The NSW Parliament recently passed changes to the Fair Trading Act 1987 (NSW) which are expected to commence on 1 January 2019.
What are the changes?
The Fair Trading Legislation Amendment (Consumer Guarantee Directions) Act 2018 (NSW) gives the NSW Fair Trading Commissioner the administrative power to issue binding consumer guarantee directions to businesses to:
- repair or replace defective consumer goods; or
- refund the purchase price
The amendments are seen as a fair, quick and cheap alternative to the court and tribunal system.
Which goods does it apply to?
A consumer guarantee direction may be given by the Commissioner in relation to goods:
- sold to a consumer who is ordinarily resident in NSW
- with a purchase price of between $25 and $3,000 (exclusive of GST)
- to which a consumer guarantee under sections 54-57 of the Australian Consumer Law applies (ie, acceptable quality, fitness for purpose, supply of goods by description, and supply of goods by sample or demonstration model)
- which are the subject of an unresolved dispute between a consumer and a business concerning the application of a consumer guarantee
- which were purchased by the consumer within 6 months prior to the complaint (unless special circumstances apply)
- which are not excluded goods under the amending legislation
Which goods are excluded from the new laws?
The following goods are excluded:
- motor vehicles and component parts of motor vehicles
- second-hand goods
- solar batteries
- any goods subject to a warranty under part 2C of the Home Building Act 1989 (NSW)
- goods the subject of pending proceedings in a court or tribunal
How long does a business have to comply with a consumer guarantee direction?
The direction will specify a time period for compliance which will be no less than 28 days and no more than 90 days unless the consumer and the business agree to a longer time period.
What rights do consumers and businesses have in relation to consumer guarantee directions?
The Commissioner may only issue a consumer guarantee direction if:
- the consumer has already made a complaint to the Commissioner and the complaint remains unresolved
- the consumer applies for a consumer guarantee direction
- the Commissioner is of the opinion that it is fair and reasonable in the circumstances to make such a direction
- the consumer and the business have had the opportunity to make submissions and give evidence (including a right of reply)
An aggrieved consumer or business may appeal a consumer guarantee direction to the NSW Civil and Administrative Tribunal within 28 days of the making of the direction.
What happens if a business does not comply with a consumer guarantee direction?
If a business does not comply with a consumer guarantee direction:
- the consumer may register the amount owing as a judgment debt and seek enforcement in the Local Court
- the Commissioner may publish information about the business including its failure to comply with a consumer guarantee direction
Please contact our commercial law team at Matthews Folbigg Lawyers on 9635 7966 if you require legal advice with respect to your rights and responsibilities under the Fair Trading Act or the Australian Consumer Law, or if you would like to review and update your terms of trade.