The Act currently prohibits unfair contract terms in standard form consumer contracts. The Bill aims to extend this prohibition to apply to small trade contracts too.
Unfair contract terms are terms that would cause a significant imbalance in the parties’ rights and obligations, are not reasonably necessary to protect the legitimate interest of the dominant party, and would cause detriment to a party.
The Bill defines a contract as a small trade contract if:
1. the parties are engaged in trade;
2. it is not a consumer contract; and
3. the trading relationship between the parties is less than $250,000 per year (for all contracts between them).
If a term in a standard form small trade contract is found to be unfair, then that term cannot be included, applied, enforced or relied on.
UNINVITED SALES PEOPLE
The Bill extends the rights of consumers to direct sales people to leave or not enter their homes. These directions can be given verbally, in writing, visually, or can be a general standing direction (e.g. “Do Not Knock” signs).
WHAT DO THE CHANGES MEAN FOR YOU?
Businesses need to review their conduct, especially with small businesses. If the Bill is passed, the current penalties in the Act will apply, which means businesses could face fines of up to $600,000 if they breach these provisions.
If you have any concerns on the Bill, you have until midnight on Friday, 27 March 2020 to make a submission. For more information on the Bill or the Act in general, please contact one of the Jackson Russell Lawyers listed.