If something goes wrong with what I've sold, what do I actually owe?

What to watch for

Six things to know about how the CGA actually plays out on the supplier side — most of which the conventional "build CGA-compliance into your refund policy" framing misses.

1. "No refunds", "exchange only", "all sales final" — the sign doesn't bind the customer, and the display itself is an offence. A "no refunds" notice in your shop, a "no returns after 30 days" clause in your terms, "credit notes only" on the back of a receipt — none of it overrides a CGA right. The Act has effect "notwithstanding any provision to the contrary in any agreement" (s43(1)).² Under s43(4), purporting to contract out of the CGA in a consumer transaction is itself an offence against section 13(i) of the Fair Trading Act, which is what the Commerce Commission enforces. The sign you've seen in half the shops in NZ isn't a defence — it's a second exposure on top of the original obligation.

2. Minor failure vs substantial character decides who chooses the remedy. Under section 18 of the CGA, minor failure (a defect that can be put right): you choose between repair, replacement, or refund, and you must remedy within a reasonable time at no cost to the customer.³ Failure of substantial character (defined in s21 — the customer wouldn't have bought the goods knowing about it, or the goods are substantially unfit for their common purpose, or are unsafe): the customer chooses, and that includes rejecting the goods and getting a full refund.⁴ The triage is which track you're on. Offering "we'll fix it" on a substantial-character failure isn't a generous response — it's the wrong response, and it makes the dispute worse.

3. "Acceptable quality" includes durability — manufacturer warranty isn't the ceiling. Section 6 guarantees that goods are of acceptable quality; section 7 defines that against what a reasonable consumer would regard as acceptable, having regard to the nature of the goods, the price, statements made about them, and other relevant circumstances. Durability is explicitly part of the test — goods must "be as durable as a reasonable consumer would regard as acceptable" given those factors.⁵ A $2,500 appliance failing at 14 months is potentially under CGA even though the manufacturer warranty was 12 months. The manufacturer warranty is a contractual add-on; the CGA underneath doesn't expire when the warranty does.

4. Sale items are covered. "As is" doesn't apply just because something was on special. The CGA applies to all consumer supplies — full-price, on sale, end-of-line, last-of-stock. The only exception is defects "specifically drawn to the consumer's attention" before sale (s7(3))⁶ — a damaged item sold with the damage pointed out and the customer agreeing, in writing, to take it on that basis. Generic "all sale items final, no refunds" signage doesn't qualify; that's a contracting-out attempt, not a defect disclosure. The specific-disclosure exception is narrow and item-specific.

5. Services have their own guarantees — and the reasonable time one is the one that bites. Sections 28 to 31 cover services: reasonable care and skill (s28), fitness for particular purpose where made known (s29), completion within a reasonable time where none agreed (s30), and reasonable price where none agreed (s31).⁷ Substantial-character for services lives in s36; remedies in s32 mirror goods (supplier's choice on minor failure, customer's choice on substantial). The one that catches service businesses is s30: if you said "three weeks" and you're at seven with no update, the customer may already have a CGA route open — the clock runs from what's reasonable in context, not from when you get to it.

6. You can contract out — for business-purpose sales, in writing, only if it's fair and reasonable. Section 43(2) lets you exclude the CGA in an agreement if four conditions all hold: the exclusion is in writing; both parties are in trade; the goods or services are supplied and acquired in trade; and it is fair and reasonable for the parties to be bound by it.⁸ "In trade" means actually trading, not "the buyer happens to have an NZBN" — a sole trader buying a laptop for personal use that also gets used for work doesn't qualify. A take-it-or-leave-it standard form presented to a much smaller counterparty may fail the fair-and-reasonable limb. If you sell to both consumers and businesses, you need different terms for different transaction types — contracting out doesn't run on autopilot. Buyer-side view: see the B2B buyer protections entry.

A separate point on what the CGA actually is operationally. The conventional read frames CGA-compliance as a customer-service feature — something you build into your refund policy, your warranty terms, your complaints workflow. That framing has it backwards. The CGA is the default. Your terms can't override it. Your signage can't disclaim it. Trying to do either is another offence. Most of this stuff has a cheap first-screen — if you'd be embarrassed to tell your mother the unvarnished version of how you're handling a complaint, you're probably in the wrong, and the law usually agrees. The watch-fors above are for the cases where the mother-test passes but the right operational call still isn't obvious — the durability question on an out-of-warranty appliance, the minor-failure-vs-substantial-character triage, the sale-item disclosure exception, the B2B contracting-out mechanics. The right operating frame isn't what should our refund policy say — it's how fast can we triage a complaint to the right remedy track. The faster you triage, the better the outcome for everyone: the customer gets a clean resolution, you avoid accidentally escalating a minor-failure case into a substantial-character claim, and the dispute doesn't end up at the Disputes Tribunal because the operational question never got past the counter. The Act is the floor; your customer service is what you build above it — and if your customer-service approach is trying to talk customers out of CGA rights they actually have, you're operating below the floor, not above it.

Where this entry stops

This entry covers your obligations as a supplier when you sell goods or services to NZ consumers. It doesn't cover:

• The Disputes Tribunal hearing process once a claim is filed. Different question — covered by the entry on chasing unpaid invoices, which carries the $60,000 jurisdiction change and the procedural detail. Most CGA cases land there rather than in court.
• The Fair Trading Act side of consumer law — misleading conduct (s9), unsubstantiated representations (s12A), unfair contract terms (Part 4A), and the rules on pricing claims and advertising. The s13(i) "no refunds" offence sits at the overlap and is named above; the broader FTA picture lives in the Fair Trading Act essentials entry.
• Manufacturer liability under Part 3. A consumer can claim directly against the manufacturer in some circumstances. If you're the manufacturer (or importer treated as manufacturer), the Part 3 mechanics are additional to the Part 2 supplier obligations and warrant their own treatment. Pointer to Consumer Protection's manufacturer-side guidance, or a lawyer if a Part 3 claim is in front of you.
• Sector-specific consumer regimes. Motor vehicle dealers (Motor Vehicle Sales Act), real estate (Real Estate Agents Act), construction (Building Act, Construction Contracts Act), financial services (FMCA, CCCFA) all carry additional consumer-protection layers on top of the CGA. If you're in any of those sectors, the CGA is the floor under the sector-specific rules, not a substitute for knowing them.
• Online distance-selling and extended-warranty disclosure specifics. The CGA applies the same way online as in-store, but the FTA Part 4 (extended warranty disclosure) and Part 4A (uninvited direct sales, online cancellation rights) rules sit alongside. Specialist territory if either is your operating model.

If you've got a complaint in front of you and you're unsure whether it's minor failure or substantial character, get a second opinion before you commit to a remedy. Cheaper than the wrong call. If the customer has named the Disputes Tribunal, take it seriously — filing fee tiered by claim size: $61 under $2,000; $121 for $2,000–$4,999; $243 for $5,000–$30,000; $468 for $30,001–$60,000, no lawyers at the hearing, decisions inside 6-8 weeks; it's genuinely accessible. And if your terms and conditions or your in-store signage attempt to limit CGA rights, the highest-leverage thing you can do this week is fix that — both because the limits don't bind your customers and because the display of them is independently exposure.

Knowing where the minor-failure / substantial-character line sits stops you over-refunding on minor failures repair would have cleared — and a complaint triaged cleanly is cheap repeat custom. Miss the line and you're escalating minor cases, giving away remedies the Act didn't require, and fielding the same disputes at the counter every week.

Last verified 27 May 2026 against the Consumer Guarantees Act 1993 (sections 2, 5–12, 18, 21, 28–32, 36, 43) and the Fair Trading Act 1986 (section 13(i)) at legislation.govt.nz, cross-checked against Commerce Commission and Consumer Protection guidance current at that date. CGA substantively stable since 2014; the Right to Repair Bill was withdrawn before second reading in October 2025 with no replacement signalled. Full source list: references.