Consumer Guarantees Law And Legal Services In Australia

Consumer Protection and Historical Development of Consumer Protection in Australia

Discuss about the Consumer Guarantees Law and Legal Services.

Consumer protection law is a way available to individual to fight back against the business practices which are abusive. These laws are designed at global level to provide protection to consumers and prevent the abusive practices of sellers of goods and services. Consumer protection laws are applicable on sellers when they seek to earn profit by providing wrong information or does not provide complete information to consumers. In Australia, consumer protection laws  exists at both federal and state level. They are enforced by agencies of government, offices of attorney’s generals, and other government bodies.

This paper contains the discussion on consumer’s protections, brief note on historical development of consumer protection law in Australia, and how consumer’s protection laws operate at both federal and state level in Australia.  In this paper, we also discuss the process of protection of consumers when consumers are not satisfied with the product or service they get.  

Section 3 of ACL defines the consumer as a person or business who purchased goods and services which does not exceed amount of $40000, goods and services exceed the amount of $40000 but they are of such nature which ordinarily used for domestic, household or personal consumption, and also cover the goods related to commercial road vehicle (Competition and Consumer Act 2010, n.d.).

The main purpose of consumer protection laws is to protect the consumers against unfair practices of trade conducted by sellers for seeking profit. Usually, all the commercial organizations are managed and controlled according to the market condition which put them in dominating position from their customers and organizations use this position to exploit their consumers. Consumer Protection Law in Australia provides the detailed application and effect of law related to consumer protection and liability of product in Australia.

The consumer protection law was developed in Australia by the agreement signed by Council of Australian Governments.  The provisions of this law are the mirror of the provisions specified in Trade Practices Act 1974, and some additional protections are also added to the consumers. Usually, this law reflects the provisions of consumer protection of fair trading legislation which applicable in both state and territory (Bruce, 2013).

In 1980, a successful attempt was made by government of Australia to implement the consumer law through a legislation introduced under Part V of the Trade Practices Act 1974. The benefits of this law are for the short period, and governments at individual level included Australian government take actions at their own for the improvement of consumer laws which result in divergence, duplication and complexity. Actions of government results in confusion in the mind of consumers related to their rights and also business organizations are not able to understand their obligations under law. All these confusions result in loss of cost, time and efforts.

The Australian Consumer Law (ACL)

At that time general consumer laws in Australia was defined by 13 Acts which almost covers the same matter related to consumer protection, it also includes two national laws that is Trade Practices Act 1974 and the ASIC Act 2001, and 8 state and territory Fair Trading Acts. Three more jurisdictions are there in which three more laws are enacted for consumer protection. There are also some general consumer provisions related to sale of goods in eight state and territories of Australia. These laws are complex and confusing for consumers and businesses.

After considering this problem the new Act is introduced by the government of Australia that is Australian Consumer Law. This new Act replaces almost 850 Sections in above mentioned Acts, and does not include number of ancillary enforcement and other regulations that support them.

The Australian Consumer Law (ACL) is the national law, and the main purpose of this law is consumer protection and fair trading. On 1^st January 2011, ACL is commenced and it is a cooperative reform of the Australian government and the States and Territories through the Legislative and Governance Forum on Consumer Affairs (CAF).

Administration of ACL is conducted by Australian Competition and Consumer Commission (ACCC), and some other consumer protection agencies operated in the states and territories. Australian Securities and Investments Commission (ASIC) also show their involvement on relevant matters (ACL, n.d.). Australian Consumer Law covers following matters:

Law related to national unfair contract terms which cover standard form of consumers and business contracts small in nature.

National law also guaranteeing rights of consumers while dealing in the goods and services.

National law related to safety of product and enforcement of laws.

National law related to unsolicited consumer agreements which deals with door to door sales and also telephone sales.

National rules related to lay-by agreements.

Penalties, power of enforcement, and consumer redress options.

The ACL applies at national level, in all the states and territories of Australia and to all businesses conducted in Australia. All those transactions which are occurred before 1^st January 2011, all the previous national and state laws are applied.

This law is administered by ACCC and enforced by all courts and tribunals in Australia, and also include the tribunals and courts of the states and territories. All those protections which are provided in ACL are similar to the protections provided in the provisions of Australian Securities and Investments Commission Act 2001 (ASIC Act). Therefore, all the products and services related to finance are treated in similar way. Council of Australian Governments signs the Intergovernmental Agreement which results in establishment of ACL.

Chapters of ACL

In 2008, productivity commission of Australia provides the recommendation of ACL, and this commission also found that ACL provide between $1.5 and $4.5 billion benefit to the Australian community (ACL, n.d.).

ACL is defined under Schedule 2 of the Competition and Consumer Act 2010 which is previously known as the Trade Practices Act 1974 (TPA). Following are some chapters of ACL which are defined below:

Chapter 1: in this chapter there are set of definitions, and also some provisions related to consumer law, and this section also includes definition of consumer.

Chapter 2: this chapter defines the general protections, and these general protections help in creates standards related to business in the market. These general protections include following bans:

General restriction on misleading conduct and deceptive conduct in business.

General restriction on unconscionable conduct and specific restriction on unconscionable conduct in case of consumer and some particular business transactions.

There are some provisions which make unfair contract terms in consumer contracts void.

This chapter includes some specific protections which deal with the particular forms of business conduct, and it includes:

Restriction on some specific practices which are unfair in businesses.

It also deals with consumer transactions related to goods and services.

Cover liability of manufacturer in case of safety defects in goods.

Chapter 4: it deals with criminal offences related to particular matter covered by chapter 3.

Chapter 5: this chapter includes power of enforcement and remedies.

ACL regulations are set out in part 6 and 7 of the Competition and Consumer Regulations 2010, and it gives practical effect to the provisions of ACL (ACL, n.d., ACCC, n.d.).

Consumer guarantees are defined as set of rules which regulates the sell and purchase transactions of consumers, and these rules are provided under ACL. Rules related to consumer guarantees define the situations under which business is liable towards their consumers and provide remedy to them. This guarantee automatically applied to the goods and services provided by seller or manufacturer.

Businesses that provide goods or services to consumers must comply with the consumer guarantees, manufacturers, and importers must comply with the consumer guarantee.

Goods must consist following guarantees:

Goods must be of acceptable quality.

Goods must fulfill the purpose for which they are manufactured.

All the necessary information related to goods must be provided to consumer.

Goods must be free from hidden securities and charges.

Goods must be selling with undisputed possession.

Repair facility must be available for reasonable period of time.

Goods must be free from defects (ACCC, n.d.; Queensland Government).

Remedies provided by ACL to consumers are divided into four parts, and these remedies are related to supplier and manufacturer of products. Following remedies are available to consumer when consumers are not satisfied with the goods:

• Remedies which are related to guarantees provided by supplier of goods.
• Remedies which are related to guarantees against manufacturer of goods.
• Remedies which are related to guarantees against supplier of services.
• Remedies which are related to guarantees against supplier and credit providers (Find law, n.d.).

Remedies available to consumers are determined by the failure to comply with the consumer guarantee. These failures are split into two parts that is major failure or non major failure. Failure to comply with consumer guarantee is considered as major failure if supplier failed to comply with following guarantees:

Guarantee under section 51 that is title of goods, section 52 that is undisturbed possession, section 53 that is undisclosed securities, section 54 that is acceptable quality, Section 55 that is fitness for any undisclosed purpose, Section 56 that is supply by description, and Section 57 that is supply by sample and demonstration.

In case of major failure consumer has right to reject the goods or they can seek compensation for any reduction in the value of goods purchased by them. In this person has right to:

Reject the goods and asked for refund.

Repairs of goods.

Replacement of goods

Sue the defaulter for damages and seek compensation.

A non major failure is not defined by the law, but any failure which is not covered by major failure can be considered as non major failure. In case of non major failure, consumer has right to get remedy from the supplier within a reasonable time (Legal Services Commission, n.d.).

Any individual who suffer any personal injury or death and any person who depend on the injured or deceased person have right to file claim against the manufacturer of product. Person also have right to file suit if goods are defective and cause damage to the person’s property (Hobart community, n.d.).

In Australia, consumer guarantee laws are enacted with the purpose of harmonizing and provide clarification on law which sets mandatory standards of quality in contracts related to supply of gods and services, and this law also assists consumers and business to understand their rights and obligations respectively. Consumer guarantee laws are not completely successful in meeting their aim of harmonization, and it is clear that different laws are applicable on business transaction and on contracts of financial services and products.

Still some aspects of law are not clear under consumer guarantees law, especially related to new term that is acceptable quality which is introduced by replacing the old term merchantable quality, and also relationship between warranties which are extended and consumer guarantee. However, there are some new concepts which govern the remedies provided in case of failure of consumer guarantee under consumer guarantee law (Paterson, 2011). ACL has made number of changes in the mandatory quality standards related to supply of goods and services to consumers, and it also extends statutory regulation related to express warranty. Consumer guarantee law removes the standard related to mandatory quality from the contract law domain, and it introduce remedies which are completely different from the remedies provided in contract law.

Conclusion:

In this paper, we discuss the laws related to consumer protection and also the structure and implementation of these laws in Australia. After considering the above facts, it is clear that government of Australia provides many rights to the consumer and also imposes many obligations on businesses. Now, business man cannot take advantage of their domain position in market by defrauding the consumers. They owe duty of care towards their consumers, and in case of negligence conduct consumer have right to file suit for compensation against manufacturer, supplier or retailer. At last, we conclude that consumer protection laws are playing important role in preventing unfair trade practices.

References:

ACCC. Buying safe products. Retrieved on 13^Th January 2017 from: https://www.accc.gov.au/consumers/consumer-protection/buying-safe-products.

ACCC. Consumers’ rights & obligations. Retrieved on 13^Th January 2017 from: https://www.accc.gov.au/business/treating-customers-fairly/consumers-rights-obligations#consumer-guarantees-applying-to-goods.

ACL. ACL review. Retrieved on 13^Th January 2017 from: https://consumerlaw.gov.au/.

ACL. An Introduction to the Australian Consumer Law. Retrieved on 13^Th January 2017 from:https://consumerlaw.gov.au/consumer-policy-in-australia/resources/an-introduction-to-the-australian-consumer-law/.

ACL. Legislation. Retrieved on 13^Th January 2017 from: https://consumerlaw.gov.au/the-australian-consumer-law/legislation/.

ACL. The Australian Consumer Law. Retrieved on 13^Th January 2017 from: https://consumerlaw.gov.au/the-australian-consumer-law/.

Bruce, A. (2013). Consumer Protection Law in Australia, 2nd Edition. Retrieved on 13^Th January 2017 from: https://store.lexisnexis.com.au/product?product=consumer-protection-law-in-australia-2nd-edition&meta_F_and=9780409334005&gclid=CjwKEAiAtefDBRDTnbDnvM735xISJABlvGOvlTO7eKkJSOUdJrAepYkGc58MJMObDpNoLThSVcM7jhoCVVnw_wcB.

Competition and Consumer Act 2010- sect 3.

Cridland, M. (2015). What to do with a faulty product. Retrieved on 13^Th January 2017 from: https://www.choice.com.au/shopping/consumer-rights-and-advice/your-rights/buying-guides/what-to-do-with-a-faulty-product.

Find law. Consumer law: Goods purchased that are suffering from a major failure. Retrieved on 13^Th January 2017 from: https://www.findlaw.com.au/articles/4504/consumer-law-goods-purchased-that-are-suffering-fr.aspx.

Hobart Community. What remedies are available. Retrieved on 13^Th January 2017 from: https://www.hobartlegal.org.au/tasmanian-law-handbook/consumers-money-and-debts/australian-consumer-law/what-remedies-are-available.

Legal Services Commission. Defective Goods. Retrieved on 13^Th January 2017 from: https://www.lawhandbook.sa.gov.au/ch10s02s08.php.

Paterson, M. J. (2011). The new consumer guarantees law and the reasons for replacing the regime of statutory implied terms in consumer transactions. Retrieved on 13^Th January 2017 from: https://www.austlii.edu.au/au/journals/MelbULawRw/2011/8.html#Heading392.

Queensland Government. Consumer guarantees your products must meet. Retrieved on 13^Th January 2017 from: https://www.qld.gov.au/law/laws-regulated-industries-and-accountability/queensland-laws-and-regulations/selling-your-products-and-services/guarantees-warranties-and-refunds/consumer-guarantees-your-products-must-meet/.