Under the Australian Consumer Law, certain consumer guarantees apply automatically, including that a service (and any resulting product) will be fit for a particular purpose or desired result specified by the consumer, either expressly or implied.
If it is not, the consumer is entitled to a remedy. The type of remedy depends on whether the problem is major or minor.
Major problems
It is a major problem if the service has not achieved what the consumer told the salesperson they needed it to do or what it is normally supposed to do, and this problem cannot be fixed quickly or easily.
Remedies for major problems
The consumer can choose to:
- cancel the contract and pay a reasonable amount for the work done, or seek a partial refund of money already paid, or
- keep the contract and negotiate a reduced price for the drop in value of the service —this may mean asking for some money back if the consumer has already paid.
Minor problems
If a problem is not major, the consumer must give the business a chance to fix the problem before asking for a refund.
Remedies for minor problems
The consumer can require the business to fix the problem.
If the business refuses to fix the problem or takes too long, the consumer may:
- be able to get it fixed by someone else and recover the costs
- cancel the contract and pay a reasonable amount for the work done, or seek a partial refund of money already paid.
When this guarantee does not apply
This guarantee does not apply to professional services provided by a qualified architect or engineer (continuing an exemption granted in previous laws). Architects or engineers must provide services with due care and skill.
The 'fit for purpose' guarantee will not protect consumers if they did not rely, or it was unreasonable for them to rely, on the supplier's skill or judgment when agreeing to particular services.
For example, it may not be reasonable to rely on a receptionist in a large service company for advice about which specific service out of a range of options is suitable.
Also, a consumer is not entitled to a remedy when a supplier does not meet this consumer guarantee due to something:
- someone else said, did, or failed to do (excluding the supplier’s agent or employee), or
- beyond human control that happened after the goods or services were supplied.
This consumer guarantee does not apply to insurance contracts.
Disputes
If there is a problem with a service, or if you are having a dispute with the supplier, view our Resolve your problem or complaint section.