The owner of an online children’s clothing store has been fined $3000 in a Queensland court and ordered to pay customers compensation after the state’s consumer watchdog received complaints from customers that they had placed orders for but never received them.
The operator of retail store Boy Jungle pleaded guilty in the Beenleigh Magistrate’s Court to failing to supply goods within a specified time frame, according to the Queensland Office of Fair Trading (OFT).
The business sold boys’ clothing and accessories via a standalone website. Online business listings for the company reveal concerns from customers, including that goods were not provided upon payment and that the business did not respond to complaints via any of its listed communications channels.
“Have tried emailing, calling, Facebooking and now each of these options have been disconnected!” one customer said in a review on True Local last year.
Queensland’s consumer watchdog started an investigation into the business in November 2015 after receiving nine complaints from customers who claimed they never received the items they had ordered from the store.
The OFT initially issued a civil penalty notice to the business operator, but said it later instigated court action because customers weren’t repaid after the notice was issued.
The business owner was ordered to pay $3000 in fines, $676 in compensation to nine customers, and $92 in court costs.
The Queensland Office of Fair Trading has confirmed to SmartCompany that the Boy Jungle business is not actively trading. The company’s website is now offline and the business operator could not be contacted.
Communication with regulators is key
Commercial lawyer and principal at Enco Legal Narissa Corrigan says while businesses are issued with warnings from watchdogs “fairly frequently”, there are steps a business owner can take to work through an issue with consumer regulators before it gets to the point of court action.
While a body like the Office of Fair Trading Queensland is not necessarily obliged to enter a discussion with a business about their unique situation, “there is always the opportunity to negotiate a resolution with them,” Corrigan says.
Securing refunds for customers when goods haven’t been supplied is a key priority, so if a business is issued a civil penalty notice ordering it to give customers refunds, it might be worth entering a discussion with the regulator if a business can’t resolve this straight away.
“It’s in their interests that the customer gets repaid,” she says.
Corrigan says instances of online retailers being unable to supply goods to customers happen quite frequently.
“I think it’s probably quite common, because it’s quite easy to set up an online store without having the capital behind it to keep going,” she says.
While the businesses that ultimately get in hot water on this issue are a “small minority” overall, Corrigan says it’s a good reminder for early stage businesses to make sure their operations can actually deliver what they have to under Australian Consumer Law.
“They should make sure they are aware of what their obligations are under consumer law, and any issues with this,” she says.