Some eleven franchisees of the Harvey Norman, a large Australian-based retailer of electrical, computer, furniture, entertainment and bedding goods, have been slapped cases by the Australian Competition and Consumer Commission (ACCC) in the Federal Court on alleged consumer rights misrepresentation.
The national consumer watchdog alleged the store's 11 franchisees, found in Queensland (Bunavit in Bundall, Ipavit in Ipswich, Oxteha in Oxley), New South Wales (Camavit in Campbelltown, Gordon Superstore in Gordon), Western Australia (Avitalb in Albany, Mandurvit in Mandurah), Victoria (HP Superstore in Hoppers Crossing, Salecomp in Sale) and Tasmania (Moonah Superstore and Launceston Superstore), misled and deceived customers when in made false claims about warranties and refunds of products.
In its case against the franchisees, the ACCC said the business entities argued they have no obligation to refund or exchange goods found with a major fault, which infringes the Australian Consumer Law.
"If an item purchased breaks down within a short time of being purchased, the consumer may be entitled to a refund or a replacement item," Rod Sims, ACCC chairman, said in a statement.
"These rights cannot be excluded, restricted or modified," he said, adding consumers had the right to certain remedies when goods were not of acceptable quality nor fit for the purpose for which they were sold.
Consumers also have no obligation to pay fees for the repair and return of faulty products.
As part of the alleged misrepresentation, the ACCC is seeking penalties, declarations, injunctions and costs. If found guilty, each store would need to pay a penalty of up to $1.1 million.
The matter is set down for a directions hearing on December 19.