Water-damaged products

After heavy rain or a flood vehicles and other goods for sale may have water damage.

Businesses and consumers should consider how guarantees and the need for accurate representation relate to the sale of damaged goods.

For businesses

You must be careful when your business sells goods that may have been damaged by water.

You should:

• dispose of damaged products rather than sell them
• contact your insurance company to find out if you can make a claim for your loss.

If you decide to sell water-damaged goods—including restored or repaired goods—you must:

• not mislead consumers about the history of the goods
• make it clear to consumers the goods have/had water damage.

Consumer guarantees for damaged goods

Your business guarantees all goods it sells will meet certain consumer guarantees.

The consumer guarantee considers goods are of an acceptable quality if a fully informed consumer believe the goods are acceptable when making their decision to purchase.

For example, a consumer is considering buying a water-damaged outdoor dining set. You point out some discoloration of the wood due to water damage. The item is discounted accordingly. The customer, knowing this, buys the item. The discoloration would usually mean the dining set fails the test for acceptable quality, however as the consumer knew of the defect and still considered the item to be of acceptable quality, the consumer guarantee has been satisfied.

Goods you should not sell

We strongly recommend you not sell the following goods if they were stored in a waterlogged area:

• any product inserted in or around the mouth (e.g. a toothbrush)
• wooden or cloth toys that might have absorbed hazardous materials
• baby-related products (e.g. cots, cribs, mattresses and toys)
• electrical items (e.g. hair straighteners, blenders and microwaves)
• clothing (e.g. underwear).

Rules for motor vehicles

You must tell a buyer when a motor vehicle is a:

• repairable write-off
• statutory write-off.

An auctioneer must announce at the start of an auction if the motor vehicle is a:

• repairable write-off and must pass a written-off vehicle inspection, or
• statutory write-off and cannot be registered.

Read more about selling a used car by auction.

For consumers

Businesses aren't allowed to lie or not disclose that goods are water-damaged.

If you are told about the damage and choose to buy the item anyway, you are accepting that your consumer guarantee for acceptable quality has been met.

If there has recently been a weather event that may have damaged shops or their stock, it is a good idea to ask the business if the item you plan to buy is free from water damage.

Rules for motor vehicles

When you buy a second-hand vehicle, make sure you look out for signs of water damage.

Motor dealers need to follow rules to legally sell:

• water-damaged vehicles
• vehicles that have been in accidents.

The dealer must tell you if a motor vehicle is a:

• statutory write-off
• repairable write-off.

A statutory write-off has too much damage to drive safely and is not registrable. You can only use these vehicles for parts or scrap metal.

A repairable write-off is a vehicle that has been assessed as a total loss by an insurer but isn’t a statutory write-off. You can only register a repairable write-off if it passes:

• a safety inspection to prove it has had its needed repairs
• a written-off vehicle inspection to prove its history and identity.

Learn more about the types of written-off vehicles.