Question

Bill Jobs was a keen competitor in the computer industry. The name of his company was Winpple Computers. His products did reasonably well in the market but lately his profit margin has been declining. This was partly because his company had not come up with anything new. He then decided to make a small laptop in a tablet form and call it HiPad. Apple Computers, a major player in the industry had released a similar type of handheld computer in the market a year ago and it was called IPad.

Winpple’s HiPad was manufactured in Australia but when it was sold, all advertisements concerning the product were set against an American background and the packaging for the product also omitted to mention that it was manufactured in Australia. The packaging came in red, white and blue colour with white stars surrounding the edges. The product has become very popular in the market. Its pricing was also comparatively lower than the IPad. One of his legal associates has recently told Bill Jobs that there might be legal implications because of the product and packaging.

There was also concern raised by some purchasers that the tablets developed problems after a period of six months and could not be fixed. The sale and purchase terms of the contracts for HiPads contained the following clause.

“The company excludes liability for breaches of the contract relating to product suitability and quality that occur after a period of three months after the purchase of the product.”

Advise Bill Jobs and dissatisfied purchasers whether there have been breaches of the Australian Consumer Law and the remedies that may be sought.                             

Answer 1

The Winpple's Ipad is manufactured in Australia and sold in America viz various suppliers. Fair enough? But according to the Australian Consumer Law, at an instance of guarantee breach as in the given question above, the responsibility for the same is divided between the supplier and the manufacturer. On top of that, according to ACL, there are 9 consumer guarantees attached. Refer to the figure below for a better idea.

As far as the breach in our situation is concerned, the allocation of the liability happens with respect to the customer guarantee that has been breached. In this case since the company has mentioned a clause stating that it excludes liability of product quality breaches after 3 months, the consumer is not essentially entitled to any solution for free. That's the reason experts suggest us to read the product clauses as carefully we would do to select tablet satisfying our specification demands. Had the tablet been defective before 3 months, it would have been a different story altogether. Possible remedies sought in this case maybe getting your tablet repaired from the retailer you bought, or directly addressing the manufacturer itself.

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