QUEENSLAND LEMON LAWS: FAKE NEWS?

The passing of the Queensland Civil and Administrative Tribunal and Other Legislation Amendment Act 2019 has been widely reported on for its introduction of supposedly new ‘lemon laws’. A closer look at the legislative amendments, however, reveals that whilst the majority of amendments have little to do with lemon laws, they do offer better consumer protection.

So what is a lemon law? A lemon law, as commonly understood, provides consumers with the right to either obtain a full refund or replace their vehicle if it has major issues. In relation to major failures, the Australian Consumer Law (ACL) offers a remedy that provides an example of a lemon law. Under the ACL consumers have a right to reject their vehicle, request a refund or request a replacement if the vehicle has a major failure – that is, if the vehicle is a ‘lemon’.

In Queensland, prior to the recent amendments, a used motor vehicle was classified as a warranted vehicle if, on the day of sale, it had an odometer reading of less than 160,000 km and its build date was no more than 10 years before the day of sale. Furthermore, for those vehicles there was a three- month or 5,000 km warranty period (whichever occurred first). The amendments in Queensland add a new class of vehicles to be covered by warranty. The new class of vehicles will ensure that vehicles sold with an odometer reading of over 160,000 km or are over 10 years old will be covered by warranty. This will entitle the purchaser to have any defects in their vehicle repaired within 14 days after the warrantor accepts the defect is covered by the statutory warranty. The warranty period for the new class of vehicles introduced is 1,000 km or the day one month after taking possession (whichever occurs first).

The majority of amendments introduced in Queensland do not meet the commonly understood meaning of a lemon law. Rather, they are largely focused on expanding the class of vehicles that must be covered by statutory warranty and increasing the jurisdictional limit of the Queensland Civil and Administrative Tribunal (QCAT) from $25,000 to $100,000, as well as expanding the types of orders that the QCAT can make; however, although these amendments bolster consumer rights and protections, there is no right to reject or obtain a refund, which is the true character of a lemon law.

The introduction of section 15, ‘Orders QCAT can make’, adds to the type of Orders QCAT can make. Section 15 (g) enables QCAT to make orders requiring a party to return the warranted vehicle to another party, requiring a party to pay a stated amount to another stated person and more. There is little explanation as to the scope of this power and the mechanics of how it will operate in practice. QCAT can also make an order combining two or more orders. For example, it is possible to interpret the new laws in a way that allows QCAT to order a consumer to return their vehicle to the Dealer and require the Dealer to pay damages to the consumer. This would effectively operate as a refund. Hence, section 15 could potentially operate as the basis of lemon laws. That said, this would largely depend on QCAT’s interpretation of its powers and whether this was the legislative intention.

Overall, the amendments do increase consumer rights; however it is debatable whether it can be considered a lemon law. We look forward to seeing how these powers are used by QCAT in due course.

Vinesh George
Company Secretary and Legal Counsel, AADA | Principal,
VS George Lawyers

Leave a Reply

Your email address will not be published.