Do you know your legal rights when you buy goods or services?  Have you bought a product that didn't do what it was supposed to do or didn't last as long as expected? 

As consumers, we all have rights covered by Australian Consumer Law that protect us when buying goods.  Businesses are legally obliged to provide certain consumer guarantees in addition to any other particular warranties that they give you as a consumer of its product or service.

1. Consumer guarantees

In accordance with the consumer guarantees, purchased goods must:

  • be of acceptable quality. For example, a new fridge means that it will keep your food cold, is not damaged when purchased and doesn't break down after 12 months.

  • be fit for any purpose represented by the business or made known to the consumer before purchase. For example, you want to buy a water-proof watch for diving and think you found one you like. You purchase the watch without checking that it's water resistant and suitable for diving. The watch turns out to be a different model to your friend's and is not waterproof, only water resistant. You cannot claim that the watch is not 'fit for purpose.'

  • match descriptions made by the salesperson, on the packaging and labels and as advertised. For example, if you purchase a handbag that was advertised in a brochure that it was the softest leather, when in fact, it was the softest vinyl, then it doesn't match the description.

  • match the sample or demonstrated model. For example, you purchase a black suit from trying on a sample and when the order arrives you find that the suit is well made but is navy in colour. The suit in this example does not meet the guarantee.

  • meet any extra express warranties. For example, a TV advertisement demonstrates a set of steak knives as "guaranteed to last 10 years or your money back!" Those steak knives should last 10 years.

  • have spare parts and repair facilities available for a reasonable period after purchase. For example, if you purchased a computer which breaks down after 12 months, it would be expected that spare parts and repairs would be available to fix it.

  • come with full title and ownership; that is, that the title to the goods rightly transfers to the person that purchased the goods.

  • come with a right to undisturbed possession;

  • not have any hidden securities and charges over them.

2. What types of goods are covered?

  1. New items: the mandatory consumer guarantee applies to new items, sales, gifts (with a proof of purchase) and services. For items purchased on-line, if the company is based in Australia, then consumer guarantees will apply. If the retailer is based overseas, it becomes difficult to say Australian Consumer laws applies to these transactions.

  2. Second-hand goods: are covered by a consumer guarantee when purchased from a store, taking into consideration the age, price and condition of the second-hand good when purchased. If you purchased a second hand item from a private seller, e.g. at a garage sale, they have no obligation to provide a consumer guarantee.

3. When are purchases covered?

The consumer guarantees automatically apply to goods bought, hired or leased or to services used after 1 January 2011 on two grounds:

  • for less than $40,000; or

  • for more than $40,000 if used for normal personally, domestic or household purposes.

There are some exceptions to the guarantee, such as, knowing about a fault before you buy the goods or if you have misused the goods.  Goods purchased prior to 1 January 2011 are not covered by current Australian Consumer Law.

4. Good that don't meet guarantees

If you have purchased items or goods that do not meet a consumer guarantee you have a few options.  The options will depend on whether the goods or items have suffered a major failure or a minor failure.  A major failure generally applies to goods which can't be fixed or are too difficult to fix. 

The test for major failure are that the goods:

  • would not have been purchased by the consumer if they had known about the problem.

  • description, sample or demonstration model differs significantly from what was purchased.

  • are unfit for the purpose it was bought for and can't be fixed within a reasonable time.

  • are unsafe.

A major failure entitles you to a refund or replacement.  Alternatively, you can ask the supplier or manufacturer of the item for compensation. 

A minor failure is categorised as something that can be fixed within a reasonable amount of time.  You could be offered a refund, replacement or repair of a product from the supplier.  If the supplier refuses to fix the problem or takes too long, you may ask for compensation to have another person fix the problem.

5. Resolving an issue

If you realise that there is a problem with goods you have purchased, you should immediately contact the supplier and let them know both verbally and in writing.  

First, work out whether you think it's a major problem or a minor problem and have in mind what you would like to happen before speaking to the supplier. 

If the person you speak to isn't very helpful ask to speak to the manager or owner of the business.  Remember some key words and phrases, in particular Australian Consumer Law, consumer guarantees, acceptable quality, refund/repair/replace and fit for purpose. Note the date and content of the conversation.

You may need to follow up your conversation with an email or letter to the supplier.  Be clear about what the problem is and what you would like the supplier or manufacturer to do to rectify the problem.  Also, allow the supplier a reasonable amount of time to respond to your correspondence and try to rectify the situation.

If you can't get a response from the supplier, try contacting your state or territory's Office of Fair Trading. If the matter cannot be resolved at that stage, it may be necessary to take the matter to a Court or Tribunal.   

We all have rights as consumers when we purchase products or use services. It's important to know your rights and first discuss any problems with the provider of the goods or services. If the problem cannot be resolved, you may have other more formal options available, such as starting a Court action. 

This article contains information of a general nature only and is not specific to your circumstances. This is not legal advice and should not be relied upon without independent legal or financial advice, specific to your circumstances.