The High Court of Australia has published two judgments of note concerning the proper assessment of damages under s272(1) of the Australian Consumer Law when consumer good do not comply with the guarantee of “acceptable quality” under s54 of the ACL.
The cases, Williams v Toyota [2024] HCA 38 and Capic v Ford [2024] HCA 39 were a pair of defective motor vehicle class actions, heard together in the High Court. In the case of Toyota, the case concerned defective diesel particulate filters that affected vehicle performance in certain Toyota Hiluxes. In the case of Ford, the case concerned defective powershift transmissions that affected vehicle performance in Ford vehicles fitted with the relevant transmission.
When the vehicles were sold as new cars, the defects were unknown to the consumer. The defects became known at a later date. In the case of Toyota, a “field fix” was developed to rectify the defect.
In issue was the proper approach to the timing and assessment of damages in circumstances where an unknown defect, discovered later, was remedied by a field fix.
The Court held at [39] of Toyota that the “indisputable starting point is the attribution of a full acquaintance with the state and condition of the goods at the time of supply to a reasonable consumer, including full knowledge of any defect.”
The Court also held at [34] of Toyota that “later acquired knowledge of the capacity to repair the defect or ameliorate its consequences, including when, how and at what cost those repairs or ameliorative steps could be undertaken” should also be attributed to the consumer at the time of supply. That is, for purposes of assessing damages under s272, the Court should make that assessment at the time of supply, but attributing to the consumer knowledge of all defects and repair steps that are known at the time of the trial.
The Court ordered that the matters be remitted to the respective trial judges for determination of damages.
Justin Gleeson SC, Tim Rogan and Patrick Meagher appeared for the plaintiffs in the Toyota matter. They were instructed by Matthew Mackenzie of Quinn Emmanuel.
Fiona Roughley SC and Sam Gerber appeared for the plaintiffs in the Ford matter. They were instructed by Chris Pagent of Corrs Chambers Westgarth.
