General division case studies

All goods purchased have a basic implied warranty which requires the goods to be of 'merchantable quality', meaning that the goods must meet the basic level of quality and performance expected considering their description, price and other circumstances.  If the CTTT finds that the goods supplied were not of merchantable quality, orders can be made for a refund of the amount paid and return of the goods.

Case study 1: Leather lounge suite

A couple purchased a new three-piece matching leather lounge suite for their home from a furniture retailer.  Soon afterwards, defects were discovered with two of the lounges and both were returned to the retailer for repairs.  One lounge was repaired satisfactorily, however the second lounge had to be returned several times for further repairs.  After the fourth repair, the lounge was returned to the couple with new leather and timber inserts.  However changes were made that altered the lounge’s appearance, and the colour of the new timber and leather no longer matched the other two lounges.

The couple applied to the CTTT for a full refund of the amount paid for the lounge suite.  At the hearing the couple gave evidence that the goods for which they had paid, being a lounge suite with all three parts matching in design, material and colour, was not what they had received.  In response, the retailer denied any liability for a refund, stating that the couple saw the final repairs at the shop.  The retailer claimed that this was an acceptance of the repairs and in effect this amounted to a ‘waiver’ in respect of any difference to the other lounges.

The Tribunal Member decided that when the couple inspected the final repairs at the retailer’s premises they would not have been in a position to identify the extent of the colour difference of the leather, and would not have been in a position to compare the differences in the timber insert panels.  The inspection of the lounge therefore could not amount to a waiver or an acceptance of the defects in the seat, and consequently failed to satisfy the terms of the agreement between the parties.

The Tribunal Member found that the retailer had an obligation to supply the couple with a matching three-piece lounge piece and that what had actually been supplied was in breach of that obligation, despite the various repairs which had been carried out.  Final orders were made for the retailer to pay the couple a full refund and to collect the defective lounge suite from the couple’s home within three weeks.

Case study 2: Furnishings

A woman engaged an interior designer to help her choose and arrange for curtains in her recently renovated home.  From a sample book, the woman chose an ivory yellow colour fabric with distinctive weave pattern to match the decor of the house and newly installed carpet.  The designer then arranged for the fabric purchase and manufacture of the curtains.

When the curtains were delivered and installed, the woman found that the colour of the curtains had a pink hue and pattern of the fabric did not at all match the sample she had chosen.  The woman then lodged an application to the CTTT seeking $4,500 compensation from the interior designer.

At the hearing, the woman gave evidence that the designer did not check the sample against the purchased fabric, and that she was not consulted prior to the manufacture of the fabric into curtains.  The designer gave evidence that a slight dye-lot variation to the sample book was 'commercially acceptable'.

The Tribunal Member found on the evidence that the woman relied on the expertise of the interior designer to achieve the interior decorating effect they were after, and that fabric matching was a crucial consideration.  The Member was satisfied that the woman did not get what she had paid for and that she was entitled to have the money she had spent refunded.  Accordingly, orders were made for the curtains to be returned to the interior designer, and that $4,500 be refunded to the woman.