Consumer Law Case Study

Introduction

Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Act 2015 will affect from 12 November 2016. it has changed some sections to the Australian consumer law. Last version of this law only applicable to the individual consumer, Act 2015 extend the scope to the small business that employs fewer than 20 persons. This thesis will discuss the following questions;

What is an unfair term under the new law and when will it apply?

What is the legal effect if a court decides a contract term is unfair?

Explain the doctrine of freedom of contract and how the unfair contract terms provisions conflict with the doctrine.

Explain the relationship between legislation and common law and which prevails.

Unfair term

The government amended the consumer law to cover the small business that employs no more than 20 persons. From 12 November 2016, the Act 2015 will affected to the standard form small business contracts. The new meaning of unfair term is:

The contract is made for a supplier of goods and services, or sale or grant the interest of land rights;

When signing the contract , at least one party is a small business employs less than 20 people;

The maximum payable price under the contract no more than $300,000 or no more than $1,000,000 when the contract has a duration more than 12 months.

Legal effect

If a court

The doctrine of freedom of contract show that people have the right to legally bind them.Freedom of contract is a judicial concept which holds that contracts are based on mutual agreement and free choice. Therefore, contracts are not be limited by outside effects such as governmental interference. This is the principle which supports that people are able to manage their relations by private agreements, when confrontation the distribution roles of the feudal