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Week 6 - Consumer Protection (Statutorial Unconscionable Conduct (Three…
Week 6 - Consumer Protection
General standards of honesty and fairness
Imposed by the law
Affects all players in the market regardless of agreement
Doesn't rely on common law as the bigger party naturally has more bargaining power
Two purposes
Protect consumers
Protect competitors
Australian Consumer Law
(ACCC). - Applies broadly to Australian citizens and residents, to natural persons and corporations
Valve v Australian consumers
Provides statutory guarantees in contracts for the supply of goods and services to consumers
Imposed by legislation
remedies are set out in ACL
9 statutory guarantees
What qualifies as for CG's
Amounts of goods and services is less than $40,000
Goods or services are of a kind ordinarily acquired for personal, domestic or household use or consumption
Goods are a vehicle acquired for use on public roads
9 Statutory Guarantees:
Products
Fitness for disclosed purpose
Guarantee that goods are reasonably fit for a disclosed purpose and for any purpose for which the supplier represents that they are reasonably fit
Merfe, Sharpe & Dohme v Peterson
What is a disclosed purpose?
Particular purpose made known to the supplier by consumer, both explicitly or implicitly pre-contractual negotiations
Particular purpose made known to manufacturer directly or by supplier in pre-contractual negotiations
Where consumer shows it relied on supplier’s skill and judgment: s 55(3)
Acceptable quality
Acceptable in appearance and finish, free from defects, safe, durable.
Reasonable expectations
Reasonable consumer, fully acquainted with the state and condition of the goods would regard as acceptable having regards to:
The nature of the goods
Price
Statements on labels or packaging
Representations by supplier or manufacturer
Any other relevant circumstances
Thomson v. Excel
Fit for all purposes for which the goods are commonly supplied
As described or demonstrated
Correspondence with description
Goods must comply with sample or demonstration model
Often brought with violations of Acceptable Quality
Services
Services have similar protections
due care and skill
reasonably fit for that purpose
And will be of such a nature and quality, state or condition that they might reasonably be expected to achieve that result
Guarantee as to
reasonable time for supply
Limiting Liabilities
General rule – cannot exclude the guarantees or limit liability for ‘consequential losses’ in contracts for supply of goods and services:
Two exceptions
Unordinary
Watch lecture again
Recreation
Remedies
Minor Failures
Major Failures
Goods would not have been acquired if buyer knew of the failure
Goods don’t match the description
Goods substantially unfit for a purpose – either common or disclosed – and can’t easily be remedied to fit that purpose
Goods not of acceptable quality because they are unsafe
In case of a major failure consumer can:
Reject the goods (provided within reasonable time) or recover compensation for any reduction in value
Recover damages for reasonably foreseeable loss or damage: s 259(4) unless failure caused by problem after goods left supplier
Unfair contractual terms
An unfair term in a standard form consumer contract is void
ACCC v Chrisco Hampers
ACCC v JJ Richards
ACCC v Servcorp
Statutorial Unconscionable Conduct
Three categories
Unwritten law
Goods and Services
Conduct against small businesses
ACCC v Berbatis
ACCC v Samton Holdings
“SHOCKS THE CONCIOUS”
Power imbalance
ACCC v Lux
Remedies
Pecuniary penalty
injunction
Damages