Harvey Norman franchisees hauled back into court by the ACCC

The Australian Competition and Consumer Commission has re-instituted legal proceedings against nine Harvey Norman franchisees for allegedly misrepresenting consumer rights.

The consumer watchdog brought proceedings in the Federal Court in November last year against 11 Harvey Norman franchisees for allegedly misrepresenting consumer rights.

But the court dismissed all but one of the ACCC’s applications for injunctions against Harvey Norman franchisees because they were filed in a state where stores have no presence.

At the time, legal experts described this as a “bump in the road” for the proceedings and a “hollow victory” for the franchisees.

Sure enough, the ACCC has now instituted new separate proceedings against each of nine franchisees that were removed from the initial proceedings.

The ACCC has not issued new proceedings against one of the franchisees, Ipavit in Queensland, as it was deregistered as a company in November last year.

The watchdog claims franchisees made representations including that they had no obligation to provide remedies for damaged goods unless notified within a specific period of time, such as 24 hours or 14 days; they had no obligation to provide remedies for goods still covered by the manufacturer’s warranty; and that consumers must pay a fee for the repair and return of faulty products.

ACCC chairman Rod Sims said it is important for these matters to be considered by a court.

“The ACCC will continue to take enforcement action where it believes that retailers or manufacturers have misled consumers about their rights under the consumer guarantee provisions of the Australian Consumer Law,” he said in a statement.

Sims also pointed the finger at Harvey Norman itself.

“While the ACCC does not allege that Harvey Norman Holdings Limited is involved in making of these representations, the fact that the allegations made by the ACCC relate to a number of its stores in widespread locations across Australia is of great concern to the ACCC, and I expect to Harvey Norman too,” he said.

The ACCC is seeking court orders including penalties, declarations, injunctions and costs against each of the nine franchisees.

Melissa Monks, senior associate at law firm King & Wood Mallesons, told SmartCompany the ACCC is obviously determined to see the matter tested in court by continuing to invest funds in recommending proceedings.

“This is not surprising given the ACCC’s firm and public commitment to championing matters relating to the consumer guarantees and since the decision by the Federal Court did not impact the substance of the ACCC’s allegations,” she says.

SmartCompany contacted Harvey Norman but did not receive a response prior to publication.

 

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