The NSW Department of Fair Trading has set a precedent by ordering a second-hand computer dealership to enter strict legal undertakings, binding it to resolve Australia-wide complaints against it.
Sydney-based Business Boost entered the undertakings in December, promising to resolve 570 customer complaints the department received last year in relation to the dealership's slow delivery practice and failure to give a refund for defective goods.
The department acted under the recently introduced Section 73A of the Fair Trading Act, which empowers it to investigate complaints and enter legal undertakings concerning traders against which it receives a large number of complaints.
"This is the first occasion on which the new power has been used, [reflecting] the seriousness with which the department views complaints against Business Boost," said David O'Connor, the NSW Fair Trading Department's director general.
If Business Boost breaches the undertakings, O'Connor claimed they would be referred to the NSW Supreme Court, where "the full range of court sanctions" will be applied to them.
But, according to Paul Childs, press secretary to the NSW Minister for Fair Trading, Jeff Shaw, the dealer of refurbished PCs has successfully dealt with about one-third of the complaints already.
Childs pointed out that Business Boost is a "very high-volume company, selling tens of thousands of computers and the total of complaints received was not above the industry average".
Their case was, nevertheless, used to set the precedent for dealing with some of the industry's more dubious practices. That prompted Shaw to order an inquiry into the retail supply of computer hardware and software in May last year when the department noted a dramatic 246 per cent increase in complaints against computer retailers.
Understandably, Business Boost's general manager Tony Freeman is not happy with all the negative publicity his company has received since the details of the case were made public.
"The long and the short of it is, yes, we have signed some undertakings and we're comply- ing with them and working closely with the department to solve customer service issues."
However, Freeman believes that, in releasing the details of the case, the department has created a false picture of Business Boost's operation and the company is currently seeking legal advice in relation to it.
Freeman said his company signed the undertakings voluntarily to show that they were serious about dealing with consumer complaints and the complaints received related to less than 10 per cent of all Business Boost's sale transactions.