Vitiating Factors: Unconscionability

Question 1

Which case refers to an old Italian migrant couple, where the son, Vecenzo, overdrafts his company’s accouni, putting him into the debt, then using his parents property for security to work with and overdraft limit?

Answer 1

Commercial Bank of Australia v Amadio (1983) 151 CLR 447

Question 2

What are the three arguments in the context of unconscionability?

Answer 2

1. Unconscionability in equity
2. Unconscionable conduct under the Australian Consumer Law.
3. Unjust contract under Contracts Review Act (1980) (NSW)

Question 3

Elements to establish unconscionability?

Answer 3

1. Weaker party suffers from a disability
2. The stronger party knowns of this disability or ought to know
3. The stronger party takes unfair and unconscionable advantage of that disability to secure an unfair.

Question 4

What type of disability was suffered by Mr and Mrs Amadio, according to Mason, Wilson, Deane JJ

Answer 4

A special disability.

Including, but not limited to.

• Neither received formal education.
• Mr Amadio had little grasp of English
• Mrs Amadio had some understanding, but had to use an interpreter.
• Mrs Amadio had no business experience.
• Mr Amadio had some experience in tranfers of properties. But received much of the assistance from in son, Vincenzo Amadio.

Question 5

Blomley v Ryan (1956) 99 CLR 362

• Contract will be set aside when which two condition are met?:

Answer 5

• 1. A party was aware of the other party’s mental incapacity.
• 2. The party took unfair advantage of that condition to procure a contract.

Question 6

Which case in 1956 is about an 78 year old man who alledged to the court that appellant knew that his was an old man, lacking education, suffered from the effects of intoxtication and was on unequal terms with the appellant the the contract of a sale of property.

Answer 6

Blomley v Ryan (1956) 99 CLR 362

Question 7

In Blomley v Ryan (1956) 99 CLR 362, the what examples of special disadvantage were included?

(11 possible answers)

Answer 7

1. Poverty
2. Need of any kind,
3. Sickness
4. Age
5. Sex
6. Infirmity of body
7. infirmity of the mind
8. drunkeness
9. Illiteracy
10. lack of education
11. Lack of assistance or explanation where assitance and explanation is necessary.

Question 8

Which judge in which case expressed the following:

“A person is not in a position of relevant disadvantage, constitutional, situational, or otherwise, simply because if inequality of bargaining power. Many perhaps event most contract are made between parties of unequal bargaining power, a good conscience does not require parties to contractual negotiations to forfeit their advantages, or neglect their own interest”

Answer 8

GLESSON CJ in Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd (2003) 214 CLR 51

Question 9

Which Statute, Part, section can you find the following?

A person must not in trade or commerce, engage in conduct that is unconscionable, within the meaning of the unwritten law from time to time.

Answer 9

Australian Consumer Law, Part 2-2, section 20.

Question 10

What remedies are avaiable under the ACL for unconscionable conduct in trade of commerce?

Answer 10

• Undertakings,
• Substantiation notices
• Public warning notices
• Injunctions
• Damages
• Compensation orders
• Redress for non parties
• Non punitive orders

Question 11

Under section 20 of the ACL, ‘unwritten law’ refers what type of law and is an umbrella term for which two historically distinctive sources of law?

Answer 11

1. Refers to the common law of Australia.
2. It is an umbrella term for both common law and equity.