New Zealand Vacuum Cleaner Co, which runs the Godfreys vacuum cleaner retail chain across the Tasman, has pleaded guilty to 10 charges under the Fair Trading Act (FTA) in New Zealand over failure to disclose customer rights in extended warranty agreements.
The charges relate to more than 3000 extended warranty agreements Godfreys sold to customers between June 17, 2014, and Sept. 22, 2015, the Commerce Commission said in a statement. Five of the charges relate to the retailer’s failure to provide written advice to customers of their rights under the Consumer Guarantees Act and the right of customers to cancel extended warranties within five days.
The other five charges relate to Godfreys’ failure to verbally advise consumers about their cancellation rights before they entered into the extended warranty agreement, the commission said.
“This case is the first prosecution which focusses on the new FTA provisions imposing specific obligations on the sale of extended warranty agreements, which came into force in 2014,” the regulator said.
The new provisions require the warrantor to explain in extended warranty agreement that some guarantees are already provided to consumers under the Consumer Guarantees Act (CGA). The warrantor must also provide comparative information on CGA guarantees and the protections they’re selling under an extended warranty agreement.
NZ Vacuum Cleaner Co is owned by Australian Vacuum Cleaner Co, which also operates the Godfreys chain in Australia. It has 31 stores in New Zealand, where it has operated for about 15 years.