Reminder for retailers: Misleading consumers about their rights can lead to hefty fines

Ten Australian Harvey Norman franchisees have been fined a total of AUD286,000 for making false or misleading representations regarding consumer guarantee rights. In the latest case, the Australian Federal Court has fined a Harvey Norman franchisee (Bunavit Pty Limited) AUD52,000 after sales representatives at the Queensland Harvey Norman store told consumers that:

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

Given consumer laws in Australia are very similar to those in New Zealand, this is a timely reminder for all retailers to ensure they (and their staff) are aware of their obligations under consumer legislation.

In New Zealand, it is an offence under the Fair Trading Act 1986 to mislead a consumer about their contractual or legal rights. If an offence is committed, individuals can be liable to a penalty of up to NZD200,000 and bodies corporate up to NZD600,000.

Image courtesy of Kg.