Jayco cops $75,000 penalty

Australian RV giant Jayco has been ordered by the Federal Court to pay a penalty of $75,000 for making a false or misleading representation to a buyer about their consumer guarantee rights.

The decision follows court proceedings by the ACCC.

Late last year, the Federal Court dismissed the majority of the ACCC’s case, including the allegation that Jayco acted unconscionably towards four consumers by denying them the right to refunds or replacements for their defective caravans.

But the Federal Court found that Jayco had misled one buyer by claiming they were only entitled to have their caravan repaired, when in fact a consumer’s rights under the Australian Consumer Law when there is a major failure also include a refund or replacement.

The Court found that the caravans purchased by four buyers, who formed the basis of the ACCC’s case, were not of acceptable quality, and that defects in three of the caravans were major.

When finding there was a major failure, the Court had regard to the cumulative effect of the defects, which included water leaks when it rained and multiple roof collapses. 

“Misleading consumers about their rights under the consumer guarantees, particularly by a large well-known manufacturer, is serious misconduct,” ACCC Chair Rod Sims said in a media statement.

“This penalty is a reminder to businesses that representations to consumers about their consumer guarantees rights need to be accurate. Consumers have a right to a repair, replacement or refund for goods with major faults.”

“The ACCC will continue to take action against businesses who deny consumers the remedies available under the Australian Consumer Law for products that have clear defects,” he said.

Jayco agreed with the ACCC to make joint submissions to the Court in relation to penalty, and consented to a declaration and costs order.

In response to the ACCC statement, a Jayco spokesperson said that the Dandenong, Victoria based manufacturer "greatly regrets that it was found to have contravened the ACL in its dealings with one customer and it intends to ensure that its contravening conduct does not reoccur.

"The proposed penalty of $75,000 was noted to be considerably lower than the maximum penalty available for the contravention," the spokesperson said.

"The Judge ruled that Jayco’s conduct was not found to be a case of systemic or repeated contravening conduct. Jayco’s conduct did not amount to a deliberate contravention and was not undertaken with an intention to mislead or deceive, but was inadvertent.

"As a result of the ruling, the ACCC has been ordered to pay back 80% of Jayco’s legal costs accrued over the past four years. Jayco will pay 20% of the ACCC’s costs.

"For over 45 years, Jayco’s vision has been to produce the best caravans tailored for Australian conditions, selling over 225,000 caravans over this time. In 2019, it was awarded Canstar Blue’s first ever customer satisfaction award in the caravan/RV sector," the Jayco spokesperson said.

Related:

ACCC takes Jayco to court

Federal Court finds Jayco misled consumer

Consumer watchdog targets shonky caravan operators