QCAT’s use of assessors in ‘lemon’ vehicle cases

“The cost of securing proof that a consumer has been sold a lemon may prevent a purchaser of a lemon from securing justice.”

Professor Stephen Corones, University of New South Wales Law Journal1

As noted in an earlier article,2 most motor vehicle claims lodged with the Queensland Civil and Administrative Tribunal (the tribunal) relate to the guarantee of acceptable quality contained in s54 of the Australian Consumer Law (ACL).

It is settled law that the time at which goods must be of acceptable quality is the time at which the goods are supplied to the consumer.3 This can present a significant evidentiary obstacle to a consumer seeking relief.

The commencement of the so-called ‘lemon laws’4 provided the tribunal with an opportunity to address this obstacle by introducing the use of assessors in motor vehicle disputes. This article explores the background to the use of assessors, and outlines the procedures in place at the tribunal.

Evidentiary difficulties

It will be recalled that s54 of the ACL imposes a guarantee when a person supplies goods in trade or commerce (other than by way of auction) that the goods are of ‘acceptable quality’. The meaning of acceptable quality is defined in s54(2) and (3).

Professor Jeannie Paterson and Kate Tokely correctly observed:5

“It may be relatively straightforward for a consumer to establish that goods are not of acceptable quality where the goods are purchased new and the defect becomes apparent soon after the date of purchase … A consumer faces more difficult evidentiary challenges if the defect in the goods appears weeks or years after purchase. The defect might be one that existed at or near the time of purchase but did not cause problems until much later, in which case the goods would not be durable and would not meet the standard of acceptable quality, or it could be a defect that develops over time and is attributable to normal wear and tear.”

These evidential difficulties have manifested themselves at the tribunal in a number of cases. For example:

  • In Grehan & Anor v Westpoint Autos QLD Pty Ltd trading as Salters Cars,6 the balance shaft gears failed six months after the time of supply in a vehicle which was five years old. No expert evidence was provided, and the Tribunal was not prepared in the absence of such evidence to infer that the defect was present at the time of supply.
  • In Bevis v Mercedes Benz Australia/Pacific Pty Ltd & Anor,7 the problems with the engine going into limp mode did not manifest themselves until over three years after the date of supply, and at a time when the vehicle had travelled over 100,000km. The tribunal observed that, the more time that has elapsed and the further a vehicle has been driven, the greater is the scope for any defects to have arisen from intervening events occurring after the time of supply.

It is worth pointing out that the evidentiary difficulties are not limited to consumers. Had the applicants in the above cases provided expert evidence in support of their claims, the respondents would effectively have been placed in the position of having to incur similar expenses in engaging their own experts had they wished to challenge this evidence.

Independent assessors

The proposed use of independent assessors as a solution to these evidential difficulties has a history which spans over a decade.8

More recently, and closer to home, the Legal Affairs and Community Safety Committee of the Queensland Parliament (the committee) conducted an inquiry into consumer protections and remedies for buyers of new motor vehicles. The Royal Automobile Club of Queensland (RACQ) made a prescient submission to the committee:9

“RACQ believes the aim of any new legislation should be to place all parties on equal footing with respect to access to legal, financial and technical resources that could otherwise be an impediment to consumers having issues fairly resolved. The current arrangements only partially achieve this outcome.

“We believe that a specialist group that has relevant technical and industry experience is needed to assist the adjudicator in making informed assessments of such cases.

“This would largely alleviate the imbalance of power/knowledge between the consumer and the vehicle manufacturer and would in many cases eliminate the need to engage an independent and suitably qualified person to support the consumer, as the specialist group could in effect become the independent party to the proceeding.

“Importantly, it would be necessary to provide members of the specialist group with appropriate legal protection to ensure they can conduct their roles without fear of litigation from an aggrieved party.”

In November 2015, the committee released its report entitled ‘Lemon’ Laws – Inquiry into consumer protections and remedies for buyers of new motor vehicles’.10 The committee recommended the use of assessors as an alternative to proceedings in the tribunal:

“The committee recommends the government consider appointing independent assessors, with investigative powers and specialised knowledge in relation to motor vehicle disputes, to deal with the issues of how consumers prove that they meet the ‘lemon’ motor vehicle threshold criteria … as an alternative to consumers initiating Queensland Civil and Administrative Tribunal (QCAT) and/or court proceedings.”

This recommendation in the form proposed was ultimately not supported by the Queensland Government in its response to the report dated 1 March 2016. However, the response was sympathetic in relation to the evidentiary difficulties faced by consumers, with the Queensland Government “…agreeing that consumers can find it difficult to prove their new motor vehicle is a ‘lemon’ which can hinder their ability to obtain appropriate redress. Consumers can face a high evidentiary burden in establishing that a new ‘lemon’ motor vehicle has a major defect which can impose a significant cost on individual consumers.”11

Assessors under the QCAT Act

On 1 September 2019, the Queensland Civil and Administrative Tribunal and Other Legislation Amendment Act 2019 commenced, increasing the tribunal’s jurisdictional limit for motor vehicle disputes from $25,000 to $100,000. This increase in jurisdiction was complemented by the creation of the Motor Vehicle List (MVL) at the tribunal.

In creating the MVL, consideration was given to the use that could be made of the provisions of Chapter 2, Part 6, Division 7 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act) relating to assessors. Relevantly:

  • Section 110(1) provides:
    The president may appoint a person with relevant knowledge, expertise and experience to help the tribunal in relation to a proceeding.
  • Section 111(1)(a) provides:
    The tribunal may … ask an assessor to give expert evidence in a proceeding…
  • Section 112(1) provides:
    The tribunal may make an order requiring a party to a proceeding … to pay or contribute to the tribunal’s costs of obtaining an assessor’s help.

Section 237(5) of the QCAT Act also provides:
“An assessor, in the performance of the assessor’s functions as an assessor under this Act or an enabling Act, has the same protection and immunity as a Supreme Court judge has in the performance of a judge’s functions.”

These powers, which were pre-existing in the QCAT Act, lent themselves to establishing a model for using assessors in motor vehicle disputes that has more than a passing resemblance to that proposed by the RACQ.

MVL practice direction

The President of the tribunal, Justice Daubney, issued QCAT Practice Direction No. 2 of 2019: Motor Vehicle List on 2 September 2019 (the practice direction).

The practice direction makes a distinction between claims up to and including $25,000, and claims exceeding $25,000. The former continue to be heard and determined by an adjudicator, and the latter are managed and dealt with by a member.

The most significant feature of the practice direction is the process for the appointment of assessors in applications in which the amount claimed exceeds $25,000. The rationale for the use of assessors is set out in paragraph 6:

“To ensure that appropriate independent expert evidence is available to the Tribunal, and to avoid the parties incurring excessive costs in engaging their own experts, it is expected that the Tribunal will generally appoint an independent expert to help the Tribunal, including by providing expert evidence. The assessor will be asked to inspect the motor vehicle (the subject of the application) and provide a report addressing the issues raised in the application.”

The practice direction goes on to outline that the parties will be required to pay the costs of the assessor. The starting point under the practice direction is that the parties will share the costs of appointing the assessor equally.12

Once payment has been made to the tribunal, the assessor is appointed and undertakes an inspection of the vehicle. The assessor then reports to the tribunal on his or her observations of the vehicle. A copy of the assessor’s report is sent to the parties and the matter is then listed for a mediation.13

The use to be made of an assessor’s report at the hearing is set out paragraph 12 of the practice direction as follows:

“A report received by the Tribunal from an assessor appointed by the Tribunal will be received by the Tribunal as expert evidence. In any Tribunal proceeding held following the receipt of the report, no party will be allowed to produce further expert evidence on the same issues covered by the assessor in the report without the leave of the Tribunal.”

In December 2019, QCAT advertised in The Courier-Mail and online for persons with extensive automotive mechanical experience to express interest in appointment as assessors. More than 30 applications were received. As of March 2020, Justice Daubney had appointed a total of 15 highly qualified assessors. Geographically, assessors are located at each end of the state, in Cairns and south-east Queensland, although coverage in between is limited at this stage.

Some practical issues

The tribunal’s total costs of engaging an assessor for one day have been calculated by the registry to be $1200. As noted above, the costs of engaging an assessor are recoverable from the parties.

It is generally expected that the engagement of an assessor in any particular case will be for one day only. It follows that if the parties are ordered to share the costs equally, they will each have to pay $600.

The assessor is provided with a template report to complete. It is important to note that the assessor is not requested to express a view as to whether the guarantee of acceptable quality has been complied with. The assessor is asked a number of questions designed to elicit expert evidence that the member hearing the case can then readily apply to reaching the relevant legal conclusions.

In summary, the assessor is asked the following questions:

  • Did you identify any defect or defects in your investigations of the motor vehicle?
  • What is the likely cause of any defects?
  • Were the defects likely to have been present at the date of purchase of the vehicle (for example, as a latent defect or a part lacking durability)?
  • What steps would need to be taken to further investigate and remedy any defects, and how long would these steps take?

It is acknowledged that many problems with motor vehicles may take more than one day to definitively diagnose. Indeed, some problems may require extensive disassembly of the vehicle to reach a definitive diagnosis. However, to allow an assessor to take days or even weeks to complete his or her task, funded by the parties at $1200 per day, would be contrary to s3(b) of the QCAT Act which lists as an object “to have the tribunal deal with matters in a way that is accessible, fair, just, economical, informal and quick…”.

Motor vehicle disputes are decided according to the civil standard of proof, which is the balance of probabilities. Having regard to the standard of proof, the tribunal considers that it is appropriate to ask the assessor, on the basis of his or her extensive experience, to express a view as to the likely cause of any defects and whether those defects were likely present at the time of supply. Either party is then at liberty to seek leave to file further expert evidence if they can satisfy the tribunal that there are grounds to warrant more extensive investigations.

I note in passing that the practice direction only refers to the appointment of assessors in matters where the amount claimed is over $25,000. This is not to deny that the same evidentiary difficulties present themselves to applicants in other cases, but it is simply a reflection that it is more difficult to justify requiring parties to pay $1200 to engage an assessor where the value of the motor vehicle is lower.

Unfortunately, due to the evolving situation with the COVID-19 pandemic in 2020, the tribunal has been delayed in using assessors in motor vehicle disputes before it. However, this position is expected to change moving into 2021.

Conclusion

I would expect the use of assessors to contribute to the fair and expeditious resolution of ‘lemon’ vehicle disputes.

There is a significant potential in these disputes for the parties to have unequal access to appropriate expert witnesses. There is also the potential for the parties to have unequal financial resources available for the purposes of accessing such experts.

Used in appropriate cases, the appointment of an assessor will assist the tribunal in obtaining appropriate expert evidence, and place the parties on a relatively equal footing in doing so.

In addition, I would also expect that the provision of an assessor’s report will assist many parties in the timely resolution of their disputes without the need to proceed to a hearing. The assessor’s report will provide both parties with valuable information in relation to the condition of the motor vehicle, which will assist them in evaluating their respective positions at a mediation.

Glen Cranwell is a full-time member of the Queensland Civil and Administrative Tribunal, and is the list manager of the Motor Vehicle List. The views expressed are those of the author, and not those of the tribunal.

Footnotes
1 Stephen Corones, ‘Why Australia needs a motor vehicle ‘Lemon’ Law’ (2016) 39(2) University of New South Wales Law Journal 625, 655.
2 ‘Glen Cranwell, ‘Motor vehicle disputes at QCAT: Some practical observations’, QLS Proctor (web page, 30 September 2020).
3 See Medtel Pty Ltd v Courtney (2003) 130 FCR 182, [64] and [70].
4 Queensland Civil and Administrative Tribunal and Other Legislation Amendment Act 2019 (Qld).
5 Jeannie Paterson and Kate Tokeley, ‘Consumer Guarantees’ in Justin Malbon and Luke Nottage (eds), Consumer Law and Policy in Australia and New Zealand (Federation Press, 2013), 97.
6 [2020] QCAT 275.
7 [2020] QCAT 421.
8 See, for example, Consumer Affairs Victoria, ‘Motor Cars: A Report on the Motor Vehicle Lemon Law Consultations’ (report, July 2008), 22; Commonwealth Consumer Affairs Advisory Council, ‘Consumer Rights: Reforming Statutory Implied Conditions and Warranties’ (final report, October 2009), 99.
9 Submission 15 (web page).
10 Legal Affairs and Community Safety Committee, ‘‘Lemon’ Laws – Inquiry into consumer protections and remedies for buyers of new motor vehicles’, Report No 17, 55th Parliament, November 2015.
11 Queensland Government Response – Report No.17, 55th Parliament, ‘‘Lemon’ Laws – Inquiry into consumer protections and remedies for buyers of new motor vehicles’, 1 March 2016.
12 QCAT Practice Direction No.2 of 2019: Motor VehicleList, 2 September 2019, [8].
13 QCAT Practice Direction No.2 of 2019: Motor Vehicle List, 2 September 2019, [11].

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