Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Michael Hill fined $169,000 over extended warranty

Michael Hill fined $169,000 over misleading extended warranty

By Jenny Ruth

Nov. 29 (BusinessDesk) - Michael Hill New Zealand has been fined $169,000 in the Wellington District Court following an investigation by the Commerce Commission into its extended warranty.

The regulator says the jewellery retailer admitted 12 charges that its Professional Care Plan failed to comply with the extended warranty disclosure requirements of the Fair Trading Act between May last year and May this year.

The care plan includes various services aimed at prolonging the life and maintaining the appearance of jewellery purchased. But the documentation supplied to customers failed to include all of the required information on the front page.

Its omissions included comparing the protections consumers automatically have under the Consumer Guarantees Act with the protection Michael Hill’s plan offered, an adequate summary of consumer rights and remedies under that Act and a summary of the consumer’s right to cancel the plan.

Michael Hill also admitted a charge that it misled consumers by adding the cost of its plan onto the price of a bracelet without the knowledge of the Whangarei couple who bought it in June 2016. They were later refunded the cost of the plan after they complained to Michael Hill.

“The law clearly sets out the information that must be provided to consumers when selling an extended warranty,” said commissioner Anna Rawlings.

“That information helps consumers to decide whether an extended warranty offers them value over and above the rights they already have,” Rawlings said.

“They can then decide whether it is worth the extra cost.”

The cost of extended warranties should be made clear and, when it is not, consumers who purchase these products may be able to cancel their agreements and obtain a refund, she said.

Judge Denys Barry said in sentencing that the conduct was “a significant set of failings, not a mere minor oversight”. It also “impugns the objectives of the Fair Trading Act as consumers had no immediately discernible comparison between their rights” under the Act compared with Michael Hill’s plan.

“The financial harm to the couple was caused by the conflation of the warranty price with the price of the bracelet. The consumers were effectively ‘gulled’ into paying for the warranty product.”


© Scoop Media

Business Headlines | Sci-Tech Headlines


Frog Recruitment: Kiwi Workers Reluctant To Make Business Trips Across The Ditch Despite Trans-Tasman Bubble Opening

When the trans-Tasman travel bubble opens today, many Kiwi companies won't be rushing to buy an air ticket, reluctant to cross the ditch to do business. The latest survey conducted by leading recruitment agency, Frog Recruitment of nearly 1,000 New Zealand ... More>>

Tourism: Employers Welcome Back Working Holidaymakers

Tourism businesses gearing up for the return of Australian visitors from next week will be relieved to learn that they will also have access to an offshore pool of much-needed job candidates, Tourism Industry Aotearoa says. Tourism employers around ... More>>

Commerce Commission: Latest Broadband Report Confirms Improved Performance Of Premium Fibre Plans

The latest report from the Commerce Commission’s Measuring Broadband New Zealand programme shows that the performance of Fibre Max plans has improved substantially. This follows a collaboration between the Commission, its independent testing partner, ... More>>

Air New Zealand: Capital Raise Deferred

Air New Zealand has decided to defer its planned capital raise to later in 2021 allowing more time to assess the impacts of recent developments on the airline’s path to recovery. 'We’ve seen some clearing of COVID-19 clouds recently, with ... More>>

Stats NZ: Prices For Transport And Housing Rise In March 2021 Quarter

Higher prices for transport and housing led to a 0.8 percent lift in the consumers price index in the March 2021 quarter, Stats NZ said today. Prices for getting around rose in the March quarter. Transport prices rose 3.9 percent, the biggest quarterly ... More>>

Stats NZ: New Report Shows Impact Of Demands On Land In New Zealand

A new environmental report released today by the Ministry for the Environment and Stats NZ, presents new data on New Zealand’s land cover, soil quality, and land fragmentation. The land cover data in the report, Our land 2021 , provides the most ... More>>


Stats NZ: March Card Spending Rebounds Despite COVID

There was a lift in retail card spending in March following a fall in the lockdown-disrupted February month, Stats NZ said today. Seasonally adjusted retail card spending rose by $53 million (0.9 percent), compared with February 2021. Visit our website to read ... More>>