Mike Stevens | Aug 18, 2011

TMR SPECIAL REPORT

The resale of dangerous write-offs is putting lives at risk as well as exposing car buyers to rip-off by unscrupulous backyard sellers.

That’s the view of NSW motor industry group, the Motor Traders Association of NSW (MTA-NSW).

Despite RTA reforms instituted in January this year in NSW and despite more recent changes to the legislation brought into effect on August 1, unlicenced traders and backyard repairers are still selling potentially dangerous repaired write-offs.

While the reforms were designed to protect consumers and reduce vehicle theft and re-birthing, James McCall, CEO of MTA-NSW, said the reforms do not protect consumers against write-offs which have been repaired poorly by unscrupulous repairers before the laws came into effect.

The reforms in NSW introduced tougher restriction on the re-registration of written-off vehicles, classing all write-offs as “statutory” or non-repairable (other jurisdictions, like Victoria, still have two classes of write-off: “repairable” and “statutory”).

The latest changes require a “certificate of compliance” stating a vehicle has been repaired to required safety standards before it can be re-registered.

The MTA estimates an average of 15,000 repaired write-offs are re-registered each year in NSW, increasing to 20,000 last year.

"We've had cars where the pillars have been cut by emergency services and the insurance companies are selling these on. They are put back together with Sikaflex. People will be killed or maimed in a crash in one of these cars," Mr McCall said.

Above: Major structural damage, cosmetically repaired. Click for full image.
Above: Major structural damage, cosmetically repaired. Click for full image.

Senior Policy Advisor for NRMA Motoring and Services, Jack Haley, downplayed the danger of repaired write-offs.

“If the repair has been done properly it is perfectly satisfactory. The main value of this reform, in our view, is that it will prevent vehicle re-birthing,” he said.

The Victorian Automobile Chamber of Commerce (VACC) supports the NSW reforms. VACC’s view is that they will encourage insurance companies to repair more vehicles and simplify the market for consumers and dealers.

“One category of written-off vehicle would remove the current position of having two classes of vehicles in the second-hand market (in Victoria); those that have been written-off and those which have not. This would provide both consumers and dealers with a simpler marketplace,” David Purchase, VACC Executive Director said.

“VACC would like to see the NSW position adopted in Victoria."

Rachel Uglow, 40, of Croki bought a second hand Toyota Prado from a car dealer in February 2011 and discovered it was a repaired write-off, with major damage to the chassis, when she took it for a mechanical check.

“The only reason we wanted to buy another car was for safety. When I first found out the car was a repaired write-off I was really angry,” she said.

The car dealer was forced to refund Mrs Uglow’s money after she contacted the RTA and the Department of Fair Trading and gathered evidence that the car was a repaired write-off.

No such protection exists for buyers who have bought privately or from an unlicenced ‘backyard’ seller.

“I think you’ve just got to be super-careful and do the homework yourself and not trust anyone. You feel a bit unprotected as a consumer,” she said.

While it is legal to sell a car that was deemed a “repairable write-off” and re-registered before January 31, under the 2004 Motor Dealers Regulation, car dealers must tell consumers if a vehicle has previously been declared a write-off.

According to the REVs website “motor dealers must declare whether, according to REVS data, a vehicle has previously been written off”.

There are no such rules for private sales. Buyers have to be especially vigilant and ensure they do the relevant checks prior to purchasing a vehicle.

But Bennett Thelmo, Business Project Officer at REVs, admitted that even if a REVs check is done there is no guarantee the written-off status of a vehicle will be reported. Both buyers and car dealers in NSW need to request this information from the RTA.

Above: SRS airbag - without the airbag. Click for full image.
Above: SRS airbag - without the airbag. Click for full image.

“We provide the history if the data comes from the relevant agency but our main business is encumbrances. Information about whether a car is written off is auxiliary information,” he said.

A spokesman for the RTA confirmed the RTA administers the Written-off Vehicle Register (WOVR) but did not acknowledge the breakdown in the process for sharing that data with REVs.

The WOVR is a national initiative “designed to deter vehicle theft and to ensure written-off vehicles are repaired to an appropriate standard before re-registration” (VicRoads).

Car buyers in Victoria are arguably at greater risk than those in NSW.

Victoria, unlike NSW, still allows two classes of “write-off” in the Written-off Vehicles register: “statutory write-offs”, which can never be re-registered, and “repairable write-offs” which can be re-registered after repair and having undergone a Vehicle Identity Validation (VIV) inspection.

Although a national initiative, each state manages its own inspection and registration regime.

“Motorists can check the history of a vehicle registered in NSW on the RTA website to see if it has been written off,” Mr Thelmo said.

The MTA however accuses the RTA and the Department of Fair Trading, which operates REVs, of avoiding responsibility.

"None of the agencies are willing to say 'we got it wrong'. Everyone just points the finger at everyone else," said Mr McCall.

In October this year REVs will be scrapped and replaced by a new national body, the Personal Property Securities Register (PPSR) but the anomalies will remain.

The message to car buyers is “do your homework”: have any private purchase checked carefully if you want to avoid investing good money and driving around in a poorly repaired ‘write-off’.

- Nerissa Penfold

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