Suppliers of Services and the Act



You must Provide 4 Guarantees
The Consumer Guarantees Act (CGA) says that any consumer service you provide must meet 4 guarantees.

The 4 guarantees are:
  • The work will be carried out with reasonable care and skill.
  • The work will be fit for any particular purpose that the customer has told you about.
  • If the time for completing the work has not been agreed, the work will be carried out within a reasonable time.
  • If the price for the work has not been agreed, the price charged will be a reasonable price for the work done.
From 8 July 2003, the Consumer Guarantees Act covers services relating to the supply of electricity, gas, telecommunications, water, and the removal of wastewater.

This means that from 8 July 2003, when you supply those services to consumers, your services should meet the guarantees under the Act, and consumers can seek a remedy from you where your services fail to meet any of the guarantees.


1. Guarantee of Reasonable Skill and Care
Reasonable care and skill will be judged by looking at the care and skill used by other competent people doing the same work. Your skills should be such that you can do the job and achieve the purpose the customer wanted. You should take the same care that other competent people take to do the job well and avoid causing any damage.
Examples of a lack of care and skill:
  • A plumber installs new guttering. The next time it rains part of the guttering falls down.
  • A drycleaner ruins a duvet by using the wrong method.
  • A painter paints over flaking paint and six months later the new paint starts to flake.


2. Guarantee of Fitness for Particular Purpose
The work you do must achieve any particular result the customer wants and has told you about.

eg, John wants a drainage system that will stop his lawn from flooding every time it rains.
eg, Rita wants the paving stones in her driveway laid in a particular pattern.
 
You must tell the customer before you start the job if you can't guarantee that the job you do will achieve the purpose or the result they want. Otherwise you will be liable under the Act for not having achieved the desired purpose.
 
This guarantee applies to particular purposes that the customer has told you about. Normal purposes for the work you are doing will be covered by the guarantee that you will use reasonable care and skill.


a) Does the customer have to specifically tell me what they want?

If the purpose they want to achieve is a normal purpose then the customer does not have to specifically state it.
eg, if a customer wants a tap replaced it is obvious that they will want the tap to turn on and off and to deliver a reasonable flow of water.
 
Where the result wanted is less ordinary the customer must let you know exactly what they want.
eg, if Rita wants a particular pattern for her paving stones she must tell you exactly how she wants it done.
 
Writing down exactly what you have agreed to do in a written quote or contract is a good way of avoiding any debate about what was agreed.


b) What if I can't be expected to know if it will work?

Sometimes it will be obvious that the customer can't expect to rely on your skill to achieve the desired result.
eg , Julie ask the painter to cut back a tree that will get in the way of the painting. The painter agrees and charges for the time it takes. The tree dies and Julie wants the painter to pay compensation. Julie knew that the painter was not a tree surgeon and that she couldn't rely on the painter having the skill to trim the tree successfully.
 
Sometimes you may want to tell the customer that you can't guarantee that you have the skills to do the job.
eg, Fran's car has a recurrent problem with the generator. The mechanic at her local garage has looked at it once and told her it is a job for an auto-electrician. Fran asks him to have another look at it anyway as she doesn't want to have to take the car to an auto-electrician in town. In this case the mechanic has told the customer that they may not have the specialist skills needed. Fran will not be able to claim that the work was not fit for the purpose.
 
If you are in a similar situation you must make it clear to your customers that you may not have the skills required.


c) What if the customer has chosen the cheapest option?

Sometimes the customer will ask you to use the cheapest option.
eg, Jan asks her painter to put only one topcoat on her house as she plans to sell it.
 
Bruce is told that his radiator needs a new core. Bruce says he can't afford it and asks the garage to just solder up the leak.
 
In these cases the result may be less fit for its normal purpose than if the customer had been prepared to pay the extra money for the second coat of paint or the new radiator core. You may want to get the customer's agreement in writing that they have chosen the cheaper option.
eg, we have repaired this radiator by soldering the leak as requested. In our opinion the radiator core needs replacing.
 
You must still guarantee the quality of the work done but clearly there will be a lower expectation on the work. You should not use wording such as "This work is not guaranteed". This could be interpreted as an attempt to contract out of the Consumer Guarantees Act.