The ACCC has instituted proceedings in the Federal Court in
Sydney against 11 Harvey Norman franchisees for allegedly
misrepresenting consumer rights. The ACCC alleges the franchisees
made "false or misleading representations to consumers about
their rights under the consumer guarantee provisions of the
Australian Consumer Law (ACL)".
The ACCC alleges that each franchisee misled consumers by
representing that the franchisee had no obligation to provide
for damaged goods unless notified within a specific time period
such as 24 hours or 14 days
for goods still covered by the manufacturer's warranty
(because the consumer must return the goods to the
for particular items such as large appliances or items priced
below a certain amount.
The ACCC also alleges that the franchisees misled consumers by
making representations that consumers must pay for the repair and
the return of faulty goods.
The ACCC says:
the misrepresentations occurred during the period from April
2011 to mid 2012
in all 11 cases, the misrepresentations were made orally by the
franchisees' employees to customers
in one case, a misrepresentation appeared on the receipt
provided to the consumer.
The ACCC is seeking penalties, declarations, injunctions and
costs, which include pecuniary penalties of up to A$1.1 million,
for a corporation or A$220,000 for individuals.
In 2010 the Competition and Consumer Act 2010 (Cth)
replaced the Trade Practices Act 1974 (Cth) and
introduced, as part of the ACL, new national consumer guarantee
provisions which replaced the previous statutory implied conditions
and warranties. The consumer guarantees provide consumers with
rights to certain remedies from retailers and manufacturers where
goods purchased after 1 January 2011 fail to comply with the
consumer guarantee provisions in the ACL. These include guarantees
goods will be of acceptable quality
goods will be fit for any disclosed purpose
goods will match any description under which they are sold
spare parts will be available for a reasonable time
all express warranties offered with the goods will be
These rights cannot be excluded, restricted or modified.
While businesses are still able to offer additional warranties
with their goods and services (such as manufacturer's
warranties or extended warranties), any additional warranty does
not override or limit the consumer guarantee provisions.
Importantly, consumers must not be misled about their consumer
guarantee rights or the protections afforded by any additional
Earlier this year, the ACCC launched a national consumer
guarantee awareness campaign to educate consumers on their rights
in relation to faulty goods and to educate retailers and
manufacturers about their obligations under the ACL.
The ACCC says consumer guarantees are a national priority for
The ACCC has also indicated that it is investigating other large
manufacturers and retailers for misrepresentations of consumer
guarantee rights in breach of the ACL.
The ACCC's recent actions show that the ACCC is actively
monitoring and prosecuting manufacturers and retailers who mislead
consumers about their rights under the ACL.
Manufacturers and retailers should ensure their documentation
(including receipt dockets, warranty documents, refund policy etc),
marketing and promotional material and product packaging are fully
compliant with the ACL. Importantly, businesses must ensure that
their employees undertake adequate ACL training to ensure they
understand the laws. This includes both sales staff who deal with
consumers, and employees who communicate with retailers and
manufacturers in the supply chain.
Middletons regularly advises clients in relation to the ACL and
has a number of ACL compliance training programs available to help
you and your staff to understand and comply with the ACL. We can
provide on-site training, online training, checklists and
compliance manuals tailored to suit your business.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
Middletons has been awarded a 2012 EOWA Employer of Choice for
Women citation acknowledging our commitment to workplace
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
The Sportscraft refunds and returns policy limitations went beyond consumer's rights under the Australian Consumer Law.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).