Reading time: 3 minutes

This article is for businesses who sell goods or services to consumers with a warranty. You do not have to provide a warranty against any defects to consumers, but if you do, it must comply with the Australian Consumer Law requirements.

What is a warranty against defects?

Your promise to consumers to repair or replace goods, redo or fix problems with services, or offer compensation is a warranty against defects.

For the representation to be a warranty against defects, it must be made around the time that the goods or services are supplied.

The warranty can be written as a formal document or a label on the packaging of goods. As long as it promises that you will do something if there is something wrong the with goods or services, it can be considered a warranty against defects.

What are the requirements?

If you are providing a warranty against defects, you must present the information in a way to make sure the consumers understand the warranty and how they can establish a claim if there is a defect.

Labels on packaging may be considered to be a document that evidences a warranty against defects, or there may be another document inside the packaging that details the terms and conditions of a warranty. If both are present on and inside the packaging, they must not be inconsistent with each other to satisfy the requirements.

What information you need to include

Your warranty against defects documents needs to include certain information to comply with the requirements under the ACL.

In your warranty against defects, you will need to include details about:

  • what you promise to do if the goods are defective
  • the circumstances under which the consumer can make a claim for the warranty
  • the steps the consumer must take and how they can claim the warranty
  • information about your business including your name, business address, and contact details
  • the duration of the warranty
  • whether you or the consumer are to pay any expenses associated with the warranty claim
  • if the consumer can claim back the expenses incurred in a warranty claim, explain how to do so
  • the rights and remedies that the consumer has under the ACL in addition to the benefits of your warranty – there is a mandatory paragraph that you are required to include which covers this

Conclusion

Keep in mind that there are rules about misleading or deceptive conduct, so make sure your representations to your consumers are not false. The simple rule is to make clear promises to the consumer about what you will do and what they have to do, and then keep your word. If you need legal advice on the Australian Consumer Law, get in touch with LegalVision’s team of small business lawyers today.

Webinars

Construction Contract Essentials

Thursday 12 August | 11:00 - 11:45am

Online
Understand how construction contracts are drafted and how to protect your construction business.
Register Now

Startup 101: Understanding Cap Tables and ESOPs

Thursday 19 August | 11:00 - 11:45am

Online
Cap tables and employee share option plans are essential for fast-growing startups. Learn more with this free webinar.
Register Now

Expanding to NZ: Structuring Your Business For Success

Thursday 26 August | 2:00 - 2:45pm

Online
Launching a business in New Zealand? Understand how to structure your business for success with this free webinar.
Register Now

Preventing Modern Slavery: Your Business’ Legal Obligations

Thursday 9 September | 11:00 - 11:45am

Online
Are you an Australian business with $100m+ annual consolidated revenue? Learn how to determine if you are a modern slavery reporting entity and your obligations under the legislation with this free webinar.
Register Now

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. From just $119 per week, get all your contracts sorted, trade marks registered and questions answered by experienced business lawyers.

Learn more about LVConnect

Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • 2020 Excellence in Technology & Innovation – Finalist – Australasian Law Awards 2020 Excellence in Technology & Innovation Finalist – Australasian Law Awards
  • 2020 Employer of Choice – Winner – Australasian Lawyer 2020 Employer of Choice Winner – Australasian Lawyer
  • 2021 Fastest Growing Law Firm - Financial Times APAC 500 2021 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review 2020 AFR Fast 100 List - Australian Financial Review
  • 2021 Law Firm of the Year - Australasian Law Awards 2021 Law Firm of the Year - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer