Suppliers are not allowed to take unreasonable advantage of consumers in supplying goods or services. The courts look at all the circumstances of a deal including the relative bargaining power between consumer and the supplier, the need for particular terms, the complexity of any documents, the use of unfair sales tactics or other pressure and the price for which the goods or services might have been obtained from someone else.
The protections under the Australian Consumer Law apply only to dealings for goods and services that are ordinarily for personal or household use.
Unconscionable conduct is not defined, but the Act sets out criteria which can be used as a check list to determine if conduct is unconscionable [Competition and Consumer Act 2010 (Cth) Schedule 2 s 21]. They are:
- is the supplier in a substantially stronger bargaining position than the consumer?
- has the consumer, as a result of the conduct, entered into a contract with harsh conditions that are unnecessary to protect the company's interests?
- could the consumer understand the documents? (e.g. is there any language difficulty or mental incapacity?)
- were any unfair pressures, or unfair tactics used? (e.g. door to door sale without an appointment)
- was the amount paid for the goods higher than elsewhere or could the consumer have obtained the goods from another supplier on better terms?
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