Setback in court battle over ‘lowest prices’ promise for Bunnings

by | Apr 27, 2020

Bunnings New Zealand has suffered another blow in a long-running battle over its claims it has the lowest prices, with an appeal and judicial review thrown out of court, according to a recent report.

The Commerce Commission charged the company with 45 offences in 2016, alleging the hardware chain’s claims were false and misleading. The commission’s case focused on claims made between June 2014 and February 2016 and covered print, radio, TV and online advertising in New Zealand, as well as staff uniforms, according to the report.

Bunnings regularly used slogans including “Lowest prices are just the beginning” and “Bunnings has the lowest price on everything you need”. The legal action followed a complaint to the consumer watchdog by competitor, Mitre 10 New Zealand.

Bunnings denies the allegations and has pleaded not guilty.

In 2018, Auckland District Court Judge Phillippa Cunningham said Mitre 10 could use price comparison evidence it had gathered as evidence in the case and staff member Murray Snowden could appear as a witness.

However, Bunnings New Zealand appealed the decision in 2019, arguing the evidence should not be allowed, according to the report.

In Auckland High Court in December, Justice Ailsa Duffy dismissed Bunnings’ appeal over the evidence and said Mitre 10’s price comparison data and Snowden’s evidence could be used as part of the commission’s case.

But Bunnings headed back to the Auckland High Court in March to appeal Judge Cunningham’s pre-trial ruling on the admissibility of the evidence and sought a judicial review of a witness summons as part of the prosecution.   

In a decision released this week, Justice Duffy dismissed both the appeal and the judicial review.  She said the appeal rested on whether Mitre 10 could still produce its price comparison data, while the judicial review centred on the manner in which the commission received the evidence.

“No-one disputes that a facsimile copy of the price data comparisons that Mitre 10 made in 2015/2016 was not kept, and that any price comparisons that Mitre 10 may now provide for the 2015/2016 period will be the outcome of Mitre 10 interrogating its electronic data systems sometime after 2015/2016.”

Justice Duffy said all that mattered was that the evidence showed Mitre 10 New Zealand was selling items at the same or lower prices to Bunnings during the specific timeframe the Commerce Commission’s case relates to.    

Bunnings also sought a judicial review as it alleged Mitre 10’s price comparison evidence had been provided to the Commerce Commission under summons and said it was an, “illegitimate discovery exercise”.

But Judge Duffy said Mitre 10 had provided the evidence to the Commerce Commission voluntarily and it could provide it to back up Snowden’s testimony.  

Each of the 45 offences Bunnings is charged with has a maximum fine of $600,000. The penalty the chain faces could potentially total $27 million.   

The Australian-owned company is one of New Zealand’s largest retailers and sold $1.35 billion in goods in the last year.

It currently has 46 retail stores nationwide and employs more than 3500 staff.