Consumer Guarantees Act
1993
1A Purpose
(1) The purpose of this Act is to contribute to a trading environment in which—
(a) The interests of consumers are protected; and
(b) Businesses compete effectively; and
(c) Consumers and businesses participate confidently
(2) To this end, the Act provides that consumers have—
(a) certain guarantees when acquiring goods or services from a supplier, including—
(i) that the goods are reasonably safe and fit for purpose and are otherwise of an
acceptable quality; and
(ii) that the services are carried out with reasonable care and skill; and
(b) certain rights of redress against suppliers and manufacturers if goods or services
fail to comply with a guarantee.
Consumer Guarantees Act
1993
• Guarantees to consumers – protection for problems which arise with
goods or services post-sale
• Provides remedies
• Complements Fair trading Act – Part 1 which provides for protection for
problems which arise from misleading conduct regarding, or false
representations made about, goods or services pre-sale.
Note:
Act binds the Crown s3
Generally No contracting out except for business
transactions s43(1), s43(2). Attempting to contract out is
an offence against s13(i) of the Fair Trading Act 1986 s43(4)
Includes gifts s24
Excludes private sales s41(1) and supplies by charitable
organisations s41(2)
Consumer
A “Consumer” is someone who:
acquires goods or services of a kind ordinarily acquired
for personal, domestic or household consumption or
use…”
Acquires from a “supplier”, s2 (someone in “trade”)
(exceptions s41(1) sales not in trade i.e. private sales
and s41(2) charitable organisations.
Goods
“Goods”, defined in s2
“Goods” are defined as those items of personal
property of any kind (tangible and intangible) and
capable of possession, i.e. chattels, shoes, books,
computer software
Includes goods which have become attached to, or
incorporated in real or personal property, i.e. wheel to
a car
Of a kind ordinarily acquired for personal, domestic or
household use or consumption; s2(1)(a) “consumer”
Does not come within any of the exceptions under s2(b)
Services
“Services”, defined in s2
“Services” applies to a wide variety of performances of
work and trade
May be personal service, or may take place in
association with provision of goods
May produce some tangible result or may relate to
something intangible
Supplier
“Supplier”, defined in s2
Covers a wide range of activities which are commercial
in nature
Does not apply in private capacity
Overview of guarantees and remedies
under the CGA for goods and services
See figures 7.1 and 7.2 in textbook, pages 303 and 304
Part 1 of the Act provides a number of guarantees in
respect of goods:
Must be a consumer
Goods must come within definition of the Act
Consumer Guarantees Act 1993 – ss 5 to
13 (guarantees in respect of supply of
goods)
S5 – Guarantee as to title in goods
S5(A) – Guarantee as to delivery
S6 – Guarantee as to acceptable quality and s7 meaning of acceptable
quality
S7A – Guarantee of acceptable quality in supply of gas and electricity
and s7B gas and electricity not to be treated as goods and their supply
not to be treated as a service.
S8 – Guarantee as to fitness for a particular purpose
S9 – Guarantee that goods comply with description
S10 – Guarantee that goods comply with sample
S11 – Guarantee as to price
S12 – Guarantee as to repairs and spare parts
S13 – Express guarantees
See textbook pages 305 to 312
Consumer Guarantees Act 1993 – ss 28
to 31 (guarantees in respect of supply of
services)
S28 – Guarantee as to reasonable care and skill
S29 – Guarantee as to fitness for a particular purpose
S30 – Guarantee as to time of completion
S31 – Guarantee as to price
See pages 320 to 322
Remedies – three categories
Remedies available where goods or services fail to comply
with guarantees:
• When failure can be remedied (fixed);
• When the failure cannot be remedied (fixed) or is of a
substantial character;
• Damages for consequential loss.
See pages 316 of textbook
Rights to remedies
See Figure 7.2 on p 304 in text book
Using the PowerPoints and the flow chart
will greatly assist you in working your way
through the legislation
Remedies – failure can be
remedied (fixed) – GOODS
First give the supplier the opportunity to repair the goods:
S18(2)(a) and s19(1)(a)(i)
(If the supplier is unable to repair the goods they can replace
the goods with goods of identical type (s19(1)(b) and
s19(2) or give a refund s19(1)(c) and s19(3))
Then if the supplier won’t repair the goods or won’t repair
them in a reasonable time
have goods repaired elsewhere, supplier must pay the cost
s18(2)(b)(i) or
reject the goods s18(2)(b)(ii) (see also ss20 and 22) and
get a refund s23(1)(a), s23(2) and s23(3) or a
replacement s23(1)(b) and s23(4)
Remedies – failure cannot be remedied
(fixed) or is of a substantial character-
GOODS
See s21 (a), (b), (c), and (d) for definition of “failure of
substantial character”
S18(3)(a) (see also ss20 and 22) reject the goods; get to choose
• refund s23(1)(a), s23(2) and s23(3)
or
• replacement s23(1)(b) and s23(4)
or
S18(3)(b) choose compensatory damages
Remedies – failure can be
remedied (fixed) – SERVICES
First give the supplier the opportunity to remedy the failure:
S32(a)(i)
Then if the supplier won’t remedy the failure or won’t remedy
within a reasonable time
S32(A) have failure of service remedied elsewhere, supplier must
pay the cost
Or
S32(B) (see also ss35 and 37) cancel the contract and get a
refund s38
Note: s33 exceptions
Remedies – failure cannot be remedied
(fixed) or is of a substantial character –
SERVICES
See s36 (a), (b), (c), and (d) for definition of
“failure of substantial character”
S32(b)(i) (see also ss35 and 37) cancel the
contract and get a refund s38
or
S32(b)(ii) get compensatory damages
Note: s33 exceptions
In addition to other remedies the
consumer may be eligible for
consequential loss
Damages for Consequential Loss
In addition to other remedies
• S18(4) for goods
• S32 (c) for services
Recap Questions
What is a ‘consumer’?
What does it mean to be ‘in trade’?
What are the 2 exceptions under section 41?
Can someone who receives goods as a gift access the
remedies under the Consumer Guarantees Act 1993?
What section?
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