LG Renegs on Refrigerator Warranty. What Should I Do?

Zaddo on 04/01/2019 - 12:41
Last edited 04/01/2019 - 16:02

The compressor died in our LG Refrigerator after 8 years. LG has a 10 year parts only warranty on their compressors. So I submitted a warranty claim, estimating I would be out of pocket about $500 labour to get the refrigerator repaired and hopefully get another 3-5 years out of it. Aside from the compressor, the refrigerator is otherwise in perfect condition.

I paid Endeavour (LG Appointed service company) $170 for a service call and to confirm the compressor was stuffed. LG Subsequently advised that they no longer stock the compressor and instead offered a drop in value settlement of $437. After strongly expressing through several emails and phone calls that I do not accept the settlement offer, LG will not budge.

Some points:
- Original cost was $2870
- Straight line depreciation on Refrigerator with zero residual after 8 years is $574
- ACCC website advises "A warranty is a voluntary promise offered by the person or business who sold the product or service to you. Once you buy the product or service, the promise becomes a right that can be enforced under the ACL."
- LG Warranty guarantees parts replacement. There is no mention in the warranty that they may offer compensation.
- I was not advised before paying for a service call that the part could not replaced. Further adding insult to injury and taking away my opportunity to decide if I wanted to pay the service fee.

I believe LG are violating the law because they are not fulfilling their contractual obligations. They have not been transparent with how they calculated their settlement value, nor been up front when I first contacted them by letting me know that they could not replace the compressor.

I am prepared to fight this, to the extent that it doesn't cost me more than the refrigerator is worth to me, by my estimates $900 (Based on $400 residual value with 8 years depreciation).

The options I am considering are:
- Small claims court
- Social media blitz to communicate with as many people as possible to let them know the truth about LG warranties.

I have replaced the Refrigerator because it has been 7 weeks since the compressor died. I am determined to pursue this out of Principal more so than getting fair compensation.

I welcome any advice on what the best course of action is.

Warranty Document

Poll Options

  • 3
    Small Claims Court
  • 1
    Social Media Blitz
  • 2
    Report to Australian Authorities
  • 18
    Accept Settlement Offer
  • 1
    Other
Electrical & Electronics Refrigerator

Related Stores

LG Australia
LG Australia

Comments

  • spackbace on 04/01/2019 - 12:43
    +5

    I have replaced the Refrigerator because it has been 7 weeks since the compressor died.

    If it was me, push for the $437 plus the $170 for the technician :)

    I wouldn't bother with small claims personally, that requires a day off work plus added stress.

  • Melb69 on 04/01/2019 - 13:21
    +1

    If you have the time. Don't take this crap. Go to small claims aiming for a new refrigerator that works if they don't have replacement parts. AS you have already replaced it. Just on sell the fridge. Or possibly get the off set cost as reimbursement for your new fridge would be better. ie get the value of cost of the LG fridge from LG as compensation.

    I am possibly in a similar situation down the track. FP have already replaced a compressor and other parts as it started to make excessive noise. They have replaced just after warranty as we did get them to check it just near the end of warranty so issue recorded and was advised to monitor it over time. Which it never got better. They had to take the fridge away, but did provide a loan one which was say about 4 days.

    Fight it.

  • [Deactivated] on 04/01/2019 - 13:42
    +1

    Go straight to Tracy.

    Here are her details..

    https://en.m.wikipedia.org/wiki/Tracy_Grimshaw

  • bargainhunter87 on 04/01/2019 - 13:46

    Sell the fridge for $250

    You were expecting to be out of pocket $500

    LG are offering you $437. (maybe negotiate to get them to add the $170 call out).

    $250 + $500 + $437 + 170 = $1357 = more than enough money to buy a nice fridge.

    You may be right in principle but you won't be much better off in "winning." Also - it is not unreasonable for a company not to have parts 8 years down the track. $500 odd dollars for a 8 year old, non-working fridge is not a bad outcome in my books.

    Life is short. Spend it doing things that actually add value to your life - like sitting on ozbargain responding to forums.

    Cheers.

  • Richardc on 04/01/2019 - 13:53
    +4

    10 yr warranty with no part, I would call this false advertising。

  • whooah1979 on 04/01/2019 - 14:28

    Check the compressor start relay for ticking noises. If it does, then buy a ~$40 part and DIY.

    • Zaddo on 04/01/2019 - 15:53

      Thanks. I will give that a go once I finalise things with LG. I don't want to mess with the compressor if they end up trying to repair it.

  • serpserpserp on 04/01/2019 - 14:43
    +1

    I think you should post a copy of the Warranty contract that LG say they are abiding by. Only then can we give you actual considered advice. You haven't really said what LG's response was to you asking for higher compensation. When you refused their offer, what was your counter for what you wanted? You did give them a counter right?

    • Zaddo on 04/01/2019 - 16:00

      I have placed a link above to a picture of the warranty card.

      When I rejected their offer, I told them that I thought a fair settlement was $900. That is based on a straight line depreciation for 8 years with a $400 residual value. After all, a working fridge still has value to the owner. I made this offer on one of the phone calls, the consultant told me that the offer could not be changed. I then escalated to their manager, who told me the same thing. So I emailed them my counter offer. I haven't had a response to my email which was sent just before Christmas.

      • serpserpserp on 04/01/2019 - 16:10
        +1

        Little confused by the terms in the warranty card, they list a compressor under the sealed component of the document but then have a separate section for a linear compressor, is the linear compressor the fault here?

        I think you have a decent case if it is the latter. I think at a minimum you should aim for cost of compressor (last known market value) plus straight line depreciation with zero residual after 8 years ( which you pointed out is $574). You are entitled to the part, and given the fridge doesn't work, you should get the value of your fridge if it was working.

        I'm surprised they didn't come to the party and offer the cash that they did and then say 30-40% off a new LG fridge. Might not be what you are after but would at least be tempting.

        • Zaddo on 04/01/2019 - 16:21

          Thanks for your support. That is exactly my thoughts and I would have taken a discounted fridge had it been offered. Yes it was the linear compressor that failed. This was the first model fridge that had this type of compressor from LG. Because it was new technology at that time, the 10 year warranty gave me peace of mind with the purchase.

          This is the email I sent to LG. I might taken a little poetic licence to the full compensation value.

          HI Mark,

          I recently phoned your customer information centre to try and negotiate a fair resolution to this warranty claim.

          I advised them that I was willing to accept $900 in compensation. I will accept this only if this matter can be resolved amicably before any legal action is initiated.

          I have copied an exert from your warranty card below. This clearly states that Australian Customers are guaranteed a replacement or refund for a major failure.

          By your own warranty card information, it clearly states that you must refund the full purchase value of the refrigerator or provide a replacement refrigerator.

          In addition, compensation is due for the loss of food we had stored in the refrigerator.

          Full compensation is therefore in excess of $3,000. I feel that $900 is a very fair offer. Should this matter not be resolved in a reasonable time (less than 2 weeks from now), I will seek full compensation through what ever means are available to me under Australian law.

          I appreciate your prompt response to this offer.

          Regards,
          Tony

          • serpserpserp on 04/01/2019 - 18:43
            +1

            @Zaddo: Be careful with your letter wording, I think the section entitled "Australian Customers" means that the Guarantee/Warranty provided by LG does not exclude you from your rights under ACL. However 8 years for a fridge might be deemed a reasonable life for the product so what is outlined under this section may not apply. Try sticking to the section specifically outlying the entitlements under the linear compressor section as this is the part of the warranty which will ultimately apply to your situation.

            Compensation will ultimately be capped at the price you paid for the fridge I'd say, so I'd refrain from inflating past that number, otherwise you may come off as being unreasonable and LG will wait until you pursue legal action. Which ultimately you don't want because there is always a risk you could lose and ultimately, who doesn't want a quick and easy resolution in these situations?

            Good luck.

  • cushydeskjob on 04/01/2019 - 17:53

    Personally I'd settle for their compo plus the $170 reimbursement. I had a thousand dollar, four year old Samsung die on me and got diddly. Do you wanna be right or do you wanna be happy?

    • serpserpserp on 04/01/2019 - 18:45

      I'd be with you, but his fridge did cost him in excess of $2,800. So at that level I'd think you have a better case to proceed with than a 1k fridge. Plus the compo plus $170 is most of your fridge cost.

  • Capo93 on 05/01/2019 - 12:28
    +1

    I am a state technical representative for an appliance manufacture that I will not name, it is not LG.

    Ill start with manufactures are not required to have parts available for X period of time.

    Liner compressors are very efficient as they have less moving parts, however everything does fail. The compress is probably an inverter compressor so it would not have a start relay.

    What I would have done in this case would have offered you a pro-rata, in the case of a 8 year old fridge, you would receive 30% off a new fridge, depending on the fridges RRP this would vary, so I think what they have offered you is fair.

    • Zaddo on 05/01/2019 - 19:39

      I appreciate the advice. The insight into how these businesses work will help me find the best settlement I can hope to achieve.

      I understand the logic of your argument. But it totally ignores the 10 year compressor warranty LG sold with the fridge. Under Australian Consumer Law they are obligated to meet the commitments they made in the warranty. Are you saying that white good manufacturers side step these legal obligations? Or when they can't replace part, just change the rules? (not trying to be argumentative, just trying to understand the internal procedures)

      You would offer 30% but LG only offered 15%…. If they had offered 30% I would probably have accepted and been happy.

      • Capo93 on 06/01/2019 - 11:12

        No I would not say they side step legal obligations. Unfortunately they don't stock that compressor anymore so what they have done is offer you compensation. If the compressor isn't made anymore, they can't supply it.

        To be honest, if they still had the compressor I would estimate you would have been out of pocket at least $500+ to change the compressor. Labour minimum of 4 hours, Endeavour probably would charge somewhere around $110 an hour or more for labour, gas/solder & filter drier. Depending on your house they might take the fridge away to workshop to complete the repair. So to be honest from my experience I think you're best to take the money and run.

        You're not being argumentative, you are just trying to get value for your money and I'm happy to help.

        Off the top of my head, yes our company would off offered 30% off the cost of buying a new fridge from us, we do not pay the compensation in money. I can confirm tomorrow if 30% is right for that age.

        As another example, LG offer 10 years warranty on the direct drive motors on their washing machines, I've had the main bearing in the tub fail, in turn it has taken the motor and gear box out and a few other parts, LG will cover the motor but you're still up for the cost of the other parts.

      • Capo93 on 06/01/2019 - 13:31

        I confirmed my spread sheet, we would of offered 30% off the RRP price of a new fridge.

        • Zaddo on 06/01/2019 - 23:22

          Thanks very much. Hopefully LG have the same policy and were just low balling me. I will try to negotiate them up to the 30%.

          I will post back with the outcome.

  • Baysew on 05/01/2019 - 14:39
    +1

    Ill start with manufactures are not required to have parts available for X period of time.

    Vs

    Manufacturers and importers guarantee that their goods:

    are of acceptable quality
    have been accurately described
    satisfy any manufacturer’s express warranty
    have spare parts and repair facilities reasonably available for a reasonable period of time, unless the consumer is advised otherwise.

    • Capo93 on 06/01/2019 - 11:19

      are of acceptable quality - The unit was of acceptable quality at the time of import/sale, it has lasted 8 years to prove that.

      have been accurately described - It was described accurately.

      satisfy any manufacturer’s express warranty - This is the part that's under dispute.

      have spare parts and repair facilities reasonably available for a reasonable period of time, unless the consumer is advised otherwise. - I would say parts were available for a reasonable period of time. What is the definition of "reasonable period of time", ACCC will not give you a time frame. I might say 8 years is reasonable, someone else might say 5 & you might say 10. Unfortunately a lot of the consumer law is grey and up to your own interpretation.

  • HighAndDry on 07/01/2019 - 11:44

    Straight line depreciation on Refrigerator with zero residual after 8 years is $574

    Nothing depreciates linearly.

    Keeping that in mind, their offer seems reasonable, especially if you can get the $170 technician fee comped too.

  • Zaddo on 10/02/2019 - 21:55
    +1

    Happy Ending: I went to Harvey Norman where I bought the refrigerator. They were sympathetic and said they would see what they could do. It took a couple weeks for them to come back to me. They gave me an offer of a full refund!!!! Yes, a full refund on the original purchase price. They even came and picked up the refrigerator for free.

    Go Harvey Norman GO!!!!!

    • Matt2024 on 09/03/2019 - 03:27
      +1

      Nice result. Had a similar situation with a washing machine that fried itself 1.5 years out of warranty.

      Rang HN .. was told to ring manufacturer.
      Rang manufacturer .. stuffed around all day.
      Rang HN again .. explained to manager about wasted time etc .. he said would u like to come down and pick a new unit.
      Shit Yes .. tyvm

      I realise that its discretionary and probably the fact that we have bought major items through them quite a few times, was in our favour.
      But we savoured this victory nonetheless LOL.

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