Lemon Laws Tasmania: Faulty Car Refund or Replacement (2026)

Claim Done is not a law firm and does not give legal advice; this page is general information. It was prepared by the Claim Done content team from the legislation and official pages listed under Sources, all checked 19 October 2026.

Your rights in 60 seconds

• Two layers. The Australian Consumer Law (ACL) covers every car bought from a dealer, new or used, in every state. The Tasmanian statutory warranty sits on top of it. Your ACL rights cannot be signed away.
• Major failure: reject the car and choose a refund or a replacement (ACL ss 259(3), 263(4)). The dealer does not get to insist on a repair.
• Minor failure: the dealer must repair, replace or refund within a reasonable time (its choice); if it refuses or takes too long, you can have it fixed elsewhere and recover the cost, or reject the car (ACL ss 259(2), 261).
• Tasmanian warranty: new and used cars from a licensed dealer with less than 120,000 km and a compliance plate under 7 years old at sale are repaired at no cost for 3 months or 3,000 km, whichever comes first (Motor Vehicle Traders Act 2011 ss 42-46).
• The 7-day rule: claim the repair from the dealer within 7 days after you first discover the defect (s 46(1)(d)).
• No cooling-off and no compensation fund in Tasmania, so the paper trail you build matters more.
• Disputes: complain to Consumer Affairs Tasmania (which replaced CBOS on 1 October 2026); claims go to the Magistrates Court of Tasmania (Civil Division) for a fee of $147.00 (up to $5,000) or $284.20 (above).

Which state’s law applies to you

What matters is where the dealer you bought from is located, not where you live. The dealer’s state decides which state warranty applies, which regulator takes your complaint, and which tribunal or court hears your claim. The ACL is the same everywhere.

• You live in Melbourne and bought from a dealer in Launceston: Tasmanian law, Consumer Affairs Tasmania and the Magistrates Court of Tasmania apply.
• You bought online from a Hobart dealer and had the car shipped to the mainland: Tasmanian law still applies.
• You live in Tasmania and bought from a dealer in Victoria: use the Victorian page. Every state is on the lemon laws Australia hub.

Interstate buyers and the court

In New South Wales and Victoria, a state tribunal cannot decide a dispute where the dealer is an individual or sole trader and the buyer lives in a different state (Burns v Corbett [2018] HCA 15), so those claims go to a court. Queensland’s QCAT currently hears these disputes, because the Queensland Court of Appeal has held it is a court (Owen v Menzies [2012] QCA 170), although two appeals challenging that are pending. In Tasmania the forum is already a court, the Magistrates Court (Civil Division), so an interstate buyer files in the same court as a Tasmanian buyer.

Your rights under the Australian Consumer Law

The ACL (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) expressly covers vehicles and second-hand goods (s 2(1)). You are a consumer if the price did not exceed $100,000 (cars bought from 1 July 2021), or if the car is of a kind ordinarily bought for personal or household use, which covers the family car at any price (s 3(1); Competition and Consumer Regulations 2010 reg 77A). Consumer Affairs Tasmania says the guarantees apply even if your car had no statutory warranty.

Acceptable quality (s 54)

The dealer guarantees the car is fit for the purposes cars like it are commonly used for, acceptable in appearance and finish, free from defects, safe and durable, judged as a reasonable consumer aware of any hidden defects would see it, given the car’s nature, price and what was said about it (s 54(2)-(3)). An older, cheaper car need not be perfect, but it must be safe and keep running for a reasonable time. It must also suit any purpose you told the dealer about, such as towing a boat (s 55), and match its description (s 56). The dealer escapes only for a problem specifically drawn to your attention before the sale, such as on a transparent notice displayed with the car (s 54(4)-(5)), or one your own inspection ought reasonably to have revealed (s 54(7)).

What is a major failure (s 260)

A failure is major if a reasonable consumer fully aware of it would not have bought the car; the car departs significantly from its description; it is substantially unfit for its normal purpose, or a purpose you told the dealer about, and cannot easily and within a reasonable time be fixed; or it is unsafe. Several minor faults can add up to a major failure: for contracts made on or after 18 December 2020, two or more failures are major if, taken as a whole, a reasonable consumer would not have bought the car (s 260(2)-(3)). The ACCC’s motor vehicle guide gives examples such as a two-year-old car that could not engage reverse after two months of repair attempts.

Refund or replacement is your choice

For a major failure you reject the car by telling the dealer, with your reasons (s 259(3)). The dealer must then, as you choose, refund what you paid plus the value of any trade-in, or replace the car with one of the same type and similar value if one is reasonably available (s 263(4)). A credit note is not a refund (s 263(5)), and the ACCC says a refund must not be reduced for your use of the car. If the fault means the car cannot be returned without significant cost to you, the dealer must collect it at its own expense (s 263(3)). For a minor failure the dealer chooses to repair, replace or refund (s 261); if it refuses or takes too long, you can have it fixed elsewhere and recover the cost, or reject the car (s 259(2)). Either way you can claim reasonably foreseeable losses such as towing, inspections and hire cars (s 259(4)).

How long you have to reject (s 262)

There is no fixed number of days or kilometres: the rejection period is the time within which it would be reasonable to expect the fault to show up, given the type of car and how much and how long it should reasonably be used (s 262(2)). The ACCC says it is not tied to warranties, so it can run past the end of the Tasmanian statutory warranty or a manufacturer’s warranty. You lose the right if you dispose of the car or it is damaged after delivery for unrelated reasons (s 262(1)).

“Sold as is” and “see the manufacturer” do not work

Any term that tries to exclude or limit the guarantees or remedies is void (ss 64, 276). Your claim is against the dealer: the ACCC says the dealer must not tell you to go to the manufacturer for a remedy, and the dealer can recover its costs from the manufacturer (s 274). You can separately sue the manufacturer, but only for damages, not a refund or replacement (ss 271-272), within 3 years of when you first became aware, or ought reasonably to have become aware, of the failure (s 273).

If the car was on finance

If the dealer arranged the loan, the lender is usually a “linked credit provider”, jointly liable with the dealer for breaches of the guarantees, capped at the amount financed plus interest and costs (ACL ss 278, 281). If the sale is rescinded or discharged, for example because you rejected the car, you can end a tied loan with that lender and recover interest you paid (National Credit Code s 135), unless you found the lender yourself. If you cannot keep up repayments, give the lender a hardship notice; it must answer in writing and name AFCA if it refuses (s 72). The ACCC warns not to stop repayments while a minor fault is being fixed. Repossession by a financier also ends the Tasmanian statutory warranty (s 44).

The Tasmanian dealer statutory warranty

The warranty is in Part 4 of the Motor Vehicle Traders Act 2011 (Tas). It must be written into your contract, but it applies even if the dealer leaves it out (ss 34(1)(c), 43(3), 43(5)). Unlike Victoria’s, it covers new as well as used vehicles.

Other dealer duties. Every vehicle a dealer sells must be fit for its common purpose having regard to its description and price (s 32, an offence). You must get a written contract with the prescribed contents and, for a used vehicle, the pre-sale disclosure statement, which must also be displayed on the vehicle (ss 34, 37; Motor Vehicle Traders Regulations 2022 reg 7). A used vehicle must come with clear title, except in a consignment sale (s 36).

Why the 7 days matter. Phone and email the dealer the day you notice a fault, and say in writing when you discovered it. Your ACL rights are not subject to the 7-day rule, but the statutory warranty is.

Cooling-off in Tasmania

There is no cooling-off period. Consumer Affairs Tasmania says there is no statutory cooling-off right for car sales in Tasmania, new or used; a contract can be cancelled only by agreement or by court order. Read the contract and the pre-sale disclosure statement before you sign.

Cancelling for a false odometer reading or a wrong description

Section 55 gives a narrower right to rescind. If, within 90 days of delivery, you have reason to believe the dealer made a false odometer representation, the contract does not comply with s 34, or the vehicle is substantially different from its pre-sale disclosure statement, you must notify the dealer in writing, with reasons, within that 90-day period or no later than 14 days after it. You may then apply to the Magistrates Court (Civil Division) within 60 days of your notice to have the contract rescinded.

Compensation or guarantee fund

None. Tasmania has no dealer guarantee or compensation fund. Instead, the Act allows compensation orders when a dealer is convicted of an offence (s 56), and a civil action to recover loss caused by a contravention of the Act, including repair costs and the costs of rescission, in a court of competent jurisdiction (s 57).

New cars in Tasmania

Tasmania’s statutory warranty covers new vehicles that meet the s 42 tests: the vehicle and all its parts must be in working order at sale and fit for the purposes such vehicles are commonly bought for (s 43(2)). In practice, the dealer’s repair duty under s 46 applies only where no manufacturer’s warranty covers the defect, or the manufacturer refused your claim (s 46(1)(c)); you then have 7 days from being told of the refusal to claim from the dealer.

That limit applies only to the Tasmanian warranty. Your ACL rights against the dealer are unaffected: for a major failure you can still reject a new car and choose a refund or replacement. The ACCC says a manufacturer’s warranty cannot take those rights away, and servicing at an independent workshop does not affect them. Recall defects are outside the Tasmanian warranty (s 45), but a recall does not replace your ACL rights; check recalls at vehiclerecalls.gov.au.

Private sales and auctions

A private sale carries no statutory warranty (it needs a sale by a licensed trader, s 42), no written contract is required, and the seller does not have to fix or disclose faults. Under the ACL, a one-off sale by someone not in business carries only the guarantees of clear title, undisturbed possession and no hidden debts. Consumer Affairs Tasmania says a dealer selling a car “privately” must say it is a licensed dealer, so ask who you are buying from and keep the advertisement.

A person who auctions vehicles for their owners is not dealing in motor vehicles under the Act (s 4(3)(d)), so a car sold at auction for its owner generally does not carry the statutory warranty, and at a traditional auction the ACL quality guarantees do not apply. Consumer Affairs Tasmania says the auction house must ensure no money is owing on the car. An eBay-style online auction is not a “sale by auction” under the ACL.

Bought privately? See private sale rights in Tasmania

Evidence checklist

1. The written contract and tax invoice, showing the dealer’s legal name, ABN or ACN and licence number.
2. The pre-sale disclosure statement that was on the car (photograph it if it is still displayed).
3. The advertisement or listing (screenshot it now, before it disappears) and any messages about the car’s history, kilometres or condition.
4. The compliance plate date (or Register of Approved Vehicles entry) and the odometer reading at delivery and today (photos).
5. A dated note of the day you first discovered each fault and the kilometres, and a copy of your written claim to the dealer with proof of when you sent it: together they prove the 7-day claim.
6. Photos and videos of the fault, warning lights and any dashboard error messages.
7. An independent mechanic’s written report or quote, saying what is wrong and, if possible, whether the fault was likely present at the sale.
8. Every call, email and text with the dealer, and any manufacturer’s warranty claim and refusal, with dates.
9. Receipts for towing, inspections, hire cars, repairs and other costs.
10. Your finance contract, any extended warranty paperwork, and the service history.

The 5 steps to a refund, replacement or repair

Step 1: Contact the dealer

Phone the dealer and follow up the same day by email. Describe the fault, the date you discovered it and the kilometres, say what you want (refund, replacement or repair), and give them 24 hours to respond. Keep a record of every contact. This email is also your claim under the Tasmanian warranty, so send it within 7 days of discovering the fault.

Check your evidence list

Step 2: No response or a refusal: send a formal demand

If the dealer does not respond, refuses, or offers less than the law requires, send a formal written demand. Our letter sets out your rights under the ACL and the Motor Vehicle Traders Act, lists each defect with the date you discovered it and the date you first claimed, states your choice of remedy and gives a firm deadline. It is also the proof that you tried to resolve the problem, which Consumer Affairs Tasmania and the court will look for.

Send the dealer a formal demand – $49

Step 3: Complain to Consumer Affairs Tasmania

Contact Consumer Affairs Tasmania through its online General Enquiry form and attach a copy of your letter. Its complaint process is to talk to the business, write to it, then contact Consumer Affairs Tasmania, so your letter shows you have done the first two steps. It aims to reply within 5 working days. Older guides say to complain to CBOS: since 1 October 2026 consumer complaints go to Consumer Affairs Tasmania.

Contact Consumer Affairs Tasmania

Step 4: Send the final demand

When Consumer Affairs Tasmania gives you a complaint reference number, come back and send a final demand. It quotes your first letter, the dealer’s response (or silence) and your reference number, and gives a short final deadline before you file in the Magistrates Court.

Send the final demand – $49

Step 5: Lodge a court claim in the Magistrates Court

If the dealer still has not fixed it, file a claim in the Magistrates Court of Tasmania (Civil Division). TASCAT is not the place: its civil and consumer stream currently deals only with residential building disputes. Claims up to and including $15,000 are minor civil claims; $15,001 to $50,000 are civil claims; more than $50,000 only if everyone agrees. The filing fee is $147.00 for a $5,000 claim and $284.20 for a $30,000 claim. The court’s civil disputes page explains the process.

1. Complete the Claim form and Notice to Defendant, using the dealer’s registered name and ABN or ACN.
2. File the original plus three copies at a Court Registry and pay the filing fee.
3. Serve the dealer in person, by registered post or through a process server.
4. After 21 days, file an affidavit of service.

No conciliation is needed before you file. A defended minor civil claim goes to a conciliation conference; a defended claim over $15,000 generally goes to a directions hearing. In minor civil claims the parties represent themselves (lawyers only with permission), so there are generally no legal costs.

Prepare your court claim – $97

Where your claim goes

Fees from 1 July 2026; the Registrar can waive or reduce a fee for undue hardship. Under the ACL, a claim against the manufacturer must be brought within 3 years of when you first became aware, or ought reasonably to have become aware, of the failure (s 273) and a claim for misleading conduct within 6 years (s 236(2)). The deadlines that usually decide a Tasmanian case come much earlier: the 7-day warranty claim, the 3-month or 3,000 km warranty period, and the ACL rejection period.

After you win: getting paid

Your claim is decided by the Magistrates Court, so a judgment in your favour is already a court order. If the dealer does not pay, you file enforcement papers at the court registry. The Magistrates Court has the same enforcement powers as the Supreme Court unless its rules say otherwise.

Garnishee order on a bank account

A garnishee order attaching a debt can take money from the debtor’s bank account, or rent held for them by an agent. The money in the account at the date of the order is taken. If that does not cover the debt, you can ask for a further order. It follows the same two-stage process as a wage garnishee: a provisional order first, then a final order.

Garnishee order on wages

• File the “Affidavit and Application for Provisional Garnishee Order Attaching Earnings” (one copy) and the “Provisional Garnishee Order Attaching Earnings” (three copies).
• Serve the provisional order on the debtor and on the employer.
• They have 21 days to object. If they do not, file the “Final Garnishee Order Attaching Earnings” with affidavits of service, then serve the final order on the employer.
• The order stays in force until the whole debt is paid or the court makes other orders. The debtor can apply to reduce the payments.

Warrant to sell property

File the “Warrant to sell property” form at the registry. A bailiff seizes and sells goods to the value of the amount owing, plus expenses. Real property can also be sold. The warrant is valid for 12 months from the date of issue. It does not allow the sale of personal clothing or bedding, or tools of trade up to a value of $3,000.

Finding out what they own

The court also has a judgment summons and an oral examination process. Ask the registry how to use it for your case.

Enforce your order – $97

Consumer Affairs Tasmania: head office contacts

Consumer Affairs Tasmania is part of the Department of Justice. It replaced Consumer, Building and Occupational Services (CBOS) for consumer matters on 1 October 2026.

Questions people ask

Is there a lemon law in Tasmania?

No, Tasmania has no Act called a lemon law. The Australian Consumer Law gives you a refund or replacement for a major failure in every state. On top of that, the Motor Vehicle Traders Act 2011 gives a statutory warranty on new and used cars from a licensed dealer with less than 120,000 km and a compliance plate under 7 years old: repairs at no cost for 3 months or 3,000 km.

Can I return a used car to a dealer in Tasmania?

Yes, if it has a major failure: reject it within a reasonable time and choose a refund or a replacement, and the dealer must collect it if the fault means it cannot be returned without significant cost to you. Tasmania has no cooling-off period, so you cannot return a car just because you changed your mind, unless the dealer agrees or a court orders it.

What is a major failure for a car?

A major failure is a problem so serious that a reasonable buyer who knew about it would not have bought the car (ACL s 260). It also covers a car that is unsafe, differs significantly from its description, or is substantially unfit for normal use and cannot easily be fixed. For cars bought from 18 December 2020, several minor faults together can count.

Does the Australian Consumer Law apply to second-hand cars?

Yes. The law defines goods to include vehicles and second-hand goods. Acceptable quality allows for the car’s age, kilometres and price, so an older car need not be perfect. The guarantees continue after the Tasmanian statutory warranty ends. They do not cover private sales or cars bought at a traditional auction.

I live in another state – which tribunal do I use?

If you bought from a Tasmanian dealer, your claim goes to the Magistrates Court of Tasmania (Civil Division), with Consumer Affairs Tasmania as the regulator, wherever you live. Because Tasmania uses a court rather than a tribunal, the rule that stops some state tribunals hearing disputes between residents of different states changes nothing here. If the dealer is in another state, use that state’s page.

How long do I have to reject a faulty car?

There is no fixed number of days under the Australian Consumer Law: you have a reasonable time, judged by the type of car, its use and how long it should last before a fault like this appears (s 262). That can run past any warranty. The Tasmanian statutory warranty is much stricter: claim the repair from the dealer within 7 days of first discovering the defect.

Can the dealer refuse a refund and only offer repairs?

Only for a minor failure, where the dealer chooses to repair, replace or refund (s 261). For a major failure you choose a refund or a replacement (s 263(4)), and a credit note is not a refund. If a minor fault is not fixed within a reasonable time, you can have it fixed elsewhere at the dealer’s cost or reject the car.

What does it cost to go to the Magistrates Court in Tasmania?

From 1 July 2026 the Civil Division filing fee is $147.00 for a claim up to $5,000 and $284.20 for a claim over $5,000 or a claim for something other than money. The Registrar can waive or reduce the fee for undue hardship. In minor civil claims, up to $15,000, the parties represent themselves, so there are generally no legal costs.

What if the car was on finance?

If the dealer arranged the loan, the lender is usually jointly liable with the dealer for breaches of the consumer guarantees, up to the amount financed plus interest and costs (ACL ss 278, 281). If you reject the car and the sale ends, you can end a tied loan too (National Credit Code s 135). Keep paying while a minor fault is being fixed.

Can I get my money if I win and the dealer still won’t pay?

Tasmania has no dealer guarantee fund, so you recover from the dealer itself; the steps are under “After you win: getting paid” on this page. If you sued the dealer and a linked lender together, the judgment can be enforced against the lender once a written demand on the dealer has gone unpaid for 30 days (ACL s 283).

Does the Tasmanian statutory warranty cover new cars?

Yes. Unlike Victoria’s, Tasmania’s warranty covers new as well as used cars that meet the 120,000 km and 7-year tests. But the dealer’s repair duty applies only if no manufacturer’s warranty covers the defect or the manufacturer refused your claim; you then have 7 days from being told of the refusal to claim from the dealer. The Australian Consumer Law applies to every new car regardless.

Is there a cooling-off period for cars in Tasmania?

No. Tasmania has no statutory cooling-off right for car sales, new or used, so a contract can be cancelled only by agreement or court order. There is a separate right to rescind for a false odometer reading, a non-compliant contract, or a car substantially different from its pre-sale disclosure statement: notify the dealer in writing within 90 days of delivery, then apply to the Magistrates Court.

Related pages

• Lemon laws in Australia: every state and territory
• Bought a used car from a dealer and it’s faulty: what now?
• Lemon laws Victoria and New South Wales
• Faulty car demand to a Tasmanian dealer and final demand
• Magistrates Court claim

Sources

• Motor Vehicle Traders Act 2011 (Tas) (ss 3, 4, 32, 34, 36, 37, 42-46, 55-57), checked 19 October 2026
• Motor Vehicle Traders Regulations 2022 (Tas) (reg 7), checked 19 October 2026
• Competition and Consumer Act 2010 (Cth), Schedule 2: Australian Consumer Law, checked 19 October 2026
• Competition and Consumer Regulations 2010 (Cth) (reg 77A), checked 19 October 2026
• National Consumer Credit Protection Act 2009 (Cth), Schedule 1: National Credit Code (ss 72, 135), checked 19 October 2026
• Consumer Affairs Tasmania: buying a new car, checked 19 October 2026
• Consumer Affairs Tasmania: buying a used car, checked 19 October 2026
• Consumer Affairs Tasmania: complaint process, checked 19 October 2026
• Consumer Affairs Tasmania: contact us, checked 19 October 2026
• Magistrates Court of Tasmania: civil disputes, checked 19 October 2026
• Magistrates Court of Tasmania: fees, checked 19 October 2026
• Magistrates Court of Tasmania: minor civil claims, checked 19 October 2026
• TASCAT: civil and consumer stream, checked 19 October 2026
• ACCC: new and second-hand cars, checked 19 October 2026
• ACCC: repair, replace, refund, cancel, checked 19 October 2026
• ACCC: Motor vehicle sales and repairs, an industry guide to the ACL, checked 19 October 2026