Farah Khan – 
How many times have you gone to a store and purchased something during a sale, only to realise that after opening the packaging it looks nothing like what the television advertisement had shown? How times have you found the product faulty?
What would you do if the store follows ‘No Exchange, No Refund policy?’
The Consumer Guarantees Act (CGA) is aimed at protecting the end-user or consumer when they purchase goods and services.
Legal coverage
It is important to understand that the Act relates only to those products meant for household use and not those made for commercial purposes.
The test is, if the product is ordinarily marketed and sold for household use, then it would be covered by the Act.
The Act does not apply to private sales, when you buy from someone who is not in trade (such as private sellers online and garage sales). It does not apply to products donated by a charity for your benefit.
The CGA applies to new or second-hand goods or products supplied by businesses that are received as a gift, bought on credit, bought at auction, online, door-to-door or other types of sales, hired or leased.
Goods are defined in the CGA to cover personal property of every kind including intangible property such as software, animals, plants and minerals.
Warranties the Act
The Act provides certain warranties subject to the following:
The goods must be of acceptable quality.
This means the product must be fit for their normal purposes, acceptable in finish and appearance, free from minor defects, safe and durable. This is based on whether a reasonable consumer would find the product acceptable taking into account (a) The nature or type of product (b) The price paid (c) Any information about the product in advertising or packaging (d) Any statement the retailer or supplier made about the product including its history, quality or condition (e) The nature of the trader and how the products were supplied (f) All other relevant circumstances
If the retailer or the manufacturer arranges the product to be delivered to you, the product must be of acceptable quality when you receive them.
2) Fit for purpose
Products must be fit for a particular purpose or special purpose that you tell a trader or they tell you that the products are suitable and you are relying on the trader’s knowledge.
The product must match description, sample or demonstration model.
Many products are sold with a description. The products you receive must be the same as the description in a catalogue or online description/photo or made by the manufacturer on packaging and labels. The products must be the same as any sample or demonstration model shown by the trader.
Breach of the Act
There are some steps to be followed when you find a product faulty (not fit for its purpose) or the product does not do what the salesperson or an advertisement said it would do.
Your first step is to go back to the retailer. The important thing to note is that a business cannot simply contract out of the CGA stating that it follows ‘No Exchange or Refund Policy.’ Many times, a retailer may try to avoid offering a product in exchange or refund saying that you should contact the manufacturer since it is covered by warranties. The manufacturer’s warranties or guarantees are not your problem to deal with if the CGA has been breached. It is the retailer’s responsibility.
Remedies available
If the CGA warranties have been breached, then you are entitled to either have the product repaired, replaced or refunded.
As a consumer, you cannot choose the option that the retailer provides in the first instance. However, if they are unable to repair the product within a reasonable time, you have the right to seek a full refund.
There are many small retailers who are not aware of the Laws of New Zealand and hence deny provide to provide a remedy.
In my opinion, the best thing to do would be to write to their management explaining the circumstances surrounding the purchase of the faulty product.
If no response is received to this complaint, you should contact your lawyer for specific legal advice. Often a letter to the retailer from your lawyer would achieve the purpose.
Farah Khan is Partner and Notary Public at Khan & Associates. Email: farah.khan@xtra.co.nz; Facebook: Farah.
