The proposed changes to consumer law that we described in our
Spring edition of the DW Report (Are Your Contracts
Void?) are expected to take effect after 1 July 2010.
The Trade Practices Amendment (Australian Consumer Law) Bill
2009 was passed by the House of Representatives on 17 March 2010
and is awaiting Royal Assent. Once this has been granted, the Bill
will become part of the law of the Commonwealth, and will be known
as the Trade Practices Amendment (Australian Consumer Law) Act
The Act, among other things, will significantly alter the
relationship between suppliers and consumers and will render unfair
contract terms in consumer contracts void.
During the passage of the Bill, some changes were made to it by
the Senate. While most of these changes were not substantive, one
change that should be noted is an amendment to the definition of an
unfair contract term to include the requirement that
it would cause detriment (whether financial or otherwise) to a
party if it were to be applied or relied on.
As a result of this amendment, the consideration relating to
detriment has been removed from the list of considerations
that a Court must take into account in determining whether a term
of a consumer contract is unfair.
Whether a specific term of a consumer contract is
"unfair", and whether a specific contract falls
within the scope of a "consumer contract", will
be matters of statutory interpretation, and consideration will be
given to the circumstances surrounding the contract. Obviously,
businessto-business contracts will not generally fall within the
category of a consumer contract.
If you are in the retail industry, residential leasing, or any
other industry where your client or customer base includes
individual persons who acquire goods, services or interests for
personal, domestic or household use or consumption, you should
review your contracts to ensure that any terms within those
contracts will not be rendered void by the operation of the
For an overview of the relevant provisions of the Bill, please
see our article in the Spring 2009 edition of the DW Report, which is
available on our website www.donaldsonwalsh.com.au. However, please be
aware that, as mentioned above, changes have been made to the Bill
since that article was written.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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