Tertiary education program

Attempts to limit consumer guarantees

Suppliers and manufacturers cannot in any way exclude, limit or avoid the consumer guarantees. Section 64 makes void any term in a contract purporting to do this and sections 29(1)(m) and 151(1)(m) make it unlawful to represent (e.g. with a sign or advertisement) that this is possible. Should a representation of this kind be made, civil or criminal penalties can be imposed of up to $1.1 million for bodies corporate and $220 000 for individuals.

Examples

  1. A notice in a retail shop saying that it has a 'No refund policy' is unlawful. The store must give a refund if there is a major failure to comply with a consumer guarantee.
  2. A notice in a retail shop stating 'No refunds in case of change of mind' is lawful. This policy does not attempt to limit the ability of a consumer to seek remedies under the consumer guarantees.
  3. A notice in a retail shop saying 'No refunds on sale items – exchange only' is unlawful. This is because the notice purports to restrict the remedies available to a consumer, should the goods be defective, to less than those given by the consumer guarantees.
  4. It is unlawful for a supplier to say that, because of an express warranty, it only has to repair defective goods and nothing more. This is because, in the event of non-compliance with a consumer guarantee, consumers have a greater range of remedies available to them than this.

Suppliers and manufacturers are not prevented from giving consumers rights that go above and beyond the consumer guarantees. For example, a retail store can say it will give consumers a refund, or exchange goods, even though they are not defective. Suppliers may not need to meet the guarantee that goods or services are fit for a disclosed purpose if they make it clear that they do not have the skill or judgement to determine whether the product is able to perform the specific function that the consumer requests.