Many advertisers treat "conditions apply" as a magical incantation. I have known some to include these words in an advertisement, believing that they are then covered for all manner of exclusions. I have also known advertisers who include these words because they feel they must, simply because the supply of product is subject to standard terms and conditions of supply. In reality, the words "conditions apply" are of limited application and even less effect. This was illustrated recently by the Western Australian Court of Appeal's decision in Bayswater Car Rental Pty Ltd v Department of Employment and Consumer Protection.1
Speaking generally, the words "conditions apply" in an advertisement can indicate only that the offer featured in the ad is subject to conditions that one would reasonably anticipate in the circumstances. For instance, an advertisement promoting a sale by a chain of bookshops could use the words "conditions apply" to indicate that customers are limited to a maximum of a certain number of books, that the offer does not apply to retailers and that the sale will end on a particular date. Having said that, greater notice than what "conditions apply" allows may be needed, even for these conditions, if particularly out of the ordinary, for instance, if the sale was to last only one weekend and the advertisement were running in a monthly publication.
The general point here is that advertisers must stand behind not only the express statements in their ads, but also any other meaning customers reasonably take from that ad. The ad will be misleading and deceptive if any of those representations – express or implied - is wrong. The question is whether including the words "conditions apply" puts customers on notice sufficiently of exclusions and limitations for that to register, or will they take from the ad that the offer is unrestricted notwithstanding the reference to "conditions apply"? The decision in Bayswater Car Rentals suggests that the answer to that question necessarily is no, that the disclaimer "conditions apply" can never perform that function and can only ever refer to the types of conditions mentioned in the bookshop example.
Bayswater Car Rentals advertised a "7-Day Special" on nominated vehicles in The West Australian. The ad ran between 17 and 24 March 2005. Easter that year fell on the weekend of the 25th to 28th of March. The ad stated "conditions apply", but did not elaborate. Angry customers were refused the 7-Day Special rate when they tried to book cars over the Easter weekend. The Court of Appeal unanimously held that this was misleading and deceptive.
Overall, the Court took the view that the advertisement made the general representation that the 7-Day Special rate would be available to the public at all nominated branches for a reasonable time after, and commencing from, the date of publication. That included Easter because the disclaimer could not, and did not, suggest to customers that there were any exclusions. As that was not the case, the ad was misleading. The Court considered that the words "conditions apply" could only ever indicate to potential customers that there were conditions that qualified a customer to take advantage of the offer.
When the matter first went to Court, the Magistrate accepted that most people understood offers of this type do not generally apply during peak periods. The Court of Appeal did not accept that consumers necessarily made that assumption. But, even if they did, the ad remained misleading at law. Readers may think that this is particularly harsh given that customers would have the terms of the offer clarified as soon as they telephoned to book a vehicle. The Court held that the advertisement was misleading despite that.
Take out
The bottom line is that advertisers should use "CONDITIONS APPLY" with caution. If the advertised offer is subject to important exclusions, it may be necessary to make those fairly prominent.
Footnotes
1 [2008] WASCA 43, handed down on 4 March 2008.
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.
