Someone Has Broken One of My Products in My NZ Store. Am I Responsible?

In Short

• Customers must take reasonable care in-store. If they act carelessly and break a product, they may be responsible for paying for it.
• If your actions (or your staff’s) contributed to the breakage, the customer may not have to pay.
• Responsibility depends on the circumstances, and disputes may be taken to the Disputes Tribunal.

Tips for Businesses

Reduce disputes by placing clear signage near fragile items, maintaining safe displays, and training staff to assist customers. Keep your store tidy and hazard-free to avoid contributing to breakages. Consider insurance to cover accidental damage, as this can protect your business from losses and limit conflict with customers.

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Table of Contents

• Determining Who is at Fault for the Breakage
• When Am I Responsible?
• When is the Customer Responsible for Broken Products?
• Dealing With the Aftermath
• Preventive Measures and Best Practices
• Key Takeaways
• Frequently Asked Questions

Customers have a responsibility to act with due care when they enter your store and browse your goods. If they breach this responsibility and break a product in-store, they may be liable. However, depending on the circumstances, if your actions caused or contributed to the item being broken, then the customer may not have to pay. This article will explain whether you are responsible if a customer breaks one of your products in-store.

Determining Who is at Fault for the Breakage

When you sell products to consumers in New Zealand, you need to comply with consumer law. This means ensuring that your products meet the consumer guarantees that apply to them under the Consumer Guarantees Act. If you fail to meet this standard, then you must provide the customer with a remedy.

However, until a customer purchases a product, these consumer guarantees do not apply to them. Therefore, if they break a product in-store, it becomes a matter of weighing up contextual factors in determining who is most at fault, instead of relying on a set quality standard. If a customer failed to take due care when the product broke, they usually have to pay for the product. However, if your business contributed to the breakage somehow, the customer may not have to pay for the broken product.

When Am I Responsible?

If a customer has broken one of your products in-store and you or your employees contributed to that breakage, you are responsible for that breakage. For example, say that you or your employees stacked the plates in your store haphazardly or spilled something on the floor and did not clean it up. Say that a customer knocks over these plates when examining them or slips on the floor and breaks your other products. Your store contributed to that breakage through your negligence. The customer then has a reasonable basis for refusing to pay for the broken product.

When is the Customer Responsible for Broken Products?

When customers enter your store, they must exercise reasonable care when browsing your products. This will vary according to the situation, but will generally mean:

• handling fragile goods with care;
• not interacting roughly with your products;
• following any warnings or signage in your store;
• keeping an eye on their children to ensure they are careful; and 
• listening to employee directions or warnings.

If a customer is careless and damages one of your products, then you can ask for compensation for that product. This only applies as long as you did not contribute to the breakage in any way.

However, customers are not responsible for breakages that occur due to an event outside of their control, such as accidentally breaking a glass during a store evacuation due to a fire. Determining who is responsible for damage is very dependent on the specific circumstances leading to and surrounding the breakage.  

Dealing With the Aftermath

If a breakage has occurred, calmly discuss the incident with the customer. If they caused the breakage, then you can ask them to pay for the damage. However, you cannot force them to pay you immediately. If you contributed to the breakage, acknowledge this fact and act accordingly. Try to come to an amicable agreement to handle the costs.

When a customer does not agree to pay for a broken item, or you cannot agree on who was at fault, you can take your case to the Disputes Tribunal. You will need to prove that the customer was careless and have some form of evidence. You could rely on testimony from your employees or other customers and CCTV footage.

Preventive Measures and Best Practices

To minimise the risk of product breakages and potential disputes, consider implementing the following best practices in your store:

• Clear signage: Place visible signs throughout your store, especially near fragile items, reminding customers to handle products with care.
• Proper product placement: Arrange your merchandise in a way that reduces the risk of accidental breakage. For example, place fragile items away from high-traffic areas or at a safe height.
• Staff training: Educate your employees on how to assist customers safely when handling delicate products and how to intervene politely if they notice potentially risky behaviour.
• Protective packaging: Where possible, use protective packaging or display cases for fragile items to minimise the risk of breakage during customer handling.
• Regular maintenance: Ensure your store is well-maintained, with clean, dry floors and sturdy shelving to reduce the risk of accidents.
• Insurance coverage: Consider obtaining insurance that covers accidental damage to your stock by customers. This can help mitigate financial losses in case of breakages. 

These precautionary measures can help protect your merchandise and reduce the likelihood of disputes over broken items.

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Key Takeaways

Once a customer has purchased a product, you owe them certain consumer guarantees about the quality of that product, and must provide a remedy if that product breaks unreasonably. However, these guarantees do not apply until a customer has purchased a product. When they are browsing your goods in-store and carelessly break a product, you may be able to ask them to compensate you for the loss. However, this is only if you did not contribute to the breakage. 

If you would like more information or help with handling shop breakages at your store, our experienced regulatory and compliance lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0800 005 570 or visit our membership page.

Frequently Asked Questions