Your Right to a Refund: Defective Product Law and the Sale of Goods Act

A broken television

Goods must be delivered in their advertised condition. Photograph by DarkSideX

So you’ve just bought yourself a new DVD player, or a washing machine, or anything else in fact. You get it home, set it up and turn it on. It doesn’t work. We’ve all been there at some time, right? If you’ve also found that when you try to take the thing back to the shop you bought it from, they won’t give you a refund, read on.

Some stores in the UK cling to the idea that their returns policy somehow trumps the law. Some stores are simply ignorant of what their duty is. They will claim they have a ‘no refunds’ policy and will only allow replacements or ‘store credit’ but it is not their decision to make, it’s yours. This goes for online and catalogue purchases, too.

Buying Goods by Description and Online

With the Internet being such a big player in the shopping lives of many people, it is important to understand just what your rights are. Under section 13 of the Sale of Goods Act 1979, all contracts for sales of goods by description (which covers most, if not all, goods purchased on the Internet) have a condition attached that the goods delivered to the buyer will actually match the description provided.

Because this is a condition, as opposed to a warranty, the buyer is granted four specific rights when faced with a defective product:

  • the right to return the goods;
  • the right to a refund;
  • the right to claim damages (but only when the product has caused a loss); and
  • the right to terminate the contract.

So, if you were to buy a brand new washing machine and when it was delivered and set up correctly, it promptly flooded your kitchen and ruined your new kitchen floor, you would be within your rights to return the washing machine and get not only your money back (or perhaps a replacement washing machine, if you still trusted the shop) but also the cost of replacing the damaged floor.

The usual rules on minimising the damage count here, of course; so it is best to try to keep any damage to a minimum, otherwise you risk having to front some of the cost of repairs yourself.

Unsatisfactory Quality and Goods Unfit for Purpose

When buying something in a shop, it should go without saying that anything you buy should live up to reasonable standards of quality. Similarly, if you specifically state to a salesperson that you want to buy a DVD recorder, they should sell you a DVD recorder and not a simple DVD player. It sounds simple, but unfortunately not everyone plays by the rules.

Section 14(2) of the Sale of Goods Act 1979 inserts another condition into all sale of goods contracts; this time requiring that all goods purchased be of “satisfactory quality”. Whether the goods in question are of satisfactory quality will, of course, depend on the circumstances but if something is bought brand new and does not work, it is reasonable to suggest that it is not satisfactory.

Meanwhile, the condition that a product be reasonably fitness for any purpose stated to the seller prior to purchase is inserted by Section 14(3) of the 1979 Act. Because of this, anyone sold a DVD player when they clearly stated that they wanted a recorder would be able to demand a refund on returning the product. As defective product lawyers across the country will attest, consumer protection law is not limited to mere faulty goods.

Can you lose these rights?

The right to reject the goods and terminate the contract cannot be taken away by any store policy or a ‘no refunds’ sign (no matter how prominent) but there are still two situations where they can be lost:

  • Failure to report dissatisfaction in a reasonable time; and
  • Altering the goods to such an extent that they cannot be returned in the same state that they were received.

As with the question of what constitutes “satisfactory quality”, what can be regarded as a reasonable timeframe to express dissatisfaction will depend on the circumstances. Altering the goods, however, should be mostly self-explanatory. Suffice to say opening the packaging is unlikely to count in most cases.

The Legality of a No Refunds Sign

At this point, you may be wondering what the point of a “no refunds” sign is if it has no actual legal standing. The simple fact of the matter is that some people either don’t know what the law is, or don’t care. Sometimes they fall into the latter category and hope their customers fall into the former. It is therefore a good idea to remember about the Unfair Contract Terms Act 1977.

Section 6 of the 1977 Act deals with exemption clauses (also referred to as exclusion clauses). The section specifically counters any attempt to get around sections 13 and 14 of the Sale of Goods Act 1979 when dealing with a sale between an individual and a business. Because of this, a store returns policy limiting returns to store credits or refunds is null and void; no matter how many notices are displayed.

As if that was not enough (and probably because some people simply won’t be told), the Consumer Transactions (Restrictions on Statements) Order 1976 makes it a criminal offence to use a void clause in a consumer sale of goods agreement. There really is no excuse for trying the old “we don’t do refunds” trick now.

In short, the Sale of Goods Act 1979 combined with the Unfair Contract Terms Act 1977 gives consumers the right to return goods for a full refund if those goods are faulty. This right cannot be taken away by purported terms in any sales contract, but they will disappear if the buyer delays too long before returning the product, or alters it in a substantial fashion. It is therefore best all ’round if faulty goods are returned promptly.

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