Federal Court finds Jayco misled consumer

After a three-year legal tussle involving Australia's biggest RV manufacturer and the nation's top consumer watchdog, the Federal Court has found that Jayco breached the Australian Consumer Law in its dealings with one consumer who had purchased a Jayco caravan.

The Federal Court found that Jayco Australia made a false or misleading representation that the consumer was only entitled to a repair, when in fact a consumer’s rights under the ACL include a refund or replacement.

The Australian Competition and Consumer Commission (ACCC) alleged four owners were refused refunds or replacement between 2013 and 2015 for their defective Jayco caravans; claiming the company did this despite knowing they were defective and not functioning properly, even after repeated repair attempts.

After finding that Jayco had made false or misleading representations to one consumer, the Court dismissed the remainder of the ACCC’s case, finding that Jayco did not make false or misleading representations to the three other consumers or act unconscionably towards the four consumers.

Major defects

However, the Court found that the caravans purchased by the consumers were not of acceptable quality, and that defects in three of the caravans were major.

In finding that there was a major failure, the Court had regard to the cumulative effect of the defects. Amongst other problems, the caravans experienced either water leaks when it rained or had multiple roof collapses.

It's been three years since the consumer watchdog instigated the court proceedings, accusing Jayco of "unconscionable conduct" towards four customers who bought defective Jayco caravans.

In late-2019 a Federal Court judge reserved judgment on whether Jayco breached the Australian Consumer Law (ACL) by its conduct.

“The ACCC took this action because we were concerned that these consumers were being denied remedies available under the Australian Consumer Law, for products that had clear defects,” ACCC Chair Rod Sims said in an online statement.

“These consumers spent tens of thousands of dollars on new Jayco caravans that had defects which caused issues such as roofs collapsing, leaking or not shutting properly.”

“We will carefully consider the judgment,” he said.

Systemic issues

Under Australian Consumer Law, consumers can choose to have a product replaced, repaired or refunded if is not of acceptable quality and there is a major fault. A retailer can choose the remedy for minor faults.

While only targetting Jayco at the time, the ACCC said in 2017 that the legal case illustrated more widespread issues within the Australian RV industry, and that it had received more than 1000 complaints about caravans.

"This is an industry that does need to be put on notice. Our aim is to change behaviour and say to the industry, you should not be behaving like this," Sims said.

Jayco declined to comment about the court's decision.

The full judgement can be found here.

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