Consumer Protection Law

Abstract

Consumer law protects the interests of consumers against sellers. This paper comprises three parts, the first of which deals with the historical background of the Australian consumer laws. The second part provides an outline of how the Australian consumer law is implemented at both the federal and state levels. The third part of this essay shows how an aggrieved consumer can access the justice system for redress.

In the history of the Australian consumer law, the reader can learn that it originated on the basis of the UK legislation and common law. The current statute was enacted in 2010; it operates uniformly throughout the Federation, as well as all Australian states and territories. A unique peculiarity associated with the implementation and enforcement of this statute is that it has empowered implementation agencies to give almost similar help as the court could. In other words, it means that offended persons can get relief with ease.

Consumer Protection

Consumer protection involves rights and safeguards that are guaranteed to a consumer of goods; it helps people enjoy fair services from suppliers, manufacturers, and retailers. This essay aims at providing a background on the Australian consumer protection, currently available legislation in the country, and how clients can get relief in the case of a negative shopping experience.

The Historical Development of Consumer Law

Before the development of consumer laws, people shared popular idea that, if no corporate institution dominated the market, competition would ensure that consumers get quality services and goods. Later on, consumers faced many challenges, which led many to the court for the redress. Most consumer-related disputes were resolved under the laws of tort, appropriate contracts, and sale of goods and services.

Before the enactment of the Australian Consumer Law (ACL), in the year 2010, Australia had thirteen Acts of Parliament dealing with consumer related issues. These Statutes included two National legislations, the Trade Practices Act of 1974 and the ASIC Act of 2001. There were also eight State and Territory Fair Trading Acts. There also existed another eight State and Territory laws on Sale of goods. The many laws dealing with the same subject matter were caused by the fact that all the Australian States have independent jurisdiction from the other. It was very hectic for business persons to comply with all these laws and for the consumers to understand what law to follow. These challenges are what influenced the need to have a unified law of general applicability throughout the Federation, hence the ACL enactment in the year 2010 (Common Wealth of Australia, 2016).

According to Martin and Turner (2005, p. 2), consumers require protection due to a number of reasons. First, there exists an imbalance between multi-national companies and consumers. In their operations, businesses use standard formulations in their contracts, which leave a person with no option but to accept them if they want to get products. For that purpose, the consumer law is designed in a way to provide implied terms, which cannot be violated by market players against consumers. The consumer protection originates from the necessity to protect the general public from harmful and dangerous products. Therefore, the Act aims at ensuring the provision of quality services and goods. There is a need to protect consumers from any malpractice and unfair prices, as well.

Sale by Description

Section 13(2) of the UK Sales of Goods Act of 1979 states, If the sale is by sample as well as by description it is not sufficient that the bulk of the goods corresponds with the sample if the goods do not also correspond with the description (House of Commons Library, 2016). The aim of this section was to ensure that consumers, who want a particular product, a sample and description, of which they already have, get exactly what they supposed to get.

Arcos Ltd v Ronaason (1933) involved an issue of the sale by description and sample. Products that were supplied, namely, wooden staves, were described as being 1/2 inch thick, were either slightly smaller or bigger. Even though the products could have been used for the intended purpose, the buyer dropped a bid as he could purchase one of a kind cheaper elsewhere. In deciding this matter, Lord Atkin stated, A ton does not mean about a ton or a yard about a yard. Still less, when you descend to minute measurements, does half an inch mean about half an inch? The buyer was allowed to withdraw from the purchase (Silberstein, 2007, p.4).

The protection mentioned above is guaranteed under Section 57(1) (C) of the Australian Consumer Law, which decides disputes when goods do not correspond with the sample or demonstration model in quality, state, or condition (Australian Government, 2010).

Reliance

A mere description of a product is not enough for a consumer to refuse the purchase on the grounds that a good does not meet provided specifications. Buyer must prove that they have relied on the description in making a decision on whether to purchase a product or not.

In the Reardon Smith v Hansen Tangen (1976) case, the House of Lords held that the mark of identification given to an oil tanker was not a part of the description. In this instance, the mark of identification was important, but the consumer did not place any reliance on it.

In Leister v Christopher Hull Fine Art (1991), the Court of Appeal decided that, in a transaction between two art dealers, the buyer had not relied on the description; therefore, it was not a violation. In this case, the seller made it clear to the buyer that he was not an expert in a particular field of painting and that the buyer would buy the painting at his sole risk.

Unsolicited Supplies and Consumer Agreements

Initially, retailers and suppliers could send unsolicited products or offer services to a consumer and later come for the payment. This tactic was meant to make buyers develop an urge of using a good even if they did not want it or could not afford it. Section 167 makes it a criminal offense for a sender of unsolicited goods to claim any money or institute proceedings demanding a recipient to pay.

As a general rule, any consumer, who receives unsolicited services or goods, is not obligated to pay for them or for any loss or damage that may come up from it. However, the Fair Trading Act excludes electricity and reticulated gas supply.

Operation of Consumer Protection Laws in Australia

The Consumer Protection Act aims at protecting consumers from unfair dealings and trade, unacceptable trade behaviour, deceptive and misleading acts, and false representations. The Act provides safety and information standards that must be followed by manufacturers or service and goods providers. The Act establishes the manufacturers liability, as well (Gibson & Fraser, 2014).

In order to understand how consumer protection laws operate in Australia, it is reasonable to establish who is considered a consumer by the law. The ACL stipulates that a person is a consumer if he or she purchases goods or receives services, the value of which does not exceed $40,000 (Bartlett & Ng, 2012). A person is also considered a consumer if he or she acquires services or goods that are acquired for the personal, domestic, or household use; in this case, their value does not matter. A person, who buys a commercial road vehicle, is also considered a consumer. The value of the vehicle does not matter, as well. One qualifies under the term a consumer if he or she buys products that are not intended for resupply or use in trade or business in any way. S.3 of the ACL provides that it is the duty of a supplier to proof that a person is not a consumer or that a sale was not a consumer one (Gibson & Fraser, 2014, p. 6).

The enactment of the ACL was significant in that it made the compliance simpler to businesses, which were subjected to many laws initially. The ACL repealed the national, state, and territory consumer laws in order to come up with a law that would be of the universal application throughout Australia. The ACL repealed the Fair Trading Act of 1987, the Consumer Affairs Act of 1971, and the Door to Door Trading Act of 1987 (Lavan Legal, 2011).

The ACL is applied and enforced as a law in each jurisdiction in Australia. The Federal Parliament has also applied the Act as a Commonwealth law in making it enforceable to corporations. In order to bring it to the full force and applicability, each Australian State and Territory Parliament consented to its application within their jurisdiction. Therefore, it means that the Act protects against unfair acts of not only corporations but also individuals within State and Territorial jurisdictions (Lavan Legal, 2011).

In the western parts of Australia, the ACL is administered and enforced jointly by the Australian Competition and Consumer Commission (ACCC) and the Consumer Protection division of the Western Australia Department of Commerce. Before the enactment of the Act, unincorporated businesses had been supervised solely by the Department of Commerce. With ACL, unincorporated businesses fell under the jurisdiction of the ACCC (Lavan Legal, 2011).

Consumer Relief

Initially, individuals, whose consumer rights were violated, could only get legal relief in the court. The ACL came up with a new mechanism that allows enforcement agencies to act where there was a contravention of the Statute. The consumer law enforcement agencies have been given much power; now, they can issue a court-enforceable undertaking, substantiation notice, public warning notice, or infringement notice.

An aggrieved person can also seek legal redress in the court. Consumer protection disputes are under the jurisdiction of the Federal Magistrates Courts. These courts were established in 2000, and the Magistrate preside them. The Court is provided with a wide range of statutory remedies for any breaches of provisions of the ACL. They include pecuniary penalty matters, injunctions, compensation orders, damages, and non-punitive orders such as adverse public and disqualification orders. (House of Commons Library, 2016)

Consumers should also be aware of their obligations to avoid instances, in which they will engage in activities, from which they cannot recover. For instance, putting into consideration the Nemo Dat Rule, no matter how strong the ACL protects a consumer, it may not work in certain instances. The Nemo Dat Rule is provided under S.21 (1) of the UK Sales of Goods Act of 1979. It states, Where the goods are sold by a person who is not their owner and who does not have the authority or consent of the owner to sell, the buyer acquires no better title than the seller (House of Commons Library, 2016). The only ground that consumers can rely on is whether they can prove that an owner was aware of a transaction and, thus, stopped them from denying knowledge of the sale. This provision is meant to make consumers practice due diligence before entering into any consumer agreements (Woodroffe & Lowe, 2010, p. 10).

The ACL is drafted in a simplified language that makes it easy for a person, who is not learned in the law, to understand. The use of such a legislative drafting language is significant as it ensures that consumers understand their rights, obligations, and remedies, as well as learn where they can seek redress. Today, the law has enabled many consumers and businesses to make well-informed choices, enhanced better competition, and promoted innovation in the market; consequently, it has contributed to the development of the national economy. The ACL has also made it easier to do business in Australia as one does not have to go through numerous processes in order to get a license (House of Commons Library, 2016).

An aggrieved person should also be aware of other law sources that are a part of the Australian consumer laws. One can rely on the common law and cases that have previously been decided in the UK courts. If a person is not satisfied with the decision made by the Consumer Protection and Enforcement Agencies or the Federal Magistrates Court, they can appeal to the state supreme court or seek approval from the High Court to appeal to the High Court of Australia. The first one has unlimited jurisdiction; therefore, it can hear such a case (Gibson & Fraser, 2014, p. 24).

Conclusion

Consumer Protection Law is that law ensures that consumers get quality goods and services at fair terms. Consumer Law developed from the urge and desire to protect the consumers from unscrupulous traders who would dominate the market and thereby put terms that were only friendly to them. The Act came to ensure that certain obligations by the traders could not be derogated from. What is more, unlike previous consumer laws which were applied differently in the States and Australian Territories, the Australian Consumer Law was ratified by all States and Territories and it, therefore, binds every person and corporation within the Federal, State or Territorial jurisdiction. On implementation, a significant element that this law brought about is empowering the Enforcement Agencies with powers so that they can hear consumer related disputes and offer similar redress as those which a Court could issue.

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