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Harvey Norman Franchisee Hit With Penalties Of $52,000

Harvey Norman Franchisee Hit With Penalties Of $52,000

The Federal Court has ordered Harvey Norman franchisee Bunavit to pay $52,000 in penalties for making false or misleading representations regarding consumer guarantee rights, the Australian Competition and Consumer Commission (ACCC) has advised.

The ACCC stated that it has now obtained penalty orders totalling $286,000 against 10 Harvey Norman franchisees with regard to false or misleading representations regarding consumer guarantees.

The court held that Harvey Norman Superstore Bundall in Queensland, operated by Bunavit, sales representatives made 10 false or misleading representations concerning the existence, exclusion or effect of a guarantee or right, the ACCC stated.

The sales representatives made statements to two consumers which represented that Bunavit: had no obligation to provide a remedy and the consumer would need to pursue the manufacturer’s warranty directly with the manufacturer, and could not assist further unless the consumer paid for some or all of the cost of the repair.

“In imposing penalties of $52,000 against Bunavit, Justice Dowsett took into account that there were more impugned statements than in the other comparable cases, the conduct continued over a longer period, more staff members were involved and Bunavit’s turnover and profit were substantially higher than those of the other offending companies,” the ACCC stated.

“However, unlike some of the other cases, none of Bunavit’s senior staff were involved.”

ACCC acting chair Dr Michael Schaper noted that under the Australian Consumer Law products sold in Australia come with a consumer guarantee that they will be of acceptable quality.

“Faulty products must be repaired, replaced, or a refund must be provided by the retailer,” Dr Schaper commented.

“This penalty is a timely reminder to all businesses, whether large or small, that they must not mislead consumers about consumer guarantee rights under the Australian Consumer Law.

“Businesses are expected to take appropriate and effective steps to ensure that their staff understand the rights of consumers and the obligations of businesses under the consumer guarantees provided by the Australian Consumer Law.”

The court declined to make declarations as it considered the penalties were sufficient to address the conduct, and declined to order injunctions, in part because Bunavit has ceased trading, the ACCC advised.

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