ACCC re-institutes legal proceedings against Harvey Norman franchisees

13 June 2013

The Australian Competition and Consumer Commission has re-instituted legal proceedings against nine Harvey Norman franchisees for allegedly misrepresenting consumer rights.

On 20 November 2012, the ACCC issued proceedings in the Sydney registry of the Federal Court against 11 Harvey Norman franchisees located in different states, alleging that they each had misrepresented consumer rights. However, the Court determined that each matter was unrelated and should be heard separately, and that only the proceedings against Harvey Norman Gordon Superstore Pty Ltd in New South Wales could continue in these initial proceedings.

As a result, the ACCC has instituted new separate proceedings against each of nine franchisees that were removed from the initial proceedings. The ACCC has not issued new proceedings against Ipavit Pty Limited in Queensland as it was deregistered as a company on 19 November 2012.

While the allegations made by the ACCC against each of the franchisees differ, examples of the misrepresentations include representations that:

  • the franchisee had no obligation to provide remedies for damaged goods unless notified within a specific period of time such as 24 hours or 14 days
  • the franchisee had no obligation to provide remedies for goods still covered by the manufacturer’s warranty, and
  • consumers must pay a fee for the repair and return of faulty products.

“It is important for these matters to be considered by the court. The ACCC will continue to take enforcement action where it believes that retailers or manufacturers have misled consumers about their rights under the consumer guarantee provisions of the Australian Consumer Law,” ACCC Chairman Rod Sims said.

“Consumers have rights to certain remedies from retailers and manufacturers when goods fail to comply with the consumer guarantee provisions, including that goods are of acceptable quality and fit for the purpose for which they were sold.”

“These rights cannot be excluded, restricted or modified,” Mr Sims said.

The nine Harvey Norman franchisees are:

  • Avitalb Pty Limited, located in Albany, Western Australia
  • Bunavit Pty Limited, located in Bundall, Queensland
  • Camavit Pty Limited, located in Campbelltown, New South Wales
  • HP Superstore Pty Limited, located in Hoppers Crossing, Victoria
  • Launceston Superstore Pty Limited, located in Launceston, Tasmania
  • Mandurvit Pty Limited, located in Mandurah, Western Australia
  • Moonah Superstore Pty Limited, located in Moonah, Tasmania
  • Oxteha Pty Limited, located in Oxley, Queensland; and
  • Salecomp Pty Limited, located in Sale, Victoria.

“While the ACCC does not allege that Harvey Norman Holdings Limited is involved in making of these representations, the fact that the allegations made by the ACCC relate to a number of its stores in widespread locations across Australia is of great concern to the ACCC, and I expect to Harvey Norman too,” Mr Sims said.

The ACCC is seeking court orders including penalties, declarations, injunctions and costs against each of the nine franchisees.

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