Benjamin James Pty Ltd – Court action

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29 July 2011
Court actions

A Victorian tribunal has affirmed a decision against Fawkner car dealer Benjamin James Pty Ltd by the Motor Car Traders Claims Committee.

The Victorian Civil and Administrative Tribunal (VCAT) backed the committee’s decision to award an $18,529.29 payout to a consumer who bought a faulty car from the dealer, trading as Benjamin James Motors.

The consumer bought a 2002 BMW X5 for $36,900 from the dealer in November 2009 but had considerable issues with its reliability. It was constantly breaking down, overheating and spilling oil. The vehicle spent most of the next 14 months with the dealer’s mechanic. To get her car back, the consumer had to pay $4000 to discharge a ‘mechanic’s lien’.

In February 2011, VCAT had ordered the dealer to compensate the consumer but Benjamin James Motors failed to pay as required.

By law, a person can apply for compensation from the Motor Car Trader’s Guarantee Fund for a loss incurred because a motor car trader fails to satisfy a court or tribunal order.

There are serious implications for a motor car trader if a claim is admitted against the fund. These include automatic suspension of the motor car trader’s licence, potential legal proceedings to recover the funds and the possibility of being prevented from future participation in the motor car trading industry.

The consumer applied to the fund and the Motor Car Traders Claims Committee admitted the claim on 23 March 2011. Benjamin James Motors applied to VCAT for review. On 28 June 2011, VCAT upheld the committee’s decision. 

In an earlier court action by the Director of Consumer Affairs Victoria, Benjamin James Motors pleaded guilty to breaching the Motor Car Traders Act 1986 by selling a car still under finance. By law, licensed motor car traders must show vehicles have a clear title, meaning they’re not stolen, written off, or have money owing on them. Melbourne Magistrates’ Court imposed a 12-month good behaviour bond (see our court action report dated 10 March 2011).

Benjamin James Pty Ltd had its licence suspended indefinitely by the Business Licensing Authority in June 2011 for breaches of the Motor Car Traders Act 1986 which were unrelated to the Motor Car Traders Claims Committee decision.