Commercial Law in Australia: Contracts, Section 21 and Businesses

This report provides an overview of Australian commercial law, focusing on its impact on small businesses and contracts. It examines Section 21 of the Australian Consumer Law (ACL) and its implications for unconscionable conduct, outlining relevant cases such as ACCc V Berbatis Holdings Pty Ltd and Blomely v Ryan. The report analyzes how these laws create a legal framework for fair trade, providing remedies and penalties for misconduct, and offering protection to small businesses. It also discusses restrictions on trade practices and penalties associated with violations of the Competition and Consumer Act (CCA). The report highlights the importance of understanding commercial laws to ensure fair trade practices and protect businesses from unethical conduct, emphasizing the role of various Acts such as the Sales of Goods Act and the Goods and Services Act in shaping the commercial landscape in Australia.

ADVANCE COMMERCIAL
LAW

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Section 21 and its impact on contract law..............................................................................1
Impact of these laws creates the category of contracts for small business.............................4
Protection purchased by section 21 of Australian consumer laws at too high a price...........5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
In the present assessment, there will be a research based on Australian commercial law.
Australia is the world's leading commercial country and has many MNCs which trades beyond
the national boundaries. With the help of various legal rules and regulations imposed by Federal
registrar of Legislation, the trade and commerce of public as well as private sector will be legally
framed. Hence, there has been discussion based competition and consumer act, 2010 and its
impact over small scale industries which enhances them to make contracts. Thus, due to such
impacts there has been generation of new category of contract laws. Further, the report will shed
light on any protection in purchase will be awarded by section 21 of ACL on higher prices. A
part from it, there will be favourable impact of such laws and acts over small scale industries as
well as protection granted to them related with higher prices.
Section 21 and its impact on contract law
In accordance with this section there has been various kinds of laws and regulations
which influences the companies or the small-scale firms to make the favourable trade and
commerce (Bassiouni, 2014). As per ACL the section 21 describes Unconscionable conduct
which states that a person must not include into trade and commerce or transaction in such
contracts. The one who is supplying the goods and services as well as who is acquiring such
goods and services. There are various laws or cases which reflects lights on impact of such acts
and contract laws:
Unconscionable Conduct: As per section 21 of ACL which provide guideline or the
legal framework of commerce and trade in context with supply and possible numbers of supply
made by a person or the corporate (Thampapillai & et.al., 2015). This access transactions
between two parties where 1 party is weaker and other one is dominating. It prohibits the
unconscionable behaviour in accordance with supply or delivery of products and services as well
as their acquisition. Thus, these involves:
 There will be bargaining strength of both the parties, dominating party will be more
active or powerful in case of making any goods and services contract.
 Weaker party could be able to understand such documentation which are used in contract.
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 There is need of Applicable industrial code in context with having the legal transaction of
goods and services.
 The dominating party will implement the unfair tactics, undue influence or increase
pressure over weak party.
 Conditions were imposed over stronger party as to control the legitimation interest.
 Focus over fair act done by both people or corporate.
To avoid being victim of such Unconscionable conduct there are some techniques which are to
be used practically such as:
 An individual must ensure all agreements must be in written document.
 Both the parties who are involved in such contracts must be able to understand such
contract as well as terms and conditions involved in it.
 If they do not able to understand any of the agreement they must not sign such document.
 The documents must be written on fair language as well as it must involve all the legal
information such as name and address of parties as well as consideration in return such as
monetary benefits.
 If such documents contain any or the illegal information or it does not feel right than a
person can easily walk away before signing such documents.
Remedies and Penalties: There will be penalties in relation with these kinds of
agreements which in relation to punish the person who indulge in the unethical conduct. It will
also facilitate the victim to claim over such conduct (Hanrahan, Ramsay & Stapledon, 2013).
There must be compensation for loss or damage occurred in such transaction as well as
dominating party must pay financial penalties over such damages. There will be punishment to
such individual who are making the illegal or void contract as well as it is harming any person's
goodwill or reputation. A person will be benefited with the refund or performance in any specific
services.
Section 31: Under this section of Commonwealth laws there has been remedies as well as
prosecution facilitated to the suppliers or the parties who are involved in transporting the goods
1 Commonwealth Act, 2010
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and service (Nicholson & Gillespie, 2013). They also benefited them with defending any
misconduct held while making payment or occurring any expenses which related with
organisational activities. Thus, it can be said that, it facilitates personal jurisdiction to a person
who acts as an agent to an individual or corporation in context with gathering the equity.
ACCc2 V Berbatis Holdings Pty Ltd [2003] HCA18: According to this case Mr. Berbatis
leased out his property to Mr. & Mrs. Roberts who were financially weak and wanted to sale
such property in context with facilitating the medical cure to their daughter. Hence, their period
of acquiring lease was expiring and they do not file any document in context with renewal of
such lease (Thampapillai, 2015). It laid dependency on Berbatis to make the renewal of such
lease but a dispute occurred between them and he had refused the agreement. Thus, in this case
Berbatis has more bargaining power and he is dominating over the couple. On the other side, Mr.
and Mrs. Roberts were not able to meet the financial requirements in context with giving the
favourable medical services to their daughter.
99 CLR3623 : In accordance with the case of Blomely v Ryan, where Blomely is about
to acquire farm of Ryan at very low price as compared with the market rate. On the other side,
Ryan was and senior citizen with age around 78 years and also suffering from prolonged disease
as well as heavy consumption of alcohol (Blomley v Ryan. 2013). Hence, Blomely has the grate
bargaining power and he is dominating over Ryan as well as he has taken the advantages of
Ryan's disease and make the transaction on precisely lower price. In fact, Blomely also taken
advantages of metal disability of Ryan which is totally void in context with entering in any
contract. This totally illegal and unlawful as there was need to have involvement of other person
who is known to Ryan as well as who would make the profitable transaction.
151 CLR 4474 : The case belongs to the bargaining power of an individual in the context
with legal Amadios and Commercial bank of Australia. Hence, Amadios is a builder and have
guaranteed his son into his business as to make the indebtedness with the commercial bank. In
context with the same they have made documents which are provided to bank as to acquire
mortgage over a building. Thus, Amadios's son has failed in the business and then the bank has
2 Australian Competition and Consumer Commission
3 Blomley v Ryan [1956]
4 Commercial Bank of Australia Ltd v Amadio
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arrested Amadios as per guarantee. Here, the victim will be Amadios who is indirectly involved
as the common bank account so he has to make the payments to bank for the failure of his son’s
business (Thampapillai & et.al., 2015). Thus, Amadios do not have the benefit of Independent
advice which was not providede by bank. Hence, the bank was aware of the Amadios's son's
financial conditions as well as they can be liable to make the notification to Amadios over the
mortgage property. Further Amadios believes that the liability was limited at 50000 in fact, there
is liability awarded by bank.
Impact of these laws creates the category of contracts for small business
Implication of laws which facilitates the legal framework of a corporate unit in the
context with making the fair operations in marketing environment. Thus, it helps the small-scale
industries to make the favourable dealings. With the help of such laws, a person and a
corporation will be aware with all laws, rules and regulation facilitated by the federal registrar of
legislation. It consists of all the legal information on the basis of precedent and the case laws
which were faced by various parties (Ellison, & Boyd, 2013). Thus, as per the case of Blomely v
Ryan here the transaction or contract occurred on mislead to a weaker party. Hence, the
dominating party took the advantage of his prolonged disease as well as Addiction of excessive
consumption of alcohol. Thus, these laws facilitate fair legislation in Australia to make the
favourable jurisdiction towards such misconduct. There have been various laws such as sales of
goods act were enforced by legal authority as to make the better execution of such acts.
A positive impact can be seen as per section 3 is facilitated in the Australian legal
environment which has facilitated remedies and cure to the various individuals as such as who
are agent or indirectly involved in any business transaction. They have been awarded with the
special rights that they could claim over the dominating party who is influencing the working of
an individual (Moses, 2017). Thus, a small-scale business can be facilitated with the various laws
and regulations which are being imposed in giving them the favourable support. There will be
influence of various extrinsic data which make the transaction unlawful and illegal so, here a
person or a corporation must know all norms and legislation implemented by Australian
commercial laws. However, suppliers and agents are the external persons who are involved in
such business transaction. These laws help such individuals in making the fruitful efforts in
context with improving the fair trade and commerce practices. There has been influence of
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various laws such as Goods and services Act, Trade Representative act, 1993, Transperson' rights
regulation Act 1946, Transportation Investigation Act 2003, CTDA,1995 etc. are the acts which
are imposed by the Australian authority as to give the legal formation business in the Australian
environment (Pearson, 2017).
These acts will help the small-scale industries in having the fruitful business operations
as well as they can defend any misconduct happen to them (Paterson & Brody, 2015). There will
be various kinds of penalties and punishments to such victims. Thus, such laws provide the
framework as well as guidance to an individual in making the favourable trade and commerce
which are necessary to protect the fair commerce.
Protection purchased by section 21 of Australian consumer laws at too high a price
Penalties:
There has been various penalties or Financial cure facilitated by the Court in proceeding
criminals which are usually the monetary fines. Thus, these charges are to be collected by local
or civil courts in Australia white the applicability of standard or concrete proof (Fines &
penalties, 2017). Thus, a supplier and an agent which are indirectly connected with the
transaction has been made as well as are acting as to generate revenue for a person or an
organisation will be exempted if any damage of misconduct held.
Restrictions over Trade practices:
In accordance with CCA5 act there has been various prohibition over the trade and
commerce such as:
 This act prohibits the Trade and commerce for an individual to make participation in
Cartels, there will be 10 years of jail as well as $500000 of penalty.
 If an individual misuse the market power such as market rate over purchase and sale of
any goods, property or services will be punished CCA act.
 In case of exclusive dealing the individual must inform the parties who are having the
same offer as well as notify them about the sales as been made.
 A person or an entity will be punished if they make any of the illegal transaction without
consideration of all the parties such as exclusionary conduct, resale price maintenance
5 Competition and consumer Act, 2010
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and anticompetitive mergers. Thus, they will be punished for 10,000,000 of penalty
which as huge amount.
Australian Consumer Law:
This law has facilitated penalties over such misconduct as that there can be any
Unconscionable Conduct, Pyramid selling, Unlawful or misconduct as well as an individual fails
to inform in the response of all the parties who are involved in the business transactions
(Rheeders, 2016). In case any mislead or misconduct held the individual who is held criminal has
to make payment of the penalties for 1.1 for an organisation and 220000 for a person. There will
be issue of notice to the parties who are making the unlawful transactions as well as documents
containing crime they have made. Thus, such penalties or legislation are facilitated by the
legislative authority in Australia in context with making the favourable taxation policies.
CONCLUSION
In the above report, the legal environment of Australia and their framework in
encouraging the growth of small scale industries in the long run as well as for the better survival
in competitive environment. There can be use of various kinds of laws such as section 3 of the
commonwealth act, sale of goods act as well as various case laws or precedent which enables or
helps in constitution of such laws. There will be influences of various Extrinsic evidences which
will impact the legal work of an organisation, to remove such misconduct there has been creation
of several corporate laws. Hence, as per case of Blomely and Ryan here the dominating party
took advantages such as acquiring the farm at very low price as well as knowing the conditions
of Ryan has mental Disease as well as his addiction to alcohol. Further, it can be said that, Laws
are enforced in the environment as to make the favourable jurisdiction, transaction as well as
trade and commerce.
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REFERENCES
Books and Journals
Bassiouni, M. C. (2014). International extradition: United States law and practice. Oxford
University Press.
Brody, G. & Temple, K. (2016). Unfair but not illegal: Are Australia's consumer protection laws
allowing predatory businesses to flourish?. Alternative Law Journal. 41(3). 169-173.
Ellison, N. B. & Boyd, D. M. (2013). Sociality through social network sites. In The Oxford
handbook of internet studies.
Hanrahan, P. F., Ramsay, I. & Stapledon, G. P. (2013). Commercial applications of company
law.
Moses, M. L. (2017). The principles and practice of international commercial arbitration.
Cambridge University Press.
Nicholson, P. & Gillespie, J. (2013). Asian socialism and legal change: The dynamics of
Vietnamese and Chinese reform (p. 334). ANU Press.
Paterson, J. M. & Brody, G. (2015). “Safety Net” Consumer Protection: Using Prohibitions on
Unfair and Unconscionable Conduct to Respond to Predatory Business Models. Journal
of consumer policy. 38(3). 331-355.
Pearson, G. (2017). Further challenges for Australian consumer law. In Consumer Law and
Socioeconomic Development (pp. 287-305). Springer, Cham.
Rheeders, A. (2016). The international interpretation of unconscionable conduct and the
unconscionability factors contained in section 40 of the Consumer Protection Act 68 of
2008 (Doctoral dissertation, University of Pretoria).
Thampapillai, D. (2015). UNCONSCIONABLE CONDUCT. Australian Commercial Law, 432.
Thampapillai, D., Tan, V., Bozzi, C. & Matthew, A. (2015). Australian Commercial Law.
Cambridge University Press.
Online
Fines & penalties. 2017. [Online]. [Available through]
:<https://www.accc.gov.au/business/business-rights-protections/fines-penalties>.
[Accessed on 12th October. 2017].
Blomley v Ryan. 2013. [Online]. [Available through]
:<https://www.australiancontractlaw.com/cases/blomley.html>. [Accessed on 12th October.
2017].
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