Lessons that some of us learned the hard way
From hearing aids to fishing rods, here are 15 examples of Disputes Tribunal cases that offer valuable examples to consumers.
The Disputes Tribunal is a low-cost quasi-court where people can ask referees to resolve money disputes involving $30,000 or less. Often, it’s the only place where low-level consumer protection laws ever get tested, giving insights into airlines trying to dodge responsibility for cancelled flights, or appliance-makers pretending they don’t have to repair appliances-after their 12-month “manufacturer’s warranty” comes to an end.
The tribunal, which is operated by the Ministry of Justice Te Tāhū o te Ture, provides valuable life lessons for ordinary people on their consumer rights, but it’s low-risk for companies flouting the law, as the tribunal publishes few case notes each year, and the real names of businesses are not published.
Here are 15 lessons in low-level everyday commerce from 2023’s tribunal hearings the public should hear about.
No payment for pain:
A woman spent $4290 on fat reduction treatment. She was disappointed with the outcome. She said she told the clinic she had a “low tolerance” for pain, and it misled her by telling her the treatment would only be “a little uncomfortable, and could feel like ants biting”. She claimed she was told weight loss was guaranteed. The tribunal found there was no guarantee, and the pain warning made by the company was adequate.
All care and no responsibility: An incompetent engraver damaged two century-old heirloom watches when trying to engrave names on them. The trader said his service was provided with “All care and no responsibility”, and he should not be liable for the $625 repair bill. The tribunal said under the Consumer Guarantees Act services must be provided with reasonable skill and care, and he had to pay up.
A warning on buying stolen goods:
A woman’s car was stolen, and sold to a company that intended to resell it. Despite the disappearance of the car, the woman added it as security on a finance company loan she already had. She then defaulted on repayments. Who did the car belong to? The company that bought the car should have checked whose car it really was, the tribunal decided. It had no more right to the car than the man who stole it, and sold it. The car was awarded to the finance company.
Companies are responsible for their agents:
A landlord paid for a Healthy Homes assessment from the subcontractor of an assessment company. The $1150 cost included the installation of two extractor fans and a panel heater. Later the landlord found these had not been installed. The subcontractor had defrauded the landlord, and not paid a cent to the company in whose name he had pretended to do the work. In fact, the company had no idea what he had been up to. Although the business had been an innocent victim too, the tribunal ordered it to pay restitution to the landlord because it was responsible for the behaviour of its agent.
Small print matters:
A man lost his $12,000 hearing aids in the sea when he became tangled in the boarding ladder on his boat. His marine insurer pointed him to the small print in its policy, which said it covered personal effects, but not personal electronics. Outraged, he sued through the tribunal. It found the insurer was within its rights not to pay.
Instruction manuals are for reading:
A fishing rod with a 10-year manufacturer’s guarantee broke during a fishing trip within a year. The manufacturer would not pay because the man used a fishing line with a breaking strain above that recommended for that rod model, and the tribunal agreed.
Uninvited “direct sales” rights:
An elderly couple were charged $35,000 for tree-trimming by a company that came uninvited to their home. The work should have cost around $5000, and the company broke laws designed to protect people from uninvited high-pressure salespeople. The tribunal found the trimmers failed to provide either a written contract, or tell the couple about their right to cancel at any time, which the Fair Trading Act requires of uninvited direct sales. The tribunal ordered the unnamed company to refund the couple $30,000. Whether they got it is not known as it’s up to complainants to enforce tribunal rulings themselves.
Private sale get-out clauses are binding:
A man bought a 20-year-old second-hand car for $8500 on the proviso he could get a full refund, if an inspection found any major issues. An inspection revealed more than $500 of work was needed. The seller would not refund his money. The tribunal found that while $500 was not a huge amount, it was clear the car was not “well maintained” as the seller’s advert had claimed. The tribunal ordered the seller make the refund.
Who pays for injured pet? A man turning his car on the u-shaped driveway of someone he did not know ran over the property owner’s dog, injuring it seriously. The owner sued for vet’s bills, but the tribunal found the owner could not prove the driver had driven negligently. “That would require a witness or, say, CCTV footage,” the tribunal said.
Document your loans: A man loaned his girlfriend $6000 to buy a boat, and spent nearly $12,000 on purchases for it, and servicing. She repaid the loan, but when they split up, he asked the tribunal to award him ownership of the boat in lieu of repayments of the $12,000, which he said was a debt she owed him. But in the absence of a written contract, the tribunal found she did not have to pay.
Truth in private adverts: A woman bought a second-hand fridge-freezer for $70 which the seller described as “good working”. It had a broken fan and thermostat. She paid $350 to get it repaired. The seller offered to refund her $70, but she refused and sued him for $350. The tribunal found the seller lied in his advert, but the buyer should have contacted him before paying for the repairs. The tribunal ordered the seller to pay the buyer $70.
Airline caught: A couple travelling were stranded in an overseas airport after their flight was cancelled. They tried to call the airline, but were put on hold so long, they gave up, and spent nearly $5000 on tickets to complete their journey to an important meeting. The airline refused to cover the cost of the new tickets. But, the tribunal ruled the Montreal Convention (covered in New Zealand’s Civil Aviation Act 1990) says airlines were liable for “damage occasioned by delay in the carriage by air of passengers, baggage or cargo” except where the airline could prove it took all measures that could reasonably be required to avoid the
damage, or that it was impossible for it or them to take such measures. In this case, the cancellation was caused by a lack of crew, and the tribunal ruled the airline must pay up.
Your time is worth nothing: A family sued an airline for just over $4800 for their “time” after being stranded for 54 hours by delays, including for bad weather. The airline paid for accommodation, and meals. That was enough under the Montreal Convention. The tribunal found there was no proven loss that had not already been reimbursed.
Read the quote: A man got a quote from a house cleaner. He didn’t read it. Once the work was done, he was shocked at the price of $3611, and refused to pay. The contract was clear, the tribunal found. However, had the price been unconscionable, the tribunal could have varied it. The tribunal operates under its own act of Parliament, the Disputes Tribunal Act. This says that where it appears to a tribunal referee that an agreement between the parties is harsh or unconscionable, the referee may make an order varying the agreement. That wasn’t the case with the $3611 bill.
Your insurer can sue in your name:
A man managed to stop his car on a motorway when a pile-up occurred in front of him. The car behind crashed into him after being shunted by a third car, which did not stop in time. The man’s insurer took a claim for damages against the driver of the third car in his name. The tribunal referee found that the third driver had failed in his duty of care, and he, and the company that employed him, had to pay damages to the drivers of the first two cars.