Laws protect against 'lemons'

We have all heard horror stories about the infamous 'lemon' car - the brand new car that seems to have things continually go wrong with it as soon as it is driven out of the showroom.

People in this situation often aren't aware of the extent of their rights. 

Australian Competition & Consumer Commission chairman Rod Sims has recently commented on failures by automobile suppliers to acknowledge protections owed to consumers. This raises the question, what are these protections?

The Australian Consumer Law, which forms part of the Competition and Consumer Act 2010, sets out protections by way of 'consumer guarantees' that apply where goods (not just motor vehicles) have been purchased from a supplier engaged in trade or commerce. The guarantees do not apply to purchases by private sale or at auction. 

The consumer guarantees impose general obligations on suppliers, which include that goods supplied will be fit for the purpose they are provided; of an acceptable quality, including being free from defects; and last for a reasonable time. 

If the goods do not satisfy the requirements of the general obligations, a consumer is entitled to a remedy, which can be a repair, replacement or refund and compensation. 

If the problem is a minor one, the supplier can choose how to fix the problem. In the case of repairs, if these are not undertaken within a reasonable time frame, the consumer can have someone else fix the problem and seek compensation for any costs incurred. 

If there is a major failure, which could include issues such as the product being unsafe or having a problem that would have stopped someone from buying the item had they known about it, consumers are entitled to return the goods to the supplier in exchange for a full refund or a replacement.

The consumer guarantees apply irrespective of whether any warranty is provided by the supplier and, importantly, apply even after a warranty has expired.

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