Air conditioning installer fined $120,000 for failing to supply goods and services

The Melbourne Magistrates Court has ordered an air conditioning and heating business to pay the maximum possible penalty it can impose for breaching the Australian Consumer Law.

In a civil case brought by Consumer Affairs Victoria, Australia Heating and Air Conditioning was ordered to pay $20,000 in costs and $100,000 in compensation to customers.

The case is similar to a lawsuit from July 2013, in which a refrigeration installer was fined $10,000 by the Dandenong Magistrates Court for taking deposits, but failing to do any work.

Australia Heating and Air Conditioning advertised “over 36 years’ experience” in installing and serving a range of brands, including Mitsubishi Electric, Daikin, Panasonic, Lennox, Carrier, Temperzone, LG and Fujitsu.

However, the court found the company had accepted money from customers, but had failed to supply those goods and services.

It also found the company breached the terms of a 2012 enforceable undertaking, which required the company to repay money to certain consumers.

Australia Heating and Air Conditioning was also found to have engaged in misleading and deceptive conduct by requesting payments when it was restrained from the court from doing so.

Aside from the fine, company officer Mardi Angela Tovey has been disqualified from managing a company until July 2024, while complaints manager Richard Francis Luke Tovey is barred until July 2018.

The company has also been ordered by the court to maintain a notice on its website until July 1, 2015, stating the company “had accepted payments for the supply of goods and services but not supplied the contracted goods and services”.

In addition, the Toveys have been restrained from accepting any payments for installing heating or air-conditioning systems before they complete the work.

In a statement, Consumer Affairs Victoria said this was not the first investigation involving a company linked to the Toveys.

“The Toveys have a history of poor conduct. In 2012, they operated a company called Worldwide Heating and Air Conditioning Pty Ltd, which was also the subject of complaints to Consumer Affairs Victoria. It went into liquidation before Australia Heating and Air Conditioning began to trade,” said the watchdog.

“Consumer Affairs Victoria took legal action against Australia Heating and Air Conditioning and the Toveys in March 2012, and they were restrained from taking payments before supplying goods and services. They later breached those court orders, causing further losses to several consumers.”

Dan Simpson from the Consumer Action Law Centre told SmartCompany the Australian Consumer Law, which came into action at the start of 2011, provides strong protections for consumers.

“First and foremost, products and services must be fit for purpose, that is to say they should do what they’re meant to do,” Simpson says.

“Services must also be carried out with due care and skill. The person undertaking the work is required to do so competently, and take reasonable steps to avoid causing loss or damage.”

Simpson says that the law also mandates that services must be delivered within a reasonable timeframe.

“That timeframe may be agreed to from the outset, or it could vary depending on factors such as products availability or weather,” Simpson says.

“The Australian Consumer Law also covers ownership of the goods. Once the customer pays for the product the ownership is transferred to them.

“If you’re concerned about a product or service you should raise it with the retailer in the first instance. If their response is unsatisfactory, you should contact the consumer affairs or fair trade office in your state.”

SmartCompany attempted to contact Australia Heating and Air Conditioning. However, no one at the company was available for comment.