Consumer guarantees are rights that are supplied by the Australian Consumer Law (the ACL) to consumers who purchase goods or services. These guarantees exist in addition to any other rights which have been provided to the buyer, including any manufacturer’s warranty.
WHO IS A CONSUMER?
A person who buys goods is a consumer under the ACL if:
- The price of the goods is $40,000 or less;
or
- The goods are of a kind ordinarily acquired for personal, domestic or household use;
or
The goods are a vehicle or trailer acquired for transporting goods on public roads;
and
The goods are not acquired for re-supply or for the purpose of production, manufacture or repair.
WHAT ARE THE CONSUMER GOODS GUARANTEES?
Acceptable quality: A consumer who purchases goods is guaranteed that the goods will be of acceptable quality, which means they must be fit for all purposes for which goods of that kind are commonly supplied, acceptable in appearance and finish, free from defects, safe and durable. However, this guarantee does not apply if the consumer was informed about a particular defect before buying the goods, and agreed to buy them anyway; or examined the goods before buying them, and the examination ought to have revealed the problem.
Fitness for particular purpose: The goods must also be fit for any specific purposes for which the buyer informs the seller they are being bought.
Sale by description/sample: Goods which are bought based on a description or sample must match the description of sample. The buyer must have a reasonable opportunity to compare the goods with the sample. The goods must be free from any defect that would not be apparent from reasonable examination of the sample or demonstration model.
Spares and repairs: It is also guaranteed that the manufacturer of goods sold to a consumer will take reasonable action to ensure that spare parts and repair facilities for the goods are reasonably available for a reasonable time.
Express warranties: In addition, there is a guarantee that any promise about the quality or performance of the goods, or the availability of spares or replacements, which is made by the seller or manufacturer of the goods, will be honoured. This guarantee covers any manufacturer’s warranty given in connection with the sale of goods to a consumer.
CAN THE CONSUMER GOODS GUARANTEES BE EXCLUDED?
Consumer guarantees cannot be excluded. If the goods are not of a type ordinarily acquired for personal, domestic or household use, the seller’s liability for breach of a guarantee can be limited to replacement, or repair, or the cost of replacement or repair.
WHAT REMEDIES ARE AVAILABLE TO THE CONSUMER IF THE GOODS DO NOT FULFIL THE CONSUMER GUARANTEES?
A consumer’s remedy for breach of a consumer guarantee, such as sale of faulty goods, depends upon the seriousness of the defect.
The ACL classifies a serious defect as a major failure, defined as one where:
- A reasonable consumer, fully aware of the defect, would not have acquired the goods;
or
- The goods are unsafe;
or
- The goods are significantly different from the description/sample from which they were bought;
or
- The goods are substantially unfit for the purpose for which they are ordinarily acquired, or for the purpose for which they were specifically required, and cannot be remedied within a reasonable time.
If the defect is not a major failure, the consumer is entitled to return the goods and require the seller to repair or replace the goods, or refund the purchase price (at the seller’s option). The goods need not be returned in their original packaging.
If the seller fails to remedy the defect within a reasonable time, the consumer may repair the goods and recover the cost of repair from the seller, or (provided the seller has been notified of the defect within a reasonable time) reject the goods and obtain a replacement or refund.
If the defect is a major failure:
- The consumer may reject the goods, and elect to receive a replacement or refund;
or
- The consumer may sue for damages for reduction in value of goods by reason of the failure.
Regardless of whether or not there is a major failure, the consumer may sue the seller for damages for any reasonably foreseeable loss caused by the seller’s breach of a consumer guarantee.
A consumer may also have rights against manufacturers of goods who are responsible for breaches of consumer guarantees, and against any linked credit finance business which provides credit for the purchase of faulty goods.
If you want to know what your rights are in relation to faulty goods or have a general legal enquiry, please do not hesitate to contact Lynn & Brown Lawyers on 9375 3411 or https://www.lynnandbrown.com.au/contact/
About the author:
This article has been written by Luke Nixon who is a Senior Associate at Lynn & Brown Lawyers. Luke was admitted as a lawyer in the UK in 1991, and has been engaged in legal practice in Australia since 1996. He has a broad range of experience in Commercial, Civil and Administrative Law, providing advice to clients and appearing regularly on their behalf in a variety of State and Federal courts and tribunals.
