Know your rights
Services bought for personal or household use
Services normally bought for personal or household use are covered by the CGA if supplied by a business. You don't need to have a contract with the supplier. This also includes services where you have contracted a trader to sell an item on your behalf, eg a boat dealer, a car dealer or a recycled clothing trader.
Services covered include work done by;
- tradespeople and subcontractors who are contracted by the main contractor
- professionals, eg lawyers, accountants, doctors
- services relating to (but not for) the supply of gas and electricity, eg meter reading, disconnection
- services relating to and for the supply of telecommunications, water and wastewater removal
- other service providers, eg banks, repairers, insurance companies and much more.
Services for business use
The only time the CGA guarantees can be excluded (also called contracting out) is if you are acquiring consumer services for business use. The clause must be written and specifically state that the CGA is excluded.
It also has to be fair and reasonable to do so, which depends on:
- type of services
- their value
- the ability of the parties to negotiate, or if it is a ‘take it or leave it’ standard form contract
- legal advice received.
It’s an offence to contract out of the Act in any other circumstances under the Fair
Trading Act. See the Commerce Commission's factsheet on Misleading consumers about their rights (external link) .
Read more about Buying products and services for commercial use.
Deciding if a service is faulty
Reasonable care and skill
A service is faulty if the supplier did not use reasonable care and skill. What is reasonable can be measured against the care and skill used by other competent people doing the same work. Many suppliers are actually regulated by law with set standards of skill, eg electricians and the Electricity Regulations.
The Consumer Guarantees Act also provides guarantees that the services will be:
- fit for any particular purposes that you told them about
- completed within a reasonable timeframe if no timeframe provided
- provided at a reasonable price if no price is set.
If you get work done by a business or trader, that doesn’t meet any of these guarantees, you can seek a remedy from them. These guarantees apply automatically whether or not you have a contract with the business who provided the service to you.
Problems that can be fixed and are not serious
If the problem is minor, the business can choose to repair or refund your money.
If there are minor problems with the services, you can ask the service provider who did the job to fix it for free. If they refuse or take longer than a reasonable time to fix it or don't fix the problem, you can either:
- get someone else to fix it and claim the cost from the service provider
- cancel the contract for service and refuse to pay for the work done or get a partial refund if some of the work or materials are suitable.
A reasonable time depends on the nature of the problem. Sometimes a reasonable time will be a few hours, or it may be a few days.
Problems that can't be fixed or are serious
You can cancel the contract for the service and refuse to pay for the work done. You can also pay less than the agreed price or seek compensation for the value of the service that is less than the charge you have paid for the service.
Services are different to products in that you can’t return the service. So there are additional remedies that you can seek from a Disputes Tribunal or Disctrict Court.
Read Consumer Guarantees for services to find out more about these extra remedies.
A problem with services is serious if:
- a reasonable consumer would not have bought the service if they were fully aware of the problem
- the service output is substantially unfit for its usual purpose, and can’t be easily fixed within a reasonable time
- the service output is unfit for a particular purpose that you told the service provider you wanted to use it for, and can’t easily be fixed within a reasonable time, eg you ask to have your tree trimmed to let in more light and the arborist trims it to improve the shape
- the service output can’t be expected to achieve a particular result that you told the service provider you wanted, and can’t be easily fixed within a reasonable period of time
- the service output is unsafe.
But it is not always easy to decide if a fault is minor or serious. It is up to the business to assess the problem. They have to provide enough information for you to make an informed choice about your remedies, if the problem can’t be easily fixed.
If the business disagrees with your claim, you may have to get a technical opinion from someone who knows about that type of service to support your view that the fault is serious.
Compensation for extra losses (consequential loss)
If a faulty service has caused damage to your property, you can also claim compensation. But there’s 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 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 are not liable, unless the services are being bought for a business purpose.
Where you have a contract for work and materials
You can still claim under both sets of guarantees for products and services depending on the issue. The tradesperson or service provider is responsible for fixing any issues with materials they have supplied as part of the services. Read Faulty products to find out more about your rights.
Overcharging or incomplete work
You have rights when a tradesperson or other service provider does not finish the job or you are overcharged, even if the CGA doesn't apply. Usually you will have agreed some terms such as price, work to be done, and the materials to be used.
If you have a contract or quote with a tradesperson or other service provider and they don’t complete the work, this is a breach of the contract. Similarly, if you have agreed a price for the work, then this is the price that you pay. Find out more about overcharging or incomplete work in our contracts section.
When you can’t claim under the CGA
You can’t claim if:
- any service failure is due to events outside the control of a service provider
- you do not rely on a service provider’s skill or expertise, or this would be unreasonable to do so
- you rely on any act or statement made by someone other than the service provider or their agent.