Commerce Commission v PB Technologies [2018] NZDC 20733

Published 30 November 2018

Sentencing — Fair Trading Act 1986, s 36U — Consumer Guarantees Act 1993 — Commerce Commission v L D Nathan & Co Ltd [1990] 2 NZLR 160. PB Tech, a computer and IT retailer, faced sentencing after pleading guilty to 14 charges. Between May and November 2017, it sold 17,400 extended warranty contracts to both businesses and consumers. Of those, some 4,400 were to consumers. Those contracts formed the basis of the charges. Under those contracts PB Tech failed to meet the necessary disclosure requirements under the Fair Trading Act. The disclosure violations included failing to provide a copy of the extended warranty agreements to customers, failing to provide a summary of a customer’s rights under both the warranty that they had purchased and the Consumer Guarantees Act 1993, and failing to provide oral notice that a customer was entitled to cancel without penalty, within 5 working days. This meant customers did not have information to allow them to make a proper decision about whether they should purchase the extended warranty contract. A starting point fine of $110,000 was adopted after reference to case law and consideration of the repeated violations over a period of months. Also important was the need to deter this kind of offending. Mitigating factors included the company's immediate guilty plea, co-operation with authorities, and steps it had taken to remedy its failings and prevent them from happening again. PB Tech also had no previous convictions. A 25 per cent discount was given and PB Tech was fined a total of $77,000, made up of $5,500 on each of the 14 charges. Judgment Date: 28 September 2018.