Question 1

Which of the following buyers would be classified as consumers within the meaning of s 3 of the ACL?

1. An individual who purchases an engagement ring for $50 000.
2. A baker who purchases flour for use in the baking of bread in their bakery.
3. A baker who purchases flour for use in the baking of bread in their home.
4. A real estate agent who purchases a sports car for use in their real estate business.

Question 2

Johnny has decided to add a new range of pasta dishes to his menu. He has placed a large sign on the restaurant window promoting his new pasta dishes as 'the best pasta in town, made with all fresh ingredients!'. Angel, the owner of Angel's, the Italian restaurant next door, is rather annoyed about the sign. She has been serving pasta for years. She has accused Johnny of misleading customers, because she knows that Johnny still uses tinned olives in his pasta dishes. Johnny's response is that, even if the olives are from a tin, they are fresh from the tin. Angel has now threatened legal action under s 18 of the ACL.

1. Is she entitled to bring such an action?
2. If so, is such an action likely to succeed?

Question 3

Alexandra has recently moved to Australia from Argentina. Her spoken English is exceptional, but she does not read or write English terribly well, and she has little experience in the way business is conducted in Australia. Alexandra ran a successful catering business in Argentina and is now in the process of establishing a similar business here in Australia. She approaches Johnny to negotiate the supply by The Lame Duck of vegan food for her business. During the negotiations, Johnny realises how little Alexandra understands Australian business practices, and convinces her to agree to pay much more for his food than he charges similar customers. He tells her that it is unusual for Australian businesses negotiating such an arrangement to use legal representation. He also tells her that it is normal practice for a customer in her position to distribute materials advertising his restaurant to all of her own customers, and to commit to a contract with him for at least ten years. Alexandra explains that these arrangements would be extremely unusual in Argentina, but Johnny insists that that is the way things are usually done and that she has no choice but to agree to them, since any other supplier would insist upon the same thing. When Johnny instructs his solicitors to draw up the contract, he tells them to make it especially complicated and legalistic. Alexandra signs the contract agreeing to all of Johnny's requirements, and she does so without seeking independent legal advice or reading it herself. A few weeks later after talking to some helpful Australian friends, she realises that she may have done the wrong thing. Can Alexandra take advantage of s 21 of the ACL?

Question 4

Ash's car is damaged in a minor accident and her mechanic informs her that it will take 3 weeks to repair the damage. Ash decides to hire a car from Davis Car Rental Pty Ltd for those 3 weeks. She makes a booking via the Davis website, arranging to collect the car at 2 pm on 14 September and to return the car at 2 pm on 28 September. When she arrives at the Davis office at 2 pm on 14 September to collect the car, she is asked to pay a deposit of $500 and to sign a document that sets out the terms of the car hire arrangement. She pays the deposit and signs the document. She then waits 30 minutes for the car to be cleaned and made ready, before finally taking the car away at 2.30 pm. Ash returns the car to Davis at 2.30 pm on 28 September. The Davis employee at the office informs her that because she has returned the car 30 minutes late, she has forfeited her deposit. Ash explains that because the car wasn't ready when she came to collect it, she thought she could have an extra half an hour to return it. The employee refers Ash to the following term in the car hire contract:

1. Davis will make all reasonable efforts to ensure that the vehicle is available for collection by the customer by the agreed time. Davis will not be liable for any delay in making the vehicle available to the customer.
2. The customer must return the vehicle by no later than the agreed time. Any failure whatsoever to comply with this requirement will result in forfeiture of the deposit.

Advise Ash whether the above terms are unfair terms under ACL.