19 November 2016 Peter Sise Melbourne, Victoria Review of the Australian Consumer Law by Consumer Affairs Australia and New Zealand Submission in Response to the Interim Report* Dear sir/madam Introduction and summary This submission addresses certain aspects of the Interim Report concerning the "unfair contract term" provisions (UCT provisions) in Part 2-3 of the Australian Consumer Law (ACL). For convenience, summaries of each submission are provided. "Overarching questions": Definition of a "standard form contract" Summary of submission The requirement that a contract be a "standard form contract" should be removed from the ACL. Instead, the test for whether a term is "unfair" should be expanded so that a term must also lack transparency in order to be "unfair". The onus should be on the applicant to prove that a term lacks transparency. Page 117 of the Interim Report asks whether there are any issues that require legislative intervention. One issue is the definition of a standard form contract and whether the UCT provisions should be limited to standard form contracts. Problems with the current definition of a "standard form contract" The common understanding of a standard form contract is a "contract that is not individually negotiated by the parties but contains the same for all transactions of that type." With effect from 12 November 2016, a definition of standard form contract was inserted into the ACL by the Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Act 2015 (Cth). That definition is really no definition at all as it simply refers to the factors in s 27 of the ACL which a court must consider when determining whether a contract is a standard form contract. Section 27 of the ACL provides as follows. (1) If a party to a proceeding alleges that a contract is a standard form contract, it is presumed to be a standard form contract unless another party to the proceeding proves otherwise. (2) In determining whether a contract is a standard form contract, a court may take into account such matters as it thinks relevant, but must take into account the following:
19 November 2016 Peter Sise Melbourne, Victoria Review of the Australian Consumer Law by Consumer Affairs Australia and New Zealand Submission in Response to the Interim Report* Dear sir/madam Introduction and summary This submission addresses certain aspects of the Interim Report concerning the "unfair contract term" provisions (UCT provisions) in Part 2-3 of the Australian Consumer Law (ACL). For convenience, summaries of each submission are provided. "Overarching questions": Definition of a "standard form contract" Summary of submission The requirement that a contract be a "standard form contract" should be removed from the ACL. Instead, the test for whether a term is "unfair" should be expanded so that a term must also lack transparency in order to be "unfair". The onus should be on the applicant to prove that a term lacks transparency. Page 117 of the Interim Report asks whether there are any issues that require legislative intervention. One issue is the definition of a standard form contract and whether the UCT provisions should be limited to standard form contracts. Problems with the current definition of a "standard form contract" The common understanding of a standard form contract is a "contract that is not individually negotiated by the parties but contains the same for all transactions of that type." With effect from 12 November 2016, a definition of standard form contract was inserted into the ACL by the Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Act 2015 (Cth). That definition is really no definition at all as it simply refers to the factors in s 27 of the ACL which a court must consider when determining whether a contract is a standard form contract. Section 27 of the ACL provides as follows. (1) If a party to a proceeding alleges that a contract is a standard form contract, it is presumed to be a standard form contract unless another party to the proceeding proves otherwise. (2) In determining whether a contract is a standard form contract, a court may take into account such matters as it thinks relevant, but must take into account the following:
Sise-Peter.docx