A Southland mum who spent more than a year paying off a new iPhone that never showed up isn’t mincing her words when she brings the problem to Fair Go.
“I was really pissed off. I felt like they had sold me something that didn't even exist,” says Rebekah Wilson.
She had spent more than a year paying off a new iPhone XR, and then waiting six weeks for it to turn up, while getting conflicting reports from the business about whether it even had a phone to sell her.
HouseSmile is the Hamilton-based online trader that sent a door-to-door agent to Rebekah in Christchurch. After weekly payments of $25 (well, $26 for the last one), they would send her the phone - a total cost of $1326 for a device that now retails for under $700.
This was a layby sale – something Wilson had used before, because she refuses to use credit cards or take on other debt.
Laybys were common before ready credit, or all those buy now, pay later apps like AfterPay and Humm and LayBuy.
“I thought it was just going to be like any layby, that they'd be holding it in their possession, that they were actually selling me something that they had, in stock, as advertised on their website, that they have this phone.”
While that is how layby traditionally worked, the law is silent on whether the retailer must hold the goods for you, but a store can’t mislead you by selling something it says it has when it doesn’t.
The Commerce Commission advises that the Fair Trading Act prohibits businesses from taking your money unless they have reasonable grounds to believe they'll be able to supply your goods within a specified time.
So, Wilson smelled a rat when she asked HouseSmile where her phone was, weeks after she’d paid it off.
“He said they were still waiting for my phone to come waiting for it to arrive, it wasn't there yet they didn't have any in stock.”
That was confirmed in writing by HouseSmile. At other times in the six weeks after she’d paid in full, Wilson was also told that the phone was there but held up by Covid-19 Alert Level complications.
Knowing her rights, Wilson wrote back by email insisting they cancel the contract and provide a full refund - but HouseSmile wanted to do that in installments - 4 weekly payments of $331.25.
Wilson felt she had no choice and agreed at first but then had second thoughts.
When Fair Go raised this with HouseSmile, it actioned a full refund within 30 minutes.
“We want to do a fair trade. If we are wrong, I will definitely be making changes,” says Rahil Tharani, director of the company that owns HouseSmile.
He tells Fair Go that he thinks it was a mistake that Wilson was told her phone wasn’t there, but by his own explanation, they don’t have to hold stock all the time.
“We’re not a retail business. In our case it's slightly different. We've made this our terms and conditions. If goods go out of stock just after you have placed the order, we have rights to upgrade your order or can come back to you and cancel your order,” Tharani explains.
No, those rights are in fact the customer’s; it’s the buyer’s choice about replacement or refund if the seller can’t fulfil that layby sales agreement. And in a world mucked up by Covid-19. that can happen more often now.
So, it might pay to ask “do you actually have this item in stock” before you buy anything, and especially if you are paying it off over a year.
Rebekah Wilson is just happy she has that full refund and is ready to find an iPhone she can touch and see before she hands over her money to buy.
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