Reference no: EM133295416

Questions (inclusive) are structured essay questions. Please USE the full ILAC method when answering questions . Make sure cite relevant sections and sub-sections of legislation and/or case law to support answer.

Case Study:- Ulysses wants to buy a new motorcycle. Ulysses visits Fagan's Motorcycles Pty Ltd on the 'Magic Mile' and takes a demonstration model 2018 Triumphant Bonneville motorcycle for a ride to the Gold Coast and back. Impressed with this bike but not with its high price, Ulysses then takes a second-hand naked (ie. without fairings) red and white 2010 Triumphant Bonneville, sporting a fuel-injected 865cc engine, a sissy bar for a passenger or to support luggage, and new white wall tyres once around the block.

The very enthusiastic salesman, Roger tells Ulysses that this 2010 motorcycle is in excellent condition, has had (so far as he recalls) only one owner, has genuinely low kilometres (3.900km); that it comes with a full 12-month registration; and has been fully maintained. Roger adds, "This could all be yours, Ulysses, for a 'drive away' price (including stamp duty and transfer fees) of only $11,000. That includes our special rebate of $500 for all purchasers over 60 years of age, which you obviously are. Alternatively, we have finance available on the best terms you'll ever get in Australia, even from the banks. If you decide on that option, you can save some money - not that this baby will burn a hole in your budget anyway. We give you special low-cost servicing on all the bikes we sell, and we guarantee that we have every spare part that you could ever want here in-store. And if you do decide to change your mind (you'd be crazy to, of course), there's a 'cooling off' period of 24 hours after you've signed the purchase contract."

Ulysses tells Roger that he just wants a good reliable motorcycle for daily commuting as well as long distance country driving, and that the two bikes seem to him to be essentially the same. Roger smiles and nods but does not contradict him and, based on this response, Ulysses decides to purchase the 2010 Triumphant Bonneville and pays a deposit of $500. An ever-smiling Roger presents Ulysses with the documents necessary to transfer title in the motorcycle to Ulysses, all of which Ulysses, who is neither commercially savvy nor financially literate, signs.

The sale document includes a clause limiting the liability of Fagan's Motorcycles Pty Ltd's to 'the supply of equivalent goods.' A Finance Agreement, which Ulysses also signs, states that he must pay $370 per month over the next five years. It makes no mention of an annual equivalent interest rate for the finance, but that interest rate is exorbitant when compared with competitive interest rates on motor vehicle loans.

A proud Ulysses mounts his newly acquired Triumphant Bonneville, intending to ride it around to his friend Jenny's place to show it off. As he rides away from the dealership, Ulysses hears a loud clunk. The sissy bar and one of the rear-view mirrors have fallen off the motorcycle and are lying in the gutter. Another loud clunk comes from the engine, and the motorcycle snuffs. Ulysses is unable to start it again.

Ulysses returns to the Fagan's dealership, only to be told by Bruce, the mechanic in the adjacent workshop, that the motorcycle has probably not been ridden since 2010, and that the rubber seals inside the engine may well have corroded. Bruce adds that the bike may even have been flood damaged, although it is impossible to tell at this point in time. He advises Ulysses that motorcycle could be repaired, but the cost would probably exceed $21,000, and that Ulysses may well be better off spending that money on a new bike.

Ulysses confronts Roger, who smiles and says to Ulysses, "That's the luck of the draw with a second-hand bike, mate! 'Buyer beware' and all that! Oh - I've only just found out that there's an outstanding charge over your bike, and that MegaBank wants to repossess it because the previous owner failed to pay off his loan on your bike." Now Ulysses is very worried, since not only is he unable to afford the $21,000 to repair the bike, but he thinks that MegaBank might repossess his bike anyway, leaving him with nothing.

Question:- Advise Ulysses as to his rights under the Australian Consumer Law.