A class action has been launched in the Federal Court against Radio Rentals for allegedly misleading its customers.
Ross Greenwood: The offer says ‘Rent, Try, Buy for $1’…
What do you think it means?
Vox Pops: That I can rent it, try it, and then buy it…
You rent, you try, and any buyer for a dollar…
Ross: Well, not exactly…actually, not even close according to lawyers.
Ben Slade: Radio Rentals say ‘Rent, Try, $1 buy’ whereas the reality is ‘rent now, pay forever’.
Ross: This is why Maurice Blackburn has launched a landmark federal court class action against Radio Rentals claiming unconscionable practice.
Morris Blackburn estimates as many as 200,000 customers are affected.
The claim could be up to $50 million.
The lead plaintiff is Wagga based mother of five, Casey Simpson – who ended an 18-month rental agreement two years after it expired.
She claims to have paid $3300 for a $430 used mattress and bed.
Casey Simpson: Why I thought I owned it… I didn’t know I was still paying for it…
Ben: Without notice from Radio Rentals, she worked out that her Centerlink pay had continued to be directly debited the fortnightly lease payments.
Ross: There’s a technical part of this…
Same day lenders are forced, by law, to charge a maximum 48 percent interest for small, short-term loans.
Radio Rentals, though, it says ‘rent, try, buy’, uses a rental contract so there are no limits.
It makes even the highest rate credit cards look cheap.
Karen Cox: I’ve put on the credit card every time… because it’s cheaper.
Ross: The answer is to read the terms and conditions – but few do…except consumer lawyers.
Karen Cox: You definitely say no to this contract if you understood the terms and conditions.
Ross: Responding today, Radio Rentals owner, Thorngroup, (ASX:TGA) said “should any proceedings be commenced, they will be defended vigorously.”
Ross Greenwood; Nine News