Consumers Master Doc PDF

Consumer Paragraphs TOPIC RELEVANT LAW RELEVANT CASES LIMITATION Consumer ACL 1. ACCC v Fitbit (2022). Fitbit falsely claimed that LIMITED by the high percentag...

Consumer Paragraphs TOPIC RELEVANT LAW RELEVANT CASES LIMITATION Consumer ACL 1. ACCC v Fitbit (2022). Fitbit falsely claimed that LIMITED by the high percentage of businesses guarantees - Specific consumer guarantees, consumers were not entitled to a refund if they that do not comply w guarantees ⇒ means Consu… which provides consumers with returned a faulty product after 45 days of customers have to go to court, which is legal rights when they purchase purchase or shipment, in contravention of the expensive, and thus disengage with the dispute goods and services. ACL which does not state products must be - Products must be of “acceptable returned in this timeframe. 1. In 2017, more than 29,000 people quality” and for products that are 2. ACCC v Booktopia (2023). From at least 10 reported consumer guarantee issues to not, retailers have to provide a January 2020 to 2 November 2021, Booktopia the ACCC, with half noting problems remedy of some kind, whether it made misleading statements in its online Terms getting remedies for faulty automotive, be a repair, replacement or of Business that consumers were only entitled whitegoods or electronics products. This refund for faulty goods. to a refund, repair or replacement if they was a 39 per cent increase in reports - Ability to cancel a faulty service notified Booktopia within 2 business days of about consumer guarantee issues when receiving a product that was faulty or not what compared to the 21,000 received in 2016, they ordered. Again, the ACCC deemed that highlighting the increasing difficulty this was not a ‘reasonable period’, and fined experienced by consumers in resolving Booktopia $6 million for their misconduct. issues themselves due to the actions of businesses. 2. Consumer Action Law Centre ⇒ urging the government to penalise businesses who don’t provide a repair, replacement or refund to a consumer when one is due. ACCC ACL 1. ACCC v Toyota (2020). Cars fitted with unsafe LIMITED by its inability to recover - Responsibility in enforcing ACL, Takata airbags were recalled, as they could compensation/damages for specific consumer ensuring that businesses and explode with too much force, potentially loss ⇒ Any fines paid by companies after individuals comply with laws on fair endangering consumers breaching the ACL go to the government, forcing trading and consumer protection 2. BlueScope Steel (2023). Fined $57 million for consumers to sue the company themselves to get - POWERS: ability to regulate engaging in cartel conduct. The owner (Jason compensation or damages for loss. This is consumer goods by issuing safety Ellis) was also fined $575,000. extremely harmful to consumers, as going to warning notices or compulsory court often is very costly, which therefore deters recall notices, banning products Criminal penalties for serious cartel conduct (to restrict them from pursuing their legal matter any further  and imposing mandatory safety competition/increase prices) include imprisonment of standards up to 10 years and/or fines of up to $220,000 for 1. PELVIC MESH CLASS ACTION ⇒ Shine - Also can educate consumers individuals, and fines of the greater of $50 million, 3x Lawyers v Johnson and Johnson + - ACCC can also instigate legal the gain from the cartel conduct or 30% of the annual Ethicon: Commenced in 2012, only proceedings against a turnover of the corporate group for corporations. compensated in 2022 person/corporation for significant - Shine wanted to take $99.5 million breaches of the ACL in legal fees (⅓ of the total sum) - Can launch criminal prosecutions in the Federal Court under criminal consumer protection provisions (Part IV Division 1: Cartel Conduct of the Competition and Consumer Act 2010 (Cth)) Courts and ACL COURTS: COURTS: tribunals 1. DePuy ASR hip implants (2016). Class action LIMITED by the expense and time taken by COURTS: against UK manufacturer DePuy, and supplier courts to reach decisions - Final option is the court which can Johnson & Johnson, which distributed and sold 1. According to estimates by the Australian provide a legally binding outcome the implants in Australia. These implants were Government Attorney-General’s for consumers and deal with alleged to be defective, not fit for their purpose Department, the average cost of going to non-compliance and were not of merchantable quality in the Federal Court is $111,130, whereas - Due to the expensive nature of the contravention of the Trade Practices Act 1974 the maximum cost of going to NCAT is court process and the difficulty in (Cth) (the predecessor of the ACL). On 29 June $288. individual consumers successfully 2016, after a 17 week trial in 2015, the Federal Extremely expensive nature of the court could prosecuting large, multinational Court approved a settlement for $250 million. lead consumers to disengage with their cases, global companies, many thus limiting the court's ability to enforce consumers may be deterred from TRIBUNALS: compliance and deal with non-compliance. Even pursuing individual legal action 1. Jackson v Honda (2022). The applicant when consumers opt to sue as part of a against companies. However, the claimed that their newly purchased car was not class-action, these can take much longer to settle courts do provide the ability for fit for purpose and was not free from defects. due to the size and scope of the suits, and the consumers to join a class action The tribunal upheld this, proving that the payout could potentially be limited due to legal lawsuit, where a group of respondent had failed to comply with the fees consumers all affected by the guarantee of acceptable quality in section 54 of 2. Camping Warehouse Australia v Downer same problem come together to Schedule 2 of the Competition and Consumer EDI (2016). Average payout per class sue collectively, reducing costs. Act 2010 (ACL) and thus, the applicant could member was expected to be $633.29, recover any loss or damage suffered because whereas the legal fees were $2.85 million  TRIBUNALS: of the failure of the respondent to comply with a - The NSW Civil and Administrative statutory guarantee under Section 272 of the TRIBUNALS: Tribunal (NCAT) was set up under ACL. Limited by the scope and jurisdiction the Civil and Administrative 1. No jurisdiction for matters in states other Tribunal Act 2013 (NSW), as a For tribunals, filing fees are only $54 for matters up to than NSW, for orders in excess of way to resolve disputes between $10,000, and a maximum of $288. $100,000, or for private sales e.g. tenants, landlords, traders and between individuals ⇒ forces consumers consumers in a timely and cost to go to court, which is a much lengthier effective way and more expensive legal process Non-legal: NO LAW Annual media “Shonky Awards” name and shame the NO LEGAL PROSECUTION CHOICE/ - CHOICE, the leading consumer worst goods and services sold in Australia, in order to The media advocacy group in Australia, expose businesses for flaws, faults or failed standards, researches and campaigns on a lack of transparency, false claims or broken behalf of consumers and publishes promises, and consumer detriment or confusion which CHOICE magazine, providing plays an important role in protecting consumers. consumers with independent 1. This is evidenced in the 2022 Shonky Award expert advice on product quality given to QANTAS for being the “Spirit of and safety to ensure that Disappointment”, with the worst rates for flight consumers are protected from delays and poor baggage handling still priced at unscrupulous businesses. a premium level. This was successful in leading to an apology from QANTAS CEO Alan Joyce, and, more significantly, to the ACCC launching legal proceedings against the company, chasing penalties for allegedly selling tickets to flights it had already cancelled - illegal under Section 18 of the ACL as misleading/deceptive conduct. The media has the ability to publicise the shoddy practices of unscrupulous suppliers and manufacturers, educating consumers on their rights and addressing modern issues. 1. The television show, “The Checkout”, features segments that examine the practices and methods of manufacturers, retailers, service providers and advertisers. Using a humorous  style, the show highlights practices that are misleading, dishonest, unfair or occasionally even illegal or unethical. This puts pressure on suppliers and manufacturers to be honest about their marketing practices, acting as a deterrent for acting against the ACL and thus promoting consumer rights. Marketing ACL GREENWASHING: The effectiveness of the ACL in protecting innovations - Section 18 states that it is illegal to 1. Volkswagen admitted in 2019 that it had made consumers with regards to the marketing and + misleading engage in conduct that misleads or false or misleading representations about the advertising of goods and services is limited by the and deceives or is likely to mislead or emissions of their vehicles when importing more sufficiency of the penalty amounts, particularly deceptive deceive consumers or other than 57,000 diesel vehicles into Australia those prior to the law reform of 1 July 2023 Consu… businesses, and it applies even if between 2011 and 2015 ⇒ fined $125 million in 1. ACCC sued Telstra in the Federal Court in the company did not intend to Federal Court (ACCC) June 2022 for making false and mislead/deceive, and if no one has misleading representations to customers suffered loss/damage. Misleading and deceptive: relating to the NBN and were fined $33.5 - Section 29 also protects 1. Australian Institute of Professional million dollars with Optus and TPG. consumers, stating that it is illegal Education (AIPE) v ACCC (2019). AIPE misled - Only 5 months later in December for suppliers to make false or vulnerable and disadvantaged clients by 2022, Telstra was again sued in misleading representations when representing their courses as ‘free’, even the Federal Court for making false marketing and advertising their though their courses would each result in a VET claims about the upload speed of goods and services. FEE-HELP debt of up to $20,000. Additionally, it consumer broadband services - Section 20 states that it is illegal to persuaded students to enrol by providing "free" engage in unconscionable conduct laptops. They were subsequently fined $153 REFORM: (taking advantage of someone’s million by the ACCC, the highest penalty for a 1. $50,000,000 vulnerability) breach of the ACL at the time. 2. If the Court can determine the value of the 'reasonably attributable' benefit obtained, 3 times that value, or 3. If the Court cannot determine the value of the ‘reasonably attributable’ benefit, 30% of the corporation's adjusted turnover during the breach turnover period for the contravention. Under former penalties, the maximum was $10  million, three times the benefit or 10 percent of relevant turnover Credit National Consumer Credit Protection Act 1. CBA ordered to pay $150,000 for credit limit Limited by the growth in usage of buy now, pay Consu… 2009 (NCCPA) increase provided to problem gambler later companies such as Afterpay. Despite the - National Consumer Credit (2020): Royal Commission case study ⇒ fact that these companies do let you buy Protection Act 2009 (NCCPA) Failed to take account of a notification by a something and pay it back over time, they are not imposes certain obligations on customer (Mr Harris) that he was a problem classified as credit providers as they don’t lenders to engage in "responsible gambler and to take reasonable steps to verify technically charge interest, rather charging ‘late lending" when providing consumer his financial situation before offering and fees’ if customers fail to repay their debts on time. credit contracts and loans in approving a credit card limit increase. This means they are not covered by the National accordance with society’s 2. ASIC sues Money3 Loans for responsible Credit Act and, importantly, are not obliged to expectations that consumers are lending breaches ⇒ ASIC alleges that in the observe the responsible lending rules. This legally protected against unfair period between May 2019 and February 2021, increases the risk of money being loaned to practices and ensure they can Money3 failed to properly assess whether consumers who are in low socio-economic make informed financial decisions. certain borrowers (including First Nations conditions, and thus cannot afford to get into - These obligations include requiring peoples) could meet their repayment debt, trapping these vulnerable consumers in lenders to make an assessment of obligations before entering into loan contracts difficult financial situations. a consumer’s ‘suitability’ for entry for the purchase of second-hand vehicles. Each 1. According to Financial Counselling into a credit arrangement before of these consumers, and a substantial Australia chief executive Fiona Guthrie, providing credit or a loan to them. proportion of Money3 customers, were either many of the people using buy now, pay - Particularly, under the law, lenders receiving Centrelink payments as their sole later companies are on “low, and often, must verify the borrower's financial income or were on low incomes ⇒ Case precarious” incomes, resorting to these situation and provide that to the management listing moved to 8 February 2024. companies as a way to pay for items but person, and give them a quote 3. ASIC v Channic (2017). Channic was fined getting into financial trouble as a result. setting out the maximum they may $278,000 for breaching consumer credit laws 2. This is supported by ASIC, who claims be required to pay back. relating to responsible lending. that one in five consumers using buy now, - If a person is deemed unsuitable pay later companies are missing for a particular loan or credit payments, demonstrating the financial amount, the lender cannot give it challenges associated with these services to them and the failure of the laws to fully reflect community expectations and values that vulnerable consumers are protected in an increasingly sophisticated credit market. Two in five Australians used a BNPL service in  the six months leading up to March 2024, according to a survey by Finder, with the most frequent adopters being Gen Z (52 per cent) and millennials (59 per cent). (ABC, “Users of buy now, pay later services to undergo credit checks under proposed new law”, 2024) (ABC, “Users of buy now, pay later services to undergo credit checks under proposed new law”, 2024) PLAN FOR EACH THEME AND CHALLENGE: 1. The role of the law in encouraging cooperation and resolving conflict in regard to consumers P1 - Courts and tribunals → talk about the acts that establish each (resolves conflict) P2 - ACCC → also talk about the act that established this (resolves conflict AND encourages ⇒ mainly resolves) TALK ABOUT THE LAW THAT SETS UP THE ACCC!!!! (Competition and Consumer Act 2010) P3 - ACL misleading and deceptive (encourages cooperation) ⇒ laws regulate it so that companies must enforce Could also mention credit ⇒ responsible lending laws 2. Issues of compliance and non-compliance P1 - Courts and tribunals P2 - ACCC P3 - Misleading and deceptive/credit 3. Laws relating to consumers as a reflection of changing values and ethical standards P1 - ACL misleading and deceptive ⇒ Trying to prevent the exploitation of vulnerable consumers P2 - Credit ⇒ Protect consumers from predatory lending P3 - Consumer guarantees + ACCC (if the business does not comply, ACCC can…) 4. The role of law reform in recognising the rights of consumers P1 - Consumer guarantees (ACL 2010) P2 - ACL misleading and deceptive ⇒ 1 July 2023 reform P3 - Credit (NCCPA 2009) + proposed law reform for BNPL companies In 2021, the definition of consumer went from 40,000 to 100,000 ⇒ protects more consumers (broke and rich) Could also talk about NCAT - now it has jurisdiction for up to 100,000 5. The effectiveness of legal and non-legal responses in achieving justice for consumers P1 - Courts and tribunals P2 - ACCC or Credit P3 - Ad standards/CHOICE