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The Necessity of Safeguarding the Consumer and Financial Rights

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Added on  2020-02-19

The Necessity of Safeguarding the Consumer and Financial Rights

   Added on 2020-02-19

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Running head: COMMERCIAL LAWCommercial lawName of the StudentName of the UniversityAuthor Note
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1COMMERCIAL LAWCurrent Issues in the Australian Consumer law The Australian government recognized the necessity of safeguarding the consumer andfinancial rights as these rights are essential to secure the other freedoms and rights such as securehousing, social, economic participation and effective education. The Australian Consumer Law(ACL) is the national law for consumer protection and fair-trading. It protects the rights of theconsumers to receive goods that are of merchantable quality and is appropriate for the purposefor which such goods were sold. The obligation of the suppliers towards the consumers isreferred to as statutory Consumer Guarantees. This implies that the supplier shall not be able toexempt from their responsibilities for the goods. In general, the Australian Consumer Law (ACL) has been ontinued to strike a balancebetween the business compliance costs and the redressal of the issues faced by the consumers,since the commencement and implementation of the statute. However, several issues persists inits application which requires to be resolved to ensure fair trading and protection of the rights ofthe consumers[ CITATION Pea17 \l 1033 ]. The most significant issues that arises from theAustralian Consumer Law are:the ambiguity of the term ‘unconscionable conduct’; whether $40000 threshold for consumer purchases is appropriate threshold;adverse impact of the dispute resolution process;lack of financial penalty on inclusion of unfair contract terms;Adverse impact of the dispute resolution process
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2COMMERCIAL LAWFirstly, the dispute resolution process under the statute has an adverse impact and in somecases, it becomes difficult to resolve issues related to the dispute resolution process and calls forimprovement. The alternative dispute resolution process could be used in a much improvedmanner to provide assistance to the businesses and consumers with a view to resolve disputesmore efficiently. The lack of enforceable alternative dispute resolution process persists to be asignificant hindrance with respect to accessible remedies and acts as a barrier in redressing theissues through the legal framework of the Australian Consumer law [ CITATION Hun15 \l1033 ].In the present day, in New South Wales, if a consumer is unable to resolve any consumerdispute through negotiation and by agreement with a trader, the only alternative options that areavailable is to request for assistance from the NSW Fair Trading. Now, the NSW Fair Trading isunder-resourced and is unable to impose a binding resolution on the parties. The other option isto take the matter before the NSW Civil and Administrative Appeals Tribunals but this processwould result in substantial anxiety for the vulnerable consumers on the grounds of time, cost, andoverall complex nature of the process. RecommendationIn order to deal with the issues arising from the dispute resolution process, there are twooptions that may be adopted to resolve the issue. An external dispute resolution process governedby the Retail Ombudsman scheme or the adoption of an enforceable conciliation schemegoverned by the consumer protection agencies may enhance the efficacy and improve theenforceability of the alternative dispute resolution results. It would further lessen the present
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3COMMERCIAL LAWhindrances towards the customers, thus, enforcing their rights to seek for remedies under theACL framework. A consumer Ombudsman should be free for consumers and should be able to conductconciliations and investigations, thus, enabling to make decisions that could be enforced andwould have a biding effect upon the parties to the dispute. A retail ombudsman in the UnitedKingdom is the best instance of a overseas consumer dispute resolution initiative that could beadopted and followed in Australia[ CITATION Mar14 \l 1033 ]. It provides an independentdispute resolution process that aims at resolving the complaints and issues between theconsumers and the traders. The retailers and the traders are obligated to pay £25000 to theconsumers who are affected due to failure or breach on part of the traders or retailers. Unconscionable conductSecondly, statutory provisions relating to ‘unconscionable conduct’ in the ACL persiststo be uncertain and enforcement of the provision is equally intricating. Consequently, thedeterrent effect against the businesses and the benefits of the protections for the vulnerableconsumers decline largely. In order to address and improve the systematic misconduct, it isimportant to introduce a general ‘unfair trading’ provision and reframe the term‘unconscionable’ as ‘unfairness’. The general prohibition on unsolicited sales such as cold calltele-marketing and door-to-door sales as these sale methods involves elements ofmisrepresentation, coercion and undue influence[ CITATION Pat15 \l 1033 ]The provisions related to the unfair contract terms should be applicable to insurancecontracts and the ACL protections for financial and insurance services has often resulted in thewide scale unfair practices that ultimately, affects the vulnerable consumers disproportionately.
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