore appear that there is no jurisdiction for the Tribunal to make the order sought.
However, the FTA s 79S(6) provides an exemption to the limitation imposed by s 79S(1) (6) Subsections (1), (3) and (4) do not apply in relation to a consumer claim: 1. arising from the supply of a new motor vehicle that is used substantially for private purposes within the meaning of the Motor Vehicles Taxation Act 1988, or 2. relating to commission fees charged by agents licensed under the Property, Stock and Business Agents Act 2002.
The parties were in dispute on the issue of whether or not the subject caravan was a "new motor vehicle" within the meaning of s 79S(6)(a).
The applicant's position was that a new motor vehicle for the purposes of s 79S is defined as "new motor vehicle" means a motor vehicle that is not a second-hand motor vehicle within the meaning of the Motor Dealers and Repairers Act 2013 . and the Motor Dealers and Repairers Act 2013 s 4 defines a "new motor vehicle" as one that is not a "second hand motor vehicle", which is defined as a motor vehicle that, at any time before being offered or displayed for sale, or sold, has been registered to a person other than the purchaser, and includes a demonstrator motor vehicle.
The applicant's submission was that the caravan was new and was sold to the applicant as such. The contract was described as a "Contract for the purchase of a New Vehicle" and the applicant purchased the vehicle for private purposes. The vehicle was not a demonstrator and the parties' agreed facts were that the applicant was the first registered owner of the caravan. Accordingly the sale comes within the exemption provided by the FTA s 79S (6) (a) and the Tribunal has jurisdiction to make the order sought.
The respondent's submission acknowledged that the respondent had sold the caravan to the applicant and that the applicant had used the caravan for private purposes.
However, the definition of "second-hand motor vehicle" set out in the Motor Dealers and Repairers Act 2013 s 4 includes a "demonstrator motor vehicle" which is defined as "demonstrator motor vehicle" means a motor vehicle: 1. that has been used only for a purpose connected with its manufacture or sale or for the purpose of demonstrating the motor vehicle, or a motor vehicle of that kind, to a potential purchaser, and 2. that has not been sold to a person other than a motor dealer, and 3. that has been registered only in the name of a motor dealer, a person on behalf of a motor dealer or another person in anticipation of the sale of the motor vehicle to that person.
The respondent's submission was that despite the fact Mr O'Neill thought he was buying a new vehicle the vehicle was a demonstrator, as provided on invoice 403 prepared by the respondent and signed by the applicant on 28 April 2014.
Further, the respondent relied on the evidence of Mr Buikstra that the caravan sold to the applicant was a display unit at the Rosehill Caravan and Camping Show 2014 and that it was used to demonstrate its qualities to potential customers.
In addition the respondent relied on the evidence of the salesman, Mr Rachford, that it was his unvarying practice when selling a display unit to write the VIN number and "display unit" on the invoice, which he had done in this case.
Hence, it was submitted, the caravan came within the definition of a "demonstrator motor vehicle" and was accordingly caught by the definition of being "second-hand". As the vehicle was not a "new motor vehicle" the exemption provided by the FTA s 79S(6)(a) has no application and the Tribunal is precluded from making orders in excess of $40,000.
The applicant's evidence was that he had attended the Rosehill Caravan and Camping Show in 2014 and that he had spent the entire day looking at caravans. He attended the respondent's display late in the day and was by then quite tired. Nevertheless Mr O'Neill gave clear evidence of his recollections of the conversation he had with Mr Rachford that day. Mr O'Neill was intending to travel from about June 2014 and therefore had a clear imperative which he expressed to Mr Rachford that his van must be ready by 23 May 2014. That conversation is consistent with the intention of the parties that a new caravan of the same model as the one on display be manufactured but with the added features agreed on. The van was in fact not supplied until 23 May 2014.
Mr Rachford gave evidence by telephone and had no clear recollection of his conversation with Mr O'Neill on 28 April 2014 and was dependant on his recollection of his usual practice when giving evidence on whether he had sold the display van to the applicant.
On this point I accept Mr O'Neill's evidence as more reliable than that of Mr Rachford. The invoice prepared by Mr Rachford on 28 April 2014 does indeed have a specific VIN number included and the words "display unit". However, the VIN number is on the line dealing with the specified exterior colour and the words "display unit" are on the line dealing with interior colour.
Mr O'Neill relied on the actions of the salesman to give effect to the agreement they had reached and gave evidence that he had not paid close attention to the details provided on the invoice he signed. I do not accept that the interpretation put on those words by Mr O'Neill is inherently implausible. I am satisfied that a reasonable person may very well interpret the words exactly as Mr O'Neill has stated he did.
I do not accept the respondent's argument that the contract was complete on signing of the invoice 403 on 28 April 2018 and payment of a deposit at that time. The contract document prepared, at least in part, on 6 May 2014 and executed on 23 May 2014 at the time of delivery of the caravan and the payment of the balance of the purchase price was an important part of the transaction.
It has been said that building contracts are not noted for their brevity and that the contract will often consist of "a monumental and forbidding aggregation of documents" F E Cleary & Sons Pty Ltd v Buckland Building Group Pty Ltd NSWCA 12 February 1976, unreported. Although this was not a building contract it was a contract for goods that required some specificity of description by the parties, involved a trade-in vehicle and a declaration regarding ownership of that vehicle and a significant payment of money by deposit and again on delivery. It is quite likely therefore that no single document was intended to express clearly all of the terms of the agreement. I am satisfied the invoice 403 could not, and in fact, did not constitute the whole of the contract between the parties.
The contract, I am satisfied consisted of "Tax Invoice 403" executed on 28 April 2014, the "Contract for purchase of a New Vehicle" executed on 23 May 2014 together with a specification sheet and other matters agreed orally between the parties.
I am satisfied that the agreement was to purchase a caravan of the same colour and description as the one on display and that there were some particular items specified and that the caravan as ordered was to be delivered later in May. I accept Mr Buikstra's evidence, and it is not in dispute, that the caravan actually sold to Mr O'Neill was the one on display at the Rosehill Show. However, it is not the one that Mr O'Neill believed he was buying and it was not the caravan the parties contracted for.
I am quite satisfied that the applicant entered into a contract for the purchase, and the respondent entered into a contract for the supply, of a new vehicle, as stated on the "Contract for purchase of New Vehicle" document executed on 23 May 2014.
Accordingly the applicant is entitled to the benefit of the exemption provided by the FTA s 79S(6) and the Tribunal does have jurisdiction to make the order sought.

[3]

Applicant's relevant submissions

The primary relief sought by the applicant is for a full refund of the purchase price of the caravan and associated losses on the basis that the respondent is in breach of the consumer guarantees provided by the Australian Consumer Law (ACL) s 54-56 and on the premise that the breaches constitute a "major failure" within the meaning of the ACL s 260.
Since the purchase of the vehicle by the applicant in April 2014 a number of defects have been identified. It is the applicant's submission that some of those defects continue, including the following ones which are themselves a major failure, namely; 1. Continuing water ingress to the caravan, 2. Faulty braking system, and 3. Non-compliant wiring and gas installation.
In addition, it was submitted, the remaining defects when taken alone may be minor but, when taken together are sufficient to constitute a major failure. Although some of the minor defects have been repaired it was the applicant's submission that because of the continuing nature of the defects and the piecemeal rectification of minor issues by the respondent the Tribunal should consider all of the defects in determining whether, at the time of supply, a reasonable consumer would have acquired the caravan.
The second aspect of the applicant's claim was that the respondent was in breach of the guarantee provided under the ACL s 56 in regard to supply of goods by description and/or the respondent had engaged in misleading and deceptive conduct contrary to the ACL s 18 in that 1. The caravan was not a newly built caravan but had in fact been constructed in 2013, 2. The caravan was not built by, or in affiliation with Winnebago, USA but had in fact been built by AVIDA which has no relationship with that company, and 3. It was misrepresented in regard to the tare mass and load carrying capacity.
The applicant provided details in an extensive chronology of events starting with the delivery of the caravan on 23 May 2014 and payment of the balance of the purchase price of $45,000 at that time. The defects complained of were listed as, 1. 26 May 2014 electrical faults including activation of step alarm without ignition connected, bathroom lights not working and two-part door not disengaging, 2. Early June 2014, problems with finishes including cabinet locks falling off, handle catches sticking, ill-fitting drawers, issues with caravan door, worn paintwork, scratched chrome handle and gasket falling out of main door lock, hairline cracks to front of caravan, incorrect manual, stability legs (2) fitted upside down, loose light fitting, electrical short in kitchen exhaust, 3. 10 June 2014, a total failure of electrical system resulting in repairs by the applicant and repairs of brakes, plumbing and electrical system by Batavia Coast Caravans on 7 August 2014, under instruction by the respondent, 4. August 2014 the applicant became aware of water ingress following rain and on 7 September 2014 water damage under the refrigerator and kitchen cabinets and toilet areas which appeared to be coming through wall panels was noted, 5. 9 September 2014 the applicant sought a refund of the purchase price based on electrical faults and water ingress through the roof, 6. 27 October 2014 caravan inspected and found to have faults with the brakes and ESC system causing wheel lock when activated and further water leaks in the bathroom area, 7. Lack of access to the caravan whilst AVIDA carried out repairs from January to April 2015, 8. March 2015 admission by respondent of 21 defects and agreement to raise issues with the supplier, 9. 5 May 2015, further electrical problems found, 10. June 2015 caravan electrical system failure and continuing braking problems resulting in further approved warranty repairs being undertaken in Dubbo, 11. 1 August 2015 electrical fault and brake malfunction resulting in further warranty repairs including water ingress, 12. 7 December 2015 respondent accepts continuing water leaks but AVIDA unable to attribute to roof and side ally sealant, 13. February to April 2016 caravan again unavailable to applicant whilst in AVIDA's possession for repairs, 14. June 2016 brake faults, 15. 13 April 2017 the applicant again rejects the caravan on the basis of major failure and seeks a full refund. Unrepaired faults identified at that time were said to be

Water ingress from roof, rear corner, boot, window,
Faulty braking system,
Faulty electrical system causing short circuits and flashing lights,
Faulty re-arc solenoid,
Leaking plumbing,
Finishes, including cracks to front wall skin,
Non-compliant wiring,
Over-stamped compliance plate. 1. 22 September 2017 offer by respondent to repair current defects, 2. 16 July 2018, respondent's expert (Muriti) admits six manufacturing defects still existing,
Cracks to front wall of external skin,
RH bed-light fallen off,
Gas hot water heater requires switch installation,
Sharp points protruding through cabinets,
Compliance plate over-stamped,
Electrical fault on LH overhead bed.

Reliance was placed on the following principles set out in the decision of the Federal Court in Vautin v BY Winddown, Inc (formerly Bertram Yachts)(No 4) [2018] FCA 426 per Derrington J, in considering s 54-56 of the ACL, 1. The test of whether goods are of "acceptable quality" is an objective one being taken from the perspective of a "reasonable consumer", 2. The question for the "reasonable consumer" is whether the goods in question have the qualities set out in s 54(2) to an "acceptable standard", 3. The "acceptable standard" is ascertained by consideration of the matters referred to in s 54(3), 4. It is necessary that the goods have all of the qualities identified in s 54(2) to the ascertained acceptable standard, 5. In 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) and includes the relevant information known at the time of trial including "after-acquired knowledge", 6. If the goods supplied do not have all of the identified qualities to the acceptable standard, they will not be of an "acceptable quality", 7. The test of "acceptable quality" under s 54 imposes an obligation that the goods in question are free from defects as well as being fit for all of the purposes for which they are commonly supplied.
The caravan was represented on the sale contract as a "new vehicle" and it was also represented on the AVIDA documentation as having been manufactured "in accordance with the highest national standards for safety and quality of care" and generally that it was manufactured in accordance with rigorous quality assurance programs.
It was also represented on documents provided by the respondent as having

Thicker, stronger body construction,
Strong roofs, strong enough to walk on,
One piece nose to tail roof,

In respect of the applicant's claim under the ACL s 55 it was the applicant's submission that the purposes for which a caravan of this kind would be commonly supplied include extended holidaying around Australia and for residing in it for weeks or months in varying weather conditions. The applicant purchased and used the caravan for that purpose.

[4]

Water ingress

The applicant gave evidence that he had noticed water ingress only a month after delivery and that he saw water ingress after rain only two months after purchase. In September 2014 Mr Ross recorded evidence of water ingress and consequential damage under the fridge and kitchen cabinets and to the flooring under the toilet.
Further, the respondent admitted and undertook repairs to damage from water ingress in March, July, October and December 2015. In December 2015 the manufacturer had acknowledged ongoing water ingress.
The applicant gave uncontested evidence of continuing water ingress issues which was corroborated by further complaints to AVIDA following the last repairs and provided photographs taken as recently as 22 June 2018 depicting the problem.
The opinion of Mr Muriti, for the respondent, that the water ingress was of the applicant's making could not be substantiated because Mr Muriti's evidence was that the seals had not been replaced in servicing the caravan. No tests were conducted to demonstrate that was the cause of water ingress and Muriti admitted under cross-examination that he was unaware of the date of purchase of the caravan, the date of complaints regarding water ingress or the dates of services conducted on the caravan.
Mr Muriti's evidence, it was submitted, should be given little weight in light of him steadfastly maintaining a position adverse to the applicant in circumstances where it was shown that there had been water ingress only months after purchase which had been reported to the respondent and when the caravan had been serviced in December 2014.
Further, the respondent's contention that lack of servicing was the cause of water ingress was inconsistent with the time-line of events. The water ingress was identified by the applicant in August 2014 on his first trip in the caravan.
The caravan was in AVIDA's possession from January to April 2015 at which time a service was conducted. That service included visual inspection of roof and window sealants. No issues were identified by AVIDA at that time in regard to the seals and AVIDA accepted that water ingress was continuing. Despite repairs said to have been undertaken by AVIDA the applicant again complained of water ingress in May, July, October and December 2015.
The respondent at no time advised the applicant of the need to service the seals and the owner's manual relied on by the respondent to demonstrate the owner's responsibility in that regard had never been provided to the applicant and in fact post-dated the date of sale of the caravan. The applicant's evidence was that the manual actually provided to him contained no information on servicing of the seals.
The respondent's suggestion that water ingress could have been caused by lack of servicing by the applicant is not rational. On the balance of probabilities the most likely explanation is that water ingress issues continued and attempts at resolving that issue were unsuccessful.
The Tribunal should, it was submitted, find that there is water ingress to the caravan and that such ingress is due to a defect in the caravan.
A caravan that leaks cannot be of acceptable quality. Ongoing leakage shows that it is not durable. There is evidence of electrical cables lying in the water which raises concerns of safety. Self-evidently the caravan is not fit for the purpose of providing accommodation in the course of extended holidaying in potentially inclement weather.
The defect is a major failure because no reasonable consumer would purchase a caravan for $68,000 knowing that it leaks, the source of the leaks cannot be identified and significant time and effort would be expended to identify the cause and remedy the defect.
In view of the fact that water ingress was identified soon after purchase, the respondent has unsuccessfully attempted repairs on at least four occasions and now denies responsibility for the water ingress, rectification of the defect is, on the balance of probabilities, not possible or not possible within a reasonable time.

[8]

Claim under s 56 - supply by description and misleading and deceptive conduct

The further submission was that the applicant contends that the supply of the caravan was in breach of the guarantee provided under s 56 and/or constituted misleading and deceptive conduct within the meaning of the ACL s 18 in that 1. The caravan was represented to be newly built but was in fact a display model, 2. The caravan was represented as being built by WINNEBAGO USA or an affiliate when in fact it was built by AVIDA which was at that time prohibited by the Federal Court from asserting such affiliation, and 3. The caravan was represented as having a tare mass of 1788kg and an ATM rating of 2400kg resulting in a load capacity of 612kg when in fact the tare mass was 1920 kg, the ATM was 2200kg, giving a load capacity of just 280kg.
It was the applicant's submission that if any one of the above claims are substantiated he is entitled to a full refund under the ACL s 263(4)(a) as each constitutes a departure in a significant respect from the representation and would have led a reasonable consumer, fully acquainted with the true state of affairs, not to purchase the caravan.
There is no dispute between the parties that the caravan in fact supplied to the applicant was the display unit on show on 28 April 2014 at the Rosehill Caravan and Camping Show.
The applicant's submission was that the Contract of Sale dated 6 May 2014 and signed by the applicant on 23 May 2014 was largely blank at the time of delivery of the caravan and the applicant signed what he thought to be a declaration related to the trade in vehicle. The applicant, it was submitted, was unshaken on this point in cross examination. His statement should be accepted because the contract as written underquotes the total price and the trade-in value, something the applicant would have been unlikely to accept and which could only benefit the respondent. Secondly, an email dated 17 September 2014 when the error came to the applicant's attention on returning from his travels brought that discrepancy to the respondent's attention.
The caravan was in fact manufactured in 2013 and the Tribunal should therefore be satisfied that the respondent was in breach of s 56 and engaged in misleading and deceptive conduct. Further the supply in those circumstances amounts to a major failure.

[18]

The claims under the ACL s 54 and 55

In regard to the applicant's reliance on the contract document executed on 23 May 2014, the respondent's submission was that the contract was already entered into on 28 April 2014 as evidenced by the invoice 403 and the applicant could therefore not rely on any representation made after the 28 April 2014. Further there was no evidence as to when the representations in relation to manufacturing standards provided in the documents had been made or that the applicant relied on them. In fact one of the documents relied on was about AVIDA, not the respondent and appeared to be a news article.
In any event, the applicant provided no evidence that the representations were not true.
Mr Darren Pearce, for the respondent, was the only witness to give evidence about the "nose to tail" roof construction and it must therefore be concluded that the caravan in fact has a one piece nose to tail roof.
The applicant's own evidence demonstrated that he had not taken seriously any comments about the caravan being "bulletproof" and there was no evidence that the claim that the caravan was a multi-terrain vehicle was untrue.
In regard to the three main points of contention raised by the applicant, namely

Water ingress,
Faulty braking, and
Non-compliant wiring and gas installation, it was the respondent's position that there was no evidence that any of the faults exist.

The applicant's assertions were not supported by expert evidence and the respondent relied on the decision of the Tribunal in Kadiroglu v Australian Motor Homes Pty Ltd and Knotts Investments Pty Ltd t/as AVIDA RVs [2018]NSWCATCD 21 for the proposition that there must be expert evidence to support the applicant's contentions regarding the defects. In addition reference was made by the respondent to a remark by myself, made during the hearing, to the effect that expert evidence is germane to a determination of whether a defect exists.
In regard to the expert evidence relied on by the applicant the respondent's submission was to the following effect.
Mr David Walton, under cross examination, acknowledged that his experience was limited to heavy vehicles, not caravans, and that he had no qualifications in relation to construction or maintenance of caravans. Mr Walton further acknowledged that he had only basic electrical qualifications and the NCAT Procedural Direction 3 for Expert Witnesses had not been brought to his attention.
Mr Walton had no professional experience with caravans, his evidence is unreliable and no weight should be given to it.
Mr Michael Ross was also relied on by the applicant as an expert witness. It is clear, it was submitted, that Mr Ross did not write all of the statements relied upon and in fact they were written by some unidentified person and for that reason alone the Tribunal should give no weight to Mr Ross' evidence.
Further, Mr Ross did not understand his obligations to the Tribunal and had not been shown the NCAT Procedural Direction 3 for Expert Witnesses and had no specialised knowledge or training that qualified him to give expert evidence in this matter.
Ms Serena Franklin provided a short statement relied on by the applicant. However, Ms Franklin was not present for cross examination, did not provide her qualifications so that it could be determined whether or not she is in fact an expert, did not acknowledge the Expert Witness code and was not referred to in the applicant's written submissions.
When there has been no opportunity to test Ms Franklin's evidence the Tribunal should not give any weight to it.
The applicant also relied on a written statement from Mr Keith Johnson. Mr Johnson was not available for cross examination and in any event he is the brother-in-law of the applicant and cannot be regarded as an independent expert. No weight should be given to Mr Johnson's evidence.
As no weight can be given to the evidence of Mr Walton, Mr Ross, Ms Franklin or Mr Johnson, the applicant has provided no expert evidence to support the proposition that the three main defects complained of exist.
Mr Muriti, expert witness for the respondent, on the other hand was an impressive witness. His evidence was that re-application of sealant is considered normal practice at regular service intervals and is the responsibility of the owner.
In regard to the allegedly faulty braking system, there was no evidence from Mr Muriti. The evidence from Mr Ross and Mr Walton should be rejected for the reasons already stated and the conclusion reached that the applicant had not established that there was any defect with the braking system.
Mr Muriti gave evidence that he would have certified the existing gas installation. Further, Mr Muriti conceded that he was not qualified to certify the wiring but opined that the photographs showed that the conduit is compliant. Further, the electrical system had been properly certified by an electrician.
The Australian Standard relied on by the applicant has not been shown to be the correct standard to apply, and it is not possible to interpret that standard without a definition of "wiring systems".
The applicant has not discharged his onus of proof that there is any defect in the electrical wiring of the caravan or the gas installation.
In regard to the applicant's submission that the number of defects identified and rectified at various times is itself a breach of s 54, it was the respondent's position that the applicant must prove each and every one of the alleged defects. It could, for example, be the case that all repairs that were done were based on the goodwill of the respondent in attending to issues that were the responsibility of the applicant. Reliance for that submission was placed on the comment made by Mr Pearce under cross examination that in resolution of the applicant's earlier proceedings some of the defects were agreed to be done "just as goodwill".
The claim under the ACL s 56 and misleading and deceptive conduct

[22]

The relief claimed

It was the respondent's position that the letter of rejection sent by the applicant to the respondent on 9 September 2014 cannot now be regarded as a notification provided pursuant to the ACL s 259(3)(a) because the parties settled their dispute and the applicant thereafter continued to use the caravan in a manner that was inconsistent with a "rejection of the goods".
The respondent however conceded that the letter sent by the applicant to the respondent on 13 April 2017 did give the respondent notice that the applicant rejected the caravan and the reasons for doing so.
However that letter, it was submitted, was not sent within the rejection period provided for under the ACL s 262. The "rejection period" is the period from the time of supply of the goods within which it would be reasonable to expect the relevant failure to comply with a guarantee referred to in s 259(1)(b) to become apparent having regard to 1. The type of goods, and 2. The use to which the consumer is likely to put them, and 3. The length of time for which it is reasonable for them to be used, and 4. The amount of use to which it is reasonable for them to be put before such failure becomes apparent.
Following the agreement reached by the parties on 2 March 2015 the applicant has taken the caravan on a long trip in June 2015 and again in May/June 2016. It would be reasonable, it was submitted, to expect any major failure to become apparent by that time, that is, within two years of the date of supply.
The rejection notice was in fact issued nearly three years from the date of supply.
Further it was argued the applicant had acted inconsistently with his rejection letter of April 2017 by requiring the respondent to return the caravan to him after each occasion the respondent had access for the purpose of inspection by expert witnesses.
In addition, the respondent's submission was that the applicant is under an obligation pursuant to ACL s 263(2) to return the goods. The respondent's submission was that it was a mandatory requirement that the applicant return the caravan to the respondent in order to claim a refund unless it could not be returned because of significant cost due to the nature of the failure or its size. The size alone is not the determinative factor but rather the cost of returning the goods that provides an exemption.
There was no evidence that the applicant was unable to return the caravan or that there would be significant cost in doing so. In fact, the applicant under cross examination acknowledged that he was unaware that he could have returned the caravan.
Even if the Tribunal finds a "major failure" of the goods, the Tribunal is precluded from ordering a refund because the applicant has not returned the caravan to the respondent as required by the ACL s 263.

[25]

The witnesses

Mr Collin O'Neill, the applicant, gave evidence on affirmation and was cross examined on his evidence. Mr O'Neill was hampered in his evidence by the fact that a clear and comprehensive witness statement had not been filed by him at any time despite the matter being in the Tribunal for a year and a half.
Nevertheless, he confirmed the matters set out on the application form itself, the service and repair records he had written himself and the summary details of purchase appearing at Tab 3, p 5 of his filed documents as his evidence. Mr O'Neill did acknowledge that to the extent that the statements expressed expert opinion evidence they should be disregarded.
Mr O'Neill also confirmed that he had taken the photographs appearing at Tab 10 of his documents and relied on the correspondence between himself and the respondent at Tabs 5, 8 and 12.
Under cross examination Mr O'Neill confirmed that he had not inspected the interior of the AVIDA Sapphire caravan on display on 28 April 2014 because he could not gain access to it.
At times the witness was aggressive with counsel and constantly interrupted counsel. Some answers to questions appeared to be disingenuous and lacked frankness and from time to time the witness changed his evidence or prevaricated.
Despite those shortcomings in Mr O'Neill's evidence I am satisfied that the over-all tenure of his evidence was truthful and to the best of his recollection. Mr O'Neill may have been showing some frustration with the process and the length of time it had taken him in seeking redress.
Mrs O'Neill also gave evidence on affirmation and was cross examined. Her recollection of the transaction on 28 April 2014 consisted of looking into several different caravans and having a cup of tea. Mrs O'Neill could not remember being present when invoice 403 was completed but remembered requesting a number of specific features for the caravan.
The applicant relied on two reports, ostensibly prepared by Mr Michael Henry Ross, dated 7 September 2014 and 31 October 2017.
The Tribunal's Code of Conduct for Expert Witnesses is set out in the NCAT Procedural Direction 3 which is readily available on the Tribunal's web-site. The introduction to that code notes that "the Tribunal may rely on evidence from experts to reach a conclusion about a technical matter". It is therefore important that experts' opinions are soundly based, complete and reliable.
It is the party's responsibility who engages the expert to bring the Procedural Direction and Code of Conduct to the expert's attention (clause 8).
The rationale embodied in requiring an expert to acknowledge and adhere to the expert Code of Conduct is to maximise the Tribunal's ability to assess how it should resolve technical disputes between individuals and to reinforce the Tribunal's confidence on expert material placed before it.
The reports provided by Mr Ross did not comply with the Code of Conduct for Expert Witnesses. There was no indication that Mr Ross had read the Code, understood it or agreed to be bound by it. There was however, in the report dated 31 October 2017, some acknowledgement of some unspecified Court Form that perhaps was intended to refer to this issue but does not satisfy the Tribunal's requirement to have confidence in the quality and independence of the report and the qualifications for expressing the opinions provided.
Further, under cross examination Mr Ross acknowledged that he had not written either of the reports submitted in his name. On leaving the witness box Mr Ross addressed a question to the Tribunal in the following words "What about the report I wrote. What happened to the report I wrote".
Mr Ross was directed to take up that issue with the applicant and his legal advisers.
Clearly the implication from the exchange, as suggested in the respondent's submission, is that the report Mr Ross actually prepared was not in evidence but two reports that he did not write were relied upon.
In the above circumstances I am not satisfied that I can rely on any evidence given by Mr Ross and accordingly no weight is given to any of his evidence.
Suffice to say that the Tribunal is entitled to be able to rely on the veracity of expert witness statements and in the case of Mr Ross' evidence it cannot do so.
The respondent's submission makes much of this point and suggests that it is sufficient for the Tribunal to dismiss Mr O'Neill's claim without further consideration. No authority is put forward for the proposition that the Tribunal has any power to do so.
The Tribunal is not aware of the identity of the author of the two reports relied on and is not even aware whether the applicant had any personal role in preparation of that material. Hence, the Tribunal's only response to the evidence of Mr Ross is that it is rejected as being of no assistance to the Tribunal.
Mr David Walton also gave opinion evidence on behalf of the applicant. Accordingly that evidence must be considered as expert evidence. The evidence was in the form of a report dated 29 October 2014 and another prepared after an inspection that took place on 19 April 2017. Again there was no acknowledgement that the witness had adopted the Expert Witness Code of Conduct or that he even knew about it. Clearly the applicant had failed to draw it to his attention. Mr Walton did however provide a resume of his education, employment history and courses undertaken.
Mr Walton admitted under cross examination that he had no qualification in the maintenance or construction of caravans or in regard to their ESC systems.
Strict adherence to legal technicalities is not required in the Tribunal. The Tribunal "..is not bound by the rules of evidence and may enquire into and inform itself on any matter in such manner as it thinks fit…"

[26]

Civil and Administrative Tribunal Act 2013 s 38(2).

It is not uncommon for the technical evidence provided to the Tribunal to be unsatisfactory in a way that may not satisfy a Superior Court but that does not mean that the Tribunal should reject it in its entirety. Sometimes the Tribunal will be assisted in a technical matter by a notation made on an invoice. The fact is that the Tribunal must do its best with the evidence available to it.
A failure to comply with the Expert Code of Conduct therefore may result in the Tribunal attributing less weight to that evidence than would otherwise be the case but without rejecting it completely.
In regard to Mr Walton's evidence, to the extent that it purports to give an opinion of a technical nature the evidence must be rejected as having been given by a person without the qualification to express the opinions given. However, Mr Walton also test towed the subject caravan and experienced some braking problems. I see no reason why Mr Walton's evidence on that issue should be rejected.
The evidence was that on the test tow the ESC and brakes were activated on a sharp left turn. Under cross examination Mr Walton admitted that is exactly what one would expect to happen on a sharp turn.
Mr Walton also gave evidence that on reversing the caravan the brakes locked up and made it difficult to park. Under cross examination Mr Walton disagreed with the proposition put to him that the brakes should be turned off when parking the caravan.
On this one point, that there was a problem with the brakes locking up when reversing the caravan, I am satisfied that the Tribunal can place some reliance on Mr Walton's evidence.
A statement from Ms Serena Franklin was filed with the applicant's material but it is not clear whether the applicant relies on that statement. Ms Franklin was not called to give evidence and was not cross examined. The report was not in the form of an affidavit or Statutory Declaration. Again no acknowledgement of the Code of Conduct for Expert Witnesses was made and the author of the statement gave no explanation of her qualification for providing her expert opinion.
In those circumstances little weight is given to Ms Franklin's report.
Two short statements from a Mr Keith Johnson were provided by the applicant. Again, no submission is made in regard to the content of those statements and it is not clear whether the applicant relies on those statements. Again the author fails to indicate any understanding or adherence to the Code of Conduct for Expert Witnesses set out in Procedural Direction 3, although the second statement does attempt to address these shortcomings by reference to some unspecified Code of Conduct. In view of the close familial and commercial relationship between the author and the applicant the Tribunal cannot be comfortable that the opinions expressed are independent.
Little, if any, weight is given to the opinions expressed by Mr Johnson.
A statement from Mr Colin Young was provided by the applicant. Mr Young gave evidence by telephone and was cross examined on his evidence. He was not sworn.
Mr Young did provide some details of his qualifications and experience and attempted to satisfy the obligations regarding the Expert Witness Code but again by reference to some meaningless Court Form which is nothing to do with this Tribunal. Much of Mr Young's report was not pressed. It is noted that Mr Young's opinion is based solely on (unspecified) information provided by the applicant's (unnamed) representative and documents attached to the report.
The Tribunal accepts the evidence given by Mr Young but will have further comments later.
Mr Owen Rachford gave evidence on behalf of the respondent by telephone. Mr Rachford was cross examined on his evidence. Although Mr Rachford gave evidence intended to go to the issue of what had passed between himself and the applicant on 28 April 2014, Mr Rachford's evidence was informed by his recollection of his normal practices rather than by any actual memory of the transaction. That is not a criticism of Mr Rachford but it is relevant to the comparative weight to be given to his evidence when comparing it to that of Mr O'Neill.
Mr Darren Pearce, the quality manager for AVIDA, provided a witness statement with attached documents. Mr Pearce gave lay evidence in support of the respondent and was cross examined on his evidence. One of the documents attached to Mr Pearce's statement was a document titled "Assessment of AVIDA CV 5422 Sapphire registration No Z65624, Serial # 10218" which purports to be a report following an inspection of the caravan on 18 June 2018.
Mr Pearce acknowledged under cross examination that he has no expertise to express the opinions contained in that report.
Mr Grant Muriti carried out an inspection of the caravan and provided a report dated 16 July 2018. The report was in the nature of expert evidence and quite properly set out Mr Muriti's qualifications, the instructions on which the report was based and its limitations. It also acknowledged the Tribunal Code of Conduct and agreed to be bound by it. Mr Muriti adopted his report on affirmation and was cross examined on it.
However, in the face of assumptions put to Mr Muriti in cross examination his opinion remained unchanged when it was patently obvious that he could not maintain his position. In those circumstances Mr Muriti's evidence was partisan and he was not fulfilling his obligation to the Tribunal in accordance with the Code of Conduct that he claimed to have adopted.
Mr Buikstra for the respondent gave lay evidence, the essential substance of which is not in dispute.
Thus, it can be seen that there is very little assistance afforded the Tribunal by the expert evidence provided by the applicant. There were also some difficulties with some of the expert evidence provided by the respondent which go to the reliability of that evidence.

[27]

The claim under ACL s 56, misleading and deceptive conduct

The applicant's submission groups the claim under s 56 and under s 18 together. Although some of the elements necessary to establish a breach of the guarantees under s 56 may coincide with the matters constituting misleading and deceptive conduct under s 18, the remedies in each case are quite different.
The remedy provided under the ACL for breach of s 56 is found in the ACL Part 5-4, s 259, et seq. The remedy provided for misleading and deceptive conduct is founded in a claim for damages under s 236.
The applicant has made no submissions in regard to the damages arising from alleged breach of s 18 but seeks to have another hearing on that issue in the event that the Tribunal does not make a finding of "major failure" in regard to the alleged breaches of consumer guarantees.
I cannot understand why the applicant would think that the Tribunal would re-open a matter that has been run for two days and in which the parties have had every opportunity to put on all of their evidence and make all of their submissions.
As already mentioned the Tribunal is of the view that the respondent failed to supply a new caravan in accordance with the contract and as represented to the applicant. Such a failure could well amount to a breach of the ACL s 18. However, it is not clear what, if any, damages flow from that breach. The matter is finalised and no further hearing on the issue of damages will be conducted. Hence the Tribunal is unable to make any orders for damages arising from breach of s 18 and will not consider that aspect of the applicant's case further.
Nevertheless, the applicant ran a case based on alleged breach of the consumer guarantees provided under s 56 and sought the remedy available under ACL Part 5-4. That is the application that will now be considered.
There were three elements to the applicant's claim in this regard. 1. The caravan was agreed to be a new caravan but was in fact a second-hand one, 2. The caravan was built by Winnebago USA, or an affiliate of that company, when in fact it was manufactured by AVIDA, 3. The Tare Mass and ATM were incorrect, resulting in a reduced load carrying capacity.
The ACL s 56 provides
Guarantee relating to the supply of goods by description (1) If: (a) a person supplies, in trade or commerce, goods by description to a consumer; and (b) the supply does not occur by way of sale by auction; there is a guarantee that the goods correspond with the description. (2) A supply of goods is not prevented from being a supply by description only because, having been exposed for sale or hire, they are selected by the consumer. (3) If goods are supplied by description as well as by reference to a sample or demonstration model, the guarantees in this section and in section 57 both apply.

[29]

Was there a breach of s 56 in regard to the named manufacturer?

In regard to this issue the applicant has made much of the orders of the Federal Court in the matter of Knott Investments Pty Ltd v Winnebago Industries Inc (No 2) [2013]FCAFC 117, and the alleged breach of those orders by the respondent. It is noted that the respondent was a party to those proceedings and that the orders of the Court are, in part, directed at the respondent. However, that is an irrelevant consideration in these proceedings. The issue for determination in these proceedings is whether the caravan was described as being manufactured by WINNEBAGO when in fact it was manufactured by AVIDA.
The applicant's evidence consists of Mr O'Neill's recollection of the conversation he had with the salesman, Mr Rachford, in which the salesman said that "Winnebago is a family company started in Australia just after World War 2, originally building caravans."
That version of the conversation is not disputed by the respondent. It was simply the respondent's argument that there could have been no reliance by the applicant on that representation in his decision to purchase the caravan. However, that is not the point. The guarantee relied on that arises under s 56 does not require that the purchaser rely on the description, only that the supply does not correspond with the description.
Further, the applicant's photographic evidence clearly shows a plate attached to the caravan with the words "Unit manufactured by WINNEBAGO Industries" with a serial number.
I am satisfied that the attachment of the plate to the caravan coupled with the conversation with Mr Rachford satisfies the requirement that the caravan was described to the consumer as having been manufactured by WINNEBAGO.
There is no dispute that the caravan was in fact manufactured by AVIDA.
Accordingly I am satisfied that the respondent is in breach of the guarantee provided by s 56 in that the description of the caravan as being manufactured by WINNEBAGO did not correspond with the caravan actually supplied.

[32]

259 Action against suppliers of goods 1. A consumer may take action under this section if: 1. a person (the supplier ) supplies, in trade or commerce, goods to the consumer; and 2. 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. 1. If the failure to comply with the guarantee can be remedied and is not a major failure: 1. the consumer may require the supplier to remedy the failure within a reasonable time; or 2. 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: 1. 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 2. subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection. 1. If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may: 1. subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection; or 2. 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. 1. 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. 2. 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. 3. To avoid doubt, subsection (4) applies in addition to subsections (2) and (3). 4. The consumer may take action under this section whether or not the goods are in their original packaging. 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: 1. the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; or 2. the goods depart in one or more significant respects: 1. if they were supplied by description--from that description; or 2. if they were supplied by reference to a sample or demonstration model--from that sample or demonstration model; or 1. 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 2. the goods are unfit for a disclosed purpose that was made known to: 1. the supplier of the goods; or 2. a person by whom any prior negotiations or arrangements in relation to the acquisition of the goods were conducted or made; 3. and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or 1. the goods are not of acceptable quality because they are unsafe.

[34]

263 Consequences of rejecting goods 1. This section applies if, under section 259, a consumer notifies a supplier of goods that the consumer rejects the goods. 2. The consumer must return the goods to the supplier unless: 1. the goods have already been returned to, or retrieved by, the supplier; or 2. the goods cannot be returned, removed or transported without significant cost to the consumer because of: 1. the nature of the failure to comply with the guarantee to which the rejection relates; or 2. the size or height, or method of attachment, of the goods. 1. If subsection (2)(b) applies, the supplier must, within a reasonable time, collect the goods at the supplier's expense. 2. The supplier must, in accordance with an election made by the consumer: 1. refund: 1. any money paid by the consumer for the goods; and 2. an amount that is equal to the value of any other consideration provided by the consumer for the goods; or 1. replace the rejected goods with goods of the same type, and of similar value, if such goods are reasonably available to the supplier. 1. The supplier cannot satisfy subsection (4)(a) by permitting the consumer to acquire goods from the supplier. 2. If the property in the rejected goods had passed to the consumer before the rejection was notified, the property in those goods revests in the supplier on the notification of the rejection.

The ACL s 259 provides a remedy for the consumer where the guarantee provided under s 56 is not complied with. The applicant seeks a refund of the purchase price of $68,490. That remedy is only available to the applicant if the failure to comply with the guarantee comes within the meaning of a "major failure" as that term is used in s 260.
The applicant's submission was that the failure to provide a new caravan in circumstances where the one actually supplied was manufactured in the year prior to supply, had been used as a display caravan for the purpose of promoting sales and had been the subject of warranty repairs prior to sale must constitute a "major failure".
The applicant's submission in regard to the misdescription of the caravan as having been manufactured by WINNEBAGO went to the issue of whether or not the applicant was misled by that description. For the reasons already stated the Tribunal will not examine any remedy relating the damages arising from misleading and deceptive conduct.
In regard to the issue of whether the breach of s 56 relating to manufacture amounted to a "major failure" the applicant asserted that it was.
The respondent simply asserted that there was no evidence of a "major failure".
One needs to refer to s 260 to determine whether either of the two failures to comply with the guarantees amount to a major failure. Therefore the first question is whether a reasonable consumer, fully acquainted with the facts would have purchased the caravan?
The supply of a caravan that is not new and has been used in a manner unknown to the consumer and has had some warranty repairs done to it prior to the consumer taking delivery, when coupled with the fact that a large sum of money ($68,490) was being paid for the caravan would, I am satisfied, be regarded by any reasonable consumer as a very serious breach of the contract entered into.
I am satisfied that any reasonable consumer who had been aware of the above facts would not have acquired the caravan for the price paid. Such a failure would clearly be a basis for any reasonable consumer to re-negotiate the purchase price or to simply decline to go ahead with the purchase.
On the other hand, although a consumer may have believed the caravan was to be a WINNEBAGO brand but was in fact an AVIDA brand, I am not satisfied that would be regarded by a reasonable consumer as conclusive of the fact that the supplied van was in any way inferior to the one described. I am not persuaded that a reasonable consumer would necessarily have failed to go ahead with the purchase if that fact had been known.
Section 260(b) is expressed in the alternative to s 260(a). Clearly in both the failure to supply a new caravan as described and the failure to supply one manufactured by WINNEBAGO both would amount to a departure from the description in a significant respect.
I am satisfied therefore that the breach of s 56 in regard to the description of the caravan as a new motor vehicle and the description of the caravan as being manufactured by WINNEBAGO are both "major failures" as that term is used in s 260.
To establish entitlement to the remedy claimed the applicant must, pursuant to s 259(3), also show that he rejected the goods and the grounds for such rejection.
The applicant's position was that the applicant twice rejected the goods by correspondence with the respondent and sought a refund of the purchase price.
The respondent submitted that the applicant was no longer entitled to rely on the rejection communicated to the respondent on 9 September 2014 because, subsequent to that rejection the parties had reached an agreement, remedial work was done and the applicant continued to retain possession of the caravan and to use it. That is, following the agreement made between the parties on 2 March 2015 the applicant's conduct was inconsistent with his rejection of the caravan in the previous September. I accept that submission.
In any event the respondent conceded that the notice given on 13 April 2017 gave the respondent notice that the applicant rejected the caravan and his reasons for doing so.
However, the respondent argued that despite the rejection notice being sent to the respondent on 13 April 2017 and even if the Tribunal made a finding of "major failure" the applicant could not recover because, pursuant to s 262 the rejection period had ended by the time that notice was given.
The "rejection period" is defined under s 262 as 1. (2) The rejection period for goods is the period from the time of the supply of the goods to the consumer within which it would be reasonable to expect the relevant failure to comply with a guarantee referred to in section 259(1)(b) to become apparent having regard to: 1. the type of goods; and 2. the use to which a consumer is likely to put them; and 3. the length of time for which it is reasonable for them to be used; and 4. the amount of use to which it is reasonable for them to be put before such a failure becomes apparent.
The applicant had taken the caravan for long trips in June 2015 and in May and June 2016. It would be reasonable, it was submitted, to expect any major failure to become apparent by about May or June 2016. That is, the rejection period expired about two years after the date of supply of the caravan.
In this case the relevant failure was the failure of the respondent to supply a new caravan and the failure of the respondent to supply a caravan manufactured by WINNEBAGO. Both of those failures were known to the applicant soon after he returned from his first trip in the caravan in late 2014.
On becoming aware of the failures he was entitled to reject the goods, which he did on 9 September 2014. However he compromised that rejection by agreeing to have work done on the caravan and to keep and to use the van. He knew that both of those failures could not be remedied by any work that was being done on the van yet he abandoned his entitlement to reject and to seek a refund based on either of those failures.
I am satisfied that the rejection period, in respect of the two major failures to comply with the guarantees provided by s 56, ended in or about September 2014. The applicant is therefore precluded by the operation of s 262(1) from seeking his remedy under s 259 for breach of s 56.

[36]

54 Guarantee as to acceptable quality 1. If: 1. a person supplies, in trade or commerce, goods to a consumer; and 2. the supply does not occur by way of sale by auction; 3. there is a guarantee that the goods are of acceptable quality. 1. Goods are of acceptable quality if they are as: 1. fit for all the purposes for which goods of that kind are commonly supplied; and 2. acceptable in appearance and finish; and 3. free from defects; and 4. safe; and 5. 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). 1. The matters for the purposes of subsection (2) are: 1. the nature of the goods; and 2. the price of the goods (if relevant); and 3. any statements made about the goods on any packaging or label on the goods; and 4. any representation made about the goods by the supplier or manufacturer of the goods; and 5. any other relevant circumstances relating to the supply of the goods. 1. If: 1. goods supplied to a consumer are not of acceptable quality; and 2. the only reason or reasons why they are not of acceptable quality were specifically drawn to the consumer's attention before the consumer agreed to the supply; 3. the goods are taken to be of acceptable quality. 1. If: 1. goods are displayed for sale or hire; and 2. the goods would not be of acceptable quality if they were supplied to a consumer; the reason or reasons why they are not of acceptable quality are taken, for the purposes of subsection (4), to have been specifically drawn to a consumer's attention if those reasons were disclosed on a written notice that was displayed with the goods and that was transparent. 1. Goods do not fail to be of acceptable quality if: 1. 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 2. they are damaged by abnormal use. 1. Goods do not fail to be of acceptable quality if: 1. the consumer acquiring the goods examines them before the consumer agrees to the supply of the goods; and 2. the examination ought reasonably to have revealed that the goods were not of acceptable quality.

[38]