Consumers left in the dark about dodgy business dealings, commercial law professor says

Wednesday, 3 April 2019

A commercial law academic is concerned consumers are being left in the dark about businesses' dodgy dealings because Disputes Tribunal orders are rarely made public and so few people complain.

That meant many people would not know if a business they were buying goods or services from had previously had a tribunal order made against it, University of Auckland associate professor Alex Sims said.

'You don't know. You have no idea. So you might be dealing with someone that's never had a problem, or someone else that's been in front [of the tribunal] 100 times,' she said.

'Also, most people don't complain. That is a big problem.'

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Alex Sims, an associate professor of commercial law at the University of Auckland, says making more Disputes Tribunal orders public could help consumers.

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Sims spoke to Stuff in the wake of an ongoing dispute between a now-defunct wedding planning business and couples who had paid it to organise destination ceremonies in the Cook Islands.

Remi Wearing and Charles Ingaua, who owned Paradise Wedding Desires, promised to refund aggrieved couples thousands of dollars after the wedding parties arrived in Rarotonga for the ceremonies and were told standard services such as hair and makeup artists, photographers and caterers were not available.

More than six months later, the aggrieved couples say they're yet to receive what they're owed, but the planners say they've paid them most of the money.

Sims said the couples involved in the dispute could go to the Disputes Tribunal, which hears cases involving small claims of up to $15,000.

With filing fees between $45 and $180, it is much cheaper than going to court.

However, she said even if they won, the couples wouldn't necessarily get their money back.

Tegan and Jerome Iakimo, one of the newlywed couples involved in a dispute with now-defunct wedding planning business Paradise Wedding Desires.

'It's all very well having the law, but it's enforcing the law. [Consumers] need to think 'is it worth doing anything?'

'Even if, for example, you are successful in the Disputes Tribunal, you don't get back the fee that you've paid. You have to take time off work and unfortunately for most people, it isn't worth it.

'That means that people get away with stuff.'

Businesses sometimes refused to follow tribunal orders that were made against them and consumers then had to fork out more money to go to the District Court or hire a debt collection agency to get what they were owed, Sims said.

She wanted the Disputes Tribunal to publish more of its orders so consumers were better informed about businesses who'd had orders made against them.

THE SQUEAKY WHEEL GETS THE OIL

Sims said complaining online, rather than going through the justice system, was sometimes a better way for ripped-off consumers to ensure businesses met their legal responsibilities.

'It's publicity. That's the thing. Get on the Facebook group if you've got a problem and just say 'I've got this problem'.'

Leaving online reviews could help inform future customers and prevent them from having a similar experience, she said.

However, ultimately, Sims' advice to consumers was simple: do your homework.

'The thing is to try to avoid being ripped off. You've got to be very, very careful. Find out from friends and other people about people they have used and they trusted,' she said.

The Ministry of Justice could not provide figures on the number of cases lodged with the Disputes Tribunal annually, or how many were made public, by deadline.

YOUR RIGHTS AS A CONSUMER

The Consumer Guarantees Act requires people or businesses selling new and second-hand goods and services to ensure they are fit for purpose, reasonably priced and of acceptable quality.

Under the Fair Trading Act businesses must provide consumers with accurate information before they buy a product or service and make sure a product is safe.

ORGANISATIONS TO CONTACT IF YOU THINK YOU'VE BEEN RIPPED OFF

If you're a member of Consumer New Zealand you can call 0800 CONSUMER (0800 266 786) for advice.

The Citizens' Advice Bureau may also be able to help.

To make a complaint about a potential breach of the Fair Trading Act, contact the Commerce Commission.