Harvey Norman franchisee ordered to pay penalties of $52,000 for false or misleading representations about consumer rights

Friday , 15, January 2016 Leave a comment

CASE : Australian Competition and Consumer Commission v Bunavit Pty Ltd [2016] FCA 6

In a timely reminder about Australia’s strict consumer protection laws that have been Legislated by the Government, the Federal Court ordered a Harvey Norman franchisee, Bunavit Pty Ltd, to pay $52,000 in penalties for making false or misleading representations regarding consumer guarantee rights.

The Court held that sales representatives at the Harvey Norman Superstore made ten false or misleading representations concerning the existence, exclusion or effect of a guarantee or right, when they made statements to two consumers which represented that:

  • had no obligation to provide a remedy and the consumer would need to pursue the manufacturer’s warranty directly with the manufacturer;
  • could not assist further unless the consumer paid for some or all of the cost of the repair.

The ACCC has now obtained penalty orders totalling $286,000 against ten Harvey Norman franchisees in respect of false or misleading representations regarding consumer guarantees.

“Products sold in Australia come with a consumer guarantee under the Australian Consumer Law that they will be of acceptable quality.  Faulty products must be repaired, replaced, or a refund must be provided by the retailer,” ACCC Acting Chair Dr Michael Schaper said.

“This penalty is a timely reminder to all businesses, whether large or small, that they must not mislead consumers about consumer guarantee rights under the Australian Consumer Law,” Dr Schaper said.

“Businesses are expected to take appropriate and effective steps to ensure that their staff understand the rights of consumers and the obligations of businesses under the consumer guarantees provided by the Australian Consumer Law,” Dr Schaper said.


Under the Australian Consumer Law:

  • when consumers buy products, they come with a guarantee that they will be of acceptable quality. This means the products will be as free from defects, safe and durable as a reasonable consumer would regard as acceptable;
  • the guarantee of acceptable quality is in addition to any manufacturer’s warranty;
  • the guarantee of acceptable quality is not limited to the period of the manufacturer’s warranty. In many cases, it will apply for longer than the manufacturer’s warranty;
  • if the product is not of acceptable quality, consumers are entitled to remedies, such as a refund, replacement or repair, at no cost to the consumer.

These rights operate in addition to any express or voluntary warranties offered by businesses and cannot be excluded by a business’ terms and conditions of sale.

For further information about consumer rights, visit http://www.accc.gov.au/consumerrights.

Source : ACCC


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