Unfair Contract Terms – Hicksons Stands Ready to Assist

On 12 November 2016 new provisions were added to the Australian Consumer Law to protect small businesses from unfair terms in standard form contracts.

We reported on these new provisions on 10 November 2016.

The Australian Competition and Consumer Commission (ACCC) has recently issued a report on the new provisions which is especially helpful in highlighting common terms of concern in particular industries and in identifying ways in which businesses can modify those terms so the risk of breach is reduced.

The terms identified by the ACCC include terms that:

  • give a business the right to vary a product offering or a price without notice or without sufficient reason
  • give a business unnecessarily wide indemnity coverage so that for example the weaker party in a transaction is required to indemnify the stronger party in all cases irrespective of fault
  • provide for the automatic rollover of a contract term without notice and often with an early termination charge being imposed in second and subsequent terms
  • enable rules of a business or an operations manual to be amended at any time and without notice
  • provide for unrestricted access to a small business’s premises or operations.

In many cases these and similar terms can be justified, especially if they are necessary to protect a larger business’s legitimate interests.

Whether you are a large or small business a review of your standard form contracts (including contracts you are asked to sign) could well be timely.

At Hicksons we have developed a special methodology for the review of standard form contracts which has applications across many industries. It can be applied quickly and efficiently to identify standard form contracts and the terms which are likely to attract the most attention under the new provisions.  As a next step we can produce a report which proposes necessary or worthwhile amendments with as little disruption to your business as possible.

Let us know if you are interested by contacting Rod Cameron (+61 2 9293 5407) or Bernard Evans (+61 2 9293 5480).

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