Consumer Guides > Consumer Guarantees ActConsumer Guarantees Act Content kindly supplied by consumer.org.nz.
The Consumer Guarantees Act is a cornerstone piece of legislation. Its role is to protect consumers.
Under the Act, your consumer rights are expressed as a series of "guarantees" that a seller automatically makes to you when you buy any goods or services ordinarily purchased for personal use.
In this guide, we explain what those rights are, and what to do if you think your rights have been breached.
What it covers
The Act covers the goods (new and second-hand) and services ordinarily purchased for personal, domestic or household use.
Those "goods" include pretty much everything in and around the home - from appliances to vehicles, furniture to food. Gas, electricity, water and computer software are also covered.
"Services" include things done by tradespeople like plumbers and painters, professionals like dentists and lawyers, after-sales and repair services from shops, and all the services you get from insurers, petrol stations, travel agents ... in general, if you pay for it, it's covered.
The Act applies to gifts. If you are given something, you have the same rights as if you bought it yourself, and can seek redress directly for any problem. It also applies to goods that you hire.
What it doesn't cover
The Act only applies if you buy goods or services from sellers "in trade". This means it does not cover private sales or goods sold by auction or tender. However, it does cover goods sold in second-hand shops and sales, and goods sold over the internet by New Zealand businesses.
The Act does not cover the purchase of houses, although it does cover house repairs. Nor does it cover goods or services usually bought for commercial use, such as medical equipment or the installation of industrial machinery.
No contracting out
Sellers cannot exempt themselves from their obligations under the Act, even if they put it in a contract. So, if a retailer puts up a sign saying "No refunds or exchanges" it is meaningless. You still have full rights under the Act.
This also means guarantees and warranties cannot state "No consequential losses are covered," because attempts to contract out of the Act may mislead consumers about their rights.
The Commerce Commission may use the Fair Trading Act to prosecute traders who attempt to contract out of the Act.
However, sellers can contract out of the Act when goods are used for business. When a product is ordinarily purchased for domestic use but is also used for business purposes - like a mobile phone, for example - the Act will allow a seller to contract out of the Act. Any contracting out must be done in writing at the point of sale.
The guarantees
Under the Act, your consumer rights are expressed as a series of "guarantees" that a seller automatically makes to you when you buy any good or service ordinarily purchased for personal use. We explain them below.
Goods
Retailers and other such suppliers guarantee their goods will:
Be of acceptable quality (see definition below).
Be fit for a particular purpose that you asked about.
Match the description given in advertisements or sales brochures, or by the sales assistant.
Match the sample or demonstration model.
Be owned by the consumer, once purchased.
Be a reasonable price, if no price or pricing formula has been previously agreed.
Manufacturers (the definition includes importers) in New Zealand guarantee that:
Spare parts and repair facilities will be available for a reasonable time.
They will honour any written warranty that comes with their products.
Goods are of acceptable quality.
Goods match their description.
Services
Service providers guarantee their services will be:
Performed with reasonable care and skill.
Fit for the particular purpose they were supplied for.
Completed within a reasonable time.
A reasonable price, if no price or pricing formula has been previously agreed.
Acceptable quality
This means goods:
Do what they are made to do.
Are acceptable in appearance and finish.
Are free from minor defects.
Are safe and durable.
The Act's terms "reasonable" and "acceptable" are deliberately open-ended. It depends on what a reasonable consumer would think was acceptable based on the nature of the goods, the price, and any statements that have been made about the goods. A concert violin is required to meet a higher standard than a child's cheap instrument. Ultimately a tribunal referee or a judge may have to decide what is reasonable or acceptable in the circumstances.
If a defect was pointed out to you before you bought the good, then it doesn't count towards making it unacceptable.
This buying checklist is brought to you by consumer.org.nz. Last reviewed Apr 2010.
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