Extended appliance warranty: it is optional and they must tell you

It is the 1971 law governing what the store offers you at the register: the service contract or insurance on the fridge, the stove, the TV or the phone. It says three things almost nobody knows: it goes in a document separate from the sale contract; as a rule it does not start until the manufacturer’s or the store’s warranty ends, whichever lasts longer; and it is optional, with the seller obliged to say so clearly.

The law reaches every sale made in Puerto Rico of household or electronic goods and appliances. It asks nothing of the buyer: the obligations are the seller’s, and the right to complain arises from the fact that you were forced, denied the sale for not buying it, or otherwise affected by an act violating the law.

• That the sale be of household or electronic goods and appliances made in Puerto Rico.Verified against the official source
• For the complaint: that you were forced to acquire the service contract or insurance as a condition of the sale, that you were denied the sale for not acquiring it, or that you were otherwise affected by an act violating this law.Verified against the official source

• The article’s sale contract, in a document separate from the service warranty contract. The law requires two documents.

1. 1

   Step 1: It is optional, and the seller must tell you

   It is the law’s shortest sentence and its most useful: “Service contracts or insurance shall be optional and it shall be the seller’s obligation to state this clearly and expressly to the buyer.” It is not enough for it to be in fine print somewhere: the law places the obligation to say it clearly and expressly on the seller.

2. 2

   Step 2: They cannot pressure you into buying it

   The law says it with three verbs, and they are worth having because they cover more than an outright threat: “Every seller of goods or household appliances shall abstain from exerting pressure or coercion or otherwise influencing a buyer into acquiring a service contract or insurance with the purchase.” Pressure, coercion, or otherwise influencing.

3. 3

   Step 3: Two documents, not one

   This is the detail that lets you see what you are signing. “In every sale made in Puerto Rico of household or electronic goods and appliances, separate documents shall be executed for the article’s sale contract and for the service warranty one, if any.” If they hand you a single paper with everything on it, the law was not complied with.

4. 4

   Step 4: As a rule, it does not run alongside the manufacturer’s

   Here is the money, because this is where months of paid coverage get lost. The law says the service warranty contract “may only take effect upon expiry of the warranty term of the article sold by the store making the sale or by the manufacturer, whichever is longer.” That is: first the longer of the two original warranties runs, and then the one you bought begins. And it adds two minimum coverages: “it shall cover payment of labour in cases where such payment is covered by the manufacturer’s warranty” and “it shall cover those defects or damages, as established in the original product manufacturer’s warranty contract.”

5. 5

   Step 5: The only written exception

   The law does allow it to run alongside, but on a precise condition worth demanding in writing: “The service contract or insurance shall take effect, as an exception, coexisting with the original warranties, if it provides to cover the insured product for any element those original warranties do not cover and, always, providing for payment of labour.” That is: only if it covers something the original warranties do not, and always paying for labour.

6. 6

   Step 6: What to do if it was forced on you

   The law opens a complaint and describes three situations that trigger it. “Any person who has been forced to acquire a service contract or insurance as a condition for the sale of goods or household appliances or who has been denied a sale for not having acquired a service contract or insurance or who has otherwise been affected by any act violating this law’s provisions, may file a complaint.” The agency “will investigate the complaint and take the corrective action that proceeds.”

7. 7

   Step 7: Which agency the complaint goes to today

   It is worth explaining because the 1971 text names an agency by another name. The law says the complaint is filed “with the Consumer Services Administration,” which will act “pursuant to the powers granted to it in Act No. 148 of June 27, 1968.” The OGP compilation itself notes in brackets that Act 148-1968 was “repealed and replaced by Act 5-1973,” which is the organic act of the Department of Consumer Affairs. That is where it is filed today, and how to file a DACO complaint has its own guide here.

8. 8

   Step 8: The penalty

   It helps to size the matter up: “Any person who violates this act’s provisions shall incur a misdemeanor and upon conviction shall be punished with a fine of no less than one hundred (100) dollars and no more than five hundred (500) dollars or with imprisonment not exceeding six (6) months or both penalties, at the Court’s discretion.”

The complaint goes to the Department of Consumer Affairs, which is today the consumer services agency the law refers to. The obligations this law creates are the seller’s, not yours: the separate documents, the clear and express notice that it is optional, and abstaining from pressure. If your matter is that the manufacturer’s warranty does not cover Puerto Rico, that is another law from the same year and it has its own guide here; if it is that your receipt faded, so does that.

• Believing the extended warranty is part of the purchase: the law says it is optional and that the seller must state so clearly and expressly.
• Accepting being charged for it inside the sale contract itself: the law requires separate documents.
• Taking for granted that it runs from the purchase date: as a rule it takes effect upon expiry of the store’s or manufacturer’s warranty, whichever is longer.
• Not demanding the exception in writing: it may only coexist with the original warranties if it covers something they do not, and always paying for labour.
• Thinking there is no remedy if you were pressured: the law opens a complaint with the consumer agency for being forced, for a denied sale, or for any other form of being affected.
• Confusing this law with the one requiring the manufacturer’s warranty to include Puerto Rico: they are different laws from the same year.

These are the government pages this guide is based on.

• Departamento de Asuntos del Consumidor (DACO)

  DACO

  bvirtualogp.pr.gov