Well-protected, or not?
12/06/2004 The Sun By Jacqueline Ann Surin

AT FIRST GLANCE, it would seem that consumer rights in Malaysia are already adequately protected by legislation.

ERA Consumer Malaysia consumer affairs manager Sharon Nobbel says that apart from the Consumer Protection Act, Malaysia has other specific laws for consumer protection, including the Food Act, Direct Selling Act, Price Control Act, Hire Purchase Act, Moneylenders Act, and Pawn Brokers Act.

Awareness of consumer rights in Malaysia can be considered relatively high, with increased information and more savvy consumers, she tells theSun in an e-mail interview.

She notes that because Malaysia has a strong middle class, the likelihood is that most consumers would demand value and quality for money spent.

Consumer Claims Tribunal deputy chairman Eddie Yeo Soon Chye agrees, saying there are enough laws and institutions to protect consumer rights in Malaysia.

"We have the laws and the existence of the tribunal, which is the government's best gift to consumers. What else do we need?" he asks, noting that the number of claims the tribunal has received has increased from 291 in 2000, to 1,155 in 2001, 2,649 in 2002, and 4,150 last year.

Datuk Dr S. Sothi Rachagan, the regional director of Consumers International Asia Pacific Office, agrees that the Consumer Protection Act, which he drafted for the government, was a good step forward.

However, he argues that much more needs to be done. Despite the impressive increase in the number of claims made to the tribunal, he says, for a population of 26 million, claims from 4,000-odd consumers was "not impressive at all" since the trader-consumer relationship is replicated daily for most citizens.

He adds that while Malaysia has the framework legislation in place, there is a need to give the laws life through supplementary legislation, adequate enforcement and publicity. For example, says Sothi, although the Consumer Protection Act has created a lot of powers for the government, much of it remains underused.

He cites, among others, Section 19 of the act, which gives the Domestic Trade and Consumer Affairs Minister the power to prescribe by regulations the safety standards for goods and services.

"The minister is given immense powers, but it is not exercised," he laments.

Sothi also points out that a section on standard term contracts that was included in the draft Bill for the law was removed.

Standard term contracts cover everyday transactions including buying a bus or cinema ticket, and prevent the need for constant negotiations between trader and purchaser.

Unfortunately, these contracts are always drawn up unilaterally by the seller and remain largely unfair to consumers.

"The clause would have enabled the minister to determine, after consultation with industry and consumer representatives, what standards should prevail for a transaction," he says.

Consumer Claims Tribunal's Yeo also alludes to this problem when he talks about traders who unilaterally and without legal basis state that deposits are non-refundable.
The tribunal, he says, has had to deal with claims of this nature.

Sothi says Malaysia also does not have an Unfair Contracts Act, which would address "bizarre" situations like the one in which the management of a car park can avoid liability for any security breach within the car park, even if it entails negligence on the part of the car park owner and its employees.

He explains that consumer rights must mean more than just protecting a customer's rights during a transaction with a trader.
"Consumer rights is about having a good quality of life, and is part of an individual's economic rights," he says.

A clear example of the lack of consumer rights that affects quality of life is when commuters have to pay toll and still end up caught in a jam on a highway, he adds.

Rights for the poor
But what concerns Sothi the most about consumer rights is that they should address quality-of-life issues, especially for the poor.

He finds it troubling that there has been an escalation in the cost of healthcare, education, transportation, housing and other essential services that affect consumer rights. It is this trend that especially affects the consumer rights and quality of life of the poor.

In Australia, for example, says Sothi, a utility company has to give consumers two weeks' notice to seek welfare assistance before the supply of utility is discontinued.

"The concept of essential service there translates into the needs of a family, so that even if the individual cannot pay the utility bill, other family members including children should not suffer for it," he explains.

In Malaysia, he laments, there is no such consumer protection, and there is even an attempt to introduce pre-paid cards for the use of electricity in homes.

The question Malaysia needs to ask, he says, is whether the current laws adequately address the problems that Malaysian consumers, especially the poor, face daily.


Cases that succeeded before the tribunal

CASE 1
Mazira placed an order with Syarikat B for a sofa set, imported from Italy, for RM9,500. Mazira paid more than RM10,000, which included the cost of transportation. The sofa set was to be delivered six months from the order date. A year later, the sofa set had yet to arrive from Italy. Finally, Mazira filed a claim with the tribunal to revoke her order and for her RM10,000 to be returned to her, along with RM130 in cost. Syarikat B refused to revoke the order, claiming it had already placed the order with Italy.

Award: Syarikat B did not file a defence for the hearing. The company was ordered to pay Mazira the RM10,000 and RM130 in cost within 14 days of the award.

CASE 2
Syarikat Easy told Mrs Virmala that she was the winner of a lucky draw and would receive a microwave oven, vacuum cleaner, food processor and water purifier, all worth RM5,800. However, to redeem the gifts, Mrs Virmala was first required to pay Syarikat Easy a deposit of RM1,000. After she paid the deposit, Mrs Virmala took the water purifier home. After doing a search on the Internet, Mrs Virmala began to doubt the quality of the water purifier. She tried many times to get her deposit back from Syarikat Easy, but to no avail. She then made a claim to the tribunal.

Award: Syarikat Easy was ordered to return the full amount of RM1,000 to Mrs Virmala.

CASE 3
Arif bought his wife, Rina, a mobile phone. Five days after using the phone, Rina discovered it was faulty. They took the phone to an authorised dealer where they were told the phone was a clone. They returned to the shop where Arif had bought the phone and demanded a refund. The shopkeeper refused to entertain their request, but instead scolded them and challenged them to report the matter to the authorities. The couple filed a claim with the tribunal.

Award: The shop was ordered to return Arif's RM1,240.

CASE 4
An adult student was dissatisfied with a private college at which he was enrolled. Among other things, he claimed that the college failed to provide the services as advertised and classes were not conducted as scheduled -- instead, the timetable was constantly changed. In addition, the qualification awarded by the private college was not recognised by the Education Department.

Award: The college was ordered to reimburse the student's money.

CASE 5
Michelle was told by Syarikat MM Sdn Bhd that she needed to undergo three or four treatment sessions to permanently remove the hair above her upper lip. After undergoing 33 treatment sessions and a further 12 hours of treatment, the hair continued to grow and it became coarser and darker. The skin around Michelle's lips became darker, too. She claimed RM3,070 from the company.

Award: Syarikat MM Sdn Bhd was ordered to pay damages and cost of RM3,072.

CASE 6
At a car exhibition, Suri paid the deposit for a national car. A week later, the car dealer's sales representative informed Suri that the car she had ordered was out of stock. The new stock would cost more because it would have newly-added accessories. Suri demanded that her deposit be returned but the car dealer refused and, instead, told her to look for a replacement. Suri filed a claim with the tribunal.

Award: The dealer agreed to return Suri's deposit of RM3,000.

CASE 7
Sara went to a boutique to have a dress made. Later, she found that the dress was not tailored to her measureents, which had been taken by three of the boutique's employees. After informing the boutique owner about her problem, Sara was scolded for not giving enough material. But she claimed she was not told of the problem even though she had left her handphone number with the employees. Sara claimed RM183 from the tailor through the tribunal.

Award: The boutique owner was ordered to pay Sara RM119.

CASE 8
Rina bought a pair of branded sunglasses for about RM230 but after using them, she found it left marks on her cheek. She requested Syarikat Nice View to replace her sunglasses but the company refused and, instead, asked her to purchase another pair. Rina made a claim for RM430.

Award: Syarikat Nice View was ordered to pay Rina RM120 as final settlement, and RM30 in cost.


Cases that failed

CASE 1

Juliana bought an IBM notebook from an Encik Nasir, who claimed to be a representative of CompuIntel Sdn Bhd. Dissatisfied with the product and the promised accessories, she filed a claim for RM2,500 against CompuIntel. CompuIntel submitted that Nasir had no authority to represent the company, and that he had bought several notebooks from the company, including the one that was sold to Juliana. The company added that it was not a party to the negotiations between Juliana and Nasir, and filed a counter claim of RM200 fo costs involved in dealing with the complaint and attending the hearing.

Both claims were dismissed by the tribunal.

CASE 2
Mr Goh filed a claim of more than RM14,000 against Atlan and Co Building Services Sdn Bhd for damage caused to his household electrical appliances owing to two separate instances of power surges at his condominium. The claim also covered the cost of repairing a leak in the bedroom and bathroom ceiling and a refund of service charges for failure to provide proper and professional service. Atlan and Co submitted that as property managers, it was only liable if the power surge was due to negligence or misconduct. The company said Goh had been informed that the power surge was caused by lightning, and it was not responsible. Atlan and Co also said no other unit owners had complained of the power surge.

The claim was dismissed.

CASE 3
Mr Chun, through a health-card programme centre known as Good Health Sdn Bhd, had been buying and renewing a hospital and surgical insurance plan since 1998. In 2002, he was admitted to a private hospital for a heart operation. Good Health's cash guarantee was withdrawn on the second day, pending an investigation by the insurance company, which was the underwriter of Chun's policy.
Chun was advised to first settle the medical bill, then file a claim with the insurance company. His claim was rejected. He then made a claim for RM22,700 from Good Health through the tribunal. Good Health submitted that it was not an insurance company nor an agent of the insurer, so Chun's claim should be against the insurance company.

The insurance company submitted that Chun had not disclosed that he had suffered from diabetes since 1994 and hypertension since 1995 before he began paying for his policy, hence the policy was void.

Chun's claim was dismissed by the tribunal.

CASE 4
Mohd Harun purchased an insect repellent from a direct-selling outlet in November 2002 for RM120. A year later, he filed a claim through the tribunal for RM150, alleging that the repellent was only 20% effective and citing costs. The direct-selling company submitted that Mohd Harun had a 10-day cooling period to return the product but, instead, he waited an entire year before complaining. It also said Mohd Harun could not produce a receipt for the purchase.

The claim was dismissed.

CASE 5
Two days after taking delivery of his new car, Shanmugam drove over a pothole and punctured two of his car tyres. He brought the car to the service centre. After an examination, he was advised to take the car to the tyre manufacturers. The tyre manufacturer turned down Shanmugam's claim to replace the tyres at their cost. The tyres would be patched but at Shanmugam's expense. Shanmugam filed a claim for RM2,125 against the car manufacturer, which submitted that it was not the party responsible for the tyres.

The tribunal dismissed the claim.

CASE 6
Mr Soon filed a claim for RM10,000 against Mekar Estate Management Sdn Bhd for the theft of his car, which he said was parked within the compound of his condominium. Mekar Estate submitted that the security guards did not see Soon park his car within the compound and had no record of his car leaving the compound. It also said that as a condominium owner, Soon had signed a deed of covenant which spelt out that residents parked their cars at their own risk. It made a counter claim of RM500 as cost incurred for attending the tribunal's hearing.

The tribunal dismissed both claims. -- Compiled by Jacqueline Ann Surin

Source: Consumer Claims Tribunal of Malaysia (all names have been changed)