We can't help you': Harvey Norman fined for misleading consumers about their rights
Date
January 18, 2016
Canberra Times
A Harvey Norman franchisee has been fined $52,000 for repeatedly telling customers with new but problem-plagued computers that it couldn't help them.
The Federal Court found a Harvey Norman store on the Gold Coast breached two sections of consumer law by falsely telling customers with malfunctioning computers that it had no obligation to provide a remedy and couldn't assist any further without payment.
The Harvey Norman electronics chain has now paid $286,000 in penalties for misleading consumers about their rights.
One woman, whose Sony laptop sometimes failed to start, failed to shut down and was slow, kept being told by a salesperson: "We can't help you."
One man, who complained his new Acer desktop randomly froze and shut down, was told on two occasions: "There's nothing we can do."
Under consumer law, products sold in Australia come with a consumer guarantee, meaning they must be of acceptable quality. If not, the retailer must offer a repair, replacement or a refund.
The proceedings were brought by the Australian Competition and Consumer Commission.
"This penalty is a timely reminder to all businesses, whether large or small, that they must not mislead consumers about consumer guarantee rights under the Australian Consumer Law," the ACCC's acting chairman Michael Schaper said.
The latest order bumps up the total amount of penalties paid by Harvey Norman franchisees in regards to false or misleading representations about consumer rights to $286,000.
In 2014, four franchisees were hit with penalties ranging from $10,000 to $26,000 - an Oxley store in Queensland, a Gordon store in NSW, and Mandurah and Albany stores in Western Australia.
Justice John Dowsett said, in imposing a penalty of $52,000 against Bunavit, the operator of the Bundall superstore in Queensland, he took into account that there were more impugned statements than in other comparable cases, the conduct continued over a longer period, and more staff members were involved.
He also took into account Bunavit's sales revenue of nearly $70 million and net profit of $1.2 million in 2012-13 - "significantly larger" than other stores in comparable cases.
In the Bunavit case, the salesperson told the customer with the faulty Sony laptop that they couldn't help her and to approach the manufacturer.
But when she received her laptop back from an Sony-authorised service centre, it had developed more problems. Again, Harvey Norman told her to go back to Sony.
When she got her laptop back for the second time, the DC input wasn't working, meaning she could no longer charge the battery.
Harvey Norman employees then told her the DC input issue was her problem, they couldn't help her unless she wanted to pay, and they were not willing to pay for a refund or replacement.
"The reason is that you did not come to us for the initial repair," a salesperson said.
"If you send the laptop back to Planet Tech to repair the DC input issue, then we will agree to pay for half of the repair costs," the same salesperson said later on the same day.
Only after she lodged complaints with the ACCC and the Queensland Office of Fair Trading did Harvey Norman begin fixing the laptop problems.
Justice Dowsett said broad denials of liability by a retailer may lead a consumer into thinking the persistence required would be "too much trouble, with too little assurance of a satisfactory outcome".
"A great number of electronic devices are purchased by consumers from retailers such as Bunavit. Consumers frequently return such devices, claiming that they are faulty, or not of an acceptable quality," he said.
"A retailer should ensure that its staff members are informed about, and conduct themselves in conformity with, the Australian Consumer Law."
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