QUT LWN051 Australian Consumer Law: Problem Solving Task Analysis

This assignment analyzes a case study involving Property Security Plus Pty Ltd (PSP) and its promotional campaign for a smart lock product, evaluating potential violations of the Australian Consumer Law (ACL). The analysis considers whether PSP, Facebook, Miranda (an influencer), and VHS (a marketing company) have contravened provisions in Parts 2-1, 2-2, and 3-1 of the ACL, focusing on deceptive or misleading conduct, unfair contract terms, and unconscionable conduct. The assignment examines PSP's promotional video, Facebook's advertising practices, Miranda's endorsement, and VHS's personalized marketing strategies. The analysis references relevant case law and legislation, including Google Inc. v. ACC, Australian Competition and Consumer Commission v. TPG Internet Pty Ltd, and ACCC v. Coles, to determine if the actions of the involved parties align with the principles of fair trading and consumer protection. The conclusion summarizes the findings, stating whether the parties contravened the ACL.

Running head: BUSINESS LAW
BUSINESS LAW
Name of the student
Name of the university
Author note

1BUSINESS LAW
Issue
The issue involves in the instant case is as to whether PSP, Facebook, Miranda, or VHS
violate the provision of Parts 2-1, 2-2, 3-1 of the Australian Consumer Law.
Rule
The Australian Consumer law1 is the national legislation that targeted to safeguard
deceptive or misleading practices, misleading or false claims, unfair contract standards, and also
guarantees to the consumer and address the marketing techniques2. The deceptive or misleading
conduct, as described in Section 2, 4, 18 of The Australian Consumer Law enumerates that it is
unlawful for the transaction to involve in an activity that either deceives or misleads or is
probable to deceive or mislead the customers or any other transactions3. The legislation that is
applicable even though there exists no intention to deceive or mislead the consumers, or there is
no damage or loss as impacting from the conduct4. It is significant to observe the conduct of
1 The Australian Consumer Law (Cth)
2 Corones, Stephen, and Philip H. Clarke. Australian Consumer Law Commentary and Materials. (Thomson Reuters
(Professional), 2015).
3 Thampapillai, Dilan. "THE AUSTRALIAN CONSUMER LAW." (2015) Australian Commercial Law 374.
4 Tan, Vivi. "Unfair Contract Terms." (2015) Australian Commercial Law : 380.

2BUSINESS LAW
business that influences the impression of the audience of service or good. At the time of
determining that the act is deceptive or misleading or probable to deceive or mislead, the most
relevant issue is to question as to whether the whole impression is made by conduct that is
inaccurate or false5.
In the case of Google Inc. v. ACC [2013] HCA 1, the issue involved is whether Google
engaged in deceptive or misleading practices by presenting in the search engine the web address
of the advertiser as sponsor link that also involves competitor name6. It was claimed by Google
that the conduct was merely an outlet for an advertiser. Justice Hayne advocated the appeal but
for a diverse reason. It was held by the honor that advertising and publishing paid and made by
the third party might infringe Section 52, and relevant examination was not whether Google had
adopted or endorsed the advertisers’ representations. Nonetheless, in case the Google users’
search engine would not comprehend that Google to make misleading representations.
In the case of Australian Competition and Consumer Commission v. TPG Internet Pty
Ltd [2013]HCA 54, 7 the High Court accepts the appeal as against the federal court’s decision
that announces that TPG involved in the deceptive or misleading conduct or making a misleading
or false representation in violation of Section s53 and 52 of Trade Practices Act, 1974(Cth) in
5 Sise, Peter. "The Unfair Contract Term Provisions: What's Transparency Got to Do with It." (2017) QUT L.
Rev. 17: 160.
6 Google Inc. v. ACC [2013] HCA 1
7 Australian Competition and Consumer Commission v. TPG Internet Pty Ltd [2013]HCA 54

3BUSINESS LAW
connection to the broadband internet transaction advertised through television in 2010 in addition
to that ordered TPG to make payment of $50,000 in penalty.
The Australian Consumer Law creates it unlawful for the transaction to motivate the customer to
buy services or goods by assuring advantages that will assist commerce in supplying services or
goods to other consumers8. The Unfair contract terms are entailed in Section 32, 35, 36 of The
Australian Consumer Law9. Furthermore, it is unlawful to take part or encourage someone to
participate in the pyramid scheme. The pyramid scheme creates money by employing an
individual somewhat than by vending actual services or goods, even though the scheme involves
the product selling. From the perspective of the unfair contractual terms, the legislation
safeguards the customers from making unfair conditions in the situation where there exists less
scope to negotiate with transactions such as contract standards.
In the case of Australian Communication Network v. ACCC [2005] FCAFC 221,10 it
had been observed by Late Justice Selway that ACH take part in the promotion and also
attempted or induced to instigate the individuals to participate in the scheme of pyramid selling
in violation of Section 65AAC of the act and the CAN director abetted and aided and knowingly
8 Ali, Syuhaeda Aeni Mat, Rusni Hassan, and Ahmad Azam Othman. "Inadequacy of Consumer Protection from
Unfair Contract Terms in Musharakah Mutanaqisah Home Financing In Malaysia." (2017): Journal of Islamic
Finance 176.5872 1-11.
9 Pearson, Gail. "Further challenges for Australian consumer law." 2017 Consumer Law and Socioeconomic
Development. Springer, Cham. 287-305.
10 Australian Communication Network v. ACCC [2005] FCAFC 221

4BUSINESS LAW
engaged in the violations. The special leave application to appeal was filed by ACCC in regard
to the whole judgment of Full Federal Court.
The unconscionable conduct is usually comprehended to imply the conduct that is as harsh as
goes contrary to good conscience. The provision is enumerated in Sections 32, 35, and 36 of The
Australian Consumer Law and Schedule 2 of Competition and Consumer Act. The transactions
under the Australian Consumer Law should not involve in the unconscionable conduct at the
time of tackling other commerce or their consumers11. It is laid down in Sections 20, 21, 22 of
The Australian Consumer Law, and Schedule 2 of Competition and Consumer Act12. The
conduct is treated as unconscionable if the same is oppressive or harsh. In order to consider
unconscionable, the conduct should be more than that of simply unfair; it should be contrary to
conscience as adjudicated against the social norms.
In the case of ACCC v. Lux Distributor [2013] FCAFC 90,13 it has been observed by Federal
Court that in vending vacuum cleaners lux involved in the conduct which was unconscionable in
violation of Section 21 of Australian Consumer Law. Thus it is summarized that the assignment
of the court is to evaluate fact by referring to the normative standard of the conscience.
11 Goldberger, Jeffrey. "Unconscionable conduct and unfair contract terms." (2016)Commercial Law Quarterly: The
Journal of the Commercial Law Association of Australia 30.2: 17.
12 Thampapillai, Dilan, et al. Australian commercial law. (Cambridge University Press, 2015).
Hunt, Kate Mathews. "Gaming the system: Fake online reviews v. consumer law." (2015): Computer Law &
Security Review 31.1 3-25.
13 ACCC v. Lux Distributor [2013] FCAFC 90

5BUSINESS LAW
In the context of false or misleading representation, the transactions are not permitted to create
statements that are false or probable to make incorrect statements. The regulation is implemented
to the advertising, packaging of products, and the information’s that are facilitated by online
services of shopping or staff. It is also implicated in the statement that is made by the commerce
online or media as for testimonials on pages of social media or their websites14.
Therefore the commerce cannot make a false statement relating to:
 Style, quality, and model of service or product.
 Whether the products are novel
 The performance, sponsorship, benefits, and characteristic of the products.
 The availability of spare parts or repair services
 The necessity for the products
 Any exclusion of services or products.
In the case of ACCC v. Coles [2014] FCA 634,15 the federal court currently delivered a decision
after a complaint made in regard of phrases “freshly baked bread and “baked today, sold today.”
The subject matter of the litigation was the third approach that is par-baking of bread that is
alleged by ACCC was implied or express misrepresentation concerning the bread was overheated
from scratch or entirely baked on the selling day. It was asserted by ACCC that
misrepresentation might be probable to induce the consumers to buy bread on the faith that is
14 Bant, E. L. I. S. E., and J. E. A. N. N. I. E. Paterson. "Limitations on Defendant Liability for Misleading or
Deceptive Conduct Under Statute: Some Insights from Negligent Misstatement." (2015).
15 ACCC v. Coles [2014] FCA 634

6BUSINESS LAW
misrepresented. The same is made in violation of Section 18(1), 29(1) (a), and 33 of Australian
Consumer Law. The section laid down that the individual should not involve in deceptive or
misleading conduct in commerce or trade.
Analysis
The PSP initiate a promotional campaign for the PSP smart lock. The campaign
comprises of the promotional video that is designated for circulation on the platforms of social
media. The video is published in social media with the term “promoted content.” Another
promotional campaign implement influencers of social media. Miranda, who is a former wrestler
in the Olympics had a great influence on social media. Therefore marketing manager of PSP for
the purpose of business mailed Miranda that the company was offering her a 50% discount on
the product. Miranda decided to accept the offer and purchase the same, and after one month, he
wrote on a blog that the product was awesome, and he did not receive any income for the
promotional campaign. Thus Miranda contravenes the provision of unfair contract terms of
Australian consumer law16. He engages in illegal practice by encouraging the consumer to
purchase the PSP locks in exchange for benefits for assisting businesses to stream products to
other consumers.
PSP had made payment for video advertisements to be shown on Facebook to the
individual who liked the post in terms of smart locks, business security, prevent burglary, home
security. The advertisement that was displayed on Facebook is amounting to misleading or
deceptive conduct. The business did not facilitate all information to evade involving in deceptive
16 Van Der Westhuizen, Chinelle, and Phil Evans. "(2019): ACL Unfair Contract Terms and Standard Construction
Contracts." U. Notre Dame Austl. L. Rev. 21 1.

7BUSINESS LAW
or misleading conduct. If there is any additional information that required to be disclosed, it
should be represented to consumers when there exists reason to believe other information needs
to be disclosed. Facebook is having sufficient information about additional information and not
disclosing the same to consumers amounting to misleading.
VHS concentrate on the personalized strategies of marketing and implement the strategy
for the promotion of PSP smart lock. They develop an algorithm, and the same is implemented
for the identification of individuals who are likely to be interested in buying products of home
security. One of the consumers named Anu Thru purchase the safety machine with VHS signage
by using code security at the price of $400, and after that, he completed the transaction without
discussing it with other staff members of VHS. After that next week, she discovers that PSP is
offering for sale on a discount rate that is S320, and she complains the same to ACCC. After
investigation, it was disclosed that PSP conceals certain information from the consumer that is
amounting to deceptive and unconscionable conduct in pursuance to Australian Consumer Law.
PSP engages in unfair contract terms as he adopts an illegal method to persuade the
customers to buy their products. They also involve unfair tactics by using the stronger party to
implement their unfair pressure, influence, or unfair tactics. Furthermore, the business did not act
in reasonable and good faith. They also engage in deceptive or misleading conduct as they did
not disclose the limitation of their products. ACCC executes the Jones Lock Manipulation test
and the test resulting that PSPM scores 73% and SHS scores 95%, but the same is totally
concealed from the consumers.

8BUSINESS LAW
Conclusion
Hus Australian Competition and Consumer Commission is the autonomous statutory
body that enforces the Competition and Consumer Act 2010 that is formerly termed as Trade
Practices Act, 1974. The act is formulated to safeguard the interest of the consumers by
advancing fair competition and trading. Therefore it can be concluded that PSP, Facebook,
Miranda, VHS contravene the Australian Consumer Law.
Bibliographys
Books & Journals

9BUSINESS LAW
Thampapillai, Dilan. "THE AUSTRALIAN CONSUMER LAW." Australian Commercial
Law (2015): 374.
Tan, Vivi. "Unfair Contract Terms." (2015) Australian Commercial Law : 380.
Pearson, Gail. "Further challenges for Australian consumer law." 2017 Consumer Law and
Socioeconomic Development. Springer, Cham. 287-305.
Goldberger, Jeffrey. "Unconscionable conduct and unfair contract terms." (2016)Commercial
Law Quarterly: The Journal of the Commercial Law Association of Australia 30.2: 17.
Van Der Westhuizen, Chinelle, and Phil Evans. "(2019): ACL Unfair Contract Terms and
Standard Construction Contracts." U. Notre Dame Austl. L. Rev. 21 1.
Corones, Stephen, and Philip H. Clarke. Australian Consumer Law Commentary and Materials.
(Thomson Reuters (Professional), 2015).
Sise, Peter. "The Unfair Contract Term Provisions: What's Transparency Got to Do with
It." (2017) QUT L. Rev. 17: 160.
Ali, Syuhaeda Aeni Mat, Rusni Hassan, and Ahmad Azam Othman. "Inadequacy of Consumer
Protection from Unfair Contract Terms in Musharakah Mutanaqisah Home Financing In
Malaysia." (2017): Journal of Islamic Finance 176.5872 1-11.
Thampapillai, Dilan, et al. Australian commercial law. (Cambridge University Press, 2015).
Hunt, Kate Mathews. "Gaming the system: Fake online reviews v. consumer law." (2015):
Computer Law & Security Review 31.1 3-25.

10BUSINESS LAW
Bant, E. L. I. S. E., and J. E. A. N. N. I. E. Paterson. "Limitations on Defendant Liability for
Misleading or Deceptive Conduct Under Statute: Some Insights from Negligent Misstatement."
(2015).
Case Laws
Google Inc. v. ACC [2013] HCA 1
Australian Competition and Consumer Commission v. TPG Internet Pty Ltd [2013]HCA 54
Australian Communication Network v. ACCC [2005] FCAFC 221
ACCC v. Lux Distributor [2013] FCAFC 90
ACCC v. Coles [2014] FCA 634
Legislation
The Australian Consumer Law (Cth)