TWO former Honda dealers have commenced proceedings in the Supreme Court of Victoria to restrain Honda Australia from making what they claim are deceptive and misleading messages to the dealers’ customers.

Brighton Automotive Holdings, which ran Astoria Honda Brighton in Melbourne’s inner south and Tynan Motors, a former Honda dealer in Sutherland in Sydney’s south, sought to restrain Honda Australia from electronic messaging the dealers’ service customers telling them that the service businesses had been closed.

The matter came into the public domain in a report in GoAutoNews Premium on March 29 but both Astoria and Tynan claim the emails were still being sent as recently as April 17.

Both dealers also sought a restraining order to prevent Honda Australia’s call centre from telling these service customers that if they get their Hondas serviced at Astoria or Tynan’s service departments the warranty on those Hondas would be void. 

Both Astoria and Tynan were among those dealerships that Honda Australia has terminated as it transitions to its new agency sales model.

A Supreme Court action was lodged by HWL Ebsworth on April 26 sought from the court:

• An injunction that Honda Australia be restrained from representing (directly or indirectly) to customers or potential customers of Astoria or Tynans, that:

(a) if they service their Honda motor vehicle with the plaintiff they would lose the warranty on their vehicles; and

(b) the plaintiffs’ service business has closed.

• An order directing Honda Australia to make corrective statements to its statements regarding the voiding of warranty and its claims the dealerships’ service departments were closed (Warranty Representation and the Closure Representation).
• Damages under Section 236 of the Australian Consumer Law (ACL)
• Costs.

The matter came before Justice Riordan on April 29 in which Honda Australia’s lawyers informed the parties that Honda Australia had given an undertaking to both Astoria and Tynans that it would not, depending on the final outcome of the action, “represent (directly or indirectly) to customers or potential customers of either of the plaintiffs that the automotive sales and/or service business conducted by either of the plaintiffs has closed, save that nothing in this undertaking prevents the defendant from  making statements to the effect that each of the plaintiffs has ceased being an authorised Honda dealership and/or authorised Honda service centre”.

The undertaking made by Honda Australia was recorded in a court order which also required that Honda Australia, by May 14, provide a list to both Astoria and Tynans of the people and their contact details who received a written communication containing the statements that Astoria and Tynans are objecting to.

The matter is listed for further directions on 11 June 2021. Costs were reserved.

According to the original complaint in the court documents, “in or about January 2021, Honda Australia sent an email to customers or potential customers of each of the plaintiffs which stated that:

‘Tynan or Astoria (as applicable) will cease being an Authorised Honda Dealer on the 29th January 2021. That means this dealership will no longer sell new Honda vehicles or be an authorised Honda Service Centre … if you would like to speak to a member of our team, please call 1800 804 954 (8:30am to 6pm AEDT weekdays). They’ll be happy to answer any of your questions.’”

The court papers go on to say that the plaintiffs “have each received a copy of the email from one of their customers dated 19 and 20 January 2021. In circumstances where the emails appear to be automated and having regard to the content of the emails and the background referred to above, the plaintiffs infer that the same email has been sent more widely to other customers or potential customers of the plaintiffs.”

It says the parties will know more details of the number of emails sent from documents required to be disclosed during discovery.

The court papers also say that “in or about January 2021, customers or potential customers of each of the plaintiffs called Honda Australia (1800 804 954) and were told by Honda Australia that they would lose the warranty on their vehicles if they serviced their vehicles with Astoria or Tynan (as applicable)”.

The papers said that “in around mid-January 2021, the plaintiffs were each contacted by a number of customers or potential customers who said that they had received a communication from Honda Australia which said that after 29 January 2021, Astoria or Tynan (as applicable) was no longer going to be an authorised Honda dealer; and when they dialled Honda Australia’s number (1800 804 954), they were told that if they serviced their vehicles with Astoria or Tynan (as applicable) they would lose the warranty on their vehicles”.

“On 20 January 2021, an employee of Tynan called Honda Australia’s number (1800 804 954).  During the phone call, he asked if he would lose the warranty on his vehicle if he had it serviced by Tynan, and a woman who identified herself as ‘Joyce’ said that he would.”

The papers said that “In or around January 2021 Honda Australia represented to customers or potential customers of each of the plaintiffs that if they serviced their Honda motor vehicle with the Astoria or Tynan (as applicable) and/or someone other than an Authorised Honda Dealer they would lose the warranty on their vehicle”.

They say that the warranty representation made by Honda Australia was false, misleading or deceptive in that the warranty on Honda motor vehicles provided by Honda is not invalidated if the motor vehicle is serviced by the plaintiffs or someone other than an Authorised Honda Dealer.

It said that subsequently in a letter from its solicitors on 8 February 2021, Honda Australia “admitted that the ‘AUH warranty’ is not invalidated if the Honda motor vehicle is serviced by someone other than an Authorised Honda Dealer such as the plaintiffs. Further particulars will be provided following discovery”.

The parties further claim that the warranty representation was false, misleading or deceptive in that the consumer guarantees contained in the Australian Consumer Law (ACL) say that warranties which apply to Honda motor vehicles are not invalidated if the motor vehicle is serviced by the plaintiffs or someone other than an Authorised Honda Dealer.

The court papers allege that “Honda Australia has engaged in conduct that was misleading or deceptive or likely to mislead or deceive in contravention of the ACL”.

In the matter of the allegation that Honda Australia claimed that the plaintiffs service departments were closed when they were still operating, the court papers state that “in or around March 2021, Honda Australia sent SMS messages to customers or potential customers of the plaintiffs which stated:

“Hi [name of customer] this is to remind you that your Honda Jazz service is due in 7 days. Your previous service dealer has closed so please find your nearest Honda Service Centre here.”

The papers say that Astoria has received a copy of the SMS from one of its customers sent on 23 March 2021. 

“Further, in or around March 2021, Honda Australia sent SMS messages to customers or potential customers of the plaintiffs which stated:

“Hi,  [name of customer] Our records show that your Honda Jazz was due for its 100,000km service 14 days ago.

“As you may be aware, due to some recent changes to the Honda Australia dealer network your previous service dealer, [Tynan or Astoria (as applicable)] is now closed. We apologise for any inconvenience this may cause but we would like to assure you that our dealer network has a number of Service Centres all with access to your vehicles records and will be more than happy to assist you moving forward.

“To keep your Honda running safely and at its best please contact your local Honda dealership to book your service.”

The papers say that Tynan has received a copy of the SMS from one of its customers sent on 24 March 2021 and it is presumed that the message was sent more widely which will be determined by discovery.

“Further, in or around April 2021, Honda Australia sent an email to customers or potential customers of the plaintiffs which stated:

“Our records show that your Honda HR-V is due for its 20,000km service in 7 days.

“As you may be aware, due to some recent changes to the Honda Australia dealer network your previous service dealer, [Tynan or Astoria (as applicable)] is now closed. We apologise for any inconvenience this may cause but we would like to assure you that our dealer network has a number of Service Centres all with access to your vehicles records and will be more than happy to assist you moving forward.

“To keep your Honda running safely and at its best please contact your local Honda dealership to book your service.”

The court papers say that each of the plaintiffs received a copy of the email from one of its customers dated 8 and 17 April 2021 respectively.

It says that in or around March 2021 Honda Australia represented and continues to represent to customers or potential customers of each of the plaintiffs that the business or service business of Astoria or Tynan has closed (Closure Representation).

The papers say that the Closure Representation “was and is false, misleading or deceptive in that the plaintiffs’ business including their service business has not been closed and remains open” and that “Honda Australia has engaged and continues to engage in conduct that is misleading or deceptive or likely to mislead or deceive in contravention of s18 of the ACL”.

The plaintiffs claim that they have suffered and/or are likely to suffer loss and damage in that some customers or potential customers of each of the plaintiffs have been or will likely be deterred from having their vehicles serviced by Astoria or Tynan and/or purchasing vehicles from Astoria or Tynan “by reason of the Warranty Representations and/or the Closure Representation”.

By John Mellor