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Refund policies punted: ACCC investigation forces AFL/ NRL clubs to re-think returns on merchandise

25 September 2018

#Competition & Consumer Law

Dan Pearce

Published by Dan Pearce, Emily Booth

Refund policies punted: ACCC investigation forces AFL/ NRL clubs to re-think returns on merchandise

Has your team bowed out of the finals race over the weekend in devastating fashion? Sorry, you aren’t entitled to refund on your new merchandise for a ‘change of mind’ (or missing out on the premiership).

However, it was announced recently that 21 AFL and NRL clubs had made changes to their refunds and returns policies following an investigation by the consumer watchdog, the ACCC. The ACCC commented that each club’s statement only provided a right to refund in very specific circumstances.

Apparently, the policies made claims which were considered misleading, including that: 

- merchandise must be unworn

- consumers weren’t entitled to a refund for sale items

- items must be returned within a limited timeframe to receive a remedy.

In fact, a consumer’s rights under the Australian Consumer Law (ACL) are much broader than this. 

Frustratingly for some retailers, there is no specified cut off time after which a refund on an otherwise faulty item can be refused after purchase. If an item has a fault or defect, the test is whether that product has a “failure” under the ACL and a range of factors are taken into account to determine this. These might include how long such an item would usually be expected to last, or whether, in the event the consumer knew the item had such a defect, they  have still chosen to buy it.

If the product is considered to have a “major failure” the consumer will be entitled to a choice of refund, repair or exchange. If the product is considered to have had a “minor failure” the retailer will be able to make this choice and limit the remedy to a repair or exchange.

Purchasing an item on sale or wearing an item will not, of itself, exclude any rights to refund or return the item. Retailers also must not mandate, as some clubs did, that an original receipt be presented when returning an item, as there may be other ways the consumer can evidence it was purchased from the retailer.

The investigation is a good reminder to other businesses with refunds and returns policies, or that provide warranties on their products and services, to review their policies with the broad scope of the ACL in mind and especially consider any statements made that appear to limit a consumer’s rights.

Authors: Dan Pearce & Emily Booth

Contacts:

Melbourne

Dan Pearce, Partner
T: +61 3 9321 9840
E: dan.pearce@holdingredlich.com

Sydney

Angela Flannery, Partner
T: +61 2 8083 0448
E: angela.flannery@holdingredlich.com

Brisbane

Trent Taylor, Partner
T: +61 7 3135 0668
E: trent.taylor@holdingredlich.com

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Dan Pearce

Published by Dan Pearce, Emily Booth

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