The ACCC appears to be stepping up its campaign to enforce the new Australian Consumer Laws, with Harvey Norman the latest to attract proceedings in the Federal Court for allegedly misrepresenting consumer rights – in conversations across the counter.

In October the ACCC also instituted proceedings in the Federal Court in Sydney against HP Australia for alleged contraventions of the ACL.

Eleven franchised Harvey Norman outlets are involved, all separate companies due to the franchise structure upon which much of Harvey Norman has been built. Each franchisee is liable for fines of up to $1.1 million.

‘In all 11 cases, the misrepresentations were made orally by employees of the relevant Harvey Norman outlet to customers.’

The ACCC alleges that the stores engaged in misleading or deceptive conduct by making false or misleading representations to consumers about their rights under the consumer guarantee provisions of the Australian Consumer Law (ACL).

In all 11 cases, the misrepresentations were made orally by employees of the relevant Harvey Norman outlet to customers. Additionally, in one case, a misrepresentation appeared on the receipt provided to the customer.

The Harvey Norman franchisees are: Avitalb Pty Limited, Albany, WA; Bunavit Pty Limited, Bundall, QLD; Camavit Pty Limited, Campbelltown, NSW; Gordon Superstore Pty Limited, NSW; HP Superstor, Hoppers Crossing, VIC; Ipavit Pty Limited, Ipswich, QLD; Launceston Superstore Pty Limited, TAS; Mandurvit Pty Limited, Mandurah, WA; Moonah Superstore Pty Limited, Tasmania; Oxteha Pty Limited, Oxley, QLD; Salecomp Pty Limited, Sale, VIC.

In its court filing the ACCC states:
– the Harvey Norman Superstore at Mandurah claimed that Panasonic was charging an $88 fee for the return of a defective camera when there was no such fee, or the fee was payable by Harvey Norman;
– the HP Superstore at Hoppers Crossing told a customer to return a faulty laptop directly to the manufacturer because ‘If we send it back… there is a cost and you will have to pay it up front’ and ‘it is not up to Harvey Norman to replace your laptop’;
– a customer of the Sale Harvey Norman store was allegedly told four times they could not receive a refund as it was not ‘company policy’;
– the Launceston Superstore told a customer that ‘we don’t do refunds or replacements’;
– Harvey Norman Oxley allegedly claimed ‘we have different rights to other retailers’;
– Harvey Norman’s Albany Superstore told a customer that ‘if it’s a software issue, it wouldn’t be covered’;
– Problems with a product purchased through the Bundall Superstore should be taken up with the manufacturer, Sony, and not the retailer, as it was ‘still under manufacturer’s warranty’;
– The Gordon Superstore allegedly told a consumer: ‘I will get Samsung to pick it up. You won’t get your refund until Samsung picks it up’ and, ‘You are not entitled to a refund’.

Similar claims were made against the remaining stores.

‘The Australian Consumer Law provides consumers with rights to certain remedies from retailers and manufacturers when goods fail to comply with the consumer guarantee provisions, including that goods are of acceptable quality and fit for the purpose for which they were sold,’ said ACCC chairman Rod Sims. ‘These rights cannot be excluded, restricted or modified.’

‘For example, if an item purchased breaks down within a short time of being purchased, the consumer may be entitled to a refund or a replacement item.’

The ACCC alleges that the Harvey Norman stores misled consumers about these rights by making representations including that:
– the franchisee had no obligation to provide remedies for damaged goods unless notified within a specific period of time such as 24 hours or 14 days;
– the franchisee had no obligation to provide remedies for goods still covered by the manufacturer’s warranty;
– the franchisee had no obligation to provide refunds or replacements for particular items such as large appliances or items priced below a certain amount, and;
– consumers must pay a fee for the repair and return of faulty products.

The court orders the ACCC is seeking include penalties, declarations, injunctions and costs.

The matter is set down for a hearing on December 19.

Earlier this year the ACCC embarked on a national consumer guarantees awareness raising campaign, ‘If it’s not right, use your rights. Repair, replace, refund.’

‘Consumer Guarantees has been identified as a national priority by ACL regulators and is a matter of particular concern for the ACCC, with more than 16,000 contacts from members of the public to the ACCC’s Infocentre so far this year,’ Mr Sims said.

The ACCC says it is conducting a number of investigations into other large manufacturers and retailers for alleged misrepresentations of consumer guarantee rights.