By Geoff Hardy - 21 Mar 2019
What the Consumer Guarantees Act 1993 (the
CGA) does is insert some basic guarantees
into every contract for the supply of consumer goods or services,
and those guarantees override anything that the written contract
might say to the contrary. This is important because large
suppliers often impose standard form terms of trade on their
customers that are heavily weighted in the suppliers' favour, and a
small customer has no chance of negotiating anything more
favourable.
The CGA only applies if you are supplying goods or services to
"consumers". However consumers are defined as individuals,
companies, Councils, clubs or other legal entities who acquire
goods or services "of a kind that are ordinarily acquired for
personal, domestic, or household use or consumption". So it is the
nature of the product or service being acquired that is important.
The only things clearly outside the ambit of the CGA are those that
would rarely or never be acquired for household use, such as
dentistry equipment, bulldozers, business management software and
military hardware.
Therefore the CGA can equally apply to business-to-business
sales as long as the product or service is of a kind that is
ordinarily acquired for personal, domestic, or household use or
consumption. But there are some exceptions. They are sales of goods
or services to customers who acquire them for the purpose of
re-supplying them in trade, consuming them in the course of
production or manufacture, or (in the case of goods) carrying on a
business of repairing or treating other goods or fixtures on land.
Those customers are excluded from the definition of "consumer".
If the transaction in question is not caught by one of those
exceptions then the business seller and buyer can still contract
out of the CGA, as long as they do so in writing. A sophisticated
supplier's terms of trade are invariably going to do that, so you
might think you are stuck. But the CGA allows this only if it is
"fair and reasonable" to do so. The fair and reasonable requirement
leaves it open for a small business to ask a Court to enforce the
CGA's remedies against a powerful supplier, even though the
supplier's terms of trade exclude the CGA. So if you are in that
situation, don't give up hope. If it is worth going to court for,
you have every chance of succeeding.
Contact
Geoff
Hardy