Problem based question worth 25%. Due: 11.59pm, Sunday 1st October 2017

Lin Fung, who is very worried about global warming, reads the following newspaper advertisement for Bing’s Appliances Pty Ltd, a retailer of electrical goods.

“Special Offer: ANCO G100 environmentally friendly air conditioners, just $735, marked down from $950 for one day only on Saturday, 1st July.”

Lin goes to the store on Saturday, 1st July, arriving half an hour after it opens, and is told by the sales staff that they have sold out of the reduced-price ANCO air conditioners, but they have a better air conditioner, the Earthcare G200, also manufactured by ANCO Ltd and also environmentally friendly, which cost $899. The salesperson hands her a manufacturer’s brochure in which it is written:

•   the EARTHCARE G200 is a revolutionary environmentally-friendly air conditioner
•   EARTHCARE G200 is designed for minimal environmental impact
•   the production process for the EARTHCARE G200 results in reduced carbon dioxide

  emissions.

  Lin is impressed with the environmental claims of the manufacturer and buys an Earthcare G200, which is delivered to her house the following week and it is installed by a technician. The technician tells her that he knows with certainty that the ANCO G100 model never sold for more than $735. Lin leaves the air conditioner running all day and all night on a very hot day. When she rises the next morning she finds a puddle of water on the table under the unit and a much-loved water-colour painting from the Tiwi Islands that was awaiting framing, worth over $2,000, that she had left on the table, ruined by the water dripping onto it from the unit.

  When she gets the air-conditioning technician in to find out what happened, she learns that there is a defect in the air conditioner causing water to flow out of the front of the unit. She also learns that the air conditioner contains a fluorocarbon gas called R407C, which is a potent greenhouse gas that will contribute to global warming if released into the atmosphere, although it is less harmful to the environment than certain other fluorocarbon gases. She also learns that ANCO is unable to substantiate the claims concerning the reduced carbon dioxide emissions in the production process.

  Required: [N.B. 5 marks per question]

  i) Advise Lin of her legal rights and what remedies may be available to her under the CCA (2010)? ii) What defences might Bing’s Appliances Pty Ltd and ANCO Ltd rely on?
  iii) What are Lin’s prospects of success? Refer to the relevant sections of the Act and case law in all your answers.

  iv) Who else may have a cause of action against Bing’s Appliances Pty Ltd and ANCO Ltd and what remedies may they seek?
  v) If there is a breach of s29 of the Consumer Law in this scenario, what would be a likely penalty – use relevant cases to support your answer.

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