Implied conditions and warranties relating to services

Contributed by Ian Macdonald and Su Mahalingham and current to 1 September 2005

TRADE PRACTICES/FAIR TRADING ACTS

The TPA (s.74(1),(2)) and the Fair Trading Act (s.40) provide the consumer with protection in relation to the supply of services.
Services are defined in the Act to include:

• the performance of work (including professional work);
• contracts for the supply of energy (gas or electricity);
• the provision of facilities for amusement, entertainment, recreation or instructions;
• banking contracts;
• money lending contracts.

Contracts of insurance are not included, nor are business transportation or storage contracts.

The Acts provide that services will be delivered with due skill and care and that the materials supplied in connection with those services will be reasonably effective for the purpose for which they are supplied. A second obligation is that where a consumer (other than a consumer engaging a professional engineer or architect) expressly or by implication makes known to the supplier any particular purpose for which the services are required or the desired result, there is an implied warranty that the services supplied under the contract, and any materials supplied in connection with the services, will be reasonably fit for the purpose or purposes for which they are sought, or of such a nature and quality that they might reasonably be expected to achieve that result. However, where the circumstances are such that the consumer did not rely on the supplier’s or the corporation’s skill or judgement, or it was unreasonable for the consumer to do so, this warranty will not apply.

The Sale of Goods Act does not imply conditions or warranties with respect to services, it relates only to goods.