In a strong message to second-hand car dealers that they cannot escape the peremptory provisions of the Consumer Protection Act (CPA), the National Consumer Tribunal has penalised two car dealerships, imposing fines totalling R150 000 and requiring refunds amounting to R1 million for breaching the Act.
Wingfield Motors (Pty) Ltd, operating as Best Price for My Car in the Western Cape, was instructed to reimburse a consumer R568 000 and pay an administrative fine of R50 000. Meanwhile, Sandton Repo Cars (Pty) Ltd was directed to refund a consumer R459 900 and pay an administrative penalty of R100 000.
The Tribunal’s decision followed consumer complaints investigated by the National Consumer Commission (NCC).
The investigation into Wingfield Motors found that the car dealership had breached sections 55(2)(a) to (c) and 56(2) of the CPA in a case involving a consumer who bought a second-hand 2017 Ford Focus RS 2.3 EcoBoost for R568 000. Within three days of the purchase, the consumer found defects needing repairs costing more than R62 000, which Wingfield Motors declined to fix. When the consumer opted to cancel the purchase and requested a refund, the dealer refused to reimburse them.
The refusal by Wingfield Motors to repair the vehicle and refund the consumer violated section 56(2)(a) and (b) of the CPA. The Tribunal found that the conduct of Wingfield Motors violated the CPA and was declared prohibited.
The investigation into Sandton Repo Cars centred on a consumer’s purchase of a 2018 Volkswagen TSI Golf-R for R459 900. Despite the dealership s claim that the vehicle was accident-free, the consumer found defects shortly after acquisition and requested a refund, which Sandton Repo Cars declined.
The NCC’s investigation uncovered that the vehicle had been involved in an accident. Additionally, the NCC found that the consumer was coerced into signing a mechanical breakdown warranty refusal notification, absolving the supplier of responsibility for any post-collection defects.
The Tribunal ruled that Sandton Repo Cars contravened section 51(1)(b) of the CPA by including terms that indirectly waived the consumer’s rights, contravened 55(2)(a) to (c) by supplying a defective vehicle, and contravened 56(2)(b) by failing to refund the consumer.
The Tribunal stated that the services of second-hand car dealers must be aligned with the CPA.
“Consumers must be protected against retailers accepting the purchase amount and not repairing a consumer’s vehicle or refunding the consumer when material defects manifest within the prescribed period.”
The NCC’s acting commissioner, Hardin Ratshisusu, expressed concern over the continued disregard of the CPA by various car dealerships. He emphasised that dealerships for second-hand vehicles must provide vehicles that are safe, defect-free, and durable, and they must repair, replace, or refund vehicles that fail to meet these standards.
“Failure to adhere to these principles not only harms consumers but also undermines the core objectives of the CPA. The judgment and reasons of the Tribunal in these two cases affirm that the rights of consumers must be respected,” Ratshisusu said.
Earlier this year, the South African Insurance Association (SAIA) raised concerns over dishonest dealers selling or reusing unsafe, deregistered vehicles as code 2 motor vehicles.
Read: Road hazard: unfit and unsafe vehicles slip through the cracks in the second-hand market
SAIA warns buyers that discovering vehicle defects after the seven-day cooling-off period may limit their recourse, unless evidence shows the seller’s prior knowledge and deceit.
“This is why it is so critical that the buyer of a used vehicle takes great care. Known and reputable used-vehicle brands are likely the safest, but the same precautions should apply. It is essential that the prospective buyer does not sign or pay anything until all the checks have been done and independent testing reports have been secured,” SAIA states.
