Australian Consumer Law: Online Transactions, Guarantees, and Remedies

This report examines the application of Australian Consumer Law (ACL) to online transactions, focusing on consumer guarantees, breaches of those guarantees, and available remedies. The report analyzes a case study involving a customer, Sangita, and her online purchases from Myers. It discusses the implications of ACL on online sales, the concept of consumer guarantees, and how breaches of these guarantees can occur. The report also delves into the remedies available to consumers, such as refunds, repairs, or replacements, and the legality of 'no refund' policies. The analysis covers various scenarios where Sangita received incorrect or faulty products, highlighting the breaches of implied and consumer guarantees by Myers. The report concludes by emphasizing the illegality of 'no refund' policies under ACL, ensuring consumer protection in online transactions. The report references the Competition and Consumer Act 2010 and relevant ACL regulations.

Australian Consumer Law

Table of Contents
Introduction.................................................................................................................................................2
1. Online transaction and ACL....................................................................................................................2
2. Breach of guarantee................................................................................................................................3
3. Remedies.................................................................................................................................................5
4. Legality of no refund policy....................................................................................................................6
Conclusion...................................................................................................................................................6
References...................................................................................................................................................7
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Introduction
Australian consumer law (ACL) is an integral legislation for safeguarding the rights of the
consumers. It is specified in Schedule 2 of Competition and Consumer Act 2010. It mainly
focuses on deceptive or misleading conduct, unfair practices, unconscionable conduct, product
safety and information, conditions and warranties, country of origin representation and liability
on the part of manufacturers in case of goods having safety defects offences.
Thus the discussion would focus on various aspects associated with ACL, the remedies under it,
ways of is breach and legality of no refund policy. In the process of this discussion, the provided
case of Sangita would be taken into consideration.
1. Online transaction and ACL
Since 1st January 2011, there are certain consumer guarantees which are applicable on services
and products that have been incorporated in ACL. This has resulted in incorporation of online
services and products bought from Australian businesses on which consumer guarantees on the
services and products are applicable (Accc, 2018).. It is on the basis of this fact it may be stated
that the online transaction of Sangita from Myers can be considered to be incorporate in the
operation of ACP. In addition to that there are certain rights and guarantees associated with
refund, repair or replacement which has been incorporated in Australian Consumer Law (ACP)
since 1st January 2011 when one or more than one consumer guarantees are not addressed
(Consumerlaw, 2018). These guarantees are applicable to both major and minor issues. In this
context it can be stated that, the aspects which have been mentioned under ACP in regards to
refunds and returns under Chapter 5 of ACL which focuses on enforcement and remedies
wherein national enforcement remedies and powers associated with consumer law is emphasized
upon that is applicable in a similar manner when buying online from an Australian business. To
get in depth of the matter, the aspects associated with refunds and returns that has been
mentioned under Chapter 5 of ACL is applicable in a similar manner as when making a purchase
from physical store (Consumer, 2018). Under this chapter of ACL it has been stated that ACL
formulates national empowerment power which is needed to be used on the part of all the
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consumer law regulators that includes civil remedies and penalties in case of breaches of
elements that has been mentioned under ACL.
On the basis of the above made discussion, it may be stated that the transaction which Sangita
has made online from Myers can be considered within the operation of ACL. In other words, the
rice cooker that Sangita purchased for her Aunt in place of which electric fry pan got delivered,
drill that she purchased for her Uncle that quality of which was not what was expected, and the
electric toothbrush that she bought for her cousin which did not match the mentioned description
as specified by online sales assistant can be considered to be included in the operation of ACL.
2. Breach of guarantee
Under ACP Chapter 3 when a consumer buys survives and product it automatically comes with
guarantees which guarantees that the product would operate effectively and would fulfill the
functioning which has been asked on the part of the consumer. As a result of this, when a
consumer buys something which is defected, the consumer gets protection under the specified
consumer rights. On the basis of this fact, it will not be wrong to state that it is the implied
guarantee of Myers to provide with products which is in functioning stated and operate as per
the demand and requirement as specified in the part of the consumer (Consumer, 2018). Other
than that, in case the products bought on the part of Sangita which is not defected or not right,
she is protected under consumer rights.
It is on the basis of the above discussed aspects of implied guarantees if the provided scenario of
Sangita is analyzed it may be observed that the rice cooker which was order by her for aunt was
wrongly parceled with electric fry pan. It puts forward the fact that the product was not
functioning or serving the purpose for which she had ordered the product. In this context if the
consumer guarantees on services and products which have been incorporated in ACL in 1st
January 2011 is analyzed it has been stated that consumer guarantees on services and products is
applicable wherein it makes it essential for products to be acceptable quality (Accc, 2018). In
this regards acceptable quality implies products which are lasting, safe in which there exists no
faults, look acceptable and operates in every aspect which is expected by the customer that the
product would usually be expected to perform. In this context as well, the product which was
ordered on the part of Sangita i.e. rice boiler which would help in cooking rice, that the product
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would not be able to perform as per the expectation of the customer (Accc, 2018). On the basis
of this fact it may be stated that the implied guarantee of the product for functioning what the
customer had asked for, establishes the breach of this implied guarantee. In addition to that under
the incorporations made to ACP since 1st January 2011 further stated that the products which are
delivered to the customers need to match the description which has been made on the part of the
salesperson, as mentioned in its promotion or advertising and mentioned on packaging and
labels. In this context as well, it may be observed that product which was delivered to Sangita’s
aunt specified on the packing that it was rice cooker, however the product inside the packing was
not meeting the description (Paterson, 2011). On this basis as well it may be stated that Myers
store Ltd. had breached consumer guarantees on products and services as specified in ACP on
the basis of which as well she may argue that Myers store Ltd had breached guarantees to which
she was entitled.
In case of the drill that she had bought for her uncle which stopped functioning immediately after
it was switched on establishes the breach of the implied terms of the product for operating
effectively as mentioned under ACP. It is on the basis of this fact it may be stated that Myers
Stores Ltd had breached the implied guarantee of the product to be working. Other than that, as
per consumer guarantees on products and services in ACP which has been incorporated since 1st
January 2011 state that products are needed to be of acceptable quality in which the criteria for
acceptable quality are lasting, safe having no faults, has to look acceptable and perform all the
functions which are usually expected on the part of the consumer (Harris, 2013). In this regards
as well, the drill which has delivered to her uncle was lacking the criteria of being long lasting
and having no faults. It is on this basis as well, she may argue that Myers Store Ltd had breached
consumer guarantees on products and services that have been mentioned in ACP.
In regards to the electric brush that Sangita had bought for her cousin it may be observed that
though it was mentioned by the online sales assistant that the brush would operate electrically as
well as with the help of battery. However, when the product arrived it was observed that the
brush could only operate electrically. On the basis of this, if the automatic guarantee or implied
guarantee as mentioned in ACP is analyzed it may be observed that on buying services and
product under ACP it comes along with automatic guarantees wherein the product is needed to
be in working condition and perform as per what has been asked for by the consumer (Accc,
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2018). In this context, while Sangita asked for the brush which would be working electrically as
well as with the help of battery while in reality it worked only electrically establishes the breach
of the implied term of functioning what has been asked for by the consumer. Similarly under
consumer guarantees on products and services as incorporated in ACP since 1st January 2011 it
has been stated that the delivered products are needed to be of acceptable quality in which the
criteria exists that the product would perform all the things which is, under usual circumstances
expected by the consumer to be done. In this context as well Snagita can argue that Myers Stores
Ltd had breached the consumer guarantees on products and services as specified in ACP.
Thus, on the basis of the above made discussion the breach of guarantees on the part of Myers
Stores Ltd on the basis of which Sangita may put her argument against the organization is clearly
observable.
3. Remedies
The remedies that Sangita may claim from Myers Store Ltd. due to the breach of implied
guarantees and similarly for the breach of consumer guarantees on products and services as
incorporated in ACP since 1st January 2011 are mainly associated with the rights to refund, repair
or replacement of the products that the consumer has bough within Australia as mentioned in
Chapter 5 of ACL. It is applicable when the product fails in meeting one or more than one
consumer guarantees. It is on the basis of the above discussed aspects Sagita may make claims
for breach of implied and consumer guarantees on products and services as incorporated in ACP
since 1st January 2011 that are associated with her right of refund, repair or replacement of the
products, which are remedies applicable in this case (Accc, 2018). In this case, guarantees are
applicable for both major and minor issues. It is worth mentioning here the problem that has
been experience on her part with the products that she bought online from Myers Store Ltd are of
major problem. A product may be considered to have major when it has issue which would have
stopped the consumer from buying the product on having awareness regarding it prior buying it,
the product is of unsafe in nature, the delivered product of significantly different from the
description or sample or it does not perform as claimed by the business that the product is
supposed to do or as there exists a mismatch as per the demand of the customer. On the basis of
this fact, it may be observed that the rice cooker that she had bought was different from the
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description, the driller was faulty, regarding which is she had the awareness would not have
bought or the electric toothbrush was not matching with what, Sangita had asked the online sales
assistant. This establishes the fact that the issues experienced with these products were major in
case of which she is entitled to ask for her choice of refund or replacement (fairtrading, 2015). It
is due to this fact, Sangita, who was willing to return the products may exercise the remedy of
refunds on the products, wherein on returning the products she may receive back the value of the
products.
4. Legality of no refund policy
In case of Sangita, it may be observed that when she want to Myers Store to return the products,
the sales assistant referred her to online receipts which stated that Myers Stores do not provide its
customers with replacement, refunds or exchange in case of purchases which have been made
online. In context of this statement on evaluating its legal status and impact, it may be stated that
such signs or specification under ACP wherein it mentions that no refund policies are provided
to its customers is illegal which is having no legal validation or prohibited under the law which
has been specified in ACL Regulations (Corones, 2016). It is due to the fact that it implies that
the organization will not be providing its customers with appropriate remedy even in cases in
which the goods that have been bought by the consumer have major problem. Thus, on the basis
of the above mentioned aspect, it may be stated that the statement on the receipts that the sold
items online would not be exchanged, refunded or replaced by Myers Stores is illegal in nature.
However, no refunds specification in case of consumers changing their mind or in case of
incorrect choice is considered to be legal, which is not the case of Sangita.
Conclusion
In the conclusion, it may be stated that ACL has various layers and complex in nature. However,
it is with the help of effective implementation of the law which helps in protecting the interests
of the consumers.
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References
Accc. (2018). A guide to competition and consumer law. [online] Available at:
https://www.accc.gov.au/system/files/1102_ACL%20Industry_guide_FA_one_column_web.pdf
[Accessed 12 May 2018].
Accc. (2018). Consumer guarantees. [online] Available at:
https://www.accc.gov.au/consumers/consumer-rights-guarantees/consumer-guarantees [Accessed
12 May 2018].
Accc. (2018). Consumer rights & guarantees. [online] Available at:
https://www.accc.gov.au/consumers/consumer-rights-guarantees [Accessed 12 May 2018].
Accc. (2018). Shopping online. [online] Available at:
https://www.accc.gov.au/consumers/online-shopping/shopping-online#shopping-online
[Accessed 12 May 2018].
Consumer. (2018). Buying from an Australian business online. [online] Available at:
https://www.consumer.vic.gov.au/products-and-services/online-shopping/buying-from-an-
australian-seller-online [Accessed 12 May 2018].
Consumer. (2018). Consumer guarantees that apply automatically. [online] Available at:
https://www.consumer.vic.gov.au/products-and-services/refunds-repairs-and-returns/guarantees-
that-apply-automatically [Accessed 12 May 2018].
Consumerlaw. (2018). Consumers and the ACL – Australian Consumer Law. [online] Available
at: http://consumerlaw.gov.au/consumers-and-the-acl/ [Accessed 12 May 2018].
Corones, S. (2016). Australian Consumer Law. Sydney: Thomson Reuters (Professional)
Australia Pty Limited.
fairtrading. (2015). Repairs, refunds, replacements. [online] Available at:
http://www.fairtrading.nsw.gov.au/sites/ftw/Consumers/Consumer_guarantees_warranties_and_r
efunds/Repairs_refunds_replacements.page [Accessed 12 May 2018].
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Harris, B. (2013). Economic Cost Provisions in Fixed-Rate Home Loan Contracts and Breaches
of Australian Consumer Law. Journal of Politics and Law, 6(3).
Paterson, J. (2011). Introducing the New, National Australian Consumer Law. Alternative Law
Journal, 36(1), pp.50-50.
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