A guide to Australian consumer law —Motor vehicle sales and repairs 19
Example 2:
Shortly after the expiration of a vehicle’s
three-year/100 000 km warranty
period, an electrical fault, which was
a manufacturing defect, caused a re
in the engine bay, and then the vehicle
burst into ames. This constituted
a major failure to comply with the
consumer guarantee of acceptable
quality under the ACL. Although the
dealer was obliged, under its contract
with the manufacturer, to obtain the
manufacturer’s pre-approval before
providing a remedy (because the
warranty period had expired), the dealer
granted the consumer’s request for a
replacement, due to a breach of the
consumer guarantee as to acceptable
quality. The dealer had a statutory right
to be reimbursed by the manufacturer
for the reasonable cost of replacing the
defective vehicle.
Product recalls
You may need to recall a vehicle if it is
unsafe, non-compliant with a mandatory
standard or subject to a ban. Recalls
are usually initiated by a business but
a responsible Commonwealth, state or
territory minister can also order a recall.
The purpose of a recall is to prevent
injury by removing the hazard and offer
affected consumers a remedy in the form
of a repair, replacement or refund.
A product that is safe now may pose an
injury risk in the future. A supplier should
recall goods as soon as any present or
future injury risk is identied.
A product may be recalled for a
variety of reasons, and product safety
recalls operate independently from
the consumer guarantees provided
under the ACL. Separate to any remedy
offered under a recall, consumers have
rights under the consumer guarantees.
Under the ACL, businesses that supply
goods must guarantee that they are of
acceptable quality, including that they
are safe, regardless of any warranties that
come with those goods.
A recall remedy may be consistent with
the consumer guarantees obligations,
though a recalled good is not
automatically deemed to be unsafe under
the consumer guarantees.
In the instance of a major failure,
a consumer can assert their rights
and ask the supplier for a refund or
replacement. If an agreement cannot
be reached between the consumer and
the supplier, the consumer can make
an application for consideration by an
administrative tribunal.
Suppliers are able to contact the
National Exchange of Vehicle and
Driver Information System (NEVDIS)
when they submit a vehicle recall
notication. NEVDIS records vehicle
identication number (VIN) data and
can provide the last known address of a
registered vehicle.
The Department of Infrastructure,
Regional Development and Cities is
responsible for monitoring vehicle recalls.
You must notify the Department if you
know that a vehicle, part, accessory or
service may have a safety-related defect.
For more information, refer to:
• the Department of Infrastructure,
Regional Development and Cities
website, for information on vehicle
standards and safety