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Noel Leeming fined $200,000 for misleading consumers about their rights

Retailer Noel Leeming Group Limited has today been fined $200,000 for misleading consumers about their rights under the Consumer Guarantees Act, following a Commerce Commission prosecution.

Noel Leeming was convicted on eight charges under the Fair Trading Act, for making false or misleading representations to consumers about their rights under the Consumer Guarantees Act.

Each charge related to a different complainant and the conduct occurred between September 2015 and January 2017 at seven Noel Leeming stores across New Zealand. The complainants purchased consumer goods such as mobile phones, laptops and household appliances.

Consumers were misled about the right to seek remedies for faulty goods from Noel Leeming rather than the manufacturer, the right to a refund for a faulty product and the right to a replacement for a faulty product.

Noel Leeming made misrepresentations such as that claims under the Consumer Guarantees Act about an iPhone had to be negotiated with Apple directly, the act “is not effective for” Noel Leeming, and a consumer was not entitled to a refund despite false representations made about the suitability of a mobile phone.

Other misrepresentations were that a consumer had to contact Microsoft about a faulty product, that Noel Leeming could repair a fridge as many times as it liked and that the consumer could only get a store credit to purchase another fridge.

Another misrepresentation was that mobile phones are only replaced within 14 days, and a new phone could only be obtained if a fault occurs three times.

“These statements are simply wrong," Commissioner Anna Rawlings said.

The Consumer Guarantees Act entitles consumers to receive a remedy from Noel Leeming, as the supplier, and supplier cannot refuse to deal with its customers and refer them to the manufacturer, she said. 

The act is also clear about the circumstances in which a refund or replacement is available, and these statements should not have been made to consumers,” Ms Rawlings said.

In sentencing in the Auckland District Court today, Judge Nicola Mathers said there were “direct and significant departures from the truth in every case … consumers were denied their rights and had real difficulty dealing with Noel Leeming.”

One complainant told the court that he got “disruptions, anxiety, stress, [and] the feeling that I was the bad guy because I was inconveniencing them, making their life harder.”

Laptops for sale in a shop. Source: istock.com


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