Holden Hit with Class Action over ACL Breaches

Compliance & Consumer Law

Background to Class Action  

A major class action lawsuit has been filed against General Motors Australia and New Zealand, the parent company of Holden, over an allegedly faulty transmission affecting certain Commodore and Colorado models. 

The lawsuit claims that General Motors failed to meet the standards of acceptable quality required under Australian Consumer Law (ACL) and engaged in misleading and deceptive practices. 

The aim of the class action is to secure compensation for consumers who suffered loss and damage due to issues with the vehicles transmission systems. 

 

 

What is Misleading and Deceptive Conduct and Acceptable Quality under the ACL?  

Under the ACL, acceptable quality refers to the fact that a product sold:  

  • is safe, durable and free from defects 
  • has an acceptable appearance and finish 
  • does everything that similar products are commonly used for. 

 

Misleading and deceptive conduct refers to actions or representations that could lead consumers to believe something false or misleading about a product or service. Businesses are prohibited from making false claims, omitting critical information, or engaging in practices that could mislead customers, whether intentionally or unintentionally. 

 

 

How Can My Business Avoid Breaching the ACL? 

To avoid breaching the ACL, businesses must ensure transparency and accuracy in all representations about their products or services.  

Here are some key steps to follow: 

  • Product is of Acceptable Quality to Sell: Refrain from selling products that are unsafe or riddled with defects.  
  • Provide Honest and Clear Information: Avoid exaggerating the benefits of your products or services and ensure all marketing materials, advertisements, and statements are factual and supported by evidence.
  • Address Known Issues Promptly: If you are aware of a defect or issue with a product, inform customers and provide solutions rather than concealing the problem.
  • Establish a Recall System: If your product is identified as being defective, unsafe, or non-compliant with relevant Australian safety or quality standards, prepare to recall the product from consumers in a timely and effective manner. 
  • Train Your Team: Equip your staff with a clear understanding of consumer rights and your obligations under the ACL. This ensures consistent and compliant customer interactions.
  • Review Contracts and Policies: Ensure your contracts, warranties, and refund policies are fair, lawful, and easy to understand.
  • Monitor Complaints and Feedback: Pay attention to customer complaints and use them as an opportunity to identify potential problems and address them before they escalate. 

 

Key takeaways  

  • Businesses must ensure their products meet acceptable quality standards, including being safe, durable, and free from defects.
  • Misleading and deceptive practices, such as making false claims or omitting critical information, can breach the ACL and lead to serious legal consequences such as class actions. 

 

Gladwin Legal are experts in Consumer Law and have extensive experience in advising businesses. If you require assistance in understanding your legal obligations please contact us at or 1300 033 934.