The Used Car Sale Cooling Off Period

We have had a few enquiries of late by persons looking to reject the used car they just purchased under their statutory cooling off period.

This brief article hopes to provide some insight into what the cooling off period actually is and how, in reality, it can be a pretty useless contractual gesture unless you’re a savvy buyer.

What is the used car cooling off period?

In Queensland, if you purchase a used car from a motor dealer then the Motor Dealers and Chattel Auctioneers Act 2014 (Qld) provides that they must give the purchaser a 1 day cooling off period.

The motor dealer must also provide other information and disclosures to you BEFORE completing any contract of sale and that is done by completing and giving you a Form 12 in the approved form produced by the Queensland Government.

Part 5 of that form gives information about when you have a right to the cooling off period and the motor dealer must advise you when the cooling off period starts and finishes.

In essence, the cooling off period allows you 24 hours to think about your purchase and notify the motor dealer that you have changed your mind and don’t want to buy the car, thereby avoiding the purchase altogether.

A Queensland motor dealer cannot refuse to cancel the contract under the cooling off provisions and can only retain from your deposit (if any) up to a maximum amount of $100 because you exercised your right to cancel the contract.

You don’t have to have any reasonable reason or particular issue to cancel during the cooling off period, it is entirely at your discretion.

Why the cooling off period is usually useless

Used car buyers need to be aware that the standardised cooling off period is better understood as a contractual cooling off and not a chance to try out the vehicle and return it after you take it home.

Whilst the standard phrase is to tell a buyer that they have a 1 day cooling off period, I would suggest that most used car buyers would drive away in their new car there and then.  The dealer will go to great lengths to get the used car ready for you to drive away that day if they can and ensure they secure the purchase from you and clear the vehicle.

If you do drive away in the used car, you are said to have taken permanent physical possession of it and the cooling off period will immediately end.  You will lose any right to cancel the contract because you changed your mind or found out the car was not what you were hoping for, even if that’s on your drive home.

What you should tell the motor dealer when buying your next used car

The legislation allows you to maintain your rights to avoid the cooling off period of 1 day despite driving the car away from the motor dealer if it is for the purpose of an inspection or a test drive.

As such, we would advise that the next time you buy a used car from a motor dealer you follow our tips below:

  • Do not sign the Form 12 or the contract of sale until the car is actually ready to be driven away and you have arranged a collection time.  This ensures you get the maximum amount of time for a cooling off period to apply.
  • When you do sign the Form 12 and the contract of sale, make a notation on both that reads “I am taking possession of this vehicle to undertake an inspection and/or test drive during my cooling-off period and I do not waive my rights to avoid this contract if I am not satisfied with that inspection and/or test drive during that time.
  • Immediately take the vehicle to a mechanic to check it over for you.  It will cost you something but may be the best money you have ever spent and could save you thousands in the months or years to come.
  • If the mechanic gives you the ok, take the vehicle for a good test drive.  Make sure it is suitable for you, drives well and you are happy with it.
  • If you are not happy with it or just change your mind, return the vehicle to the dealer before the cooling off period ends and sign section 2 of Part 5 of the Form 12 when you do so (make sure you take a copy or photograph of the Form 12).

No doubt the used car salesmen is not going to be happy about you knowing your rights and ensuring you don’t lose them.  If they put up a fight about you taking the car for an inspection and/or test drive then, quite frankly, they can’t have much faith in the quality of the car they have just sold you.  So be weary of used car salesman reluctant to allow you a closer inspection, but happy to take your money to buy it.

How can we help?

We assist people make, or defend claims regarding cars, motorbikes or other vehicles that suffer from defects such that a car dealer should provide a remedy to you, even outside the cooling off period.

Feel free to call us or make an appointment to talk about your issues and find out why you might want to choose us to help you make a claim.

DISCLAIMER:  The above article was written at a specific point in time in the past and is provided as general guidance only.  It is not intended to be specific legal advice to any person’s particular circumstances who may be reading it.  We do not recommend you use this article as a replacement for obtaining proper legal advice on your issue and encourage anyone reading the article to obtain legal advice to ensure the above information and guidance remains valid and suits your particular circumstance.  In our experience, there is no ‘one size fits all’ to legal problems!