The Consumer Guarantees Amendment Act 2013 introduced some major changes to the Consumer Guarantees Act 1994 (CGA), which came into force on 17 June 2014.

The key changes include:

  • a new guarantee regarding delivery of goods;
  • amendments to the definition of ‘acceptable quality’ so that the courts can take into account the nature of the supplier and the context in which the supplier supplies the goods;
  • an implied guarantee that gas or electricity supplied by an electricity retailer will be of acceptable quality; and
  • auctions and competitive tenders are now subject to the CGA in the same way as other consumer transactions where they are purchasing from a professional seller.

Businesses will also need to consider whether provisions in their contracts that currently allow them to contract out of the CGA will still be effective under the new legislation, and consider what impact this may have. Section 43 of the CGA has been amended in such as way as to make the effectiveness of contracting out provisions less certain. In addition to requirements that the agreement is in writing and the relevant goods are acquired in trade, it must now be fair and reasonable for the parties to be bound by a contracting out provision.

For more information, including a summary of the key amendments and relevant issues for businesses refer to our earlier client update here.