Breaching Provisions of Australian Consumer Law: Angelwings Airlines Case

Running head: BUSINESS LAW
Business Law
Name of the Student
Name of the University
Author Note

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Question 1
Issue
Whether the Angelwings Airlines has breached any of the provisions of the Australian
Consumer Law (ACL). Whether any enforcement actions can be taken by ACCC and Courts
against the Airlines and remedies (if any) are available for Fabio and Greta under the ACL.
Rule
In Australia, the relationship between the consumer and the supplier are regulated by the
Laws provided under the Australian Consumer Law (ACL), which is enforced by the
Australian Competition and Consumer Commission (ACCC). The definition of consumer has
been provided in section 3 of the Competition and Consumer Act 2010. Under this section, a
consumer has been defined in two ways being a consumer of goods and a consumer of
services. The consumer of goods implies any person who has made a purchase of goods
having a worth of any amount not exceeding $40,000. However, there are certain
cases where even amount greater than this is being considered. However, to be rendered as a
consumer of goods under this section, the goods needs to be purchased for personal or
domestic consumption. This section does not consider a person to be a consumer if the goods
are purchased for the purpose of the re-supply. Likewise, this section also provides for the
definition of consumer of services. The consumer of services implies any person who has
obtained services having a worth of any amount not exceeding $40,000. However, there are
certain cases where even amount greater than this is being considered. However, to be
rendered as a consumer of services under this section, the services needs to be availed for
personal or domestic consumption.
The Competition and Consumer Act 2010 (Cth) extends protection to the consumers when
they have been wronged by the suppliers or manufacturers. Section 18 of the Act contains

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provisions relating to the misleading and deceptive conduct that has been extended by the
supplier of goods and services. Under this section, a person, who is involved in trade and
commerce, has been restricted from indulging in any activity, which is deceptive or
misleading or has the probability to deceive or mislead. It has been held in the case of
Futuretronics International Pty Ltd v Gadzhis [1992] 2 VR 209, promises which has been
broken and prediction falsely made are included in such conduct. In the case of Henjo
Investments Pty Ltd V Collins Marrickville Pty Ltd (1988) 79 Alr 83, it has been held that the
concealment of information, which is relevant to the consent of the consumer to make the
purchase can be treated as misleading and deceptive. The making of false guarantees and
warranties without having any intention to deceive or mislead also can be treated as
misleading and deceptive under this section. This can be illustrated with the case of
Accounting Systems 2000 v CCH Australia [1993] FCFCA. This principle has further been
extended to the case of Yorke v Lucas [1985] HCA 65, in which it has been held that a
conduct does not need to be deliberate, the deception suffered by the consumer is enough to
bring the case under the purview of this section.
To bring a case under the purview section 18 of the Act, the court applies an objective test
to check whether a conduct can be treated to be misleading and deceptive. This test has
evolved from the case of Taco Co of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177.
The court firstly detects the section of the public that has been targeted by the conduct of the
supplier, secondly it assesses the conduct with the reaction of all the individuals in that
section to that conduct and thirdly the court will look into the matter that whether the conduct
of the supplier has caused any deception or misconception to the people of that section.
However, any conduct, which is merely confusing and not exactly misleading or deceptive
cannot be brought under the clutches of this section. The same can be illustrated with the case
of McWilliam’s Wines Pty Ltd v McDonald’s System of Australia Pty Ltd (1980) 33 ALR

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394. In the case of Bateman v Slatyer (1987) 71 ALR 553, it has been held that a mere
presence of an exclusion clause cannot put a limitation to the liability under section 18.
Under section 29 of the Act, the supplier of services or goods are prohibited to make any
representations to the consumer regarding the goods and the services to be supplied, which is
deceptive or misleading. A misleading, false and deceptive representation while promoting a
product by the supplier of goods is restricted under this Act. This includes any
misrepresentations regarding the standard, value, quality, or grade of the services provided. In
the case of Hartnell v Sharp Corporation of Australia Pty ltd (1975) 5 ALR 493, it has been
held by the court that the supplier of goods or services has the responsibility of refraining
from making any statement regarding the goods or service, which is misleading or false and
has a chance to deceive the consumer. In case a supplier indulges in such a conduct, the
supplier will be liable to pay to the consumer damages of pecuniary nature. The same has
also been contended by the court in the case of Australian Competition & Consumer
Commission v Cadbury Schweppes Pty Ltd [2004] FCA 516.
Any misleading or deceptive conduct on the part of the supplier extends a right towards
the parties thus misled or deceived by such conduct to claim pecuniary damages from such a
supplier. Moreover, the ACCC also has the power to institute a proceeding against such a
supplier with respect to the deception that has been caused to the employee by virtue of that
misrepresentation.
Application
In this present situation, Fabio and Greta, sold their farm make a trip to Italy. Their only
airline experience had been a few interstate trips; this would be their first trip overseas. They
made a considerable amount of research regarding which airline services to avail by the
information gathered from television and newspaper advertisements and airline websites.