The Consumer Guarantees Act (CGA) covers you for products that don’t do what they are meant to, or are defective or faulty in some way.
Any products you buy should be of acceptable quality. This means the products should:
- be satisfactory in look and finish
- be free from small faults
- last for a reasonable time
- be safe to use
- do everything they are commonly used for.
These factors are used to test whether a reasonable person would think a product is faulty or not, taking into account:
- who supplied the products, eg an established chain vs flea market trader
- age and type of products — second-hand products are more likely to show signs of use and may be less durable
- price — poor-quality products are usually cheaper
- statements made about quality or condition by the salesperson or in advertising.
If you are specifically told about any faults when you buy the product, you can’t claim because of them later on.
Manufacturer's warranties and extended warranties
If products come with a manufacturer's warranty, or you have paid for an extra extended warranty, your rights under the CGA still apply.
These extra warranties are in addition to CGA protections, so make sure it will offer you more than what you are already entitled to under the law. For example, a manufacturer might offer a 'lifetime warranty' for a product. Under the CGA a product only has to last a reasonable time, so this manufacturer's warranty would cover you even after your rights under the CGA have expired.
When you can’t claim under the CGA
You can’t claim if:
- you used the product in a way that a reasonable consumer would not
- you used the product so much that it is reasonable that it broke
- you broke or lost the product
- you modified the product and this is what caused the issue.
Consumer Guarantees Act
Common problems and what to do
What to do if:
It's an electrical product
Electrical appliances must be safe even if they are sold second-hand by a private seller. If you buy second-hand, get the product checked out by an expert or qualified person if you can.
All electrical products, new and secondhand, must comply with:
- electrical safety requirements
- product safety standards
- any unsafe goods notices.
It's a digital download or streaming
Digital products include software and internet downloads or streaming, eg music, games, movies and e-books.
The CGA applies to digital products. So you have the right to a refund, repair or replacement for faulty digital products supplied by New Zealand businesses.
Watch out for:
- illegal (pirated) copies
- faulty downloads
- unfair contract terms, eg limiting liability if downloading orstreaming doesn't work
- limited information on customer helplines and how to complain
- online scams.
The fault can be fixed and isn’t serious
You must give the retailer the opportunity to:
- repair the products within a reasonable time and free of charge
- replace products of an identical type and value within a reasonable time — you only have to pay the difference if you choose a replacement of greater value
- refund the value of the products in full, in the same form as your original payment.
If a product is faulty, the retailer can’t simply offer you store credit. They must fix or replace it, or give you a refund. A 'reasonable time' is how long it would take other retailers to fix or replace the products.
If they refuse to fix the problem, take longer than a reasonable time to fix it, or don't fix it at all, you can:
- get the products repaired elsewhere and claim the cost of those repairs from the retailer
- reject the products and claim a refund or replacement products.
All refunds must be paid in cash, or however the products were paid for originally.
It’s a serious fault
You can legally:
- keep the product and claim compensation for the loss in value
- reject the product and get an identical replacement
- reject the product and ask for a full refund.
If you reject a product because of a serious problem and ask for a refund, you don't have to accept a credit note or an exchange of products instead of cash.
A problem with a product is considered serious if:
- a reasonable consumer would not have bought the product if they had known about the fault
- products are significantly different from their description, sample, or demonstration model
- products are not fit for their normal or specific purpose and can’t easily be put right
- the products are unsafe.
Factors that influence whether a fault is serious include:
- If you have only had the products for a short time then the fault is more likely to be serious.
- The more expensive a product is, the more likely it is that the fault may be serious.
- How different the product is to any claims made in the advertising, packaging or made by the seller.
- If there have been any other faults — a series of minor faults might become serious if they add up to a loss of confidence in the reliability of a product.
The retailer must give you enough information to be able to make an informed choice about the remedies. If you choose to reject a product, you must do it in a reasonable time. A reasonable time means soon after the date you became aware of a defect.
It is your responsibility to return the faulty product to the business. If it’s expensive or complicated to return the item, the business must arrange for it to be collected, at its expense.
For example, if you’ve had a wood burner installed and don’t have the equipment or skills to remove it, the business must arrange — and pay for — someone to come and get it.
The fault caused extra losses (consequential loss)
If a faulty product has caused damage to your property, you can claim compensation. But there is a limit to what you can claim. The loss must be ‘reasonably foreseeable’ and you must minimise or avoid any extra loss if possible. Sometimes it is hard to put an amount on the loss you have suffered because the damage has also affected other property. You may need to seek legal advice on this.
A retailer or manufacturer can’t opt out of consequential loss so they’re not liable, unless the services are being bought for a business purpose.
You bought faulty products on credit
Although you should go to the retailer first to get faulty products fixed, let your lender know about the problem too.
If the retailer has gone out of business or refuses to act, you might be able to get a remedy from your lender instead if the retailer arranged the credit contract. In these cases, the lender is also responsible for quality guarantees under the CGA.
Contracts and sales agreements – cancelling a contract
You can't go back to the retailer
If the retailer has gone out of business or you have problems dealing with them, you may want to go to the manufacturer instead:
- If the fault has resulted in the products losing some of their value, you're entitled to ask the manufacturer for a refund of some of the purchase price. But, if they have given you a warranty saying they will repair or replace the products then you have to give them a chance to do that first.
- You can ask them to pay for any extra damage caused by the products (consequential loss), but not if the problem is caused by an event outside of human control, such as an earthquake.
You bought from an overseas seller
While your consumer rights might still apply when you buy online from overseas, it can be difficult to enforce them and resolve problems. Check the seller's website for terms and conditions including:
- return, exchange or refund policies
- complaints process
- consumer laws.
If you pay by credit card, you can ask your bank for a chargeback if your products don’t arrive. This reverses the charge on your credit or debit card. There is a time limit on getting a chargeback. Ask your bank or credit card company what it is.
We have industry-specific guidance, eg on electronics and appliances, and cars in our Help by product and service section.
Help by product and service
Get support at any point from:
- Citizens Advice Bureau (CAB) — a free, independent service, run by volunteers. CAB can advise you on your consumer rights and obligations, in person, by phone, or online.
- Community Law Centre — offers free one-on-one legal advice to people with limited finances. The organisation has 24 community law centres throughout the country. You can find legal information and other resources on its website.
Find a CAB(external link) — Citizens Advice Bureau
Our law centres(external link) — Community Law Centres
Take it further
If you can’t resolve your issue directly with the business, the Disputes Tribunal or District Court may be your next step. Bear in mind, if the seller is overseas it may be harder to enforce any formal decision.
What the tribunal can help with(external link) — Disputes Tribunal
If you think the business has misled you about your consumer rights, you can complain to the Commerce Commission. Commerce Commission doesn't act on behalf of individuals and can't investigate every complaint. But their investigations do help make sure businesses are complying with the law. Your information helps them assess which consumer issues are causing greatest harm.
Make a complaint(external link) — Commerce Commission