Bought a faulty car from a registered trader? Learn your rights under NZ consumer law, how to claim a repair or refund, and when legal advice can help.

Bought a Faulty Car from a Dealer? Here’s What New Zealand Law Says

Purchasing a car—whether new or used—is a significant investment. Unfortunately, some buyers later discover that their newly purchased vehicle has hidden defects or serious mechanical issues. If this happens and you purchased the car from a registered motor vehicle trader, you may have legal rights under the Consumer Guarantees Act 1993 (CGA).

At Core Legal, we regularly advise clients across Masterton and Wellington on how to resolve disputes involving faulty vehicles, and what steps to take when dealing with non-compliant dealers.

Case Example: Tribunal Orders Partial Compensation for Faulty Car

In one recent case before the Motor Vehicle Disputes Tribunal, a consumer purchased a used vehicle for $4,000. After an engine failure and other mechanical issues, she sought a full refund. While the Tribunal dismissed her claim for a full refund, it did award her compensation to cover the reasonable cost of repairs for specific defects.

This case demonstrates that even when a full refund may not be justified, partial remedies may still be available.

How to Check if the Seller is a Registered Trader

Before purchasing a vehicle, it’s essential to check whether the seller is a registered motor vehicle trader. You can confirm this by searching the Motor Vehicle Traders Register. If the seller is not registered, your consumer protections under the CGA may not apply in the same way.

What Does “Acceptable Quality” Mean Under NZ Law?

When you buy a car from a trader, the vehicle must meet the guarantee of acceptable quality. This includes:

• Being fit for its usual purpose
• Having an acceptable appearance and finish
• Being free from minor defects
• Being safe to use
• Offering a reasonable level of durability, given the age and price

In the Tribunal case, the engine failure was not considered a breach of acceptable quality, because the vehicle was old, had high mileage, and was purchased at a low price—factors that meant ongoing repairs could reasonably be expected.

What Are Your Legal Remedies If the Car Is Faulty?

If your car fails to meet the acceptable quality standard, you have several options under the CGA:

• Minor Defect:
  You can require the dealer to repair the vehicle within a reasonable timeframe.
• Unresolved Repairs:
  If the trader refuses or fails to repair the defect in time, you can arrange your own repair and claim reasonable costs, or choose to reject the vehicle.
• Major Failure:
  If the defect is significant and makes the car unsafe or not fit for purpose, you may reject the car entirely and claim a refund or compensation for the loss in value.

What Costs Can You Recover?

You may be entitled to consequential losses, such as towing, mechanical assessments, and temporary transport costs. However, legal fees are not usually recoverable unless the dispute goes to court and costs are formally awarded.

When to Seek Legal Advice

If you’ve been sold a faulty car or are unsure how to handle a dispute with a trader, seeking advice from a lawyer experienced in consumer and vehicle law can make a real difference.

At Core Legal, we offer fixed-price Initial Consultations to help you quickly understand your rights and next steps. Our team assists clients across Wellington, Masterton, and the wider Wairarapa region with practical, cost-effective legal support.

???? Contact us today to discuss your situation and find out what options are available to you.