list of contributors - GALA

What Happened: Nokia had guaranteed that, in accordance with the particular preconditions
mentioned in the guarantee terms, there are no material or structural defects
or other defects due to the quality of work when the product is sold for the
first time to the end buyer. Nokia had also guaranteed to repair a defective
product or to replace it with another product during the guarantee period.
However, according to the guarantee terms Nokia was not liable for indirect
damages or costs.
The Consumer Ombudsman claimed that Nokia shall be prohibited from
using the guarantee term that excludes compensation for indirect damages
arising in connection with defects, because such condition is unfair. In
addition to the alleged unfairness based on Chapter 3 Section 1 of the
Consumer Protection Act (38/1978), the Supreme Court’s ruling concerned
the question of whether the limited guarantee given by Nokia Oyj should be
considered to be an express representation of the seller under Chapter 5
Section 20 of the Consumer Protection Act. In such case, Nokia would also
have been liable for compensating the indirect loss suffered by the buyer due
to defects in the product.
The Supreme Court found that Nokia had not given an express
representation regarding certain features of the product, when they had only
agreed that the product fulfils the criteria already imposed by the law. The
Supreme Court stated that the provision in Chapter 5, Section 20 of the
Consumer Protection Act limits the liability for express representations to
cases where the product at the time of concluding the contract differs from
that which was agreed. Therefore, said provision limits the liability to cases
where the product did not have, at the time of concluding the contract, such
specific features, to which the seller had agreed to. In this case the seller had
agreed to repair the defects of the product based on a functionality guarantee
regardless of whether the primary reason of the defect already existed at the
time of concluding the contract or whether it had arisen later during the
guarantee period. Consequently, the liability for indirect damages based on
an express representation set forth in Chapter 5, Section 20 of the Consumer
Protection Act differs by nature from the functionality guarantee, which was
the case here. Therefore, Nokia’s guarantee was not an express
representation of the seller as set forth in Chapter 5 Section 20 of the
Consumer Protection Act and the guarantee term excluding compensation
for indirect damages was not deemed unfair for this reason.
However, the Supreme Court stated that unclear terms could also be unfair
from the point of view of consumers and Nokia’s guarantee terms could
perhaps be deemed unclear, but the Consumer Ombudsman had not
invoked this argument. Nokia had not limited the legal rights of a consumer
to compensation for indirect damages in case the defect or loss is due to
negligence on behalf of Nokia. Therefore the Supreme Court found that
Nokia’s guarantee terms should not be deemed unfair based on the grounds
presented by the Consumer Ombudsman, when making a general
assessment of the terms.
3. Topic: Amendments to the information to be given in respect to consumer products
and services
Who: Council of State
When: January 2005
What Happened: The new Decree on information to be given in respect to consumer products
and services (613/2004) came into force in the beginning of 2005. Provisions