Australia: Competition and Consumer Law News – 20 February 2018

Last Updated: 27 February 2018
Article by Howard Rapke and Ian Robertson

Most Read Contributor in Australia, August 2018

In the media

Tweed real estate agents fined $55,000 for underquoting and licensing breaches
A recent NSW Fair Trading investigation has seen 34 fines totalling $55,000 issued to 16 real estate agents in the Tweed Heads region. The operation targeted general compliance and underquoting, and found breaches relating to unlicensed individuals and corporations, as well as the use of misleading advertising (15 February 2018). More...

Criminal cartel proceedings commenced against Country Care and its managers
Criminal cartel charges have been laid against The County Care Group Pty Ltd, its Managing Director and a former employee. The charges against County Care Group represent the first criminal prosecution of an Australian corporation and the second criminal prosecution of a cartel (the first being NYK) under the criminal cartel provisions of the Competition and Consumer Act (15 February 2018). More...

CFMEU to pay $1m in penalties for secondary boycott
The Federal Court has ordered the Construction, Forestry, Mining, and Energy Union (CFMEU) to pay $1 million in penalties for secondary boycotts against Boral and Alsafe at construction sites in Hawthorn and Richmond, Victoria. The court ruled that the CFMEU contravened section 45D(1) of the Competition and Consumer Act 2010 (CCA) by engaging in conduct in concert with a shop steward at both sites which hindered or prevented the acquisition of concrete from Boral and its subsidiary Alsafe for the purpose of causing substantial loss or damage to Boral's business (14 February 2018). More...

Brands give illusion of competition, commission says
A proliferation of brands from a few providers is camouflaging a high insurance market concentration in Australia, according to a Productivity Commission draft report (12 February 2018). More...

Letore ordered to compensate migrant victims
The Federal Court has ordered Letore Pty Ltd (Letore) to compensate victims of a permanent residency program, which was operated by Clinica Internationale Pty Ltd (Clinica), for amounts they paid to Clinica. In 2016, the Federal Court found that Clinica had engaged in unconscionable conduct and made false or misleading representations about the program (12 February 2018). More...

Federal Court orders over $7 million in fines
The Federal Court has penalised three companies with fines of over $7,000,000, following the ASIC proving that they offered and gave cash payments to financially vulnerable clients in connection with the provision of financial advice. The Court found that the three companies, Wealth and Risk Management (WRM), Yes FP and Jeca Holdings (trading as Yes FS), ran a business model meant that all three engaged in unconscionable conduct (08 February 2018). More...

Hyundai promises to obey consumer law amid ACCC crackdown on car industry
Hyundai agrees to step up its compliance with Australian consumer laws, as the ACCC targets the car manufacturing industry at large (08 February 2018). More...

'Four pillars' policy under fire from Productivity Commission
The "four pillars" policy that prevents big bank mergers is unnecessary and has repressed competition, says the Productivity Commission, which has called for a sweeping review of restrictions on ownership of the nation's banks (07 February 2018). More...

Canberra petrol prices remain stubbornly high, 10 cents cheaper across the border
Consistently high fuel prices in the capital have caused renewed calls for real-time price tracking, but the ACT Government says that is not the answer (06 February 2018). More...

ACCC releases guidance on free range egg standard
The ACCC has released guidance for egg producers on its approach to enforcing the new National Information Standard on free range eggs, which comes into effect on 26 April 2018. The guidance explains egg producers' obligations under the misleading or deceptive conduct provisions of Australian Consumer Law. This includes representations made through marketing activities such as product packaging and advertising (06 February 2018). More...

In practice and courts, published reports

Competition in the Australian financial system: draft report
Productivity Commission: 07 February 2018
This inquiry focusses on competition in Australia's financial system as a means to improve consumer outcomes, enhance the productivity and international competitiveness of the financial system and the broader economy, and support ongoing financial system innovation — without undermining financial stability objectives. More...

Exposure Draft: Australian Consumer Law Review Amendments
Views are sought on the design of the exposure draft legislation and regulations (and accompanying draft explanatory materials). These exposure drafts include amendments to:

  • clarify existing provisions relating to consumer guarantees, voluntary recalls, unsolicited consumer agreements and false billing;
  • enhance the regulators' information gathering powers for investigations in relation to product safety and unfair contract terms;
  • extend the unconscionable conduct protections to publicly listed companies;
  • expand the remedies available to the courts for contraventions of the ACL; and
  • improve price transparency.

Submissions close on 28 February 2018. Further information is available on the Treasury website.

Competition Law Symposium
The symposium, Cartels, Optimal Enforcement and Theories in Competition Law, will be held in Brisbane on 27 March 2018. The program, which can be downloaded here, features keynote speakers from around the world.

Small business collective bargaining guidelines consultation
The Australian Competition and Consumer Commission is seeking feedback on new guidelines for small business collective bargaining. The guidelines are for small businesses, including farmers, to assist their understanding of the authorisation and notification processes for obtaining ACCC approval for collective bargaining and boycotts. Submissions close on 23 February 2018. More...

Cases

Australian Competition and Consumer Commission v Swishette Pty Ltd [2018] FCA 55
ESTOPPEL – issue estoppel – Anshun estoppel – abuse of process – where in an earlier proceeding it was alleged that a company had contravened the misleading or deceptive conduct provisions and the unconscionable conduct provisions of the Australian Consumer Law – where in a later proceeding it was alleged that the respondents were persons "involved" in the contraventions – whether it was unreasonable not to have included these claims in the earlier proceeding.
CONSUMER LAW – misleading or deceptive conduct – unconscionable conduct – person "involved" in contravention – whether respondents were knowingly concerned in, or party to, contraventions of the Australian Consumer Law – where contravener and respondents had same director – where conceded that knowledge of director is to be imputed to the respondents – where one respondent used its credit card to pay relevant expenses for the contravener – where one respondent provided a guarantee and mortgage to support the contravener's overdraft.
TRUSTS AND TRUSTEES – trustee's right of indemnity or exoneration – where trustee found to have been involved in contraventions of the misleading or deceptive conduct and unconscionable conduct provisions of the Australian Consumer Law – whether trustee would have a right of indemnity or exoneration in respect of the liability that would arise if a consumer redress order were made under s239 of the Australian Consumer Law.
Competition and Consumer Act 2010 (Cth) s137H, 155, Sch 2, Australian Consumer Law, ss2, 18, 21, 29, 31, 232, 239, 240, 248; Evidence Act 1995 (Cth), s87, 191; Trade Practices Act 1974 (Cth), s52; Federal Court Rules 2011, r22.02; Penalty Interest Rates Act 1983 (Vic), s2; Trustee Act 1958 (Vic), s36.

Kallin Pty Ltd v ACN 107 851 847 Pty Ltd [2018] NSWSC 124
CONSUMER LAW — Misleading or deceptive conduct — Whether statement misleading — Reliance upon misleading statements — Causation — Damage —None established. CONTRACTS — Breach of warranty — Not established – No damage established.

NB2 Pty Ltd v P.T. Ltd [2018] NSWCA 10
CONSUMER LAW – misleading or deceptive conduct – whether respondents made representation that appellants would be the only fresh fruit and vegetable retailer in a section of the respondents' shopping centre. CONSUMER LAW – misleading or deceptive conduct – whether failure by shopping centre's owners to disclose to an independent retailer of fresh fruit and vegetables in the centre that a supermarket had plans to engage in that activity was misleading or deceptive or constituted unconscionable conduct.

Ipstar Australia Pty Ltd v APS Satellite Pty Ltd [2018] NSWCA 15
CONSUMER LAW – Competition and Consumer Act 2010 (Cth) – Australian Consumer Law – unconscionable conduct – whether conduct of an experienced commercial party in imposing a price increase on another experienced commercial party was in all the circumstances unconscionable. CIVIL PROCEDURE – Commercial List, Technology and Construction List – Procedure – whether reply to commercial list response forms part of pleadings – whether p leaded case encompassed claim for statutory warranty for defective equipment regardless of cause of defect.

Semantic Software Asia Pacific Ltd v Ebbsfleet Pty Ltd [2018] NSWCA 12
CONTRACTS – breach of contract – consequences of breach – right to damages – whether remedy identified in contract was the exclusive remedy for breach. CONTRACTS – construction and interpretation – whether contractual guarantee was given by first appellant only. CONTRACTS – breach of contract – whether breach established – whether shares in the second appellant company had tripled in value within two years of their issue – whether trial judge erred in relying on certain expert evidence regarding value of the shares. CONSUMER LAW – misleading or deceptive conduct under statute – parties accepted that representation that shares would triple in value was misleading and deceptive – whether reliance on particular representation was established by respondents. CIVIL PROCEDURE – procedural fairness – self represented defendants – defendants indicated that they would be unable to pay for US resident to give expert evidence – failure to make expert available for cross-examination led to rejection of his report – defendants gave no indication that situation would change – whether procedural unfairness because trial judge failed to advise defendants to seek adjournment to further attempt to make expert available.

Guy v Crown Melbourne Limited (No 2) [2018] FCA 36
CONSUMER LAW – misleading or deceptive conduct – "poker" machines – whether features of the Dolphin Treasure electronic gaming machine give rise to representations about the odds of winning which are misleading or deceptive – whether representations are made by Crown Melbourne in making the electronic gaming machine available for gambling – whether representations are made by Aristocrat in manufacturing and supplying the machine – consideration of the term "theoretical return to player" – application dismissed. CONSUMER LAW – unconscionable conduct – whether there is a class of gamblers of the Dolphin Treasure electronic gaming machine who are "habituated" or "addicted" to gambling – whether such a class of gamblers are at a "special disadvantage" – consideration of expert evidence concerning the relationship between features of electronic gaming machines and gambling disorder – whether the respondents engaged in unconscionable conduct in making the machine available for play to this class of gamblers – application dismissed. Competition and Consumer Act 2010 (Cth), s131C; Sch 2 Australian Consumer Law (Cth), ss18, 20, 21, 22, 232.

Pattinson v Bellwether Agriculture Pty Ltd (In Liq) [2018] NSWSC 38
TRADE AND COMMERCE – Trade Practices Act 1974 (Cth) and related legislation – misleading and deceptive conduct. DAMAGES – assessment of damages where loan the subject of the claim repaid and re-advanced by discretionary trust controlled by the lender – recovery of mitigation costs – whether an order should be made under Fair Trading Act 1987, s72, for the payment of a sum of money to the trustee of the discretionary trust controlled by the lender – approach court should adopt on assessment of damages on an ex parte application. BANKRUPTCY – whether claim for misleading and deceptive conduct provable in bankruptcy.

Brand2Content Pty Ltd t/as Franchise Works v Solar Australia Pty Ltd [2018] NSWSC 56
CONTRACTS – Breach of contract – Consequences of breach – Right to termination – Innominate terms – Principle from Koompahtoo case CONTRACTS – Construction – Interpretation – Whether franchise consultant's negotiation of sponsorship agreements without authorisation from client breached obligation to act in good faith CONTRACTS – Construction – Whether an exclusivity provision prohibited sponsorship fundraising by franchise consultant CONTRACTS – Construction – Whether client's authorisation for inclusion of unusual terms by franchise consultant was required CONTRACTS – Construction – Interpretation – Whether consultant breached obligation to act in good faith by failing to follow client's instructions, misleading client, failing to provide honest answers to client CONTRACTS – Construction – Interpretation – Whether consultant's obligation to act in good faith was breached by failure to inform client about special condition TRADE AND COMMERCE – Competition and Consumer Act 2010 (Cth) and related legislation – Misleading or deceptive conduct – Whether misleading or deceptive representations about an approval requirement for unusual terms and an exclusive territory of operation were made EVIDENCE – Opinion evidence – Exceptions – Expert opinion – Whether chartered accountant had specialised knowledge or sufficient evidence to make assumption about likely number of future sales CONTRACTS – Termination – Election – Whether parties agreed to terminate CONTRACTS – Termination – Repudiation of contract – Express refusal to perform CONTRACTS – Remedies – Damages – Loss of chance – Reasonableness of assuming completion of further franchise agreements after breakdown of client-franchise consultant relationship.

Evolution Traffic Control v Skerratt [2018] NSWSC 49
COMMERCE — Pre-contractual representation — Inducement of purchase — Incomplete disclosure of material information — Whether misleading or deceptive conduct — Whether plaintiff reasonably relied on representations COMMERCE — Misleading representations — Damages — Fair value — Whether Potts v Miller approach to assessment question is appropriate No question of principle.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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