Misleading Conduct & Australian Consumer Law

This assignment examines the Australian Consumer Law (ACL) specifically focusing on Section 18 which prohibits misleading and deceptive conduct in trade or commerce. It analyzes a case study involving a company engaging in such conduct and how the ACL can be used to protect consumers in similar situations. The assignment explores the rights of both consumers and businesses under this section, highlighting the importance of transparency and ethical business practices.

Running head: LAWS20061 MANAGEMENT LAW
Management Law
Name of the Student
Name of the University
Author Note

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Table of Contents
Question 1........................................................................................................................................3
Issue.............................................................................................................................................3
Rules............................................................................................................................................3
Application..................................................................................................................................4
Conclusion...................................................................................................................................4
Question 2........................................................................................................................................5
Issue.............................................................................................................................................5
Rules............................................................................................................................................5
Application..................................................................................................................................5
Conclusion...................................................................................................................................6
Question 3........................................................................................................................................7
Issue.............................................................................................................................................7
Rules............................................................................................................................................7
Application..................................................................................................................................7
Conclusion...................................................................................................................................8
Question 4........................................................................................................................................9
Issue.............................................................................................................................................9
Rules............................................................................................................................................9
Application................................................................................................................................10

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Conclusion.................................................................................................................................11
Reference.......................................................................................................................................12

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Question 1
Issue
According to the case study the issue has been arises whether Susan is entitled to have all
the fortunes from his husband after their divorce or she was only entitled to have $100,000
according to the contract which has been formed at the time of marriage?
Rules
As per the case study it is a case of contract law. When a contract was formed it make the
concerned with the legal enforcement of promises where the terms of contract has been made
freely and have common intention to make a legal relationship between the parties. It has sets
particular of terms where as per the basis of such terms a contract can be formed under the
Australian contract law. The terms of the contract are agreement where proposal and acceptance
must be included, consideration, capacity to contract, intention to create legal relationship and
certainty of the contract. If a contract fails due to the dissatisfied these terms then it will never
form a valid contract.
In the case of Administration of PNG v Leahy (1961) the court has found that the terms
of contacts are missing when the contract has been formed. It also failed to establish improper
legal relationship due to the failure of the illegal intension between the parties which make the
contract completely invalid.
Another case is Australian Woollen Mills Pty Ltd v The Commonwealth High Court
of Australia (1954) where the contract has failed to form due to the dissatisfaction of the terms
of contract. According to the terms of contract there was no consideration, condition and legal

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intention has been found by the court which makes this contract completely void. Ermogenous v
Greek Orthodox Community of SA Inc (2002) is another case of contract law where a Court
has not found the legal intention in the formation of the employment contract. Therefore without
the consideration of the circumstances a contract never be formed under the Australian contract
law.
Application
As per the facts of the case when Tom proposed Susan he promised to bring her to
Australia, give her a house to live in, a car to drive and keep her safe but on the day of wedding
he asked her to sign a contract where he mentioned about $100,000 in the event of a divorce or
he will cancel the wedding.
According to the contract law it is important to application of the terms which are
agreement where proposal and acceptance must be included, consideration, capacity to contract,
intention to create legal relationship and certainty. Therefore as per the case facts the contract is
completely invalid because while the formation of the contract it not establishes any legal
intentions between the parties. Tom has already make promises to his wife before the marriage to
provide her every Fortune when he will marry her. Therefore Susan has right to claim every
Fortune which has been promised before the marriage and the agreement which is made at the
time of marriage has failed to satisfy the terms of contract. Therefore no contract has been
formed.
Conclusion
The agreement which was signed by Susan was invalid due to the failure to satisfy the
terms of the validity of a contract.

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Question 2
Issue
As per the fact of the case the issue has been arises whether Steve was actually legally
bound to buy the car from Jason or he can terminate the contract?
Rules
As for the case study it is a case of contract law where the terms of contract have been
breached by one party. Contact can be formed between two or more than two parties where they
must carry the terms of contract which are proposal and acceptance, consideration of the
contract, capacity to create the contract, legal intention for the formation of the contract and
certainty of the terms.
In the case of Airloom Holdings Pty Ltd v Thales Australia Ltd [2011] the court has
found that the contractor has claimed damages for the termination of contract where the terms of
the contract has been breached by the aggrieved party.
Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson is another case of
contract under the Australian contract law where the court has found that the parties who are
involved in the formation of the contract has failed to exercise their duties as per the term of the
contract. Therefore it has been beached and the innocent party has claimed the damages from the
aggrieved party. Therefore it can be stated that it is important to form a contact it must
established and stated every terms clearly for make the contract valid.

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Application
As per the terms of the contract it has five essential elements for the formation for legally
binding the contract. Those are:
 Offers and acceptance which describe that there should be an agreement has been
formed where one party will make the offer while other party accept the offers.
 Consideration as defined as per the value of the money or property or any service or
any promise where exchange should be exercise then a contract can be formed.
 The capacity to enter into a valid contract define the parties should be sound mind
and complete the age of minority where they can participate in the formation of the
contract.
 The intention defines to establish a legal relationship between the parties. The invalid
legal intention never forms a valid contract.
 The certainty has defined where the contract should be formed completely clear and
binding to each other at the time of formation of the contract.
According to the fact of the case Steve has stated to Jason that he will buy the car if it had a
turbo engine, paint window and Leather seats. After installation of everything Jason has it cost
$50,000 but Steve stated that he was not interested to buying the car. As per the terms of the
contract a legal contract has been formed between Jason and Steve. Therefore Steve is bound to
buy the car from him otherwise Jason can take legal action against the breach of the contract.
Conclusion
It can be concluded that due to the formation of a legal contract Steve was legally bound
to buy the car from Jason because he has made the consideration to buy the car as per his choice

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and Jason already installed every requirement which cost him some amount. Therefore Jason has
right to take legal action against Steve.
Question 3
Issue
As per the case study the issue has been arises whether Carl was liable for the negligence
and if he found guilty with the offences then what will be the defenses he can obtain under the
law of tort?
Rules
Negligence has defined when failure has been found of the application of appropriate and
ethical rules under some circumstances. Negligence can occur when a person has failed to
exercise their duties and reasonable care and cause of damages. Under the negligence the person
who is guilty with the act of negligence he can obtain for defense which is known as contributory
negligence. It defines the liability of the negligence applicable for both the plaintiff and
defendant. Bankstown Foundry Pty Ltd v Braistina [1986] is one of the famous cases of
contributory negligence where Court has found the liability of negligence by both of the plaintiff
and defendant. Therefore the damages which have been caused due to the negligence should be
divided the liability and compensation between the plaintiff and defendant. The another case is
Podrebersek v Australian Iron and Steel [1985] where the court has found that due to the
negligence by both of the workers and the contractor, they found liable for the damages.

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Application
The contributory negligence basically exercises for the defense which claimed due to the
negligence by the defendant. It helps to defense the potentially eliminate the responsibility of the
defendant for paying the damages to the injured plaintiff. It also divides the legal responsibilities
between the plaintiff and defendant.
According to the fact of the case Carl is not skilled chef which is required to cook
sashimi from fugu fish. Harry who was hungry, ate the preparation of sesame by fugu fish which
causes him sickness and spend two weeks in the hospital. Here as per the fact of the case Harry
has knowledge about the poisonous effect of having fugu fish but in spite of that knowledge he
ate the food and not for cleaning properly by Carl it has affected Harry.
Carl has owned the duty of care towards Harry while serving food to him. However he
has failed to satisfied the terms of duty of care due to his negligence and it cause both physical
injuries to Harry. Here Harry is also liable for his damage as because he had the food while
having the knowledge that Carl was not a skilled chef who can cook the fugu fish properly. It is a
case of contributory negligence where both plaintiff and defendant are equally liable for the
negligence. Therefore if the court has ordered for the compensation then it will be divided
between them as both of them are liable for the negligence act.
Conclusion
According to the fact of the case it can be concluded that though Carl was found guilty by
the act of negligence but he can use the defense of contributory negligence where the liability
will be divided with Susan.

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Question 4
Issue
As per the facts of the case is whether Betty has owned any legal rights under the
Australian consumer law to take any legal action against the company who are engaged with
misleading and deceptive conducts?
Rules
The Australian consumer law has registered for the protection of the consumer for the fair
trading under the Australia. It helps to set the consumer rights and guarantees and provide the
protection to the consumer for repair, replacement and refund when they suffered with any
damages or loss due to the faulty service.
Under the Australian consumer law the section 18 has defined the legislation which
provides every trade or commerce from misleading and deceptive conducts. The registration of
ACL has made the standards of business conduct in the market. It helps to protect the consumers
for the trade or commerce from every misleading and deceptive conducts. The Miletich v
Murchie (2012) which is one of the famous case of Australia where the court has found that the
company was involved with the advertising material that is related with the misleading and
deceptive conduct. Australian Competition and Consumer Commission vs. Metricon Homes
Qld Pty Ltd [2012] is another case of Australia where the misleading and deceptive conducts
has been found through the application of the verbal representation in advertising material which
has been related with such facts.

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Application
The misleading and deceptive contacts have been prohibited under the Section 18 of
Australian consumer law. The consumer and the developers has the right to use the legislation
of this section where it has comply with the business and legal proceeding in selling and
purchasing of the products. It helps to identify whether the seller has intentionally mislead the
purchaser or they intentionally encourage the consumers for a wrong conclusion. It also helps to
provide all information which defines the correct facts but represent false impression. This
section also helps both the purchaser and seller through the agents of them not able to update the
information about the obligation under the Australian consumer law. It also protects them where
the agents have intentionally not added in information about the contract with the consumers.
When the Seller has make silent reaction about the dispute of the product then the consumer law
helps to protect us consumer from every misleading and deceptive conducts.
According to the fact of the case when Betty ordered the phone from the website of the
company after seeing every features which she required in her new phone. After delivering of the
phone she realized the features which she has been seeing before placing the order of the phone
is not matched with the feature of the delivered product. Therefore it is clear that the company
has involved in the misleading and deceptive conducts which is against the rule of Section 18 of
Australian consumer law. Due to the damage which she has suffered for such acts by the
company she can take legal action against them and claim the compensation. They became
failures to comply with the terms of the Section 18 of ACL.

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Conclusion
According to the case facts the company has found to engage with the misleading and
deceptive contacts. Therefore Betty has rights to take legal action against the company according
to the terms of Australian consumer law.

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Reference
Administration of PNG v Leahy (1961) 105 CLR 6
Airloom Holdings Pty Ltd v Thales Australia Ltd [2011] NSWSC 1513
Australian Competition and Consumer Commission v Metricon Homes Qld Pty Ltd [2012]
FCA 797 (Metricon)
Australian Woollen Mills Pty Ltd v The Commonwealth High Court of Australia (1954) 92
CLR 424
Bankstown Foundry Pty Ltd v Braistina [1986] HCA 20
Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95
Miletich v Murchie [2012] FCA 1013
Podrebersek v Australian Iron and Steel [1985] HCA 34
Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson