The Law Handbook 2024

708 Section 7: Consumers, contracts, the internet and copyright ACL). This applies even where the goods are not bought directly from the manufacturer or importer. Whether a time period is ‘reasonable’ depends on the type of goods. For example, a reasonable period will be longer for parts for new cars than for cheap toys. A manufacturer is not liable after a specified time if it took reasonable steps to ensure that the consumers are advised in writing, at the time of purchase, that repairs or parts won’t be available after a certain time (s 58(2) ACL). This guarantee does not apply to goods bought at auction. Express warranties A manufacturer guarantees that it will comply with any express warranties (extra promises) given by the manufacturer in relation to the goods (s 59(1) ACL). Similarly, a supplier guarantees that it will comply with any express warranty given by the supplier (s 59(2) ACL). ‘Express warranty’ is defined broadly (s 2 ACL) and includes any undertaking, assertion or representation: • about the quality, state, condition, performance or characteristics of the goods; • about the availability of parts, repairs, or identical goods; and • the natural tendency of which is to induce persons to acquire the goods. This guarantee does not apply to goods bought at auction. Title, undisturbed possession and undisclosed securities Several consumer guarantees protect consumers when a seller does not have the right to sell the goods. These guarantees do not require the supply to be ‘in trade or commerce’, which means that they apply to all sellers, whether or not they are operating a business. These guarantees also apply to goods bought at auction. First, the supplier must have the right to dispose of the goods (i.e. they must have clear title in the goods) at the time the consumer acquires property in the goods (e.g. by taking delivery of the goods) (s 51 ACL). This means that when a consumer buys goods, there is a guarantee that ownership rights are passed to the consumer. The only exceptions are: • where there is a clear intention that the consumer will not obtain clear title in the goods (e.g. where the goods are provided for a limited period); or • where the goods are hired or leased because the consumer does not expect to own the goods outright. Second, consumers have a right to undisturbed poss­ ession of goods (i.e. that no one will try to repossess or reclaim the goods) subject to any security, charge or encumbrance (e.g. a mortgage) that was disclosed to the consumer when they purchased the goods (s 52 ACL). This guarantee applies to hired or leased goods, but only for the period of the hire or lease. Further, if the consumer purchased the goods under a payment plan and the consumer fails to make the payments, the seller may be entitled to repossess the goods. Third, goods supplied to a consumer must be free from any undisclosed security (e.g. a mortgage), charge or encumbrance unless it has been disclosed to the consumer (s 53 ACL). This guarantee does not apply to goods that are hired or leased. Consumer guarantees: Services Services must be rendered with due care and skill Suppliers guarantee that services will be provided with due care and skill (s 60 ACL). This means that the service provider must use an acceptable level of skill or technical knowledge and take necessary care to avoid loss and damage. Services must be fit for specified purpose Suppliers guarantee that services will be reasonably fit for any purpose that the consumer made known to the supplier, either expressly or implicitly (s 61 ACL). The services – and any product that results from those services – must be of such nature, quality, state or condition that they might reasonably be expected to achieve the consumer’s desired result, if the consumer has made this known to the supplier or the supplier’s agent. This guarantee only applies if it was reasonable for the consumer to rely on the skill and