The Federal Court of Australia has found that certain popular model Ford vehicles are defective.

Between 2011 and mid-2016, Ford sold approximately 70,000 Focus, Fiesta and Ecosport vehicles fitted with a PowerShift dual-clutch transmission in Australia.

The class action is for the benefit of any person who bought or leased (or otherwise acquired an interest in) any of the Ford models described below at any stage over the period 1 January 2011 to 20 December 2024.

On 29 June 2021, Justice Perram delivered his decision in relation to the Ford Class Action, together with his Honour’s reasons for it. We are pleased to advise that the applicant was successful in her claim for damages, and on key aspects of her claim for group members. Ford was ordered to pay $17,248.19 (including interest) to Ms Capic. In particular, the Court found that the Affected Vehicles suffered from certain component and design deficiencies, and that they were therefore not of "acceptable quality" within the meaning of the Australian Consumer Law. A copy of the judgment is available on the Federal Court’s website (https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2021/2021fca0715).

On 3 November 2021, the Court gave judgment on the "common questions" – that is, issues which arose in Ms Capic’s claim and also arise in group members’ claims. Broadly speaking, group members need to show (1) Ford is liable and (2) they have suffered loss as a result. The November judgment concerned whether Ford is liable to group members. The Court has now made orders which give effect to this judgment. This decision is important because group members can rely on these findings, and will not have to prove those separately. A copy of the judgment is available on the Federal Court’s website (https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2021/2021fca1320).

The two judgments given this year are important steps, but so far, there has been no decision about how much compensation group members may be entitled to. The Court has left open the possibility of loss being determined on an aggregate basis (ie, all group members together).

On 1 February 2022, Ford lodged an appeal against the two judgments. On 24 February 2022, Ms Capic was granted permission to appeal aspects of the judgments that went against her, and affirming parts of the judgments that went in her (and group members’ favour). A copy of the judgment is available on the Federal Court’s website (https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2022/2022fca0155).

On 26 August 2022, the Court made orders for a notice to be displayed on this website which provides group members with an update on the status of the proceedings. A copy of the notice is available here.

Between 20 and 28 March 2023, an appeal hearing was held before Justice Yates, Justice Beach and Justice Downes of the Full Court of Federal Court of Australia.

On 14 November 2023, the Full Court handed down its decision on an appeal brought by Ford and a cross appeal brought by Ms Capic.  Ms Capic has enjoyed substantial success on the appeal.  The Full Court has upheld the primary judge’s findings that the Affected Vehicles were not of an acceptable quality.  In addition to the defects found to exist by the Trial Judge, the Full Court also found all vehicles had a superadded propensity to experience troubling vehicle behaviours, as a result of architectural deficiencies.   Ford succeeded in part, with the Full Court also finding that the Trial Judge should have considered some other factors when determining how much to award Ms Capic in damages. The matter will be sent back to the Trial Judge to re-determine the amount of damages Ms Capic should be awarded.  The Full Court did not express a view as to whether Ms Capic’s damages should be increased, decreased or should stay the same.  The Full Court was not asked to determine the damages payable to group members.  A copy of the Full Court’s judgment is available on the Federal Court’s website (https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/full/2023/2023fcafc0179) and a summary is available (https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/full/2023/2023fcafc0179/summary/2023fcafc0179-summary). The orders made by the Full Court on 13 December 2023 are available (https://www.comcourts.gov.au/file/Federal/P/NSD1321/2021/3931250/event/31642860/document/2209359).

On 10 January 2024, Ms Capic lodged an application for special leave to appeal aspects of the Full Court’s decision. That application was granted on 13 February 2024. The grant of special leave is available here.

On 11-12 April 2024, the High Court heard Ms Capic’s appeal. In her appeal, Ms Capic asked the High Court to determine how damages are to be assessed under the Australian Consumer Law in cases where the statutory guarantee of acceptable quality has been breached when a vehicle has been supplied with an unacceptable risk of failure. Ms Capic’s appeal was heard immediately after another case raising similar issues. The other case was Williams v Toyota Motor Corporation Australia Limited. A video-recording of Ms Capic’s appeal to the High Court can be viewed on the High Court’s website, and transcripts are also publicly available:

• Day 1 (11 April 2024) video or transcript
• Day 2 (12 April 2024) video or transcript

The outcome of the High Court appeal in Ms Capic’s matter and in Williams v Toyota may impact how group members’ damages are to be assessed. While we do not know when the High Court will issue its judgment on the appeal, we expect that it will give judgment this year. When the High Court gives judgment, the Trial Judge may be asked to re-assess Ms Capic’s damages.

We do not expect the Trial Judge will take any further steps in respect of the re-assessment of Ms Capic’s damages, or the assessment of group members’ damages, until after the High Court has dealt with Ms Capic’s appeal.

On 6 November 2024, the High Court delivered judgment in the appeal (along with the related appeal in the Toyota proceeding). We are pleased to advise that Ms Capic was largely successful on the appeal.

• Here is the linked judgment of the High Court in Capic v Ford, along with a copy of the judgment summary.

• We have also linked the related judgment in Williams v Toyota, along with the judgment summary in that case.

The High Court ordered that the proceeding be remitted to the trial judge to re-assess Ms Capic’s damages in accordance with the High Court’s reasons.

On 19 December 2024, the Federal Court approved orders amending the group definition to include all persons who purchased, leased or otherwise acquired an interest in an Affected Vehicle between 30 November 2018 and 20 December 2024 (New Group Members). If you purchased, leased or otherwise acquired an interest in an Affected Vehicle between 1 January 2011 and 29 November 2018 (and have not opted out of the class action), you have always been, and continue to be, a group member (Existing Group Members).

On 7 February 2025, the Federal Court approved two notices to Group Members. The notices contain important information regarding the effect of the High Court judgment and provide New Group Members with the opportunity to opt out of the class action. We encourage you to read the Notices.

• A copy of the Existing Group Member Notice is located here.

• A copy of the New Group Member Notice, including the opt out form, is located here.

The important aspects of the High Court’s judgment are extracted below:

• When a company fails to comply with the statutory guarantee of acceptable quality – as occurred in this case – 'affected persons' may, if they qualify, recover damages for two types of losses: (a) reduction-in-value losses; and (b) consequential losses.

• Reduction-in-value damages, being damages for the difference in the value of the Affected Vehicle by reason of the failure to comply with the consumer guarantee at the time of supply to the relevant consumer.

• Consequential losses, being losses suffered by the affected person because of the failure to comply with the guarantee (e.g. losses on resale, costs associated with unscheduled service visits, excess financing costs, GST and stamp duty).

• The High Court found that the right to claim reduction-in-value damages runs with title or ownership of the Affected Vehicle.

• The High Court also found that the right to claim for consequential losses is not tied to title or ownership and, therefore, consequential losses may be available to all Group Members who have owned an Affected Vehicle. This means that, even if you have since sold your Affected Vehicle, you may be entitled to recover consequential losses. Consequential losses will depend upon your individual circumstances.

The proceeding is next listed on 31 March 2025, at which time the Court will re-assess Ms Capic’s damages in accordance with the High Court’s reasons and make directions regarding the procedure for determining group members’ entitlements.

To stay up to date, we encourage you to provide your contact details to us by registering here.

Click here to register your interest in the Ford Australia Class Action. We will then make contact to provide you updates on the case, including the outcome of the case once the Court makes a decision, going forward.

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