Australian Consumer Law Interpretation; Replacement or Refund?

dna level c on 16/02/2018 - 22:29

I purchased a microwave from Costco about 9 and a half months ago, I paid $160 at the time.

For the last couple of weeks I've been experiencing a major problem, essentially half the time I try to use it the microwave doesn't do anything and then turns itself off, which Costco agreed was a major problem.

I took the microwave back to Costco today with original purchase receipt, original box, etc. I explained what the issue was and asked if they could replace the product. I was advised that they only offer refunds, I explained that I would prefer to have the product replaced as they are currently selling it for $190, they advised that replacing the product was not an option.

I then asked if I could purchase the same microwave again right now for $190 and then return the defective one for a $190 refund, they advised this was not an option either.

I then cited Australian Consumer Law, in specific this portion from the website "When you have a major problem with a product, you have the right to ask for your choice of a replacement or refund." - "your choice of a replacement or refund", I made sure to repeat that part to them.. but I was again rebuffed.

I ran through this with the person at the refunds counter, her manager and the 2IC manager at the store, being told by all 3 that a replacement was not an option, even under ACL, but that I could have a refund. We disagreed on the interpretation of ACL.

After speaking with the 2IC manager, we came to the agreement that they would refund the microwave for $160, the 2IC would take my details, research ACL and then contact me with an outcome in a few days. I was planning on buying another one in the meantime for $190, but as I finished up the refund with the original person who assisted me the manager radioed back to advise that I could purchase another one for $160.

Although it worked out in the end, I'm wondering if I was entitled to a replacement under ACL, or if their remedy of only offering a refund for $160 was correct?

TLDR: Bought microwave for $160, it stopped working properly, price is now $190, I wanted a replacement, Costco only wanted to give me a refund for $160, meaning I would have to pay an extra $30 to replace it.

General Discussion

Comments

  • oscargamer on 16/02/2018 - 22:46
    +1

    is the model currently being sold EXACTLY the same as the one you bought?

    exactly the same in every detail?

    • dna level c on 16/02/2018 - 22:47

      Yes, 100% EXACTLY the same.

      • payton on 16/02/2018 - 23:02
        +1

        you may as well take the $160 and buy a different brand elsewhere that hopefully not as prone to major defects

    • payton on 16/02/2018 - 23:01
      +6

      a decent microwave for home use (not office/commercial) should last many years

      • citygal on 16/02/2018 - 23:16
        -8

        Please refer s 140 and s 142 of ACL

        If no safety defect exists, they may not be liable to refund or replace

        Also, they are entitled to compensate you with the AMOUNT of loss suffered

    • blitz on 16/02/2018 - 23:44
      +4

      Every sentence there has an error.

      • ronnknee on 18/02/2018 - 17:16
        +3

        Looks like a major defect. Can we replace citygal?

  • fossilfuel on 16/02/2018 - 23:20
    +7

    The new consumer guarantees provisions of the ACL mean that businesses dealing with defective goods must provide a repair, replacement or refund, and if there is a major failure with an item, the consumer has the right to chose the remedy, including requesting a refund. link

    The new ACL guidelines specifies that the consumer can choose between a repair, replacement or refund in the case that there's a MAJOR FAILURE with the product. In this case, you have the right to choose either a replacement or refund. I guess the manager and 2IC realised that they goofed and then radioed through to allow you to purchase an identical item at what you paid for originally.

    "Replaced products must be of an identical type to the product originally supplied. Refunds should be the same amount you have already paid, provided in the same form as your original payment."

  • hashtagbargain on 16/02/2018 - 23:29
    +5

    Glad you stood vindicated in the end. I’d agree with your interpretation of the ACL.

    However if you wanted to avoid the whole saga, you could have bought a new microwave at 190, then returned the old one with the new receipt.

    • dna level c on 18/02/2018 - 19:47

      I thought about that, but I didn't figure that I would experience the issues that I did when returning the item. Hopefully Costco learns and updates their internal policies to meet ACL.

    • SirFlibbled on 19/02/2018 - 16:04

      It's hardly even an interpretation. In this case, it's so obvious that Costco staff clearly have a reading and understanding problem.

  • p1 ama on 17/02/2018 - 00:37
    +1

    I don't know why you're so hell-bent on buying the same model that crapped out on you in the first place.

    • dna level c on 18/02/2018 - 19:50

      I like the microwave, it's got good power and it was a good price. Hopefully the issue I experienced doesn't happen again, if it does then I'll return it to Costco, get a refund and buy something else.

  • jace88 on 17/02/2018 - 08:06

    Regardless of warranties by manufacturer (which should cover this?), there's also statutory consumer guarantees which apply here around quality (it's also the reason why Apple gives 2 year warranties on everything here now instead of 1 like other countries).

    This guide might help: https://www.choice.com.au/shopping/consumer-rights-and-advic…

  • oscargamer on 17/02/2018 - 10:21
    -2

    The good thing about what happened to you is that you get a new 12 month warranty. This would not have been the case if they had done a warranty replacement with the first one.

    • oscargamer on 17/02/2018 - 13:45
      +1

      can someone explain the neg vote?

      • Gotchas on 17/02/2018 - 23:43

        Maybe because ACL covers you for the replacement one under consumer guarantee
        But you are correct that the voluntary warranty they supply resets

  • exc3113nce on 18/02/2018 - 18:28

    Yep as everyone else here has said, since it's agreed it's a major fault, and 10 months would likely be within the rejection period, then under s263(4)(b) of the ACL you're entitled to reject the goods and elect to have the rejected goods replaced with goods of the same type, and of similar value, assuming that the goods are reasonably available to the supplier (which we can assume).

    Just note the act says goods of the same type and of similar value, so it doesn't have to be the exact model. I haven't checked case law though.

  • Toons on 18/02/2018 - 20:15

    Normally if it's a failure within 30 days of purchase you are entitled to a replacement some actually just do this anyway as there is no value in repair cost for some items.

    After that it's up to the company you bought it from if to Attempt repair of the item as they need to ensure it's faulty before handing a refund or replacement and sometimes the cause.

    If it's a flat out Major failure, The choice is yours if they have the same exact model in stock model in stock

    The price is a null factor if you happened to buy it on sale and it's failed they are obligated to replace it like for like

    This is often where they try to con you into taking a refund then paying the extra when all you wanted was the same working piece of kit. they believe they are going to lose money but it's not their contract is with the distributor or manufacturer so they loose nothing. The faulty one is actually replaced with a brand new one by the company to costco

    Some credit cards actually double your warranty period automatically if you used the card to purchase the item they cover failed items too.

    • SirFlibbled on 19/02/2018 - 16:07

      There is no 30 day rule in the ACL.

  • Toons on 19/02/2018 - 18:37

    I didn't actually know about it or could find it either (manufacturer CSG let it slip and said anything with a demonstrable fault has to be replaced if the fault appears within 30 days of delivery )that was the key word i was over 30 on the date it was purchased but the delivery date was 3 days later keeping me under. it was that fact i'd just made it under that he mentioned it.

    Perhaps it's a clause in Home appliances and electrical goods not a broad brush which is why you might need to read some of the fine print.

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