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Slow or no justice for buyers of dodgy cars despite Consumer Tribunal 'help'

06 December 2019 - 15:05 By Wendy Knowler
Used car dealerships were ordered to refund unhappy customers, but to date no money has been paid back.
Used car dealerships were ordered to refund unhappy customers, but to date no money has been paid back.
Image: 123RF / Nneirda

They celebrated their victories when the National Consumer Tribunal ordered motor dealerships to refund them for dodgy cars - and dished out hefty fines - but due to a  lack of follow-ups, their wins were hollow.

In September 2017, the tribunal found a Kraaifontein motor dealership, Western Car Sales, guilty of prohibited conduct in failing to take responsibility for the dud car it sold to Hanlie van Lill for R61,000.

Dealership owner Chris Pretorius was fined R100,000 and ordered to refund Van Lill in full within 30 days.

The ruling was hailed as a “major new consumer protection decision”, a test case and a strong warning to motor dealers who are doing business as if the Consumer Protection Act doesn’t apply to them.

But the fine wasn't paid and Van Lill has yet to get a cent of her money back.

In July this year, the tribunal ordered a Vereeniging used car dealership, Ultimate Cars (now Executive Auto), to pay the balance of Lumkile Mkwalo’s car finance agreement with Nedbank’s MFC - R112,000 - and to pay a fine of R50,000 to the National Revenue Fund within 30 days.

Mkwalo bought a 2007 Audi A3 from the dealership in September 2015 for R112,000, and when it broke down three months later, the dealership demanded he contribute towards its repair.

He refused, given that the Consumer Protection Act dictates that suppliers take full responsibility for faulty products within six months of purchase.

MFC granted him a moratorium on further payments, due to the dispute, but the dealership refused to repair the vehicle and three years later demanded R75,000 in storage fees from Mkwalo.

He then lodged a complaint with the Motor Industry ombud, which sided with him on the issue of the funding of the repair, but was of the opinion that the dealership had a right to demand storage fees from him.

Unhappy with that, Mkwalo then asked the National Consumer Commission (NCC) to take the case to the tribunal. When the NCC said it could not, Mkwalo got a lawyer to do so.

Finally, in July the tribunal ordered that the dealership settle Mkwalo’s MFC contract and pay that R50,000 fine by the end of August.

When TimesLIVE recently asked the tribunal whether those payments had been made, spokesman Sibusiso Nyathi said: "The National Credit Regulator, or the National Consumer Commission, in a matter arising in terms of the Consumer Protection Act, may institute proceedings in High Court on its own behalf for recovery of an administrative fine imposed by the tribunal.

“The tribunal cannot comment or advise you on the status of compliance with its judgment as it is now functus officio.”

He referred TimesLIVE to the NCC about the settlement of Mkwalo’s car finance debt and to the National Treasury about the payment of the fine.

As Mkwalo took the case to the tribunal directly, without the help of the NCC, the NCC was of no help.

A Treasury spokesperson suggested that TimesLIVE approach the department of trade and industry instead, which has yet to respond.

TimesLIVE then asked Nedbank if it intended to pursue Mkwalo for payment of that R112,000, given that he is now unemployed and unable to find further free legal representation in order to approach the courts for justice.

Responding, a bank spokesman said MFC had cancelled Mkwalo's vehicle finance agreement on the Audi.

“The ownership and title of the vehicle will return to MFC and MFC will directly engage with the dealer to seek the repayment of the original invoice amount financed,” she said.

“MFC will also refund Mr Mkwalo all payments received on the account - R8,667.”

Approached for comment, Executive Auto owner Jacques Pieterse referred TimesLIVE to his attorney, who said the first his client had heard of the tribunal ruling was when contacted by Nedbank this week.

The dealership has since paid the R122,000 to the bank in settlement of Mkwalo’s debt, but would be appealing the R50,000 fine to the National Revenue Fund, the attorney said.

* Van Lill bought her VW Passat from Western Car Sales in late 2015. It broke down three days later, never to go again.

The dealer told her the car was sold voetstoets and washed his hands of the matter.

Van Lill complained to the motor industry ombud, and when the dealership ignored its decision - that they take back the car and refund Van Lill - the National Consumer Commission decided to make it a test case.

In September 2017 the Tribunal found the dealer guilty of prohibited conduct and fined him R100,000 and ordered him to refund Van Lill her R61,000 within 30 days.

But the owner of Western Car Sales, Chris Pretorius, evaded the regulatory process by closing and liquidating the dealership.

In July this year, an NCC spokesman told TimesLIVE that the NCC had established that the company had not been liquidated and that Pretorius would be pursued in his personal capacity as a director of the company.

“The NCC is thus in the process of instituting civil proceedings against the respondent,” the spokesperson said.

But Van Lill said this week that she’d been told by the NCC’s legal division that the case was closed.

“I am furious. I’ve wasted four years of my life, constantly following up on this ruling, while that car has been gathering dust in my yard,” she said. “I’m furious!”

GET IN TOUCH: You can contact Wendy Knowler for advice with your consumer issues via e-mail: consumer@knowler.co.za or on Twitter: @wendyknowler