Understanding your consumer rights can help you avoid costly mistakes. Before you buy:

• think about what you want the product or service to do
• shop around and compare quality and price
• take your time and avoid impulse shopping and you will end up buying exactly what you need, at a price you can afford.

It is illegal for retailers to mislead you or use
high-pressure selling tactics. When you have made your purchase, keep the invoices, dockets or receipts supplied by the trader. These are your proof of purchase and may be required if you need to return the goods.

What are your basic rights as a consumer?

The goods you purchase must:

• comply with any product information and safety standards applying to them (eg. care labels on garments and textiles, safety instructions on dangerous goods)
• have accurate information provided with them and include any information required by law, such as:
  • price and content details
  • weight of package.

• be and remain free of debt, charges or mortgages, ie. ‘clear title’, unless they are disclosed or known to you before you agree to buy the goods
• be of ‘merchantable quality’ ie. meet the basic level of quality and performance expected, considering their description, price and other relevant circumstances. Goods that have a fault should be labelled as seconds or damaged stock

• be fit for a particular purpose if you have made a specific purpose known to the seller and have relied on the seller’s skill or judgement
• match any description or sample (eg. if the package displays a picture or describes the contents, the contents must match that description).

Implied warranties also apply to second-hand goods.  

Goods bought at auction are not covered by implied warranties. However, the seller is obliged to provide ‘clear title’ unless any debt, charge or mortgage is otherwise disclosed or known to you before you agree to buy the goods.

Retailers or manufacturers cannot avoid or change implied warranties. They apply even if you do not return the manufacturer’s guarantee card or notice provided with the goods.

Services you purchase should be performed with due care and skill. Any materials supplied in connection with services should:

• be reasonably fit for the purpose for which they are supplied
• be of a nature and quality that might reasonably be expected if you have made known to the supplier the result that you want from the services.

Any problems under an implied warranty can be dealt with by the seller. Do not be misled by the seller into thinking you must only deal with the manufacturer.

What are voluntary warranties?

Retailers and manufacturers sometimes supply goods on terms additional to the implied warranties. They are usually in writing, may only be available in certain circumstances and may be subject to time limits. Some examples are:

• a store may give you a full refund on any goods purchased from it even if you change your mind
• a 3 year warranty on your car.

Additional warranties that go beyond the implied warranties are called voluntary or express warranties. Voluntary or express warranties cannot replace or restrict the operation of implied warranties. If a seller tells you about a voluntary warranty, they must abide by it.

IMPORTANT – If a manufacturer or a retailer fails to stand by its voluntary warranties, you can seek compensation for any loss suffered as a result.

Refund, repair or exchange?

You are entitled to ask the trader for a refund if the item you bought is:

• not of ‘merchantable quality’
• not the same as the item described in advertising or by the salesperson
• not fit for the purpose you made known to the trader and you have relied on the trader’s judgement.

Instead of requesting a refund, you may wish to negotiate with the trader to repair or exchange the item.

The trader does not have to provide a refund if you:

• were responsible for damaging the item by not following the instructions or misusing the product
• have changed your mind
• knew, or should have known, about a fault when you purchased the item (eg. if the product was marked as a second*)

• were unable to prove where and when the item was purchased (this is where keeping receipts will help).

* If a second has a fault that you were not aware of, or could not have discovered upon reasonable inspection, you may still be entitled to a refund.

What if the store has a ‘No refunds’ sign?

A sign in a store that says ‘No refunds’ is illegal as it misrepresents your rights if the product is, for example, faulty. Other examples of illegal signs are ‘No refunds after 7 days’ or ‘We will exchange or repair or give credit notes but we do not refund’. However, a sign which states: ‘No refund for incorrect choice’ or ‘No refund if you change your mind’, is legal. If you have an issue you cannot resolve with a retailer contact Fair Trading
on 13 32 20.

How do lay-bys work?

There are no credit charges to be paid with a lay-by but you don’t receive the goods until you have completely paid for them. You select the items you wish to buy and enter into an agreement with the store to pay a deposit and the balance of the cost in regular instalments.

Lay-bys can be arranged for goods being made to order but it is not advisable to enter into a lay-by for unseen goods. It would be better to wait until the goods have arrived in the store.

The paperwork for a lay-by sale is important. It sets out the arrangement between you and the store in a legal document.

The time-frame for a lay-by is flexible and could be anything from a few days to some months. It is up to you and the supplier to decide. The supplier is obliged to hold the goods over the agreed time.

When you set up a lay-by, you should get a written statement (eg. a stamped sales docket or a receipt).

This outlines the terms of the lay-by and should give details of the:

• purchase price and deposit paid
• dates on which instalments are due
• outstanding balance
• cancellation charge that may apply
• length of time the goods will be held.

A retailer does not have to allow you to inspect the goods during the lay-by unless it is specified on the statement. However, if it is convenient many retailers will do so as a goodwill gesture.

If you want to cancel a lay-by you may do so at any time without giving a reason. If the retailer won't accept the cancellation in person or by telephone, you should write to them. There may be a cancellation charge. The Australian Retailers Association recommends an amount between $25 and $30 per lay-by. However, retailers have the right to determine their own cancellation fee, which must be specified in the lay-by statement with the terms and conditions.

What are the rules on advertising?

Shoppers should receive accurate information about any products or services they want to purchase. It is illegal for a trader to make misleading or deceptive claims about goods or services, including:

• passing off used goods as new
• advertising products with false endorsements
• claiming benefits they simply do not have.

Buying online or from a TV advertisement?

Buying goods over the phone that are advertised on the television or buying on the internet can be a convenient alternative to shopping in person. However, you should take sensible precautions and not fall into the traps of high pressure sales techniques. If the product sounds too good to be true then it probably is.

When you purchase goods on the internet from overseas, NSW laws may only offer you limited protection. Consider the following when shopping online.

• Know who you are dealing with.
• Always phone or email when first dealing with a supplier.
• Compare prices by converting to Australian dollars.
• Check postage and handling costs.
• Check refund, warranty and return policies.
• Have a special credit card for online shopping with a low credit limit.
• Check if the site is secure before paying by credit card. Look for a key or closed padlock icon at the bottom of your web browser.
• Never give your personal bank details or passwords to anyone.
• Check ScamWatch www.scamwatch.gov.au and the National Fraud Information Centre (USA) www.fraud.org for the latest scams to avoid.

How can you use your credit card wisely?

Keep track of what you spend on your credit card. Buy at the start of the billing period to take full advantage of the interest-free period for up to 55 days, if applicable.

Some cards may charge the interest from the date of the transaction. Check all the terms and conditions as there are many different products available.

Buying from door-to-door sales people or telemarketers?

Door-to-door sales and telemarketing is also known as direct commerce. Under NSW law:

• sellers must not visit you between 8pm and 9am, 7 days a week
• you have a 5 day ‘cooling-off’ period during which you can choose to cancel a sale over $100

• you can ask sellers to leave at any time and they must do so as soon as practicable
• you must get written information about your cancellation rights before the contract is made; telemarketers must give you the information over the phone and follow up in writing.

The Commonwealth Government has set minimum standards for unsolicited telemarketing and research calls. A caller must not call or attempt to make a call as follows:

Days	Telemarketing calls	Research calls
Weekdays	before 9am or after 8pm	before 9am or after 8.30pm
Saturdays	before 9am or after 5pm	before 9am or after 5pm
Sundays	calls prohibited	before 9am or after 5pm
National public holidays	calls prohibited	calls prohibited

The Commonwealth Government has also established a Do Not Call Register to enable consumers to elect not to receive unsolicited telemarketing calls. For more information go to www.donotcall.gov.au or call 1300 792 958.

What are the rules on deposits?

When you place a deposit on an item, you may be entering into a binding agreement to proceed with the transaction. If you change your mind, the trader may keep all or part of your deposit, depending on the circumstances. Many traders will return your deposit as a gesture of goodwill. However, it is always a good idea to think the deal through before handing over a deposit.

What can you do if things go wrong?

Suppliers are required to follow consumer laws and most of them are reasonable and want to see their customers satisfied. However, if you feel you have been misled or wrongly treated, you can take the following action:

1. Speak or write to the supplier and explain how you want the situation resolved.
2. If this is unsuccessful, contact the Office of Fair Trading on 13 32 20 or lodge a complaint on our website at www.fairtrading.nsw.gov.au

Case study

Lyn bought a washing machine from a discount whitegoods store. The machine only worked for a day then broke down so Lyn called the store and they sent their repairer to fix it.

The machine worked for two more weeks and then broke again. The repairer returned and found the machine needed a new motor.

Lyn was sick of the machine not working so she tried to negotiate with the store to return it and get her money back. They refused even though Lyn kept her receipt as proof of her purchase.

Lyn then called Fair Trading and a customer service officer negotiated for the store to give Lyn a replacement washing machine.

Lyn received a replacement machine because the original washing machine was not of ‘merchantable quality’ – in other words the machine had a basic serious fault that Lyn did not know about at the time of purchase.