Australian Consumer Law provides protection for businesses, not just your typical consumer

The Australian Consumer Law (ACL) has been in operation for over 3 years. It commenced on 1 January 2011.

Despite the name, a significant aspect of the ACL provides protection for business. Specifically, the statutory consumer guarantees contained in the ACL will apply to many goods acquired by small and medium sized businesses for use in their operation.

The statutory consumer guarantees relevantly, include that the goods supplied are:

1. fit for all the purposes for which the goods of that kind are supplied; and
2. acceptable in appearance and finish;
3. free from defects; and
4. safe; and
5. durable,

as a reasonable consumer fully acquainted with the state and condition of the goods would regard as acceptable having regard to the following:

(a) the nature of the goods; and

(b) the price of the goods; and

(c) any statement made about the goods on any packaging or label on the goods; and

(d) any representation made about the goods by the supplier or manufacturer of the goods; and

(e) any other relevant circumstances relating to the supply of the goods.

The reason why this Guarantee will apply to many purchases of goods made by businesses, is that the goods are deemed acquired by a “consumer” if the “amount paid or payable for the goods does not exceed $40,000.00”. Further, nothing in the definition restricts “consumer” to a natural person a company can be a consumer.

Exclusions

However, excluded from the scope of transactions which are regarded as acquisitions as a consumer, are acquisitions of goods:

(a) for the purpose of re-supply; or

(b) for the purpose of using them up or transforming them in trade or commerce through a process of production or manufacture or in the course of repairing or treating other goods or fixtures on land.

Enforcement

If you believe there has been a breach of one or more of the guarantees, my recommendation is that you follow this process:

1. bring the breach to the attention of the supplier;
2. if there is no satisfactory response, we send a letter of demand;
3. if still no satisfactory response;
4. I’ll advise as to the evidence you will need to establish your claim;
5. if such evidence is available, and the cost and stress is justified, consider commencing legal proceedings;
6. we can then draft the necessary documents and prosecute the claim on your behalf.