Australian Consumer Law and Waiver Agreement Breach

The assignment involves a case study where Jason sells a truck to Chong for his construction business, claiming it's not in immaculate condition. However, Jason is aware that the truck has oil leaks. The agreement includes a waiver of rights, which is breached by Jason's misleading information about the goods and purchase agreement terms. This analysis will explore the breach of Australian Consumer Law provisions regarding misleading or false claims and the seller's responsibility to provide sufficient information to customers.

Business &
Corporations Law

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK...............................................................................................................................................1
A).................................................................................................................................................1
B).................................................................................................................................................2
C).................................................................................................................................................2
D).................................................................................................................................................3
E)..................................................................................................................................................3
REFERENCES................................................................................................................................5

INTRODUCTION
Australian Consumer Law (ACL) have framed many rights and obligations of consumers
when purchase or sell of goods take place. This law applies to nationality and in all states and
territories even to Australian businesses also who deals in trading of goods and services. The
protection which generally reflected in similar provision in Australian Securities and Investments
Commission Act (ASIC), in order to treat all goods and services in same way (Hylton, 2013). In
this report, case study on Chong and Jason has been explained in context of selling of goods and
misleading of information.
TASK
A)
Issue: Chong had purchased the truck from Jason of $55K and he enclosure a clause into
purchase agreement which is relinquishing his defence under Australian Consumer Law. After a
point of time he found that oil was leaking from truck and he want to recover the amount from
Jason. But Jason pointed out that he is not consumer under ACL because cost of truck is more
than $40,000.
Rule: According to provision of Australian Consumer Law a person or a business will be
considered as consumer if they are coming under following conditions:
 They purchase the products or services where cost of there is not more than $40,000.
 Purchase of goods and services is more than $40,000, but they are ordinarily acquired for
domestic, household or personal use or consumption.
 Goods are used for commercial road vehicle which principally used to transport products
on public roads.
Application: In given case, Chong was a person who had purchased the truck for his
construction business. As per according to Australian Consumer Law, he is not considered as
consumer because he has also not fulfilled following condition.
 Purchase price of truck is more than specified limit i.e. 55,000.
 He had purchased the vehicle but not for ordinary purpose for domestic, personal use or
household consumption.
 Truck was not used for commercials road purpose.
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If Chong wants to claim on buyer, then firstly he has to fulfilled all above mention
conditions in order to take refund from Jason.
Conclusion: Chong is not considered as consumer under ACL because he is not
covering under terms and conditions which are specified in law.
B)
Issue: Jason represent the wrong information about truck which is that it is brand new but
in that leakage of oil is there.
Rule: As per provision of ACL, if any business is engage in an illegal which is creating
false impression on consumers regarding any products or services, then it will be considered as
unlawful (Malbon, 2013). It includes advertisement or any statements which are given in media
or made by person to represent their business.
Application: Jason had used comparative advertising in which person is promoting their
goods and services over their revivals (False or misleading claims, 2017). Some factors may
include; price, quality, volume. So, according to these provision Jason had breached the law at
the time of advertising the truck as brand new because in that there is oil leakage. This shows
that there is misleading of information regarding vehicle.
Conclusion: It has been analysed from above issue that Jason had ruptured rules and
regulation or law under ACL.
C)
Issue: While forming agreement with Chong, Jason breached the law which waive the
rights of buyer.
Rule: According to provision of law, if parties are forming any agreement, then it should
be in native language (Micklitz, Reisch and Hagen, 2011). Wavier is a voluntary action which is
performed by party to remove another person rights or specific ability at the time of forming
agreement.
Application: In given case scenario, Chong doesn’t understand English very well. So
Jason had inserted one clause while doing purchase agreement which is waiving the right of
Chong and protection under ACL statutory guarantees. While doing so it is responsibility of
Jason that whatever agreement they are forming it should be in native language so that it will
easy for other party to read document. In agreement, language should be simple and clear which
should make easy for person to read out the document while signing them.
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Conclusion: From above case it has been concluded that as per provision of law Jason
had breached the agreement because at that time he included wavier where rights of Chong are
not protective.
D)
Issue: Is Jason is having right to claim against Chong that he had waived his protection
under statutory guarantees at the time singing purchase agreement.
Rule: As per provision of ACL, waiver is voluntary relinquishment of someone’s rights
or privilege while performing any contract. The government may issue some exemption
regarding wavier for companies so that they can operate their business function properly
(Munch, 2012). These are specially for banks in which they can recover the amount from person.
At the time of forming this agreement, it should be in native language so that both parties can
easily execute their duties according to terms and conditions which are specified in contract.
Application: In given case, at the time of forming contract Jason claimed for that Chong
had waived his right under statutory guarantees at the time executing purchase agreement. On the
basis of this, Jason is not having authority or right to claim against him because he only entered
into waive agreement with Chong. However, Chong is not able to speak in English very well and
don’t understand also so he may right to claim against Jason. If Jason wants to claim against
Chong, then he has to make agreement in simple language which would be understood by both
parties. Apart from that if any loss has been incurred for using truck, then Jason is liable for
compensating amount to him if Chong would come under consumer definition which is specified
in law.
Conclusion: It has been comprehended from above issue that Jason cannot claim for the
waive agreement which has being made with Chong.
E)
Issue: Apart from these advertising the product and doing waiver agreement whether
Jason had breached any other provision which is specified in ACL.
Rule: In given provision of ACL, businesses and corporation are not allowed to give
statement which are incorrect or likely to creating false impression of goods and services in front
of customers. This rule applies when organisation or person is advertising their product in order
to increase the awareness about their products and services. It applies to any statement which are
giving by person through media or any other source (Price, 2016). Apart from this, if person is
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doing any agreement regarding purchase and it became their responsibility to specify all terms
and conditions which has to be perform by parties.
Application: With reference to given case, Chong had purchased the truck from Jason for
his construction business by saying that it does not deal with any immaculate condition. But
Jason was aware about that there is problem in truck i.e. oil leaks. From this waive agreement
has been done by Jason in which Chong rights are surrender. While doing this, two forms of
agreement has been breached by Jason i.e. misleading of information about goods and purchase
agreement. Rather than this, none of the provision had been breached by seller as accordance
with Australian Consumer Law. But is responsibility of seller to provide all sufficient
information to customers regarding the purchase of goods or services. Otherwise they will have
held liable for compensating loss amount to buyer (White, Klinner and Carter, 2012). Further if
they are doing wavier agreement, then it should be clearly state by person in native language so
that they came to know about their terms and conditions of contract.
Conclusion: It is concluded from above issues that Jason did not broke any other
provisions which are specified in ACL.
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REFERENCES
Books and journals
Hylton, K. N., 2013. Toward a Regulatory Framework for Third-Party Funding of
Litigation. DePaul L. Rev. 63. p.527.
Malbon, J., 2013. Taking fake online consumer reviews seriously. Journal of Consumer
Policy. 36(2). pp.139-157.
Micklitz, H. W., Reisch, L. A. and Hagen, K., 2011. An introduction to the special issue on
“behavioural economics, consumer policy, and consumer law”. Journal of Consumer
Policy. 34(3). pp.271-276.
Munch, S., 2012. Improving the benefit corporation: How traditional governance mechanisms
can enhance the innovative new business form. Nw. JL & Soc. Pol'y. 7. p.i.
Price, Z. S., 2016. Seeking Baselines for Negative Authority: Constitutional and Rule-of-law
Arguments Over Nonenforcement and Waiver. Journal of Legal Analysis. 8(1). pp.235-
276.
White, L., Klinner, C. and Carter, S., 2012. Consumer perspectives of the Australian Home
Medicines Review Program: benefits and barriers. Research in social and administrative
pharmacy. 8(1). pp.4-16.
Online
False or misleading claims. 2017. [Online]. Available through:
<https://www.accc.gov.au/consumers/misleading-claims-advertising/false-or-misleading-
claims>. [Accessed on 22nd September 2017].
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