SECOND-HAND VEHICLE DEALERS (COOLING-OFF RIGHTS) AMENDMENT BILL

Second Reading

Adjourned debate on second reading.

(Continued from 2 July 2009. Page 2764.)

The Hon. J.M.A. LENSINK (18:15): When I last spoke to this, members on this side did not have a formal position, so I outlined some general remarks in relation to the bill and indicated that we would be supporting the second reading. I will not go over those comments again, but I raise some questions to which I would appreciate responses from the minister in her summing up. I will also make some other comments.

There are few issues, I think, which remain unresolved in relation to this bill. One which has been raised by the Motor Trades Association relates to auctions. It would like to have the definition of 'auctions' tightened up so that it is absolutely clear that it is at the fall of the hammer. I have had a chance to examine the substantive act and I am a little surprised that there is no definition of 'auction' anywhere within the substantive act, so I would like some clarification on that.

I indicate that I have had discussions with parliamentary counsel about this issue, and they have a particular view about auctions and so forth and I would appreciate it if the minister were able to consult with them and put those remarks on the record. Depending on that response, we may still seek to amend that to clarify this area.

My understanding is that within the sector there are auction houses operating which have quite an extensive role in second-hand vehicle transactions. Indeed, I am advised that over a number of years the definition which is in the substantive act about sales which are negotiated immediately after the conduct of an auction has suffered some bracket creep, for want of a better word, where that period of time of 'immediately' has become any working day before or after an auction.

I would like to have that clarified as to whether the minister has an understanding or whether there is an accepted definition of 'sale negotiated immediately after an auction' and whether that is a period of hours or, indeed, a day. So, that is one matter.

I note, too, from the substantive act, that in relation to the licensing of dealers the Crown is exempt, which I guess I am somewhat bemused by. That may well have happened under a Liberal watch in terms of the passing of that act, but I have received some examples of advertisements where a government-type auction has demanded a $200 cash deposit, which I note is greater than the amount which is actually being put forward in this bill.

There is also the matter of deposits. We have talked about deposits quite explicitly in terms of the non-refundable deposit, but in terms of 'other deposit', which would be part of the current practice (and I am advised that the industry averages about 5 per cent), the current act does not make any reference to such a deposit.

I would ask the government whether a deposit of up to 5 per cent or, say, 10 per cent would be illegal and that, once the cooling-off period has expired, would it be reasonable for traders to expect to receive such a deposit to guarantee the transaction of the vehicle?

Clearly, if there is a two day cooling-off period, the most opportune time would be at the signing of the cooling-off period whereby the deposit would be made at that point, and if the person then decided not to pursue the purchase the non-refundable deposit would be retained and the rest of the deposit would be returned.

All members, I think, would have received a letter from the Motor Trades Association in relation to this bill in which it asks for a number of commitments from the government, and I will put a few of these on the record. First of all, in relation to auctions, I think I have covered that already. The third point was in relation to deposits, to which I have just referred. The association has also asked for a commitment to a simple straightforward waiver form, and I indicate to members that the Liberal opposition will be moving amendments to this effect.

The MTA makes the point that there has been a number of ministers and indeed probably shadow ministers who have held responsibility for the consumer affairs portfolio, and I think it understandably seeks assurances. The association can have my assurance as shadow minister that we have formulated our position and that it will not change, but we would appreciate the government making a similar commitment.

The fifth point asks for some formal commitment about the interpretation of 'inducement' which I have also been advised in briefings is in relation to a financial benefit; that is, to reduce the advertised or best price on offer for a vehicle which would be done in order to execute a waiver. Point 6 relates to defining the expansion of what constitutes a dealer to include family, friends and associates. The MTA seeks to clarify that position, so I would ask that as a question to the minister, and also to clarify that a person who has a reasonable excuse would not be caught in the process. Point 7 is that the MTA would like it to be confirmed on the record that it will remain the case that an individual can sell a maximum of four vehicles per annum.

Point 8 is that a dealer who was presented with forged documents in relation to a salesperson would have a reasonable defence in any subsequent legal action. The ninth point that I will refer to from this letter is in relation to a code of conduct. Can the minister give some update as to the status of where that might be at and what time lines might be expected in terms of the development of that code of conduct. With those remarks, I conclude my contribution and look forward to the committee stage of the bill.

Debate adjourned on motion of Hon. I.K. Hunter.