BLAW10001 Lecture Notes - Lecture 9: Australian Consumer Law, Consumer Protection, Standard Form Contract
14 May 2018
School
Department
Course
Professor
Consumer Protection
1. The necessity of regulating consumer transactions
•Consumers deal at a disadvantage with the suppliers of goods and services because, as
individuals:
-They have less negotiating power
-They are less well organised
-They lack information about the goods and services they are obtaining
-They don't know much about the law
2. Difficulties with earlier consumer protection provision
•Past efforts to regulate transactions focussed on specific problems
•These early measures were piecemeal, narrowly focussed, legally technical, incomplete and
not always uniform
3. Australia’s uniform consumer protection law
•In 2010, the Competition and Consumer Act 2010 (Cth) was enacted
-Legislation contains, in schedule 1, a set of provisions called the Australian Consumer Law
(ACL)
-All the governments in Australia have enacted legislation to adopt this schedule as their law
•The result is a single, uniform, consumer protection law that operates throughout Australia, as
from January 1, 2011
•Many Acts that preciously regulated aspects of consumer protection have been replaced by this
new law
-This has made application of the law much simpler than it used to be
4. Regulation of consumer transactions by the ACL
•The ACL deals comprehensively with the following aspects of consumer protection:
-misleading or deceptive conduct
-unconscionable conduct
-unfair terms in contracts
-unfair business practices
-guarantees in consumer contracts
-unsolicited consumer agreements
-safety standards
5. Defining ‘consumers’ and ‘consumer transactions’
How to assess if a person is a ‘consumer’ and thus able to use consumer protections:
•Consider the purpose of purchase
-A person is not a consumer if goods are acquired for purpose of re-sale, use in production or
to repair other goods
-A consumer is the final user of a good in a domestic context
•Consider the price of the goods purchased
-Price of goods must be less than $40,000 for consumer, regardless of what purchased
-If price exceeds $40,000 a person only acquires the goods as a consumer if goods are
acquired for person/household use
-The acquisition of vehicles or trailers acquired for use principally in the transport of goods on
public roads is considered to be a consumer acquisition (even if used for business)
•The term ‘consumer contract’ is defined differently:
-The ACL contains specific definitions of consumer contracts
-Definition: A consumer who has entered into a standard form contract (no option to
negotiate, pre-prepared document)
6. Enforcement of the ACL
The ACL is enforced by:
•Private actions brought against suppliers by consumers. Consumer can ask for:
-an injunction;
-an award of damages;
-payment of compensation;
-a declaration that the contract or arrangement is void in whole or in part;
-an order varying the terms of a contract or arrangement
-a refund of monies paid; or
-an order for repairs or the supply of spare parts.
•The imposition of pecuniary penalties and fine
-A court may order a supplier who has breached specific provisions of the ACL to pay a civil
pecuniary penalty.
-The breach of specified provisions is also made an offence, for which substantial fine can be
imposed
7. Regulation of misleading or deceptive conduct (s 18)
Section 18 says: A person must not, in trade or commerce, engage in conduct that is misleading or
deceptive or is likely to mislead or deceive
•The wording means that it is not only consumers that can claim a breach of s 18, but others as
well
•The word ‘persons’ includes both natural persons and corporations
•Conduct is misleading when it leads the persons at whom it is directed into error.
McWilliam’s Wines v McDonalds System (1980) 33 ALR 394
Summary: McWilliam’s advertised large cask wine under the name “Big Mac”. McDonald’s
claimed misleading under s 52 of Trade Practices Act because consumers might think the
wine is a McDonald’s burger.
Decision: McWilliams’ conduct not likely to mislead consumers
Ratio decidendi: Advertising in no way suggested a connection between McWilliam’s and
McDonald’s, reasonable person would not mistake the two products.
ACCC v TPG Internet Pty Ltd (2013) 250 CLR 640
Summary: TPG advertised on television unlimited data for $29.99 per month, with additional
fees in less prominent parts of the ads. ACCC alleged misleading conduct under s 18 of ACL.
Decision: Dominant messages of the advertisement had a tendency to lead those whom they
were directed into error.
Ratio decidendi: A person may be lead to error even if they do not enter into a legal
transaction. Ads deliberately sought to present the headline information selectively, target
audience likely to be mislead given limited broadband knowledge.
ACCC v Coles Supermarkets (2014) 317 ALR 73
Summary: Coles’ ins-tore bakeries advertised “fresh” and “baked today” bread. The bread
was actually partially baked, frozen, and stored before the final baking process. ACCC alleged
misleading conduct as signs and labels a misleading representation.
Decision: Misleading conduct under s 18 and 33 of ACL
Ratio decidendi: To reasonable and ordinary people, the signs conveyed all baking had been
done today, likely to mislead the public.
Document Summary
Consumer protection: the necessity of regulating consumer transactions, consumers deal at a disadvantage with the suppliers of goods and services because, as individuals: They lack information about the goods and services they are obtaining. Legislation contains, in schedule 1, a set of provisions called the australian consumer law (acl) This has made application of the law much simpler than it used to be: regulation of consumer transactions by the acl, the acl deals comprehensively with the following aspects of consumer protection: Safety standards: de ning consumers" and consumer transactions". How to assess if a person is a consumer" and thus able to use consumer protections: consider the purpose of purchase. A person is not a consumer if goods are acquired for purpose of re-sale, use in production or to repair other goods. A consumer is the nal user of a good in a domestic context: consider the price of the goods purchased.
