Business Law: Rob Adam explains new rules on faulty goods

Rob Adam, a partner at Ashton KCJ.

Rob Adam, a partner at Ashton KCJ. - Credit: Archant

The Consumer Rights Act which came into force on October 1, 2015, was heralded as a great innovation, providing much-needed clarity for consumers, and attempted to tackle head-on some of the failings of previous consumer legislation.

The Act spells out what consumers can expect from goods and services that they purchase from a business. Old phrases such as “satisfactory quality” survive from the earlier legislation.

Goods and services must be of satisfactory quality, and they must be fit for purpose, match their description, and should match any earlier samples provided.

The important terms of the contract must be prominent and transparent - it is not enough for those terms to be in writing, key terms should be brought to the attention of consumers.

One previous area of great uncertainty surrounded the right of consumers to reject goods, and the point at which that right was lost.

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The act introduces the concept of a short-term right to reject, whereby if the goods are defective, they can be rejected as long as they are returned within 30 days of purchase.

If the goods are defective, but not returned within 30 days, the seller has a right to try and repair the goods. If the goods are still faulty after that one repair, then again, the goods can be rejected.

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In both cases of rejection, the consumer should have their money returned to them in full, as long as rejection takes place within six months.

The Act is less certain around perishable goods. The Act suggests that rejection must take place sooner than 30 days, in essence before the goods themselves perish. There is one very important exception to this rule, which relates to motor vehicles.

If rejection takes place after six months, then the consumer would have to give some credit for use of the vehicle during that period. The Act also provides rights in relation to digital goods and stresses the availability of alternative dispute resolution for parties in dispute.

This is a welcome development at the consumers, and hopefully will give clarity and not only to consumers but also to businesses, around what has always been a difficult issue, namely when and how long consumers have to reject faulty goods.

: : Rob Adam is a partner at law firm Ashton KCJ.

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