Mazda “Zoom Zooms” to a $11.5m fine
2 mins reading time
In November 2021, the Australian Competition and Consumer Commission (ACCC) was partly successful in Australian Consumer Law (ACL) proceedings issued in 2019 against Mazda Australia. The Federal Court found that Mazda engaged in misleading and deceptive conduct, and made false or misleading representations, to nine consumers in respect of their available consumer guarantee rights. However, the Federal Court dismissed the ACCC’s other allegations that Mazda had also acted unconscionably.
In protracted legal proceedings occurring since 2021, the ACCC appealed the Court’s decision to dismiss the unconscionable conduct allegations. That appeal was dismissed in March 2023. Mazda also appealed against the finding that it had engaged in 49 specific instances of misleading and deceptive conduct. That appeal was similarly dismissed.
So, we “zoom zoom” to February 2024, when the Federal Court handed down its penalty. Mazda received $11.5 million in penalties, and also agreed to pay further compensation to the affected consumers.
The Court found that Mazda made 49 separate false or misleading applications to the nine consumers, whose vehicles had experienced recurring and serious faults. Mazda ignored or rejected the consumers’ requests for a refund or replacement vehicle, instead stating that the only remedy available was further or ongoing repair. In some instances, Mazda had eventually offered to refund only a portion of the vehicle’s purchase price or had offered a replacement vehicle only if the consumer contributed a payment.
Key takeaways
Mazda’s fine serves as a clear (and serious) reminder to businesses to make sure they understand, comply with, properly apply, and properly represent the requirements of the ACL.
The statutory consumer guarantees are non-excludable, and consumers have a set framework of rights where there is a ‘major’ or ‘non-major’ failure. It is also the case that multiple ‘non-major’ failures – when taken together – can constitute a ‘major’ failure.
The ACCC is focussing on high-value consumer goods (eg, motor vehicles and caravans, etc) as one of its priority enforcement areas.
We’re here to help
Macpherson Kelley has substantial experience in representing caravan manufacturers and component suppliers, and also operates its Motor Dealer Industry Group. For further information about the statutory consumer guarantees, business and consumer rights, and dealing with customer queries and complaints, please contact our team.
more
insights
Battle of the terms and conditions
Anti-Money Laundering and Counter-Terrorism Financing (AML / CTF) Regime set to apply to Lawyers
Anti-Money Laundering and Counter-Terrorism Financing (AML / CTF) Regime set to apply to the real estate sector
stay up to date with our news & insights
Mazda “Zoom Zooms” to a $11.5m fine
In November 2021, the Australian Competition and Consumer Commission (ACCC) was partly successful in Australian Consumer Law (ACL) proceedings issued in 2019 against Mazda Australia. The Federal Court found that Mazda engaged in misleading and deceptive conduct, and made false or misleading representations, to nine consumers in respect of their available consumer guarantee rights. However, the Federal Court dismissed the ACCC’s other allegations that Mazda had also acted unconscionably.
In protracted legal proceedings occurring since 2021, the ACCC appealed the Court’s decision to dismiss the unconscionable conduct allegations. That appeal was dismissed in March 2023. Mazda also appealed against the finding that it had engaged in 49 specific instances of misleading and deceptive conduct. That appeal was similarly dismissed.
So, we “zoom zoom” to February 2024, when the Federal Court handed down its penalty. Mazda received $11.5 million in penalties, and also agreed to pay further compensation to the affected consumers.
The Court found that Mazda made 49 separate false or misleading applications to the nine consumers, whose vehicles had experienced recurring and serious faults. Mazda ignored or rejected the consumers’ requests for a refund or replacement vehicle, instead stating that the only remedy available was further or ongoing repair. In some instances, Mazda had eventually offered to refund only a portion of the vehicle’s purchase price or had offered a replacement vehicle only if the consumer contributed a payment.
Key takeaways
Mazda’s fine serves as a clear (and serious) reminder to businesses to make sure they understand, comply with, properly apply, and properly represent the requirements of the ACL.
The statutory consumer guarantees are non-excludable, and consumers have a set framework of rights where there is a ‘major’ or ‘non-major’ failure. It is also the case that multiple ‘non-major’ failures – when taken together – can constitute a ‘major’ failure.
The ACCC is focussing on high-value consumer goods (eg, motor vehicles and caravans, etc) as one of its priority enforcement areas.
We’re here to help
Macpherson Kelley has substantial experience in representing caravan manufacturers and component suppliers, and also operates its Motor Dealer Industry Group. For further information about the statutory consumer guarantees, business and consumer rights, and dealing with customer queries and complaints, please contact our team.