Business Situation of Anna and Julian with Bliss Island - Essay Example

Case Analysis and Essay Name Institution Course Instructor Date Case Analysis and Essay Introduction By looking at the events that unfold in the case study, it is clear that Anna and Julian are entangled in an exploitative business situation with Bliss Island. For the record, Bliss Island resort fails to honour the provision of quality services that are advertised in the resort’s brochure. These services include reef diving, delicious cakes, and tropical experience, among other services. It is conclusively clear that the resort violated the legal providences of the Australian Consumer Law (ACL).1 The ACL generalizes the fact that every consumer is entitled to particular business contractual rights. The rights are important in protecting the consumer against exploitative business dealings.2 Based on the Bliss Island resort’s violation of the ACL, this paper seeks to present an analytical essay that provides legal-based advisory measures that are important in resolving Anna and Julian’s dilemmatic business ‘exploitation’ experience. Background The ACL The ACL represents the newly enacted statutory consumer protection law in Australia. Implemented in 2011 by the Council of Australian Governments (COAG), the ACL replaces the state and territorial common consumer protection laws. The ACL’s framework reflects COAG’s regulatory reform system and the 2008 Productivity Commission recommendations on consumer policy framework of Australia.3 However, the existing state and territorial regulatory bodies (Intergovernmental Bodies) still hold the mandate to implement the ACL. The Intergovernmental Bodies work in an interlinked manner through the Standing Committee of Officials of Consumer Affairs (SCOCA). SCOCA’s agreement requires every business transaction to comply with the ACL guidelines. According to the agreement, ACL guidelines provide protection and empowerment to improve the well-being of consumers, promotes healthy business competition, and provides a confident consumer participatory platform in markets, thereby allowing fair trade transactions.4 As such, SCOCA takes specific procedures to enforce ACL guidelines. These procedures include stopping unlawful transaction, undoing the effects of the unlawful transaction, ensuring future observance of the law, discouraging future offending transactions, reassuring the efficacy of regulatory compliance, and punishing the perpetrators of the law.5 ACL guidelines on Personal services This essay section focuses entirely on ACL guidelines that pertain to appropriated issuance of service transactions. In other words, the ACL guidelines on personal services are important in protecting consumer guarantees, shielding unfair business practices, appropriating sales practices, enforcing regulatory compliance, ensuring safety of products, and providing guidance on how to deal with unfair contractual outcomes.6 Under consumer guarantees protection, every service-based business must meet specific service providence guarantees. With regards to the guarantees, every business needs to provide services with appropriate care and skills.7 This means that every business needs to rely on acceptable knowledge, skills, and technicality levels that befit the providence of that particular service, coupled with observance of absolute care to prevent occurrence of damages or losses. Also, the guarantees require every business to provide services that fit ‘consumer-specified’ purposes. This means that the service products ‘in question’ must reasonably satisfy the consumer’s demands and expectations. Finally, the guarantees require businesses to provide consumer-specified services within the agreed time-frame or within a reasonable time-frame. However, the reasonability depends on the service products’ nature. Basing on guarantees’ reasonability, every business needs to comply with the guarantees even in the presence of contractual agreements.8 It is necessary to note that the guarantees applicability is governed by enacted measures. These measures include service transactions conducted in or after 2011, commercial services that cost around 40,000 Australian dollars and any other personal services that cost any price as long as it serves a domestic purpose.9 Guarantees’ applicability limitations arise when services do not fall within the aforementioned measures. Notable limitations include service purchases made before 2011, and commercial services costing above 40,000 Australian dollars, among others. The obligations taken in business’ guarantees violation are divided into two main groups. These groups include major and minor failures. Major failures are characterized by first, acquisition of services where the business conceals the services’ informational nature. Second, consumers acquire services that fail to satisfy the service-specified purpose and are unfixable within a reasonable time-frame. Third, consumers acquire unsatisfactory consumer-specified services that are unfixable within a reasonable time-frame. Fourth, consumers acquire services that do not produce consumer-specified results and are unfixable within a reasonable time-frame. Finally, consumers acquire services that endanger their safety.10 When major failures occur, guarantees mandate any consumer to select between two legal actions. These actions include cancelling the service and obtaining a refund that equals the cost of the remaining unconsumed services or consuming the services and obtaining compensation that equals the value differences between paid services and delivered services.11 Alternatively, the business needs to compensate the consumer on other associated losses and damages with an exception of nature-caused damages such as storms. On the other hand, the occurrence of minor problems discourages consumer’s immediate cancelation of service and demand of compensation. In this case, the ACL guidelines mandate the business to fix the identified problem free of charge and within a reasonable time-frame. If the business fails to do so, any given consumer is entitled to cancel the service and claim compensation. The claim of compensation also includes losses and damages associated with specific service consumption. Advisory context Basing on the above-discussed content, it is clear that Bliss Island resort violated the ACL guidelines in various ways. It is important to note that the resort previously provided all quality services described in its brochure.12 In due course, service specifications changed. However, by considering Commercial Bank of Australia v Amadio case, Sandra failed to elaborate such changes when Julian called to place the anniversary holiday booking. By doing so, Sandra concealed important information that concerned the suitability of consumer-specified services. As a result, Sandra violated the ACL’s guidelines guarantees. The violation resulted in occurrence of major and minor failures.13 In this case, major failures occurred when the resort failed to provide consumer-specified cakes and consumer-expected reef diving experience. On the other hand, a minor failure occurred when the hotel did not provide necessary security measures to safeguard consumers’ property. Lack of proper safeguarding measures led to the loss of Anna’s jewelry. Since the described service transaction befits the applicability of the guarantees’ measures (the service transactions occurred in 2015 and served a domestic satisfactory purpose), the ACL guidelines mandates Julian and Anna to take a legal course of action (that focuses on redress and compensation). With respect to the noted major failures, Julian and Anna have a legal consumer right to either cancel the services and demand a refund that equals the remaining unconsumed services or consume that particular service and demand a compensation that equals the value difference between paid services and delivered services.14 With regards to Australian Competition and Consumer Commission v Harvey Norman Franchisees case and considering the fact that the Julian and Anna had consumed the ‘inappropriate’ services, they are only entitled to claim a compensation that equals the value difference between paid services and delivered services. In Australian Competition and Consumer Commission v Harvey Norman Franchisees case, Harvey Norman Franchisees paid a value difference of 116,000 Australian dollars for airing misleading and deceiving advertisements.15 In Julian and Anna’s case study, the compensation needs to include value differences of paid consumer-specified cakes and offered delicacies, followed by that of paid consumer-expected reef diving experience and offered unsatisfying reef-diving experience respectively. However, the compensation amount might reduce when Bliss Island resort decides to settle the value difference of paid consumer-expected reef diving experience and offered unsatisfactory reef-diving experience. This is because tropical storms contributed to the unsatisfying experience. Alternatively, in the scope of noted minor failure, ACL guidelines mandate Bliss Island resort to fix the identified problem free of charge and within a reasonable time-frame.16 In this case, Anna needs to inform Sandra about the jewelry theft issue. Thereafter, the resort needs to take the responsibility of tracking and apprehending Pete, followed by returning the recovered jewelry to Anna. The tracking, apprehending, and recovering process must occur within a reasonable time-frame. Whatever the outcome, the resort needs to compensate for the loss of Anna’s jewelry. On a final note, if the resort fails to comply with any of the noted major and minor failures’ obligations, ACL gives Julian and Anna the right to take the matter to the judicial court.17 Conclusion In conclusion, the paper presented an analytical essay that provided legal-based advisory measures that are important in resolving Anna and Julian’s dilemmatic business ‘exploitation’ experience. In this regard, the advisory measures relied on the jurisprudences of ACL guidelines that govern issuance of services. In the advisory context, it is noted that Bliss Island resort violated consumer guarantees, thereby leading to major and minor failures. With regards to ACL guidelines, Julian and Anna are entitled to appropriate compensation. In any given way, Bliss Island resort needs to meet the demands of Julian and Anna. Otherwise, the resort faces jurisdictional repercussions that may involve heavy fines and penalties. Bibliography Baldwin, Robert, Martin Cave and Martin Lodge, Understanding regulation: theory, strategy, and practice (Oxford University Press, 2011). Berry, Mike, Tony Dalton and Anitra Nelson, Mortgage default in Australia: nature, causes and social (Australian Housing and Urban Research Institute, Melbourne, Australia, 2010). Brebner, Julie, ‘Resale Price Maintenance – The Need for Further Reform’ (2001) 9 Trade Practices Law Journal 19. Bruce, Alex, Consumer Protection Law in Australia (LexisNexis Butterworth, 2011). Henry, Paul C, ‘How mainstream consumers think about consumer rights and responsibilities’ (2010) 3(74) Journal of Consumer Research 670. Latimer, Paul, Australian Business Law 2012 (CCH Australia Limited, 2012). Trade Practices Amendment (Australian Consumer Law) 2010 (cth). Whish, Richard, and David Bailey, Competition law (Oxford University Press, 2012). Read More