Transcript Chapter Two Consumer Conflict

Caveat Emptor
Long Questions:Q1 Part 3
Part of your ABQ
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Causes of Consumer
Conflict
Non Legislative
Methods of Solving
Consumer Conflict
Legislative Methods
of Solving Consumer
Conflicts
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•Poor quality products or services
•Over-priced products or services.
•Bad customer service
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Non-Legislative
Methods of Solving
Consumer Conflicts
Talk to the Retailer/
Negotiation
Third Party Assistance:
Consumer Association
of Ireland, Trade
Associations,
Ombudsman
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1. Talk to the retailer/ Negotiation: Consumers
involved in conflict should first of all talk to the
retailer involved.
 Know your legal rights
 Bring along your receipt as proof of purchase
 Speak to manager in a non aggressive manner.
 Write a letter of complaint if you do not get
adequate redress.
 At some stage in the process the retailer should
engage you in negotiation, i.e a process of
bargaining to try to reach a mutually acceptable
solution to the conflict. E.g. offering a repair if
the fault is a minor one.
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2. Assistance from a third party:
Organisations that can assist in resolving a consumer conflict are:
Consumers Association of Ireland: is an interest group (a noncommercial type of organisation) for consumers. It aims to make sure
that consumers get good quality products and services and know their
rights. They publish the magazine Consumer Choice and lobbies the
government about consumer issues.
Trade Associations: e.g. The Vintners Federation of Ireland is a strong
National Trade Association for pubs outside the greater Dublin area.
They work on their members' behalf to promote and protect their
interests and give advice to members on topics such as licensing laws,
employment legislation, planning matters and much more.
Ombudsman for Public Services: The ombudsman deals with complaints
against public bodies such as government departments, local
authorities, an post and the HSE. She is independent of the government.
The Ombudsman will issue a recommendation but it is not legally
binding. However, most public bodies comply in order to avoid bad
publicity and damage to their reputation. If they do disobey her she will
include this in her annual report to Dail Eireann.
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Financial Services Ombudsman: specialises in
resolving consumer complaints against banks
and other financial institutions such as insurance
companies and credit unions. The decision of the
ombudsman is binding on the institutions
involved.
Ombudsman for the Insurance Industry:
investigates consumer complaints against
insurance companies. The decision of this
ombudsman is binding on an insurance
company, but not on the individual making the
complaint.
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The Laws
Sales of Goods &
Supply of Services
Act 1980
Consumer
Protection Act
2007
The
agencies
National
Consumer Agency
Small Claims
Court
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Legislative Methods of Solving Conflicts: trying to
solve the conflict by referring to the laws of Ireland or
by using a legal organisation.
1. The Sale of Goods and Supply of Services Act 1980:
A consumer law that ensures products and services
are up to a certain standard by setting out:
The legal rights of consumers when they purchase
goods
The legal responsibilities of retailers to consumers.
The legal remedies available
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Provisions of the Act.
1. GOODS
Merchantable Quality: a provision of the Sale of Goods and Supply of
Services Act that ensures goods must be of an acceptable standard,
taking into account what they are supposed to do, their durability
and their price. e.g. If the heel of your shoes broke after a week you
would be entitled to your money back as it would be expected to
last longer.
Fit for their Purpose: a provision of the Sale of Goods and Supply of
Services Act, this means that the goods must do what they are
expected to do. For example, a dishwasher must clean the dishes.
Goods must be sold as described: the product must be exactly as
described by the brochure/salesperson, and must not be misleading
Goods must match their sample: If a good is sold by sample then it
the product you receive must correspond to the sample you selected
exactly, e.g. wallpaper, carpet.
Legal Ownership & Quiet Possession: the buyer relies on the seller
having a proper title and claim on the goods, i.e. the seller has the
legal right to sell. As a result the buyer should be able to enjoy quiet
possession, i.e. using the goods as they wish.
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Provisions of the Act
 2. Services
 Services must be provided by a competent
person with skill and using due care and
diligence.
 Any materials used must be sound and fit for
the purpose and be of merchantable quality.
 3. The contract is between the buyer and the
seller. The retailer cannot tell the buyer it is
the problem of the manufacturer, he is legally
responsible to sort it out.
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4. Signs
The retailer cannot put up any sign that gives the
impression that a consumer has no legal rights. It
is illegal to display the following signs:
No refunds
Credit Notes Only
No refunds on sale items
5. Guarantees cannot take away a consumer’s
basic legal rights against the retailer. They can
only give extra protection to the consumer. It
gives him the choice of having the goods fixed
by the manufacturer under the guarantee or
getting the retailer to deal with the complaint.
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This law does a good job of protecting
consumers because:
1. It ensures that consumers get their money
back if the product or service they buy is not up
to legal standards. While the law cannot do away
with faulty goods, it ensures that consumers do
not lose money if they buy a faulty product.
2. Consumers cannot be fooled into thinking they
must accept a credit note by retailers who put up
signs to this effect. By banning such signs, this
law protects those consumers who do not know
their rights.
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Prohibiting
Aggressive
Practices
Prohibiting
misleading
practices
Establishing
the National
Consumer
Agency
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This Act protects consumers from unfair
practices. The following are prohibited by the
Act:
 False product descriptions
 False prices
 False or misleading advertising/ false claims
 Aggressive practices
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False Product Descriptions: Goods
must be sold with a fair product
description from the salesperson
or advertisement, regardless of
whether it is written or verbal. E.g.
Waterproof jacket that lets in rain.
Withholding important information
would be misleading. Making false
claims for cures for illnesses is
illegal. E.g. Herbal remedies…head
shops?...
False Price: It is illegal to give false
or misleading information about
prices. Goods marked as being
reduced in a sale must have been
on sale at the original higher
prices for at least 28 consecutive
days prior to the sale.
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The CPA gives the Minister the power
to make regulations requiring prices
of certain goods to be displayed in a
certain manner, e.g. inclusive of
taxes and charges.
False or misleading advertising/ false
claims: the information in advertising
should be fair and accurate. e.g. Free
gift should not increase the price.
Running promotions or competitions
when the top prize is not available.
Aggressive Practices: Traders are
prohibited from engaging in
harassment, (e.g. demanding
payment for unsolicited goods),
coercion (forcing someone to do
something) and exercising undue
influence (e.g. running a pyramid
scheme where a person has to
persuade others to join to get their
money).
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Unsolicited Goods
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This is when goods are sent to someone
without the goods having been ordered by the
receiver or by someone on his behalf. Another
name for it is Inertia Selling.
The goods only become the property of the
recipient and the sender loses all rights to
them, if either of the following conditions
occurs:
If the sender did not take possession of the
goods within six months and the recipient did
not unreasonably refuse to permit the sender
to do so.
The recipient wrote to the sender stating his
name and address, where the goods can be
collected and the fact that they were
unsolicited goods and after this
correspondence the sender did not take
possession of the goods within 30 days, nor
did the recipient refuse to permit the sender to
do so.
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Pyramid Scheme: promise you quick and
easy money in return for a cash sum. But
they are actually designed to con you into
investing significant amounts of money
which can never be recovered. You may be
approached by email, letter, phone or
online, or a friend might invite you to go to
a meeting about it.
How the scam works
You are tempted by the promise of "free"
money if you invest in the scheme.
When you “buy in”, your money goes to
those above you in the pyramid.
In order to move up the pyramid you are
usually asked to recruit new members, and
they become a new level of the pyramid
below you. It can involve large numbers of
people parting with small sums of money
over a period of time.
In theory, as you go further up the pyramid
you are supposed to get more money but
this does not happen because there are
not enough people to join the scheme.
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The NCA is the State agency that promotes consumers’ awareness of their legal
rights and ensures consumer legislation is obeyed by businesses. They’re
responsibilities include:
 To promote and protect the interests and welfare of consumers. To inform
consumers of their rights/publish shopper’s rights leaflets/ provide a consumer
phone service/website.
 To enforce the relevant consumer law. Enforcement tools include prohibition
notices, undertakings from traders, compliance notices, on the spot fines for
offences relating to price display, and the ability to "name and shame" with the
publication of non-compliant trader names. These powers include the right to
enter premises, get documentation and other evidence in relation to any trade or
business which is being investigated.
 Enforcement role in relation to pricing and price displays and a product safety
role when it comes to items such as personal protective equipment- like GAA
helmets or toys. Prohibits false pricing, e.g. goods advertised as being reduced in
a sale must have been on sale at the higher price for twenty eight consecutive
days (in a row) sometime in the last three months.
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To encourage compliance with the relevant law/ to investigate
suspected offences under any of the relevant laws.
To refer cases to the Director of Public Prosecutions where
appropriate.
To conduct research into consumer issues/attitudes.
Responsibility for market surveillance of non-food consumer
products. It enforces product safety legislation, investigates
complaints about unsafe products, alerts consumers and advises
manufacturers, suppliers and retailers.
To conduct pricing surveys to raise awareness of price
differences.
To advise the government of the impact of laws on consumers
and make recommendations on legislation or policy, which
concerns or is likely to impact on consumer protection and
welfare.
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The NCA is very effective because it is a statutory body, is an
advocate for the consumer and has enforcement powers for
example:
The NCA can serve a compliance notice on a trader whom it
considers to have engaged in a prohibited activity. The NCA has
the power to enter premises to gather evidence, with the support
of the Gardaí if necessary. The trader has 14 days in which to
appeal the notice. If the trader fails to comply, the NCA may take
criminal proceedings.
Publication of a Consumer Protection List; a list of traders
convicted of criminal offences, subject to court orders, bound by
an undertaking, served with a compliance notice, or subject to a
fixed payment notice.
The National Consumer Agency may also apply to the court for
an order that requires a business to pay compensation for any
loss or damage to the consumer resulting from an offence.
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The aim of the Small Claims Court procedure is to provide
an inexpensive, fast and easy way for consumers to
resolve disputes without the need to employ a solicitor.
The Small Claims service is provided in your local District
Court office.
The claim cannot exceed €2000
The current fee to apply is €18
You can apply online or in your local District Court office.
The court will invite both parties to present their case
before making a recommendation. This is private and
informal.
The Small Claims Court cannot force an agreement but is
very persuasive and will refer unsolved cases to the
District Court for a hearing. This would be held in public
and enforceable by law.
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2012 Q1HL
Evaluate the role and the functions of the
National Consumer Agency (NCA) in protecting
consumers. (20 marks)
2012 Q1 OL
Outline two functions of the National Consumer
Agency (15 marks).
Mocks 2012 HL
Discuss how the provisions of the Consumer
Protection Act 2007 help protect consumer rights
in the marketplace. Make reference to the NCA in
your answer. (20 marks).
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2011 Q1 HL /2008 HL
(i)
Discuss the rights of the consumers under the
terms of the Sale of Goods and Supply of
Services Act 1980.
(ii) Illustrate two forms of redress available to
consumers for breach of the Act (30 marks).
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2010 Q1 HL
Evaluate the role of each of the following in
protecting consumers:
(i) The Small Claims Court
(ii) The Office of the Ombudsman for Public
Services (20 marks).
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2007 HL Q1
Discuss the provisions of the Sale of Good
and Supply of Services Act 1980 and evaluate
its effectiveness. (30 marks).
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