Module 8 Flashcards
Assume Farah has breached the contract. A court is likely to find the $4 500 cost of hiring ranger Nick is:
A direct loss
Assume that Farah has breached the contract. A court is likely to find the cost of Tom’s stay at TM Kennel (that is the cost Rhianna refuses to pay is)
A direct loss
What is the likely result of Rhianna’s claim for $2000 in damages for distress due to Tom’s newly developed aggressive behaviour?
Unlikely to be successful in this claim as it is not a direct or consequential loss flowing from Farah’s breach
What is consumer law
Law that regulates consumer transactions and the std conduct of the business that produces goods and services
Consumers have limited info and bargaining power when dealing with corporate manufacturers and service providers
Consumer law
Is a mixture of legislation and common law
Legislation consumer law
Sale of Goods Act
Competition and Consumer Act 2010
Australian Consumer Law
Competition and Consumer Act
Federal piece of legislation that operates AUS wide
Largely follows the TPA with two significant exception
- introduction of a consumer guarantee regime
- more nationally oriented product safety legislation
Misleading or deceptive conduct s18
- Formerly section 52 of the Trade Practices Act 1974
- A person must not in trade or commerce engage in conduct that is misleading or deceptive or is likely to mislead or deceive
- Has a very broad application
Components of s 18
A person
In trade or commerce
Engaging in
Misleading or deceptive conduct
A person includes
both natural persons and corporations
Misleading or deceptive conduct refers to
conduct that leads members of the public in their capacity as consumers of goods or services into error, or is likely to do so.
The test of whether something is misleading in a s 18 sense is the
meaning that would be given to the representation by an ordinary and reasonable member of the class of consumers to which the representation was addressed
McWilliam’s Wines Pty Ltd v McDonalds System of Australia Pty Ltd (1980)
Facts:
McWilliams Wines named one of its wines the ‘Big Mac’
McDonald’s who have a hamburger called the Big Mac claimed that McWilliam’s use of the name amounted to misleading and deceptive conduct
Issue: Was McWilliam’s use of the name misleading?
Decision: No the distinction between wine and hamburgers is clear so as not to confuse the relevant class of consumers
Taco Co of Australia v Taco Bell Pty Ltd (1982)
Facts: a mexican restaurant named “Taco Bell” opened in Sydney
Another corp in Sydney used that name for its Mexican restaurant over the previous five years. They brought action for misleading and deceptive conduct
Issue: was the newly opened restaurants use of the name misleading?
Decision: Yes because both restaurants sold the same type of food
Campomar Sociedad Limitada v Nike International Ltd
Facts: a Spanish company made perfume under the name “Nike Sports Fragrance’
Nike international was a large sports apparel company. The nike perfume was displayed in pharmacies underneath other sports fragrances including one by Adidas
Issue: could Nike sue for misleading and deceptive conduct
Decision: Yes it was, it would lead the class of consumers who purchase Nike to think the perfume was another product
Remedies for misleading or deceptive conduct
- Injunction
- Damages
- Adverse publicity orders
The meaning of ‘consumer’ under the ACL
S 3 of ACL provides definition of consumer
Person is taken to have acquired particular goods or services as a consumer if and only if
- the amount payable for the goods or services did not exceed 40 000
- the goods or services were of a kind ordinarily acquired - domestic consumption
- the goods consisted of a vehicle or trailer acquired for use principally in the transport of goods on public road
A consumer transaction is not covered by legislation where they
were acquired for resale or for consumption by way of trade or commerce or in the course of repairing or treating other goods or fixtures on land
Guarantee as to title s 51
there is a guarantee that the supplier will have a right to dispose of the property in the goods when that property is to pass to the consumer
Guarantee as to undisturbed possession s52
Does not apply if the consumer was aware of any encumbrance
Guarantee as to acceptable quality s54
Where goods are supplied to a consumer in trade or commerce other than by way of sale by auction there is a guarantee that the goods are acceptable quality
- fit for all purpose will goods of kind are commonly supplied
- acceptable in appearance and finish
- free from defects
- safe
- durable
Fitness for any disclosed purpose s55
If the supplier supplies in trade or commerce goods to a consumer other than by way of sale by auction then they must be fit for any purpose disclosed
- fitness is express or implied
Guarantee as to supply of goods by description s 56
Guarantee that the goods supplied correspond to the descirption
Guarantee as to supply of goods by sample or demonstration model s57
If a person supplies in trade or commerce goods to a consumer by reference to a sample or demonstration model and not by way of sale by auction there is a guarantee that
- goods correspond with the sample or demonstration model in quality, state or condition
- if the goods are supplied by reference to a sample the consumer will have a reasonable opportunity to compare the goods with the sample
- goods are free from any defect that would not be apparent on reasonable examination, cause them not to be examinable quality
Fitness for particular purpose s61
There is a guarantee that goods should be fit for a purpose disclosed by buyer
Reasonable time s62
there is guarantee that when time frame of contract is not established goods or services be supplied within a reasonable time
Services for which there are no guarantees
s63 provides that there is no guarantee in respect of transportation or storage or insurance
Guarantees are non excludable
s64 provides that guarantees are not to be excluded, restricted or modified by a term in the contract.
ACCC v MSY Technology Pty Ltd
Consumer product seller tried to have a no return policy but this is not able to be excluded
Consumer remedies
Where there is a breach of a guarantee the consumer has a remedy against the supplier
The nature of the remedy depends on whether the failure to comply with the guarantee is a major failure
A major failure arises if:
a) goods would not have been acquired by a reasonable consumer fully acquired with the nature and extent of the failure
b) the goods depart in one or more significant respects
i) if they were supplied by description
ii. . supplied by reference to a sample or demonstration model
c) the goods are substantially unfit for purpose for which goods of the same kind are commonly supplied and cannot easily and within reasonable time be remedied to make them fit for purpose
d) the goods are unfit for a disclosed purpose that made known to
i) supplier of the goods
ii) any person by whom any prior negotiations or arrangements in relation to the acquisition of goods without being remedied in reasonable time frame
e) the goods are not safe
Consumer rights where failure can be remedied and is not a major failur
Consumer can require supplier to remedy within reasonable time
If supplier does not do so consumer can:
- reject goods and recover money paid
- have the failure remedied by another and recover reasonable costs from the supplier
- damages for loss or damage may also be recovered (only to extent that is reasonably foreseeable)
Consumers rights where is failure is major that cannot be remedied
Customers choice to recover compensation for reduction in value (therefore keep goods)
Reject goods and have money returned
Damages for loss or damage may also be recovered
Unfair contract terms
The ACL provides that a term within a consumer contract is void if the term is unfair and the contract is a standard for contract e.g. contracts for car rental, mobile phones… where there is no room for bargaining and the terms are imposed by the stronger party
S 27
provides a series of tests that the court can apply to decide if a contract can be described as standard form
Jetstar Pty Ltd v Free
lady changing airline booking
jetstar hit her with 900 dollar fee
took them to court
court didn’t find it unfair because it was made clear to her and similar to what other airlines charge
