Misleading and Deceptive Conduct in Advertising: A Case Study

Running Head: BUSINESS LAW
BUSINESS LAW
Name of the Student:
Name of the University:
Author Note

1BUSINESS LAW
Issue:
The issues that have been identified in the given case study are:
 whether Ohau engaged in misleading and deceptive conduct while advertising for its
product ‘ Less is best” and what are the possible claims
 What the possible Causes of action of ACCC are in this given scenario
Rule:
It can be said in accordance with section 2(1) of the ACL that trade or commerce in the context
of Australian Consumer Law can be defined as any professional or business activity or any trade
or commerce within the territorial boundaries of Australia as well as trade and commerce
between any place outside Australia and Australia.
It has been provided in subsection 2(2) (a) and (b) of the ACL that a company’s act of engaging
in a conduct can be referred to:
 refusing or giving effect to the terms of the contract,
 giving effect to a provision of understanding
 Giving of a covenant.
As provided in section 18 of Australian Consumer Law, it can be said that any company or
business organization must not engage in misleading and deceptive conduct.
An objective test can be applied by the courts to identify whether the conduct is misleading and
deceptive. In the case Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR
191, it had been held that the courts must take into consideration whether fair reading or viewing

2BUSINESS LAW
of the conduct would lead an original or reasonable member of the target audience to be
deceived.
It has been provided in section 4(1) of the ACL that any representation made by a person with
respect to future matter would be considered to be misleading in nature if the person who made
the representation without having reasonable grounds to believe such representation to be true. It
has been provided in subsection 4(2) of the ACL that for commencing proceedings in relation to
subsection 1 for making any representation about a future matter by either of the parties to the
proceeding or any other person, it would be held that such party did not have reasonable grounds
to make the representation unless evidence suggests otherwise.
It has been provided in section 29(1) of the ACL that any person who engages in trade or
commerce specifically in relation to supply of goods and services must not promote any service
or goods by making a misleading and false representation particularly about the standard,
quality, value and composition of the product.
Business must not any cost engage in advertising which misleads or deceives the customers even
if the business did not intend to deceive the customers and no damage was sustained by the
consumers by relying on such misleading and deceptive conduct. Some of the important cases
which deal with misleading and deceptive conduct are Google Inc v Australian Competition
and Consumer Commission1, Australian Competition and Consumer Commission v TPG
Internet Pty Ltd 2and Sidhu v Van Dyke3. It had been held by Gibbs CJ in the case Parkdale
Custom Built Furniture Pty Ltd v Puxu Pty Ltd that the meaning of the words which are
likely to mislead or deceive customers is misleading and deceptive is opaque. Firstly it is
1 (2013) 249 CLR 435
2 (2013) 304 ALR 186
3 (2014) 308 ALR 232