Second-hand cars: What legal rights do owners have?

These days, it’s not unusual to hear about car manufacturers recalling their vehicles due to potential safety issues. But many cars, especially if the recall is for older vehicles, have changed hands from their original owners.

Even though you bought your car second-hand, you still have rights–both as a consumer and if you’re injured because of a defect in the car. Here, we outline the law, as well as what’s involved in making a compensation claim and what to do if your second-hand vehicle causes you harm.

As good as new

If you own a second-hand vehicle, your claim to compensation is the same as if the car were new. If there’s a manufacturing default with the car that results in injury, you can make a product liability claim.

If you’ve suffered an injury as a result of this or any other defect, you should speak with a lawyer as soon as possible to get more case-specific advice. When we assess these types of claims on a case-by-case basis, we consider:

  • how long the default has been identified
  • the type of defect, and
  • the injury you’ve suffered.

Original and second-hand owners

Under the Australian Consumer Law (ACL), the term ‘goods’ encompasses second-hand goods, including cars. This means manufacturers may have to compensate consumers if they supply a defective product that causes injury.

Under the ACL, second-hand car owners generally have the same rights as those of the original purchaser of the car, particularly if you’ve bought the used car directly from the manufacturer and you can show that the manufacturer is liable. If you bought the car from a private owner or at auction, the supplier may not be held liable for the car’s fault–liability is generally limited to the manufacturer when there’s an issue.

Implied warranties exist so that a car should remain in good, safe working order for a reasonable period of time, especially if the owner regularly has the car serviced and uses it only for its proper purpose.

It can at times be difficult to prove liability, because the previous owner may have misused, tampered with or damaged the car. The manufacturer may therefore try to mount the defense that the defect didn’t exist when they sold the car to the original owner. It’s important that when purchasing a car you should take a look at the log book to see if the car has been regularly serviced, and if possible, you should have your mechanic inspect the car.  

The ACL states that even if a statutory warranty doesn’t cover a used or second-hand car, it’s still covered by automatic consumer guarantees that the car should be fit and proper for use.

Available routes

Depending on the circumstances of your injury, there are several courses of action you can take, though the laws can vary from state to state. If you’ve been injured in a motor-vehicle accident or by working with the vehicle (such as changing the oil), and you live in Victoria, for example, you may be entitled to a Transport Accident Commission (TAC) claim. Alternatively, if your injury results from a fault in the car due to the manufacturer’s actions, you may be entitled to make a product-liability claim.

Whatever the circumstances of your injury and wherever you are in Australia:

  • seek medical attention as soon as possible and let your medical professionals know how you got hurt
  • take photographs both of your injuries and of the car and (if possible) its defect
  • keep records of any medical or out-of-pocket expenses
  • gather any information you have about the car, such as proof of purchase and the description of the car as it was advertised when you bought it
  • seek proper legal advice
  • keep the product.

Although it can be a bit trickier than being the original owner of a car, second-hand-vehicle owners still have rights, and the possibility of compensation if you get hurt from a defect in your used car.

Dimi Ioannou is a principal in Maurice Blackburns Melbourne office.

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Dimi Ioannou

Maurice Blackburn Melbourne
Dimi Ioannou is a Principal Lawyer and Practice Group Leader at Maurice Blackburn Lawyers in charge of the firm’s Public and Product Liability team in Melbourne. Dimi is an accredited specialist in personal injury law. Dimi works in the area of public liability and represents ...

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