High Court rules in favour of Mitsubishi Motors in fuel consumption label dispute

It was alleged that the label was misleading and deceptive

High Court rules in favour of Mitsubishi Motors in fuel consumption label dispute

The High Court has ruled in favour of Mitsubishi Motors Australia and its dealer in a dispute concerning the fuel consumption values appearing on the label applied to a Mitsubishi vehicle.

Mitsubishi Motors Australia manufactures, imports, and supplies new Mitsubishi vehicles to dealers within Australia. Northpark Berwick Investments sells new vehicles supplied to it by Mitsubishi to consumers.

In 2017, Zelko Begovic purchased a new 2016 Mitsubishi MQ Triton from Northpark, but he became dissatisfied with the vehicle's fuel consumption exceeding the fuel consumption values on the label. Begovic filed a claim in the Victorian Civil and Administrative Tribunal (VCAT), alleging that Mitsubishi contravened s. 18 of the Australian Consumer Law (ACL) because its fuel consumption label was misleading and deceptive. He also alleged that the vehicle was defective and not of acceptable quality as required by the consumer guarantee.

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Begovic succeeded in his claims before the VCAT, leading to an order to Northpark to pay Begovic the vehicle's purchase price. Before VCAT, the critical evidence of the vehicle's fuel consumption substantially exceeding the fuel consumption values on the label applied to the car was the results of tests carried out in 2019.

Mitsubishi appealed to the Supreme Court of Victoria on questions of law, including whether a manufacturer required by law to apply a fuel consumption label to a vehicle could be found to have engaged in misleading or deceptive conduct. This question raised a "mandatory conduct ground," which the Supreme Court ultimately dismissed.

The case reached the Court of Appeal, which likewise dismissed the appeal, finding that the Motor Vehicle Standards Act (MVA) and the Australian Design Rule 81/02 – Fuel Consumption Labelling for Light Vehicles (ADR 81/02) did not require Mitsubishi or Northpark to "offer such a vehicle for sale in the first place", still less "require that a vehicle be offered for sale in circumstances where the representation in the label is misleading or deceptive".

Mitsubishi and Northpark raised the matter to the High Court, which, in a unanimous decision, ruled in favour of them on the mandatory conduct ground.

The High Court relied on existing case law to resolve the case. The court considered that, as a part of a national legislative scheme, it is necessary to construe s. 18 of the ACL consistently with the provisions of the MVS Act, which gave effect to ADR 81/02 as a safety standard under the ACL. The court said that in the event of apparent inconsistency of statutory requirements relating to the same subject matter and enacted by the same legislature, the general provision may need to be subordinated to the specific provision to alleviate the apparent conflict.

Under the MVS Act, Mitsubishi could not import the vehicle without the fuel consumption label being applied to it. In turn, Northpark could not supply the car to Begovic without that fuel consumption label remaining applied to it. The presence of that fuel consumption label on the vehicle supplied to Begovic is a requirement of a national standard and mandated by s. 106 of the ACL as a safety standard. Consequently, Mitsubishi was bound to apply, and Mitsubishi and Northpark were bound to maintain that fuel consumption label on the vehicle to not contradict s.106 of the ACL.

Further, the form and content of the fuel consumption label on Begovic's vehicle were dictated by law. Specifically, ADR 81/02 required the values for fuel consumption displayed on the label to be those provided in accordance with the law. The court found that in circumstances where Mitsubishi and Northpark were bound to apply and maintain the fuel consumption label on Begovic's car, they did not breach s.18 of the ACL. Ultimately, the court allowed Mitsubishi and Northpark's appeal.

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