Karmy Pty Ltd, trading as Schots Restoration Emporium, has misled consumers about their rights to refunds, in breach of the Trade Practices Act 1974, the Federal Court has declared.
"The court declared that by telling consumers that they were not entitled to refunds on new, sale or seconds items, Schots had misrepresented consumers’ rights", ACCC Chairman, Professor Allan Fels, said today.
"The misrepresentations appeared in advertisements published in the Sunday Age TV magazine on 6 and 20 April 2003, in signs displayed at Schots' Clifton Hill and Moonee Ponds stores, and in the conditions of sale displayed on Schots' website".
By consent of the parties, Justice North made various orders including
- declarations that Schots had contravened sections 52 and 53(g) of the Act, which deal with misleading and deceptive conduct and the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy;
- injunctions prohibiting Schots from making representations that consumers are not entitled to refunds under any conditions;
- publication of corrective advertisements in the Sunday Age TV magazine, the Australian Retailer magazine, in-store signs and on Schots’ website; and
- the implementation of a trade practices corporate compliance program;
"Businesses must not mislead consumers about their rights when they advertise goods for sale", Professor Fels said. "The statutory rights implied by the Act give consumers a basic, guaranteed level of protection when they purchase goods and services and businesses may not exclude, restrict or modify these rights.
"If businesses do misrepresent these statutory rights, the ACCC will act to stop these practices, as it has done in this case”.
Under the Act, consumers are entitled to obtain a refund if the goods they purchase are not of merchantable quality, are not fit for their purpose or do not correspond with their description or sample. These rights exist even if the goods purchased are seconds items or are not new. Further information