Implication of Terms in Contracts, Consumer Guarantees and Exclusion Clauses under Australian Law

This article discusses the implication of terms in contracts, consumer guarantees and exclusion clauses under Australian law. It covers topics such as the three ways terms of a contract may be implied by common law, customer rights under the Australian Consumer Law, and the legal entitlement of suppliers to use exclusion clauses in their contracts.

Business law

TABLE OF CONTENTS
Question 1........................................................................................................................................3
Question 2........................................................................................................................................3
Question 3........................................................................................................................................4
3a..................................................................................................................................................4
3b.................................................................................................................................................5
3c..................................................................................................................................................5
References........................................................................................................................................6

QUESTION 1
The courts are disinclined to imply terms into a contract at common law. Implied terms are
fundamental part of the contracts. Often, it is not assessed to be the court’s role to re-write the
contract for the party purpose, prevailing of freedom of contract is there (Stone and Devenney,
2017). There are restricted conditions wherein the courts would imply terms in a contract at
common law, the three ways wherein terms of a contract may be implied by common law are
Terms implied through custom, Terms implied in fact and Terms implied at law.
QUESTION 2
The Australian Consumer Law establishes customer rights that are named as consumer
guarantees; these are inclusive rights to repair, replace, refund and compensate for loss and
damages. In addition to this, consumer is capable of cancelling a defective service (Australian
Consumer Law, 2019).
It is the right of the customer to receive the petrol taken from the browser in againts of the
amount paid by them. The customer is guaranteed for receiving petrol under the Australian
Consumer law; it states that when customer purchase products and services then it comes with
implied guarantees that provided supply will fulfil customer purpose and expectations (NSW
Government Fair Trading, 2019). If delivered product or service is not viable then customers
have right to get refund or compensation for damages.
In the case of receiving unleaded 95 petrol from the pump marked, provision of misleading
customer applies, as it is the duty of the seller to deliver products as per the provided description.
It is the responsibility of the pump marked to provide clean petrol and customer has the right to

receive the quality of fuel under any circumstances (Willett, 2016). In addition, the consumer has
the right to receive suitable petrol for their purpose, as provided in the customer consumer
warranties, the provided petrol must be suitable for the car usage, in any case, and if there is any
fault, the seller will be claimed for compensation or cancellation of service.
QUESTION 3
3a
The s 3 of the legislation states that an individual is taken to have obtained specified goods as a
customer when the payable amount for good does not exceed $40,000, further in the case
purchase of Honda Civic car for $35,000 from your next door neighbour, the person is qualified
as a customer. By making use of the s 3 test, in the case of purchase of Honda Civic car for
$35,000 from a car dealer it can be stated the person is also qualified as a customer, as he/she has
purchased the car for commercial use and the amount does not exceed $40000, and the same is
applicable in the case of purchase of a commercial delivery van for $39,000. Under s 3, if the
person purchase goods that are ordinarily obtained for domestic use and the acquired vehicle is
meant for use in the transport of goods on public roads, so this qualifies a customer for the case
of purchase of a Honda Civic car for $ 45,000 from a car dealer. However the person in the case
of purchase of domestic grade carpet for use in a nightclub for $50,000 is not entitled as a
customer, it is because the amount exceeds the requirements and is also does not meet the
qualifications for customer qualification (Australian Competition Law, 2018). The purchase of a
commercial grade oven for $12,000, in this case, the person is a customer, as it meets the amount
requirements and it had purchased the same for domestic use.

3b
By considering the analysis of 3a, consumers are those individuals if the payable amount for
good does not exceed $40,000 or purchase is done for domestic purpose. Therefore, business
may be considered as consumer but only if purchase is less than of $40000.
3c
The above suppliers are legally entitled to make use of exclusion clauses in their contracts, if all
other circumstances and warranties are excluded from such clauses. In addition to this, corporate
cannot deny their duty for damages and fundamental rights of consumers described under
Australian consumer law (Legal Services Commission, 2018).

REFERENCES
Books and Journals
Stone, R. and Devenney, J., 2017. The modern law of contract. Routledge, Stockport, United
Kingdom.
Willett, C., 2016. Fairness in consumer contracts: the case of unfair terms. Routledge, United
Kingdom.
Online
Australian Competition Law, 2018. Section 3
Meaning of Consumer (Online). Available through <
https://www.australiancompetitionlaw.org/legislation/provisions/acl3.html>.[Accessed on 25
January 2019].
Australian Consumer Law, 2019. Legislation(Online). Available through <
http://consumerlaw.gov.au/the-australian-consumer-law/legislation/>.[Accessed on 25 January
2019].
Legal Services Commission, 2018. Exclusion Clauses and the Australian Consumer Law
(Online). Available through < https://lawhandbook.sa.gov.au/ch10s02s06s01.php>.[Accessed on
25 January 2019].
NSW Government Fair Trading, 2019. Petrol (Online). Available through <
https://www.fairtrading.nsw.gov.au/buying-products-and-services/buying-products/petrol>.
[Accessed on 25 January 2019].