The Australian Consumer Law (ACL) gives consumers automatic guarantees on goods and services that apply regardless of what any contract says — a seller cannot take them away by inserting an exclusion clause. Yet many Australian consumer contracts still include disclaimers and exclusion clauses that misrepresent your rights or create the impression that the business's warranty is your only remedy. Knowing what the ACL guarantees you is one of the most powerful pieces of consumer knowledge you can have.
What is a Consumer Guarantees?
The ACL (Schedule 2 to the Competition and Consumer Act 2010) sets out consumer guarantees that automatically apply when you purchase goods or services as a consumer (an individual, or a business acquiring goods or services for less than $100,000 where they're not normally acquired for resupply or use in production). For goods, the guarantees include: acceptable quality (safe, durable, free from defects, acceptable appearance, fit for normal purpose), fitness for disclosed purpose, matching description, matching sample, and repair/replacement parts availability. For services: due care and skill, fit for purpose, and completion within reasonable time.
Red flags to watch for
These representations are potentially misleading if they give the impression that consumer guarantees don't apply. Under the ACL, you are entitled to a remedy (repair, replacement, or refund) when goods fail to meet the consumer guarantees. 'No refund' policies do not override this.
A manufacturer or retailer warranty ('this product is warranted for 1 year and that is your only remedy') cannot override ACL consumer guarantees. Presenting it as the sole remedy is misleading under ACL section 29.
For goods or services under $100,000 supplied to a consumer, sections 259-271 ACL give the consumer rights to compensation for foreseeable losses caused by a failure to meet consumer guarantees. These rights cannot be excluded.
Under the ACL, if goods cannot be repaired within a reasonable time or after a reasonable number of attempts, you are entitled to a replacement or refund. Contracts setting artificially high repair thresholds before replacement is offered may understate your rights.
While arbitration can be agreed for commercial disputes, the ACL's consumer guarantee regime provides rights enforceable through state and territory consumer protection agencies. Clauses that attempt to channel consumer disputes exclusively to private arbitration may be unfair contract terms.
Your legal rights
The ACL consumer guarantees (sections 51-59 for goods; sections 60-62 for services) are non-excludable statutory rights. For major failures (a failure a consumer would not have bought the product had they known about it, or that cannot be remedied), you can choose a refund or replacement. For minor failures, the supplier may choose to repair, replace, or refund. ACL remedies are enforced by state and territory consumer agencies (e.g., NSW Fair Trading, Consumer Affairs Victoria) and the ACCC at the federal level. You can also pursue claims in state tribunals (NCAT, VCAT) or courts.
Questions to ask before you sign
- 1Does this contract claim to limit or override my ACL consumer guarantee rights?
- 2Does the warranty or remedy clause accurately represent that ACL guarantees apply in addition to any voluntary warranty?
- 3What happens if goods fail after the warranty period but within a time when I'd reasonably expect them to last?
- 4If the service fails, what remedy does the contract provide — and does it acknowledge my ACL rights to compensation for consequential loss?
- 5Is there an arbitration clause, and does it prevent me from accessing state consumer protection agencies?
Disclaimer: This guide is for educational purposes only and does not constitute legal advice. Contract law varies by jurisdiction and individual circumstances. Always consult a qualified legal professional before making decisions based on this information.