CHOICE membership

Statutory warranties transferable?

If goods are sold privately (eg I buy an appliance off Gumtree, etc), does the ACL mandate that the statutory warranty must still be honoured by the original retailer (if I also get the original receipt, etc)?

I know most retailers will already handle warranties from anyone as long as they have the receipt, but is also a requirement under the ACL?

Looking through the ACCC site, it only gives these references, which seem unclear:

  1. Private sellers and auctioneers aren’t bound by consumer guarantees. (but do the original ones still follow?)

  2. ACL does apply to second hand goods (is this only from a business selling 2nd hand gear only?)

  3. The only mention of non-original purchasers relates to gift recipients being covered.

So are people buying goods off gumtree/ebay completely at the mercy of retailer goodwill?

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Good question - I think there is mention with some products that it applies to the original purchaser only, but with vehicles I believe it continues through as many owners as you can line up within the warranty period …

If Widget Manufacturing Company makes a kitchen widget they warrant to last 12 months and you sell it after 2, and it fails for the buyer after 3, can they escape it through a clause when they have essentially made a statement of warrantable life?

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Some products offer a Limited Lifetime Warranty, that is if it is still owned by the original owner or purchaser (as it may be gifted originally) the product remains covered for “Lifetime” but if resold or is later passed onto someone else this express warranty clause is rendered void. This is an express/extended Warranty ie offered to either enhance or add extra protection to your normal ACL rights and they cannot remove your ACL rights.

Private purchase & buying at auction ACL protection is limited to giving you clear title protection under ACL. That means if you go to a person’s house and buy their juicer, the ACL says you should have clear title, that is no one else has a right to recover/own that product. If the seller fails to ensure that, they have breached the ACL and you can seek compensation/refund if the goods are subsequently recovered by the person/business that has the title (right to own) that good or those goods. No other guarantees of the ACL cover your contract of sale between you and the seller. So things like fit for purpose, etc do not exist in that sale.

Of course if the “private” seller operates as a business then ACL does cover you. Auctions are a bit different as they only act as an agent to enable a transaction to occur between you and another party.

If it is a safety issue that becomes apparent then I would think anyone who now owns it would be entitled to recompense or replacement.

But to Ebay specifically, they have contractual obligations built into the terms we agree to on using them that protect for a number of ways both buyers and sellers.

For sellers
"eBay protects you from many events outside your control and is here for you when things don’t go as planned.

This policy outlines the protections eBay gives you if:

An item arrives late that you sent on time
There are carrier disruptions, bugs or severe weather
A returned item has been opened, used or damaged
A buyer retracts their bid or doesn't pay
A buyer changes their order or requests something extra
A buyer has an unusual rate of complaints or returns
Your seller performance standards are impacted
You send the item within your handling time to an international buyer
You have eBay Money Back Guarantee requests"

For buyers:
"Most eBay sales go smoothly, but if there’s a problem with a purchase, the eBay Money Back Guarantee assists buyers to receive the item they ordered or get their money back.

Buyers can use eBay Money Back Guarantee when:

They don't receive an item
They receive an item that does not significantly match the listing

Most sellers work with buyers to quickly resolve issues, but if a solution isn’t reached, buyers can seek assistance via eBay Money Back Guarantee."

and if you pay or sell using Paypal they also provide protections:

Buyer
"S9.1 The PayPal Buyer Protection Policy applies to payments made using our Services.

S9.2 If you are an eligible buyer, the PayPal Buyer Protection Policy can help you recover payments made in respect of certain items purchased where items are:

Not received; or
Significantly not as described. (my highlighting not Paypals)

S9.3 If your purchase meets the requirements for the PayPal Buyer Protection Policy, we will attempt to recover your payment from the seller.

S9.4 If you have received any cash back, rebate, credit or other promotional incentive from us or any third party for a purchase eligible for the PayPal Buyer Protection Policy, you may only recover the amount of your payments less the value of the cash back, rebate, credit or other promotional incentive.

S9.5 Where we are unable to recover the whole or part of your payment from the seller we may, in our absolute and sole discretion, decide to make a payment as a gesture of goodwill.

S9.6 You have no automatic entitlement to receive any payments under the PayPal Buyer Protection Policy.

S9.7 The PayPal Buyer Protection Policy does not indemnify you for loss which may be incurred and it is not a contract of insurance.

S9.8 If we determine a claim in your favour we will reimburse you the full purchase price of the item and original postage costs only. We will not reimburse you for the postage costs you incur to return an item to the seller or another party we reasonably specify.

S9.9 If the seller presents Proof of Shipment to your address, we may find in their favour even if you did not receive the item."

Sellers rights are also in the same section of Paypal’s rules but are harder to copy to here so I have instead left a link to the entire section and you need to look for Shecule 1 in that document https://www.paypal.com/au/webapps/mpp/ua/useragreement-full#int_Schedule_1

Gumtree offer no protection to either buyers or sellers

“Gumtree is a local classifieds website and ads aren’t reviewed before they go live on the site. Gumtree doesn’t offer any sort of buyer protection / payment programs. Any emails you receive that talk about such systems are scams, even if they may have the Gumtree logo. If you receive any emails promoting these services, please report it to us. If ever in doubt simply contact us and we’ll be happy to help.”

So my answers (and may be argued or corrected by others) to @bbuxton’s questions in order of their post are:

No the original ones don’t (except perhaps in the case of a safety recall)

Yes it applies only for a Business not a one off private sale (though again a Safety recall may be covered with the manufacturer/importer)

If buying off a retailer you are covered by ACL as they are a business.

If a private seller then on Ebay you may be covered by Ebay warranties/rules and if on Gumtree no you wouldn’t except for Clear Title (and again perhaps Safety recalls by the Manufacturer/importer).

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I would say yes as the ACL is about the product and not about who purchased it. If one can prove the date of purchase of a product (receipt, bank statement, tax invoice etc), then it should still be covered by a implied (under the ACL) or manufacturer warranty even if the original purchaser is not the owner.

In most cases the retailer will not know who purchased the product and therefore would be able to condition against the transfer of products to others as a void of a warranty. This is different for things like cars or houses (major life purchases) where the buyer is known as a result of licensing or other administration/contract processes.

But, there are risks as warranties (implied under the ACL or by the manufacturer) do not cover misuse or negligent actions of the owner. If a past owner, for example, misused the product and then someone else purchased it not knowing it had been misused, if the retailer/manufacturer determines that misuse has occurred, then repair or resolution under a warranty may not be possible. I suppose this is where the term ‘buyer beware’ comes for second had goods…and why for major purchases such as houses or cars, one often spends money to obtain independent advice on the condition of the house/car.

There is info about second hand goods and examples here.

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I think when other ACL rights are expressed regarding Secondhand goods this only applies if the goods are purchased from a business (whether sole trader, partnership or company) and not as part of a private sale eg bought at a garage sale.

"Consumer guarantees on products and services also apply to:

  • bundled products and services
  • gifts with proof of purchase
  • sale items
  • online products and services bought from Australian businesses
  • second-hand products from businesses, taking into account age and condition."

The ACL only expresses one right when purchased as a private sale and that is the right of Clear Title:

"Rights to a repair, replacement, refund, cancellation or compensation do not apply to items:

...//...
  • bought as a one-off from a private seller, for example at a garage sale or fete (but you do have rights to full title, undisturbed possession and no unknown debts or extra charges)"
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Don’t disagree as most second hand goods are sold without any paperwork (receipts, manuals, original packaging etc). However, if one has the proof of purchase as required under the ACL, then one should be able to exercise ones rights under the ACL. Receipts don’t contain purchaser information/details.

For example, say a family member gave you a 6 month washing machine because they were moving overseas and also gave manuals and purchase receipt. In 10 months from purchased it stopped working…I think that if you have the proof of purchase, you could exercise ones right under the ACL.

This is possibly why the car industry transfers warranties to any second/subsequent owners of cars if the car is still purchased within the manufacturer warranty period. The date of purchase (from the date of the original registration) is easily obtained and it would be very hard to void a warranty for second hand car purchased within the manufacturer warranty period.

I can see why second hand goods with no proof of purchase (which would be mostly the case) would be excluded by the ACL.

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It says gifts are covered under ACL so someone gifting you the washing machine would allow you coverage. Selling you it though no.

Cars many times come with extended/express warranties that extended your rights under ACL and these do cover subsequent owners.

The ACL is quite clear that refund, replacement, compensation etc do not apply to private sales. This by extension would void those rights to claim from the manufacturer, as it does not say except in the case of claims against the manufacturer.

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Well say you bought the same washing machine off your family, with receipts etc. I think it would still be covered as you have proof of purchase.

As outlined earlier, second hand goods purchased with proof of purchase would still still be buyer beware one doesn’t know if the purchase has been misused in the past…which could result in loss of any rights. It is however rare to see second hand goods with proof of purchase enlosed.

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If they don’t have proof you aren’t the original owner or that it was a gift to you then they probably would just accept that you are the original owner or gift receiver. But if they know you aren’t they have the right to refuse.

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Yes, but the reasonable person test possibly would also apply.

Another example could be we sometimes buy things in behalf of others (elderly family members, friends etc) and then get reimbursed later for the purchase (sometimes we might even try before handing it in if they indicate we can - use a new chair until they come snd collect it…use a electr9nic device to set up or see what it is like etc). This may be seen as a second hand transaction or different purchaser of the goods to the ultimate owner when a warranty claim is made. Even in this case, I suspect that a reasonable person would consider any claim for warranty under the ACL reasonable and fair.

I think having the proof of purchase would be critical.

It is a thought provoking topic!

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If a receipt has x name on it and y named person returns the goods because of some failure and demands ACL rights, then the business could rightly ask for proof whether it was a gift or not. So let’s say you purchased it in your name and then were reimbursed by your father, then technically it is secondhand and they have the right of refusal. Yes, you acted as an agent but you may require Statutory Declarations to help prove that and they might still contest that as would be their right. It would just be easier to say it was a gift you bought for him and avoid the extra hassle.

If you purchase the goods and instead put the receipt in your father’s name and he then reimburses you and he then returns the goods he will be covered by ACL as you acted as an agent only. It is obviously in his name so no questions about his ownership.

If you go to a garage sale and buy the goods and the person gives you the receipt, then under the ACL you are not legally covered (this is the law as printed), if the receipt was just a standard one out of a cash register you could bluff your way to coverage, but strictly under the Law you are not covered. If again it had a name different to your’s they would be well within their rights to refuse until you provided proof it had been a gift to you.

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So it looks like only the original purchaser has the right to a remedy for faults, under the ACL. I took another look through the text of the legislation and it does appear that it defines “the consumer” as the person who originally did business.

Perhaps the ACL needs to extend those rights to all subsequent owners? Otherwise I’d be hesitant to purchase second hand gear privately knowing it’s only the anonymity of an original receipt that might protect me.

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I am yet to see many (all) receipts with names of the purchaser…possibly only for major items such as cars or houses or those maybe requiring delivery (but this is usually on the delivery docket and not necessarily on the receipt)…

A credit card receipt will also suffice as a proof of purchase, and these usually only have limited details as well and not enough to determine purchaser.

Delivery dockets, statements of purchases and some tax invoices may display the purchaser or delivery address. These may be an issue if 9ne only has these and retailer/manufacturer requires identification to prove purchaser is owner.

So, maybe the refusals because not purchaser may be limited…unless one voluntarily discloses this when making a warranty claim.

I have also not been asked when returning a product back to the retailer. Even warranty claims for cars where they know your name, but not know you, have never been asked. Usually driving the car is enough.

This is what Consumer Victoria says about car warranty transfers…

Maybe transfers can only be excluded as terms of sale and not a general provision across all sales.

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Agree, especially where proof of purchase can be provided by the new owner. Maybe Choice should make a request for clarification/amendment to remove doubt.

A product’s quality, durability and longevity should be more important than the number of owners it has. A owner of a 12 month old fridge for example, should have rhe same consumer rights irrespective of whether they are the first (original) or second owner. Not providing the same rights cou,d be seen as discriminatory toward the seond owner.

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Some goods come with additional rights that allow for transfer of ownership and new owners being covered but as you point out the ACL really only protects the original purchaser or the person who received it as a gift.

As @phb notes this perhaps should be extended to the next owner/s if still within acceptable warranty periods but I don’t know if it will get much traction in Canberra, but it might

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The premis of the thread is [quote=“bbuxton, post:1, topic:15424”]
I know most retailers will already handle warranties from anyone as long as they have the receipt, but is also a requirement under the ACL?
[/quote]
that evolved into pondering government action.

Thanks to everyone for extracting clauses from the ACL, and it seems the general opinion is the answer is unclear and the ACL may need tidying up.

The definitive answer to the original premise would be from the ACCC. I sent that question (and a link to this thread) to the ACCC moments ago. I’ll post whatever they respond with.

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I decided to speak with our consumer rights advisors to see if I could get a definitive answer to this question. I’m paraphrasing a little hear but the short answer is that the ACL will not apply as there has not been a ‘supply’ of goods and services by the original retailer, so they the subsequent purchaser cannot exercise any rights to a remedy under the consumer guarantees against the retailer.

However, trade and commerce (which is undefined) does have a wide import under the ACL. The case law states that whether conduct is or is not ‘in trade and commerce’ will depend on whether it has a commercial or trading character.

For example, regardless of whether a private seller had an ABN or not, if that seller was selling a high volume of goods frequently on Gumtree/eBay their conduct may fall within trade and commerce( giving rise to obligations under the consumer guarantees).

Regarding manufacturer warranties, the warranty itself will state whether subsequent buyers can claim under the warranty, but they are usually limited to the original purchaser. One exception is a motor vehicle, where the warranty can be transferred to later purchasers.

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This is a question I asked and the response I got from the ACCC.

I have a question about warranties. I’m looking at possibly buying some secondhand goods that are still in their warranty period and has a copy of the the sales receipt but the manufacture is claiming on their website that the “warranties are non transferable”. Where do I stand on this if a warranty issue was to arise. Company is an operating in Australia with an ABN.

Hi Percy, warranties exist per product rather than per consumer. With that said, refunds would likely be out of the question in the event of a major fault as the original payment method would likely be tied to the original buyer. You would still be eligible for a repair or replacement.

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This is possibly what is important. One need to demonstrate the purchase date and the purchase place. If a receipt comes with the second hand goods, then any warranty claim should be honoured at the point of sale. The challenge is getting receipts when purchasing second hand goods as these are often discarded by the original buyer.

For general purchases, the terms and conditions of the warranty document applies. When purchasing items from a retail outlet (Good Guys, Harvey Norman) I always ask for a cash receipt. That way, if I want to sell the item later on, the receipt can be passed onto the buyer so the warranty passes on to them.

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