Compensation for damage and loss

You can ask for compensation for damages and losses you suffer if the supplier could have reasonably anticipated the problem. This is in addition to a repair, replacement or refund.

What compensation is covered?

Compensation should put you in the position you would have been in if the products or services had done what they are supposed to under consumer guarantees. This is usually a financial costs, but can also include lost time or productivity.

Example: A consumer took their curtains to a dry cleaner to be dry cleaned. When they went to pick up their curtains, they were badly damaged. The consumer is not only be entitled to a remedy for the defective service (a refund for the dry cleaning fee) but also have the dry cleaner pay for the loss incurred. This could include the dry cleaner paying to replace the curtains.

What is not covered?

Businesses don’t have to pay for damages or losses that:

  • are not caused by their conduct, or their products
  • relate to something independent of their business, after the goods left their control.

Misleading claims about compensation

Suppliers cannot mislead you about your rights to compensation.

Making a claim for compensation

Take the following steps to make a claim for compensation:

  1. Work out an accurate amount of compensation you would need to return you to the financial position you were in before the problem occurred.
  2. Contact the business verbally or in writing to explain the problem and present your claim for compensation. You may also want to ask for a refund or replacement.
  3. Show proof of purchase with a receipt or bank statement.
  4. If the supplier refuses to discuss your compensation claim or you cannot negotiate an agreement, you can seek formal dispute resolution or take legal action.

Need more information?

Go to the Australian Competition and Consumer Commision website for more information about your rights when with products and services bought before 1 January 2011.

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