Mazda v ACCC - Although Mazda misled consumers at least 49 times, it is NOT 'unconscionable conduct' ruling

Transport
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Mazda v ACCC NOT ‘unconscionable conduct’ ruling

Below are the salient points from the article. Apart from the continued poor performance of the ACCC in its prosecutions, the decision is germaine to how the courts view the rights of Australian Consumers. The Justice said about Mazda’s behaviour that “it cannot be regarded as being conscionable”, but ruled that it was not ‘unconscionalbe conduct’ (I think) because the ACCC did not prove it was systemic. [Bolding is mine.]

The Full Federal Court has dismissed appeals from both Mazda and the Australian Competition and Consumer Commission (ACCC) concerning a ruling it made in November 2021.

The ACCC had appealed the ruling, arguing Mazda did in fact engage in unconscionable conduct in its dealings with nine consumers.

Mazda, in contrast, appealed the Court’s ruling as it argued it didn’t make 49 false representations to consumers about their consumer rights.

“I accept that this evaluative judgment is contestable and generally the case was made harder by the ACCC than it could have been by it not seeking to prove major failure or advancing a “system” case,” concluded Justice Lee in his ruling, calling the ACCC’s case “prolix, repetitive and complex”.

The Justice did, however, say Mazda’s conduct towards one of the affected owners “was not only seriously wrong, but of such a character that according to prevailing norms of conducting Australian business, it cannot be regarded as being conscionable”.

In his November 2021 ruling, Justice O’Callaghan found Mazda’s conduct represented “appalling customer service” but rejected the ACCC’s allegations of unconscionable conduct.

“The fact that Mazda did not always give the consumers precisely what they were seeking was not unconscionable conduct,” said Federal Court Justice O’Callaghan in the ruling.

Federal Court Justice O’Callaghan found Mazda represented to customers they were only entitled to a repair, offered to refund only a part of the initial purchase price, or offered replacement cars to the customers on the condition they paid for them.

“The Court found that Mazda misled these consumers about their consumer guarantee rights by representing that they were only entitled to have their vehicles repaired, even though a consumer’s rights under the Australian Consumer Law also include a refund or replacement when there is a major failure,” the ACCC said in a statement.

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Just another example of why the ACL is a load of wishy-washy terms.
Full of ‘may’, and ‘should’, and vague examples of levels of defects that constitute ‘minor’ and ‘major’ defects.
Too many times courts have to try and decide how to interpret this ACL mess.

This time the learned justices have, on appeal, decided that the action was neither ‘conscionable’, nor ‘unconscionable’.

Breathtaking interpretation of the English language.

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There’s no question that poorly drafted law creates issues but this bring to light what the law is, and how it’s required to be interpreted and applied. While ‘neither/nor’ doesn’t appear to pass the common sense test the law doesn’t use common sense as a basis, as it’s simply too vague and subjective; rather, the law requires clear proofs to be provided within its framework before a ruling in favour of a plaintiff’s case can be made. This is why the law is written in a painfully specific way.

Justice’s comments suggest that the case brought before the court by the ACCC did not leave it open for Mazda to be found as having engaged in unconscionable conduct, because sufficient proof of unconscionable conduct was not presented. Unfortunately, if a case is not framed correctly the justice can’t rule in favour of the plaintiff; firstly it’d be unjust and secondly it’d be thrown out on appeal and have wasted the court’s time.

Based on justice’s comments to the effect that Mazda behaved very badly, and that ACCC dropped the ball, it appears clear that he was disappointed to essentially be prevented from finding in favour of the plaintiff. It’s the job of a justice to consider whether the evidence presented proves the charge beyond reasonable doubt, if it doesn’t they have no choice but to find in favour of the defendant.

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It is because the ACL is framed in such a painfully unspecific way that the ACCC has such a dismal record of prosecuting those who transgress the vibe of it.

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Some with a more cynical view think the ACL works mostly as intended for the more serious cases. It quickly becomes window dressing that looks good but isn’t really. Pollies can thus be proud to appear to support consumers (and in many cases it works for us because the companies step up) while not clearly holding businesses accountable when they prefer to dodge, wiggle, stonewall, or ignore excepting in the most egregious cases the media get onto (donations are important).

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Let’s not lose sight of what occurred. It’s pretty clear that the case was unsuccessful not because of the ACL but because of the ACCC’s case. Also don’t forget this was an appeal and the Justices found similarly on the matter of unconscionable conduct. If the ACCC feels ACL is holding them back it’s open to the ACCC to pursue legislative change.

Consumers definitely are at a significant disadvantage, partially because competition has been clipped and demand has stayed perpetually well ahead of supply, whether it’s trades or aged care providers. If businesses were going to be held properly and swiftly accountable for their actions many would have to close but the supply/demand balance would skew further towards supply. It’s sad that such a situation has arisen but consumer rights have rarely been a hot spot, until as you say the media latches onto an issue.

Having taken six cases valued from 2.5k to 25k to the state’s consumer affairs tribunal only one was unsuccessful; it progressed all the way to the tribunal and at that point the registrar decided she couldn’t hear the matter.

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