I AM UNHAPPY WITH A USED CAR I BOUGHT FROM A MOTOR CAR TRADER Use this fact sheet if you: are a consumer who has purchased a used car from a Licensed Motor Car Trader (LMCT); and the car is not a commercial vehicle and was not purchased at auction; and you are unhappy with the transaction. Motor car transactions can be complex. This factsheet is designed only to give you general information about some, but not all, of your rights and obligations. !! IMPORTANT !! delivery of the car, or the LMCT acted unfairly towards you or Don’t delay in seeking legal advice: it misled you in getting you to sign can be much more difficult – and often the waiver. impossible – to get out of the contract or exercise your rights if you let too Notice of the cancellation must be much time pass. in writing. Cancelling a motor vehicle contract The LMCT must return your trade- without legal grounds can have serious in and most of the money you have consequences. Be sure to seek legal paid, but will keep 1% of the advice before you take any action. purchase price or $100, whichever is greater. You will usually have to Cooling-off rights pay for any damage (except fair wear and tear) caused when you The Motor Car Traders Act may allow you to cancel a contract to purchase a had the car. used car from an LMCT within three The three day cooling-off period clear days of signing the contract. The does not currently apply to new three clear days does not count the cars, commercial cars, or cars day on which the contract was signed, bought at auction. Saturday, Sunday or a public holiday. The law is due to change to Some of the important things to note introduce a three day cooling-off are: period in relation to new cars. Usually the LMCT will have you Under the new law, the LMCT must waive your cooling-off rights. return your trade-in but will keep However, the LMCT may not be 2% of the purchase price or $400, able to rely on this waiver if it is not whichever is greater. This change in the right form, if it is not signed will come into effect no later than 1 immediately before you take December 2008, so get advice about your rights to cancel a conduct breaching the Fair Trading contract to buy a new car if you Act. However, in order to protect all have recently signed up. your rights you should seek legal advice immediately if you think you Other reasons for cancelling under have been lied to or treated unfairly. the Motor Car Traders Act Problems with the safety and If the trader has made a false quality of the car representation about the odometer reading of the car; or Implied conditions and warranties If the contract for sale of the car For most contracts there will be an does not contain the prescribed implied term that the car be of particulars, terms and conditions; merchantable quality and fit for or purpose. If the car is substantially different Whether the car you bought meets from that represented in the notice these standards will depend upon a attached to the car when it was sold, number of things including the price, the apparent condition of the car and then section 45 of the Motor Car whether you inspected the car before Traders Act may allow you to apply to you signed. apply to VCAT or the Magistrates Court to rescind your contract (ie you For more information on implied return the car to the trader and the conditions and warranties see our fact trader returns the money you have sheet on implied terms. paid) . If there are problems with the quality of You have 3 months for the time you the car, it is important that you seek signed the contract to apply for an legal advice immediately. If you delay: order. However, if you have complained to the trader within 3 you may be deemed to have months of signing the contract, you accepted the car and therefore lose have one month from the complaint any right you may have to cancel to apply for an order. (although you may still be able to claim damages); Being misled or treated unfairly you may be unable to get the If you feel you were misled, lied to, evidence required to prove that the taken advantage of or treated unfairly, vehicle was defective when you you may have rights to cancel the took delivery. contract or seek damages. The Fair Trading Act 1999 (Vic) prohibits misleading or deceptive and unconscionable conduct. You will generally have six (6) years to take legal action from the date of the Roadworthy certificate it only applies to a car which was manufactured not more than 10 An LMCT should not sell you a used years before the date it was sold car without providing a current and which has been driven for less roadworthy certificate. than 160 000 kilometres; A roadworthy certificate: the warranty period is for 3 is current if it has been issued in months or 5,000 kilometres from the last 30 days; when you take delivery of the car, whichever comes first; only relates to the most important safety related parts of the car that the trader can exclude defects. can be easily inspected; The steps the LMCT must take to exclude defects is reasonably does not tell you about the general complex, so get advice if you have condition and mechanical reliability signed anything relating to of the vehicle. exclusions; The roadworthy certificate might tell defects occurring in tyres, battery you if the vehicle is safe to drive, but it will not tell you whether it is likely you and certain accessories are not will have to pay some hefty repair bills covered. in the near future. If you want to know about the mechanical soundness of a If the LMCT is refusing to fix the car car you will be need to get a and the car is covered by a warranty comprehensive inspection done, like under the Motor Car Traders Act you those offered by the RACV and VACC. can make a claim to the Motor Car Trader’s Guarantee Fund. If you think you have been issued with a false roadworthy certificate: You may also have been sold an extended warranty under your get the car tested immediately by another licensed vehicle tester; contract. This will set out what is covered, how much will be paid for make a complaint to VicRoads; repair of a defect and the circumstances under which cover will seek advice from Consumer Action be given. about your rights in relation to warranties and cancelling your If the company who provided the contract, and taking action against extended warranty is refusing to fix the original licensed vehicle tester. your car as agreed, seek advice about Warranties making a claim in the Victorian Civil and Administrative Tribunal. Often a used car sold by an LMCT will be covered by a warranty under the Loan (credit) contracts Motor Car Traders Act. Some things If you have paid for the car with a loan to note about this warranty are: contract, you will need to consider what to do about it. reasonable attempts to obtain credit on If the loan has already been drawn reasonable terms, but were unable to down, it is important that you do not do so. stop payments until you have sought legal advice. The LMCT arranged insurance, credit, consumer credit insurance, See our fact sheet on Linked Credit and gap insurance Disputes and get legal advice. Often an LMCT will sell or arrange See also our sheets on Motor Finance insurance, credit, consumer credit Wizard insurance and gap insurance. Often the LMCT will be paid a commission Where things have to happen before for selling you these products. the contract goes ahead, like getting finance Get advice if you do not understand exactly what you have been sold. Often people will make their contract with the LMCT subject to conditions, Delayed delivery like obtaining finance of the If the trader delays making the car purchaser’s choice or subject to a available for delivery by more than 14 satisfactory mechanical test. days from the delivery date stated in the contract, you may be able to If you agreed with the trader that cancel the contract by notifying the something would happen before the trader in writing. This will not work if deal would go ahead, and that thing you caused the delay. does not happen, then you may be Canceling the contract without legal able to end the transaction. grounds In some circumstances, under section If you try to get out of the contract 124 of the Consumer Credit (Victoria) without a lawful reason you could be Code you will be entitled to cancel the sued for damages. contract even if you did not make the contract subject to finance but you If you are unhappy with the deal you make it known to the LMCT that you must get legal advice immediately, so need finance, and you made that you can weigh up your options.