> Business advice  > Guarantees, warranties and refunds  > For all businesses  > Who guarantees what

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• Who is a ‘supplier' and ‘manufacturer'?
• Guarantees - goods
• Guarantees - services
• When there is a warranty
• Claims for consequential loss
• Compensation limits

Your responsibilities depend on whether you are a supplier or a manufacturer - including retailers, traders, service providers and others.

When the manufacturer does not have a place of business in Australia, the importer takes on the manufacturer's responsibilities to provide a ‘remedy'.

A ‘remedy' is an attempt to put the situation right – common remedies include repair, replacement and refund.

Who is a ‘supplier' and ‘manufacturer'?

Who is a supplier?

You are a supplier if you:

• sell goods or services to a consumer in the course of business or professional activity, including a non-profit business or activity
• act through employees. This means the statements and acts of an employee are those of the supplier.

Who is a manufacturer?

A manufacturer is a person or business that either:

• makes or puts goods together
• has their name on the goods.

The importer is responsible for consumer guarantees on goods if the manufacturer does not have a place of business in Australia.

Guarantees - goods

Both the supplier and manufacturer guarantee that goods:

• are of acceptable quality - they will be safe, durable and free from defects. They will be acceptable in appearance and finish, and do the job such things are usually used for
• match any description given to the consumer

They also guarantee that any express warranties will be honoured.

A supplier also guarantees the consumer is buying goods:

• that have clear title, unless the supplier told the consumer otherwise before the sale
• that are fit for any disclosed purpose - the goods will do the job the consumer was told they would
• with a right to undisturbed possession – the supplier promises no-one has a legal right to take the goods away or prevent the consumer from using the goods
• that do not have any undisclosed securities – the goods do not have any hidden securities or charges
• that match sample or demonstration model.

A manufacturer guarantees the availability of repairs and spare parts for a reasonable time after the consumer buys the goods

Guarantees - services

A supplier guarantees to provide services:

• with due care and skill – they will use an acceptable level of skill or technical knowledge, and take care to avoid loss or damage
• which are fit for any specified purpose - the service will achieve the result the consumer was told it would
• within a reasonable time, when no time was set.

When there is a warranty

You must honour any extra promises (sometimes called ‘express warranties') made to the consumer about such things as the quality, state, condition, performance or characteristics of goods. You guarantee that the goods will satisfy those promises.

For example, a supplier tells the consumer that a bed will last for 10 years. If the bed only lasts for six years, the consumer will be entitled to a remedy.

However, you must still also meet the consumer guarantees. This means you must fix a problem when goods fail to meet a consumer guarantee, even if the consumer does not have an express warranty, or the goods are out of warranty.

For more information, see ‘Warranties and consumer guarantees'.

Claims for consequential loss

When goods and services fail to meet a consumer guarantee, the consumer can also claim for consequential losses – compensation for their reasonably foreseeable costs in time and money because something went wrong. For more information, see Compensation for consequential loss

Compensation limits

Limits on compensation for non-household goods or services

Suppliers and manufacturers can limit their liability under the consumer guarantees to a consumer for problems with goods or services not used for personal, domestic or household purposes.

You can limit remedies to:

• replacing or repairing goods
• reimbursing the consumer for repairing or replacing the goods
• re-supplying services
• reimbursing the consumer if they have paid someone else to supply the services.

You can only do this if it is fair or reasonable. What is ‘fair and reasonable' will depend on the circumstances, including whether:

• the consumer had no choice but to agree to limit compensation
• the consumer was given something in return for buying the goods or services from you, at the expense of buying from someone else
• the consumer knew or should have known about the limit on compensation
• the goods were a special order for the consumer.

Related information

• Australian Consumer Law
• Australian Consumer Law: For businesses
• Warranties and consumer guarantees
• Compensation for consequential loss

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