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Warranties

Types of warranties

Warranty against defects (manufacturer's warranty)

Express warranty

Extended warranty

Expired warranty

Warranty responsibility

Consumer guarantees

Repairs and replacements

Warranty against defects (manufacturer's warranty)

A warranty against defects (or manufacturer's warranty) promises the consumer that:

  • products or services will be free from defects for a certain period of time; and
  • defects will entitle the consumer to repair, replacement, refund or other compensation.

Example:

Sally buys a television that comes with a written warranty. The warranty says the manufacturer will replace the television if it breaks within three years of the initial purchase.

Warranty against defects document

A warranty against defects document must state:

  • what the business will do (eg, repair or replace)
  • what the consumer must do (eg, stop using the goods as soon as the fault is noticed and contact the trader)
  • the warranty period (how long the warranty is for)
  • how the consumer can claim the warranty (what the process is)
  • all information in a transparent way - in plain language, legible and clearly presented
  • prominently the warranty provider's business name, business address, phone number and email address (if any)
  • that the benefits to the consumer by the warranty are in addition to other rights and remedies available to consumers under the Australian Consumer Law.
  • mandatory text:
    • 'Our goods come with guarantees that cannot be excluded under the Australian Consumer Law. You are entitled to a replacement or refund for a major failure and compensation for any other reasonably foreseeable loss or damage. You are also entitled to have the goods repaired or replaced if the goods fail to be of acceptable quality and the failure does not amount to a major failure.'

Businesses can include extra information in a warranty against defects to explain how consumer rights apply under the ACL. The extra information must not limit or negate the mandatory text.

A warranty against defects may be a formal written document or any material with writing on it, eg, packaging or labelling.

Warranty against defects requirements

Warranties against defects may set out requirements the consumer must comply with, eg:

  • repairs must be carried out by qualified staff
  • repairs must be done according to the manufacturer's specification
  • quality parts must be used when required

If a trader or manufacturer wishes to seek to restrict a consumer's freedom to choose (eg specify who a consumer uses as a repairer), they should get legal advice on the prohibitions on Exclusive Dealing found in the Competition and Consumer Act 2010.  Basically exclusive dealing involves a trader imposing restrictions on a person's freedom to chose whom, in what or where they deal.

A warranty against defects may contain an express warranty.

Express warranty

Express warranties are any additional promises made by the trader or the manufacturer about the quality, performance or features of a product.

Example:

When John buys a hammock, the store says the hammock can hold up to 100 kilos. This is an express warranty, as it is a promise about what the goods can do.

Alternatively, you are entitled to:

  • ask the trader for a repair, replacement or refund depending on the nature and extent of the problem; or
  • seek compensation from either the manufacturer or the trader for any damage that may have been caused by the product being faulty and not complying with its express warranty.

Extended warranty

An extended warranty is when you choose to pay an additional amount (usually at the time of purchase) to 'extend' a manufacturer's warranty for a set period of time.

When a trader offers an extended warranty they must explain exactly what the warranty provides over and above the rights you already have.  For example the right to a refund or return if the product is faulty.

Example:

Kim buys a new blender. The salesperson informs him that he can pay an extra $50 to make sure the manufacturer's warranty lasts for seven years instead of five. This is an extended warranty.

Expired warranties

If a product turns out to be faulty, you may be entitled to a repair, replacement or refund, depending on whether the problem is major or cannot be fixed. This applies regardless of whether the product is still under warranty.

Example:

Chris buys a plasma TV for $8000. It stops working after two years. The trader says they will not provide a repair or replacement as the TV only had a 12 month manufacturer's warranty. The trader informs Chris that he should have bought an extended warranty, which would have given him five years' cover. However, it is reasonable for Chris to expect more than two years' use from an $8000 plasma TV. Chris is entitled to a repair, replacement or refund from the trader.

Other resources

PDF documents need a PDF reader. Please read more on free PDF readers. Contact us if you have difficulty viewing or printing the document or need the document in an different format. You can order a printed copy of a consumer guide by emailing consumer.affairs@justice.tas.gov.au or ring 1300 654 499.