17 August 2015 | Reading time: 2 minutes
Look out retailers … the ACCC is continuing its ‘big brother’ role in the consumer law space. In the recent Electronic Bazaar case1, the ACCC brought an action against Dhruv Chopra (Chopra) (trading as Electronic Bazaar) for contravening its obligations under the Australian Consumer Law (ACL). Amongst other sanctions described below, the Federal Court fined Chopra, a sole trader, $100,000 making it clear that small business owners are not exempt from their obligations under the ACL.
Guaranteed to mislead.
The concept of misleading and deceptive conduct, pursuant to section 18 of the ACL, is nothing new. What is less well known and disputed is the prohibition under section 29 of the ACL which provides that a person must not make false or misleading representations concerning the existence, exclusion or effect of any condition, warranty or guarantee, right or indemnity.
Chopra admitted to providing consumers with false or misleading representations pertaining to their right to a refund, repair or exchange of the goods where:
Suppliers and manufacturers cannot limit, restrict or exclude a consumer’s right to a refund, repair, or replacement under the ACL (the Consumer Guarantees2).
Payment without delivery.
Chopra received payment for goods that he failed to supply to consumers within the specified period agreed at the time of the transaction or within a reasonable period of time (if not period was specified) in contravention of section 36(4) of the ACL.
Back to school.
The Federal Court ordered Chopra back to school to undertake compliance training in relation to his ACL obligations. Unfortunately for Chopra, the Federal Court also made the following orders:
No matter how big or small.
As we warned in our recent post about the appliance giant Fisher Paykel3, the Chopra decision should be a stark warning to all businesses, no matter how large or small, that they may be penalised should they mislead consumers or fail to provide consumers with their goods within the specified or reasonable period of time.