Australian Competition And The Consumer Act -Myassignmenthelp.Com

Question: Discuss About The Australian Competition And The Consumer Act? Answer: Introducation It is to be stated that the conduct or action of a party to a contract will be held to be unconscionable if such conduct defies good conduct and is considered unreasonable. The provision of unconscionable conduct however, is ambiguous as there are no clear definitions of it provided by the law (Knapp, Crystal and Prince 2016). It is to be mentioned that the clause of unconscionable conduct is governed by the common law of Australia. Schedule 2 of the Australian Competition and Consumer Act 2010 also governs the provision of unconscionable conduct. Section-21 of the Australian Consumer Law states that a contract should be signed by a consumer, only if he completely understands the terms of such contract. However, such principle holds true for written contracts. A person dealing with the acquisition and supply of goods will be regarded to have conducted in an unconscionable manner if he fails to act in good faith or impose any unreasonable terms on the weaker party. Unconscionable conduct will also be said to have been exhibited by the stronger party if he uses undue influence on the weaker party to enter into such contract. Subsection 21(3) mentions that the court will consider the circumstances which are reasonably foreseeable to a reasonable man in determining whether the subsection of the aforementioned act has been breached. It can be stated according to subsection 4c that the court will assess the terms of the contract and the execution of duties of the parties in determining whether any unconscionable conduct was exhibited by either of the parties. In addition it can be said that the court might also assess the circumstances of the parties at the time when the contract was formed. Intervention of equity is essential and inevitable in certain circumstances according to common law to protect the interests of the weaker party to a contract. However equity intervenes in circumstance where one of the parties takes advantage of disability of the weaker party. If it is established that one of the parties intended to form the contract on harsh terms which were likely to create oppressive results for the weaker party, such party has the right to rescind the contract. The case, Louth v Diprose High Court of Australia (1992) 175 CLR 621; [1992] HCA 61 deals with the clause of unconscionable conduct. In this case the defendant had emotionally blackmailed the plaintiff to buy a house for her. The defendant had taken advantage of the plaintiffs feelings for her. However, after their relationship failed and the two fell out the plaintiff started legal proceedings against the defendant and claimed the house back. The court held that the plaintiff had every right to claim the house back. The action of the defendant was held to be unconscionable as she had emotionally blackmailed him to buy the house and such conduct created an atmosphere of crisis and was not necessary to be exhibited in reality. Another important case dealing with the same provision is Blomley v Ryan (1956) 99 CLR 362. In this case the defendant had agreed to buy from the plaintiff a farm. The plaintiff regularly used to be intoxicated due to alcohol intake and was 78 years of age. The court held that plaintiff did not have the capacity to make a rationale judgment about the decision to sell the plot of land as he was under the influence of alcohol. The consideration amount was also well below the market price. Commercial Bank of Australia v Amadio (1983) 151 CLR 447; [1983] HCA 14 in this remarkable case addressed an important issue in relation to unconscionable conduct exhibited by a party. The defendant had induced the plaintiffs to act as guarantors of a loan taken by the defendant. The parents of the defendant were Italians and therefore had very little understanding of the English language. It was held by the court that the defendants had the right to rescind the contract as the defendants conduct was considered to defy good conduct and therefore intervention of equity was necessary. Kakavas v Crown Melbourne Ltd [2013] HCA 25 is a relatively recent case dealing with the same provision. The High court of Australia interpreted section 51 AA OF THE Trade Practices Act 1947 and applied the same in the aforementioned case. However, the aforementioned section was repealed and replace by the section 20 of the Australian competition and consumer act 2010. In this case the plaintiff had an interest in gambling. The court held that the habit of gambling did not constitute a special disability or disadvantage and therefore the question of unconscionable conduct did not arise. Application In this chosen case study Rofi is a refugee from Burma who has arrived in Australia. He does not have proper understanding of the English language. Rofi had entered into a contract with the agent of Bolton Connect Pty Ltd, John. It is to be mentioned that John had been aware of the fact that Rofi does not good command or understanding of the English language. He had induced him to enter into the contract. Therefore in this circumstance the court will analyze and assess the circumstance of Rofi at the time of entering into the contract. The court will assess the way the terms of the contract were carried out. Although it was mentioned to him, that if he decides to rescind the contract he would be liable to pay a penalty of 1200 dollars, it cannot be expected that he had completely understood the aforementioned clause as he did not have proper understanding of the English language and lacked technical knowledge. Further it is to be stated that the agent John had access to translator de vices which he did not use while explaining the terms of the contract Rofi as he was in a hurry to meet his targets. Therefore, after discussing and analyzing the facts of the case, it can be stated that John had exhibited unconscionable conduct when he attempted to induce Rofi into entering the contract. The court can apply the provision as stated in section 21(4) of the Australian Consumer Law in order to establish unconscionable conduct. The aforementioned provision states that court must consider the circumstances of the parties at the time of contract formation. It can further be established by the findings and the decisions of the courts in the cases discussed above that Rofi has the right to rescid the contract as he did not understand the hidden penalty charge of the contract. Rofi in this situation was exposed to a detrimental position by John who had tried to take advantage of his disability. Conclusion Thus, in conclusion it can be said that a contract had formed between Bolton Connect Pty Ltd. and Rofi. However such contract was entered in to by Rofi due the unconscionable conduct of John and therefore Rofi has the right to rescind the contract without paying any penalty charge. References Australian Competition and Consumer Act 2010 Blomley v Ryan (1956) 99 CLR 362 Commercial Bank of Australia v Amadio (1983) 151 CLR 447; [1983] HCA 14 Kakavas v Crown Melbourne Ltd [2013] HCA 25 Knapp, C. L., Crystal, N. M., Prince, H. G. (2016). Problems in Contract Law: cases and materials. Wolters Kluwer Law Business. Louth v Diprose High Court of Australia (1992) 175 CLR 621; [1992] HCA 6