Stemmet v Motus Corporation (Pty) Ltd t/a Milnerton Multifranchise (NCT/83884/2017/75(1)(b)) [2018] ZANCT 21 (25 March 2018)

SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document in compliance with the law and SAFLII Policy

IN THE NATIONAL CONSUMER TRIBUNAL

HELD IN CENTURION

Case number: NCT/83884/2017/75(1)(b)

In the matter between:

WALEED STEMMET

APPLICANT

and

MOTUS CORPORATION (PTY) Ltd t/a Milnerton Multifranchise RESPONDENT

Coram:

Prof T Woker –Presiding Member

Date of hearing: 23 MARCH 2018

Judgment and Reasons

THE PARTIES

1. The Applicant is Waleed Stemmet an adult male residing at […] H. Road; Cape Town; who filed a complaint against the Respondent with the National Consumer Commission (“Commission”) in terms of the Consumer Protection Act, No 68 of 2008 (CPA) (the Applicant)

2. The Respondent is Motus Corporation (Pty) Ltd a private company with limited liability incorporated in terms of the company laws of the Republic of South Africa and engaged in the business of selling motor vehicles (the Respondent).

THE HEARING

3. A hearing was held on 23 March 2018 in Cape Town. The Applicant represented himself and the Respondent was represented by Ms Foster, a legal advisor of Motus Corporation (Pty) Ltd.

THE APPLICATION

4. This is an application by the Applicant for leave to refer his complaint, which was non-referred by the Commission, directly to the National Consumer Tribunal (the “Tribunal”) in terms of section 75(1)(b) of the CPA. The Respondent opposed the application.

5. Section 75 (1) of the CPA states as follows:

Referral to Tribunal

“(1) If the Commission issues a notice of non-referral in response to a complaint, other than on the grounds contemplated in section116, the complainant concerned may refer the matter directly to—

(a) …;or

(b) the Tribunal, with leave of the Tribunal.

(2)…

(3) A referral to the Tribunal, whether by the Commission or by a complainant in terms of subsection (1), must be in the prescribed form.

(4) The Tribunal—

(a) must conduct a hearing into any matter referred to it under this Chapter, in accordance with the requirements of this Act, and the applicable provisions of the National Credit Act pertaining to the proceedings of the Tribunal; and

(b) may make any applicable order contemplated in this Act or in section 150 or 151 of the National Credit Act, read with the changes required by the context. (5)…”

6. The Commission issued a notice of non-referral, dated 6 June 2017, in which it states that it was prevented, in terms of section 116 of the Consumer Protection Act, 2008, from being referred to the National Consumer Tribunal, because more than three years have passed since:

(a) the act or omission that is the cause of the complaint;

(b) in the case of a course of conduct or continuing practice, the date on which the conduct or practice ceased.

7. The Tribunal must in accordance with s75 (1) (b) first determine whether to grant the Applicant leave to refer the matter to the Tribunal. The purpose of the hearing held on 23 March 2018 was to determine this issue and this judgment relates only to the issue of whether to grant leave to refer and does not deal with the merits of the matter, save only as far as the merits may relate to the issue of leave to refer.

CONTEXT

8. Despite the fact that this judgment does not deal with the merits of the complaint that the Applicant has against the Respondent, it is appropriate to set out a brief background and the context of the issues in dispute between the parties. In particular, the time line of events is important.

9. The Applicant took his motor vehicle a 2011 TATA 2.2 Xenon Dropside to the Respondent t/a as Milnerton Multifranchise for a routine service on or about 11 November 2015. He also reported that the vehicle had a slight diesel leak. The vehicle is financed through ABSA Bank and was under an extended warranty at the time. The Applicant had purchased the extended warranty on the recommendation of ABSA Bank and as it was under an extended warranty he was obliged to take the vehicle to an accredited TATA agent.

10. The Applicant alleges that he was told to collect the vehicle on 23 November 2015 and that the vehicle was fine. He paid R1 700

for the service. He then drove the vehicle for 88kms when it came to an abrupt standstill. He contacted the dealership on 24 November 2018 and they agreed to collect the vehicle. This did not occur and so the Applicant had the vehicle towed to the dealership on 25 November 2015. The dealership agreed to do an assessment and inform the Applicant of the problem. At the time, the Applicant was dealing with Rochelle Roems the Service Advisor/Warranty clerk from the dealership. Despite numerous calls and emails to the dealership, the assessment was never done and the Applicant was never informed about the nature of the problem. The Applicant has provided information regarding his interaction with the Respondent but for the purposes of this judgment it is not necessary to consider these in detail.

11. On 14 January 2016 the following email was sent to Rochelle Roems by Ruan Lotz from Tata and Imperial Select Recon Centre Milnerton:

Subject: RE Unhappy customer – Feed back

Good day all:

As requested the engineers were here and was asked to remove the pistons and was done as requested from the engineers. On Monday the 11 of January 2016, Barry said: he will supply me with a report and what will be need to be done on the vehicle. I spoke to him yesterday and again to confirm when the report will be received. I am following up daily. Please let the client know that I have not forgotten about his vehicle and he will get all necessary information as soon as I am updated about the vehicle. No empty promises were made by me and the client knows that the vehicle is being attended to, the last time I spoke to the client was on Monday and I told him that I am waiting for the engineers and as soon as I get feedback he will be notified immediately. As soon as I get the report further actions can be taken and the vehicle can then be fixed and in running condition.

Thank you in advance

Ruaan Lotz

12. Despite assurances from the Respondent that the vehicle was being attended to, nothing was done and in February 2016 the Applicant received a letter from Ruaan Lotz informing him that the Milnerton dealership was closing down and that he needed to collect this vehicle. He was also informed that TATA Milnerton would not be responsible for any damages to the vehicle whilst it was on the premises of TATA Milnerton because it was no longer under the supervision of the workshop.

13. At that time, the Applicant had referred his complaint to the Motor Industry Ombudsman of South Africa (MIOSA). He was advised by MIOSA to leave the vehicle at the Milnerton branch as they had undertaken to repair the vehicle.

14. At the end of February 2016, the vehicle was delivered to his premises by the Respondent. The vehicle had not been repaired.

15. The Applicant has received no feedback regarding the vehicle from the Respondent and had to continue paying his instalments to Absa Bank. He was unable to use the vehicle. This caused his business to suffer. He could not meet his monthly repayments and the vehicle has been repossessed by ABSA Bank. The Bank is awaiting the outcome of these proceedings before deciding how to proceed further.

16. The Applicant lodged a complaint with the MIOSA on 28 January 2016. From a letter sent to the Applicant by MIOSA dated 18 October 2016, it appears that MIOSA invited the Respondent to respond to the Applicant’s complaint and that it failed to do so. MIOSA also requested the Applicant to submit his vehicle for an independent assessment. The Applicant adhered to this request and obtained an assessment from an independent assessor which he (the Applicant) paid for. The independent report stated that the damage could have been caused by wear and tear but it also stated:

Concern though on inspection report conclusion points 1,3,4 these are inconclusive and point to possible workshop inadequacy. (if engine had bearing knock, why service vehicle?, road test vehicle? Invoice client and state all fine on 23/11/15).

17. As a result of the inconclusive nature of this report, MIOSA declined to conclude that the Respondent should repair the Applicant’s

vehicle; this despite the fact that the Respondent had actually undertaken to do the repairs (see email from Ruan Lotz to Rochelle

Roems cited in para 11 above) and MIOSA had had no response from the Respondent. It also seems from the email to Roems that the Respondent had removed the pistons from the engine as per the engineer’s request. There is no indication whether these pistons were ever replaced. According to the Applicant the vehicle is still not in running order.

18. The Applicant filed a complaint with the Commission on 9 November 2016 and on 6 June 2017 the Commission issued a notice of non-referral on the basis that the matter had prescribed.

.

CONSIDERATION OF THE MERITS OF THE APPLICATION FOR LEAVE

19. The Tribunal set out the factors that must be evaluated in order to ascertain whether to grant leave in Coertze and Burger v Young. [1] In that case, which has been referred to by the Tribunal in a number of other decisions,[2] the Tribunal held that the following two factors should be considered:

(1) The Applicant’s reasonable prospects of success with the referral; and

(2) Whether the matter is of substantial importance to the Applicant or the Respondent.

20. It is firstly very clear that the matter is of substantial importance to the Applicant. He has gone to a great deal of effort to attempt to resolve the matter with the Respondent, to lodge the complaint with the MIOSA and the Commission and to pursue it further with the Tribunal. He paid to have the vehicle assessed despite undertakings by the Respondent that it was dealing with the matter through its own engineers and according to Lotz was prepared to ensure that the vehicle was restored to running order. He is primarily concerned about the level of service that he received from the Respondent. He explained that as his vehicle is or was under an extended warranty, he was obliged to have any problems dealt with by an entity accredited by the Respondent and could not have taken the vehicle to another repairer. He states that as a result of the Respondent’s uncaring and dismissive attitude he has suffered damages. He has been unable to continue with his business as he cannot afford to purchase another vehicle, his reputation has suffered as he has been unable to meet his monthly repayments to ABSA Bank and he still owes money to the Bank for a vehicle that is not functioning.

21. The Applicant has identified section 54 of the CPA as being relevant to his matter. Section 54 provides that a consumer is entitle to demand quality service. When a supplier undertakes to perform any services for or on behalf of a consumer, the consumer has a right to

(a) the timely performance and completion of those services, the timely notice of any unavoidable delays in the performance of the services;

and

(b) the performance of the services in a manner and quality that persons are generally entitled to expect.

22. In considering the reasonable prospects of success, the Tribunal is satisfied that the Applicant has laid a foundation for a complaint in terms of the CPA that the Respondent must answer to. It also appears from the information before the Tribunal that the Respondent failed to respond to queries from MIOSA. This is particularly concerning because MIOSA is recognised in terms of section 82 of the CPA as the industry ombud for the motor vehicle industry. Section 82 (8) of the CPA requires that all suppliers abide by their applicable industry codes. Failure to abide by an industry code constitutes

prohibited conduct under the CPA. Where the Tribunal finds that a supplier has engaged in prohibited conduct it may impose an administrative penalty of R1 million or 10% of supplier’s annual turnover.

23. Should the Tribunal find that the Applicant did not receive quality service from the Respondent, this would also constitute prohibited conduct. Such a finding will not only lead to the possibility of an administrative penalty being imposed on the Respondent, the Chairperson of the Tribunal may also issue a notice in terms of section 115 (2) (b) which will enable the Applicant to proceed to the High Court where he will be able to claim any damages he is able to prove. All of this can only be done once all the issues are fully ventilated before the Tribunal.

24. One final issue that needs to be considered is the issue of prescription. The Commission stated in the notice of non-referral to the Applicant that it would not refer the matter to the Tribunal because the matter had prescribed. It is unclear why the Commission was of this view and it is to the credit of the Respondent that it has not relied on this in its answering affidavit. It is clear that the dispute between the parties arose in November 2015 when the vehicle was delivered to the Respondent for its routine service. There can be no question therefore that the matter has prescribed.

25. The Tribunal therefore grants leave for the matter to be heard.

DATED at Centurion on this 25th Day of March 2018.

_____________________.

Prof. T A Woker

Presiding Member

[1] NCT/7142/2012/75(1)(b)&(2).

[2] See also Mbekeni v Freeway Toyota (NCT/36177/2015/75(1)(b) [2016] ZANCT 18 (1 April 2016) and Papo v Standard Bank of South Africa Ltd (NCT/69527/2016/14 [2017] ZANCT 81 (27 July 2017).