Consumers Mislead by Sales Staff at Major Furniture Retailer

In a recent case, the Australian Federal Court ordered a Queensland franchisee of a major furniture retailer to pay thousands of dollars in penalties for making false or misleading representations regarding consumer guarantee rights.

Similar to New Zealand, all products sold in Australia come with a consumer guarantee. Faulty products must be repaired, replaced or a refund must be provided by the retailer, because consumers expect that any product purchased will be of acceptable quality.

The sales representative stated the furniture retailer had no obligation to provide a remedy and the consumer would need to pursue the manufacturer’s warranty directly with the manufacturer; and that they could not assist further unless the consumer paid for some or all of the cost of the repair. This contradicts Australian Consumer Law as it does in New Zealand. Nine other franchisees were involved in the same proceedings.

In New Zealand, under the Consumer Guarantees Act, if the good is faulty (i.e. if you didn’t cause the problem) and the problem is minor the retailer can choose between repairing the goods, replacing them or giving the consumer a full refund. If there is a major problem the consumer can return the goods and demand a replacement or a complete refund.

The Australian case is a timely reminder to all businesses, including retailers and manufacturers, that they must not mislead consumers about consumer guarantee rights under the Consumer Guarantees Act.

Source: Australian Furniture Association

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