Chrisco contracts challenged in Aust courts

THE Christmas hamper company, Chrisco, is facing court action in Australia over allegedly unfair contract terms that also apply to New Zealand shoppers.

New Zealand’s Commerce Commission is watching proceedings to decide whether it will also take action against terms and conditions allowing Chrisco to keep taking payments from customers’ banks accounts after the customer has fully paid off their goods.

The layby business allows shoppers to buy food and other goods at a mark-up to the usual retail price and pay them off by instalment throughout the year so they arrive in time for Christmas.

But Chrisco’s terms and conditions allow it to keep taking direct debits from customers after the customer has fully paid off their goods, unless the customer phones up or specifically ticks a box to ‘‘opt out’’ of what Chrisco calls its ‘‘headstart’’ programme.

The extra money is set aside for ‘‘next year’s order’’, according to Chrisco’s website, and if the cus- tomer fails to make an order, Chrisco will make one for them using their previous purchases as a guide. The money is refundable if the order is cancelled.

Rolling direct debits have fallen foul of consumer watchdog the Australian Competition and Consumer Commission (ACCC), which says Chrisco included an unfair contract term in its 2014 layby agreements by allowing it to keep taking direct debit payments after the shopper had paid for their order.

The ACCC

also

alleges

that Chrisco misled customers by saying they could not cancel their lay-by agreement after making their final payment, contrary to Australian consumer law.

The watchdog is also challenging Chrisco’s lay-by termination fee, saying it is more than Chrisco’s reasonable costs. The charges will be heard in February.

The Commerce Commission must wait until March before it gets the power to challenge unfair contract terms; by then Chrisco may have changed its terms, said a commission spokesman.