Reference no: EM134008193

Assignment:

Explain why consumers deserve additional legal protection?

1. What is the role of the ACCC?
2. Which bodies enforce State consumer protection laws?
3. How is a consumer-defined in the ACL?
4. In what circumstances will a business be in contravention of s 18 of the ACL?
5. Can s 18 of the ACL be enforced by persons other than consumers? Explain.
6. How does a court decide whether or not conduct is 'misleading or deceptive'?
7. Can an expression of opinion be misleading or deceptive within the meaning of s 18 of the ACL?
8. How is unconscionable conduct defined for the purposes of s 20 of the ACL?
9. What factors are taken into account by the court in deciding whether s 21 of the ACL has been contravened?
10. In what circumstances will a term of a contract be unfair and therefore void under s 23 of the ACL?
11. What factors are taken into consideration by a court in deciding whether or not a term of a contract is unfair?

Legal Hypotheticals

Question 1

Which of the following buyers would be classified as consumers within the meaning of s 3 of the ACL?

• An individual who purchases an engagement ring for $50 000.
• A baker who purchases flour for use in the baking of bread in their bakery.
• A baker who purchases flour for use in the baking of bread in their home.
• A real estate agent who purchases a sports car for use in their real estate business.

Question 2

Ada has recently moved to Australia from Italy. Her spoken English is exceptional, but she does not read or write English terribly well, and she has little experience in the way business is conducted in Australia. Ada ran a successful business in Italy as a supplier of olive oil to restaurants. She is now in the process of establishing a similar business here in Australia with two employees. She approaches Johnny to negotiate the supply of olive oil to his restaurant. During the negotiations, Johnny realises how little Ada understands Australian business practices and convinces her to accept less payment than what he pays current suppliers. He also tells her that it is unusual for Australian businesses negotiating such an arrangement to use legal representation. Then Johnny instructs his solicitors to draw up the contract for 12 months for the amount of $90,000, and he tells them to make it especially complicated and legalistic. Ada signs the contract agreeing to all of Johnny's requirements, and she does so without seeking independent legal advice. One of the terms in the contract permitted only Johnny to terminate the contract at any time for any reason whatsoever without informing Ada. Ada asks Johnny to change it or to give her the same ability to terminate the contract. Johnny replies, 'Take it or leave it'. This is what I give to all my suppliers.'

After chatting with Ada, Johnny has decided to add a new range of pasta dishes to his menu. He has placed a large sign on the restaurant window promoting his new pasta dishes as 'the best pasta in town, made with all fresh ingredients!'. Angel, the owner of Angel's, the Italian restaurant next door, is rather annoyed about the sign. She has been serving pasta for years. She has accused Johnny of misleading customers because she knows that Johnny still uses bottled olives in his pasta dishes. Johnny's response is that, even if the olives are from a bottle, they are fresh from the bottle.

Answer the following questions.

• In the above case study, identify statements/conduct that may contravene the consumer protection provisions of the ACL.
• Does Johnny's conduct fall within unconscionable conduct provisions of the ACL? Explain your answer with reference to relevant case law/statutory provisions.
• Can Ada argue that the contract term is unfair under ACL? Explain your answer with reference to relevant case law/statutory provisions.
• Do you think Johnny acted in contravention of s 18 of the ACL? Explain your answer with reference to relevant case law/statutory provisions.