Consumer Contract Law - Case Study Example

Running head: Consumer Law Consumer Law Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Name Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Course Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Lecture Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx 29th November, 2012. Issue The issue to be discussed involves Consumer Contract Law (CCL) 1where there is a situation of if the consumer has rights to be protected when it comes to rights of accommodation. The case is of a consumer who supposedly booked a holiday with Accommodation Noosa Pty ltd. All the agreements have been made and the client has completed his part of the contract in the payment procedures which is a consideration in the contract about to be entered. However the accommodation provider does not obey to the terms of the contract because he/she does not honor the agreement where the service provider was specified on the type of room to be offered by the client. There is a situation of double booking of the room previously booked and in the service providers view, he provides for an alternative room to the initial booker instead of the second booker. This case is set to determine if the client who had originally booked the holiday room has the right to take action against the accommodation provider. Rule Section 18 of the Australian Consumer Law in support with section 52 of the Fair Practices Act 2gives consumer provisions that are in charge of regulating unfair trade practices. To rule out the case, there has been misleading and deceptive conduct that has been practiced by the accommodation provider and thus under section 18,it is stated that no one person engaging in trade activities has the right to participate in commercial trading practices that are likely to deceive the clients. Australian courts do not have a specific definition of what can be termed to be misleading or deceptive conduct but the overall understanding of the statement misleading and deceptive can be said to be a behavior or alleged conduct that can lead a person into error. Misleading on the other hand may mean making false claims or giving the wrong information to someone else who allegedly relies on it. In some situations a trader may not intend to give a client information that is misleading though they acted in an honest and reasonable way but in the long run, it is viewed to be deceptive conduct due to ignorance of certain aspects. The rule of misleading and deceptive conduct is categorized into many categories and in ruling out the case, silence is seen to be the major course of deceptive conduct in this case. Failure to disclose certain information to a client in advance is found to be intentional especially in situations where the client is to rely on it. In this case, the hotel owner can be said to be practicing unfair contract terms where there is an agreement on the specific room to be provided but what is agreed on is not what is provided for. Mere silence will include situations where specific information is not relayed to the relevant parties and thus contribute to misleading conduct which can harm the personal interest which can cause harm. According to ACL unfair terms in consumer contracts are not acceptable where the word unfair in the court means a situation of imbalance in the rights of each party under the contract, not protecting the individual interests of both the consumer and supplier of services and one party is deemed to be unfair if it causes both financial and non financial harm to any party. In the case, there were unfair terms because the interest and considerations of the client were not met hence this caused non financial harm. Application Other cases that can be ruled out in a similar way that involved misleading and deceptive conduct and silence playing a major role is in the case of Rondel v Worsley3 where there was a duty of the counsel to be provide answers for the client on any issue raised by them. In this case the courts ruled out that the profession had the responsibility to cater for the personal interests hence in the case it was ruled out that the service provider had a responsibility to serve the interests of the client with maximum competency, the service provider was to give clear communication to their clients and finally inform the client of any change in the arrangement earlier agreed. In the case to be ruled, Accommodation Noosa was liable for providing information on any change in the agreement reached upon hence they were guilty of being silent until the last minute. In the case of Taylor v Johnson4, a contract between the two parties set out that there would be notices from either party in the price terms reached upon any change in price, it would be communicated at the right time. It would be a mistake if one party relied on information that had been amended earlier. In ruling out the case, a mistake had been made when one of the parties did not communicate to the other on an important matter. The defendant had an obligation to communicate any material information that would be relied upon. As in the case of Pegela v National Mutual life Association of Australia Ltd5Silence in the case was termed to be deliberate hence any action that would be amended by the parties did not take place leading to a breach of misconduct which contravened the contract agreement. In Accommodation Noosa’s case, if there was double booking that happened, it was their responsibility to inform the original client once they noted the mistake hence the client while receiving an alternative room would have been aware in advance and any changes that he would have wanted would have been made. This therefore meant that by him being informed in advance, any change would have been made with reasonable expectation that he would get an alternative room. Like in the case of Poseidon Ltd v Adelaide Petroleum NL6, keeping information to oneself and not disclosing it to another party leads to misleading acts which can lead to compensation if there is harm or damage incurred. An example of a case where there is a duty to disclose is in the case of Noor Al Houda Islamic College Pty v Bankstown Ltd7where there was lease of land that would be used as a school. It was found out that there was an obligation to exercise care which would be reasonable and disclose any information that would help in leasing the land. There was a breach of contract where part of the leased site was contaminated and it was not disclosed. In the case, it was held that there was deceptive misconduct by not fully disclosing the information relating to the land which might have caused harm if the school was to be built there. Another case where there was misleading conduct in contract agreement was in the case of Australian Competition and Consumer Commission v Telstra Corporation Limited8 where there were various claims made by Telstra about Next G Mobile Network of the network coverage. Telstra in their argument said that they relied on the advertisements that were directed to the consumers and claimed that they had various disclaimers to the extent in which network coverage would be found. The court however argued that the disclaimers that they had put would not prevent misleading conduct to the customers as in their advertisement; they did not sufficiently communicate the extent in which the information would be relied upon. Conclusion There are remedies for consumer law protection where there are misleading and deceptive conduct information is liable to the service owner being sued hence payment of damages, compensatory orders and injunctions as stipulated by chapter 5 of the ACL. However civil penalties and criminal sanctions do not apply in the remedies because according to section 18, it specifies on business conduct where there are provisions and remedies that a consumer can demand if there was harm caused as result of not being given the right information. Among the remedies given, the client who was the initial booker would have written a letter to the management of the ignorance and lack of proper booking in the holiday company d the client would base his complaint on silence until notification in the last minute. The client would also have claimed for compensation because even though he was given an alternative room, it would not have offered the same satisfaction as compared to the alternative room that he would be given. References Australian Competition and Consumer Commission v Telstra Corporation limited [2007] FCA 1904 Consumer Contract Law (CCL) Fair Practices Act Noor Al Houda Islamic College Pty v Banks town Ltd (2005)215 ALR 625 Pegela v National Mutual life Association of Australia Ltd (2006) VSC 507at (740) Poseidon Ltd v Adelaide Petroleum NL (1991)105ALR 25 at 26 Rondel v Worsley (1969)1 AC 191 at 227 Taylor v Johnson (1983)151 CLR 422 Read More