CONSUMER LAW

Question 1

ROLE OF THE LAW

Answer 1

Consumer laws aim to protect consumers and make them aware of their rights. The role of the law is to protect those who are unable to protect themselves. Consumer law was not always necessary as many years ago the number of products available for sale was much smaller, and it was possible to inspect a product before you purchased it

Question 2

AUSTRALIAN CONSUMER LAW

Answer 2

The Australian Consumer Law has applied since 2011 as a result of an agreement between the Commonwealth Government and the governments in each state and territory. The Australian Consumer Law has a wide range of purposes such as encouraging fair trading practices and are involved iprotecting consumers.

Question 3

UNFAIR TRADING PRACTICES

Answer 3

Australian Consumer Law protects consumers from a number of unfair trading practices. Unfair trading practices which are illegal and protected by Australian Consumer Law include:

False advertising.
Falsely stating goods as new.
Falsely stating the country of origin.
Unconscionable conduct.
Much more. (Available on the Australian Consumer Law website.)

Question 4

Unconscionable Conduct

Answer 4

Unconscionable conduct is unfair conduct in business transactions that goes against good conscience.

For example, deliberately taking advantage of a person with a disability when negotiating a contract

Question 5

CONTRACTS

Answer 5

Each time you purchase or lease goods or services you enter into a contract. In day-to-day transactions, these contracts are unwritten. However, written contracts are also used in some circumstances such as making large purchases.

Under the contract, you make the commitment to pay in exchange for goods or services. For a contract to exist, both parties must intend that the contract will be legally binding and they must be able to freely agree.

Question 6

UNFAIR CONTRACTS

Answer 6

A standard-form contract term will be considered unfair for a variety of reasons including that the term would cause detriment to a party if it were to be applied or relied on. An unfair contract term is unenforceable but the contract itself can still be enforceable, particularly if the purpose of the contract can be fulfilled once the unfair term is removed. Some examples of unfair terms in consumer contract could be the ability to let just one party terminate contracts but not the other.

If a standard-form contract term is found to be unfair, the Federal Court has the power to make any orders it desires. If a term is found to be unfair, then the party attempting to enforce it will no longer be permitted to do so. If the term was already enforced, the court may grant remedies to return the party against whom the term was enforced to that party’s original position

Question 7

CONSUMER GUARANTEES

Answer 7

Consumer Guarantees protect the interests of consumers when they enter into a sales contract.

GOODS SHOULD BE FIT FOR PURPOSE
ACCEPTABLE QUALITY 
SALE BY DESCRIPTION OR DEMONSTRATION
SALE BY SAMPLE 
OWNERSHIP AND REPAIR OF THE GOODS
SKILL AND CARE IN THE PROVISION OF SERVICES

Question 8

GOODS SHOULD BE FIT FOR PURPOSE

Answer 8

The Australian Consumer Law states that goods purchased must be fit for their intended purpose.

In most cases the intended purpose of the item is obvious such as a refrigerator which has the purpose of keeping food cold. If it cannot reasonably do so then the consumer can claim a remedy.
If a consumer has a specific purpose in mind when buying a product and they have discussed this with a salesperson who has guaranteed that the goods sold will fit that the purpose and then the consumer discovers that the good is unable to meet that purpose, they can claim a remedy.

However, the consumer can not claim a remedy if they misuse the product.

Question 9

ACCEPTABLE QUALITY

Answer 9

The seller and the manufacturer of goods have an obligation to ensure that goods sold are of acceptable quality. This means that the goods should be fit for their purpose, safe to use, free of faults or defects for a reasonable time, acceptable in appearance.

When deciding whether goods are of acceptable quality the law considers the type of goods purchased, the price paid and the description on packages or labels or information given by the supplier at the time of sale.

This does not apply if the purchaser is told about a defect or the defect can easily be seen before the sale.

Question 10

SALE BY DESCRIPTION OR DEMONSTRATION

Answer 10

Goods must match the description given or match any demonstration shown before purchase. For example, a newly purchased electrical appliance should look and operate the same as any description or demonstration shown in-store or online.

Goods must also meet any additional promises made by the seller. These are known as express warranties.

Question 11

SALE BY SAMPLE

Answer 11

When an item is sold from a sample, it is expected that the goods are supplied will closely represent the sample.

For example, it is common practice for a consumer to choose carpet from a book containing sample carpet squares. The carpet installed in the home should match the sample shown. If there is a substantial difference from the sample shown then the supplier must rectify the problem.

The consumer should be given reasonable opportunity to compare the actual goods with the original sample. Slight variations are acceptable such as natural markings of leather.

Question 12

OWNERSHIP AND REPAIR OF THE GOODS

Answer 12

The supplier must guarantee that they own the goods and can legally transfer the ownership rights to the consumer.

Manufacturers also need to guarantee that they will provide reasonable access to spare parts and repairs if the item developed a defect.

Question 13

SKILL AND CARE IN THE PROVISION OF SERVICES

Answer 13

Traders who supply a service to consumers must use appropriate care and skill. They must have an acceptable level of skills to complete the work and avoid doing damage or causing the consumer any loss. They must also complete the work in a reasonable time.

Question 14

WHAT HAPPENS IF THE GOOD OR SERVICE DOES NOT MEET ALL THE EXPECTATIONS

Answer 14

The consumer may have a claim against the supplier or the manufacturer who are obliged to rectify the problem. Consumers can ask for the goods to be repaired or replaced, or they can ask for a refund or some form of compensation.

If the supplier refuses to do so, the consumer can contact Consumer Affairs Victoria for advice.

Question 15

11 CONSUMER RIGHTS

Answer 15

Hmm

Question 16

6 METHODS OR INSTITUTIONS FOR RESOLVING DISPUTES

Answer 16

ACC, ASIC, CONSUMER AFFAIRS 
VCAT
OMBUDSMAN 
LAWYERS 
COURTS
CLASS ACTIONS

Question 17

ACC, ASIC AND CONSUMER AFFAIRS

Answer 17

The Australian Competition and Consumer Commission (ACCC) is the national regulatory authority which deals with most consumer complaints.

Complaints involving financial products and services are investigated by the Australian Securities and Investments Commission (ASIC).

Lastly, Consumer Affairs Victoria is a state regulatory body. It works in cooperation with the ACCC and ASIC to protect and promote the interests of Victorian consumers.

They:

• Review and advise the Victorian Government on consumer legislation and industry codes
• Advise and educate consumers on their rights and responsibilities and changes to the law
• Conciliate disputes between consumers and traders
Enforce and ensure compliance with consumer laws.

Question 18

VCAT

Answer 18

VCAT will hear disputes between consumers and traders. There is no limit on the value of the goods or services in dispute. A person may file an application in VCAT’s Civil Claims List. VCAT will first try to mediate the case, but if an agreement cannot be reached, both sides will be asked to present their evidence and then a tribunal member will decide the case on the same day

Question 19

Ombudsman

Answer 19

The Victorian Ombudsman is an independent officer of the Victorian Parliament. They can assist consumers if they have paid for goods or services from a government body, such as a local council.

Specific industries may also have an ombudsman to assist with consumer complaints such as the Victorian Energy and Water Ombudsman and the Telecommunications Industry Ombudsman

Question 20

Lawyer

Answer 20

Lawyers can give consumers advice about how to gain compensation. A matter can be taken to a court or or alternatively a lawyer can negotiate an out-of-court settlement. In consumer law many lawyers will often work on a ‘no win, no fee’ basis. This makes it easy for consumers to bring a case to court

Question 21

COURTS

Answer 21

A consumer dispute can be taken to the courts. In its civil law, the Magistrates’ Court of Victoria hears and determines disputes arising from any monetary demands. The Magistrates’ Court can determine most disputes over money or property up to the value of $100000 and occasionally they can also hear cases with an unlimited value.

Larger claims can be taken to the County Court or the Supreme Court. If the dispute is federal, it can be taken to the Federal Court

Question 22

CLASS ACTIONS

Answer 22

In Australia, class actions can be commenced by one person making a claim where seven or more people have claims which arise out of the same or related circumstances.

They allow the victims of large scale wrongs to protect their rights in a more cost-effective way. If a group of people have been similarly injured by the same individual or group they can join together to bring a civil action. They can support each other and share the costs. They allow people to pursue civil actions that they couldn’t afford by themselves

Question 23

How CONSUMER Law has changed

Answer 23

NGCTUCA

In the 1930s the tort of NEGLIGENCE was established to cover faulty products.

The Trade Practices Act 1974 delegalised misleading and deceptive conduct and started the first CONSUMER GUARANTEES.

In 1996, Australia adopted a National Competition Policy, that aimed to remove restricted competition in the marketplace as this would mean more competition therefore lower prices.

Do Not Call Register Act 2006 outlined rules for telemarketing calls.

Fair Trading Act 2003 bought with it many changes including unfair business practices were prohibited.

In 2004 the Unfair Contract Terms Taskforce was established.

On 1 July 2012 an Act also brought in the application of the Australian Consumer Law nation wide.

Question 24

Recent changes: What does AUSTRALIAN CONSUMER LAW that was implanted in 2012 provide

Answer 24

• a single, national consumer law system for Australia.
• laws which prohibit unfair contract terms.
• revised national product safety law.
• national consumer guarantees.
• new enforcement powers.
• the Australian Competition and Consumer Commission

Question 25

Unsafe goods and services

Answer 25

It is important that all goods and services offered to consumers are safe to use. Unsafe goods and services can lead to injuries to death. For example Elastic straps can cause eye injury.

Question 26

NOTICES and Bans

Answer 26

Unsafe goods and services laws ensure all consumer goods and any services are safe for use. Consumer goods or services, which could reasonably cause injury to a person can be declared unsafe and given a safety warning notice, safety ban or a recall notice. These notices and bans can be issued by the supplier or by the government if the supplier refuses to or if they are anonymous.

Question 27

3 types of NOTICES and Bans

Answer 27

SAFETY WARNING NOTICE - Alerts the public to a safety concern with a product.
SAFETY BAN - It is illegal to supply, possess or manufacture goods that have been given a safety ban.
RECALL NOTICE - Suppliers usually recall goods when they realise that the goods are not safe to use and can cause injury.

Question 28

3 standards

Answer 28

There are mandatory safety standards, mandatory information standards and voluntary safety standards. Suppliers cannot be forced to comply with a voluntary standard and it is illegal to falsely state that a product meets the standard. The Government will set mandatory standards. Products that do not meet mandatory standards are banned, and suppliers who continue to supply these products can be given fines. The ACCC is responsible for investigating and taking action against suppliers who continue to supply banned products.

Question 29

When was the Samsung galaxy note 7 available for purchase

Answer 29

September and October 2016

Question 30

Hazards, first recall, suspension

Answer 30

It was found that a manufacturing defect in the phones’ batteries had caused some of them to generate excessive heat, resulting in fires and explosions.
After its first recall, Samsung exchanged the affected phones for a new update which utilised batteries from a different supplier. However, in early October 2016, reports emerged of incidents where these replacement phones also caught on fire.
On 10 October 2016, in response to the new incidents, Samsung announced that it would once again suspend sales of the Galaxy Note 7 and recall all devices worldwide. The next day, Samsung also announced that they would no longer manufacture or sell the Note 7 permanently.