Topic 8 Consumer Protection Worksheet

Question 1

How is advertising dealt with under consumer law? Which of the following is correct?

a) Under consumer law advertising is not restricted in any manner unless a consumer can

specifically demonstrate the retailer has been deliberately untruthful.

b) Advertising is not dealt with under consumer law; advertising has always been considered

as an invitation to treat and therefore cannot be considered to be part of a contract, even if

misleading.

c) In modern times consumers are considered more sophisticated and able to distinguish

mere advertising from untruthful statements.

d) Advertising clearly falls within the ambit of consumer law in that a person in trade and

commerce is not permitted to engage in conduct (advertising included) which in trade and

commerce is misleading or deceptive: s 18 ACL.

Question 2

What is a consumer transaction? Which of the following is correct?

a) Every transaction in Australia is a consumer transaction since ultimately all goods and

services are consumed in one way or another.

b) A consumer transaction is defined as a purchase of goods by the person who intends to

consume the goods; any purchase by a non-consumer is not a consumer transaction.

c) A consumer transaction is a particular transaction where a good or service is actually

acquired for consumption, and is acquired for a reasonable small amount and the good is

not acquired for further manufacture or on supply.

d) A consumer is any party to a contract who receives goods or services from another party;

every contract is therefore covered by consumer law

Question 3

What is the definition of a consumer transaction under the ACL? Which of the following is

correct?

a) Consumer goods are any goods or services which have a price tag of less than $40,000,

irrespective of their use.

b) Under the ACL a consumer transaction is defined as the acquisition of goods or services for

less than $40,000, which are ordinarily used for personal or domestic consumption

purposes and not for resale or remanufacture.

c) Consumer goods are any goods sold by a retailer to a person who intends to use those

goods within the next 12 months, that person is defined as a consumer.

d) A consumer transaction is any transaction where the person acquiring the goods or

services and utilise the goods within Australia.

1Question 4

What guarantees exist in relation to the quality of goods? Which of the following is

correct?

a) Goods are not permitted to be sold unless they have been verified as of an acceptable

quality under the Australian standards system set by the consumer affairs bodies.

b) Goods which are not of an acceptable quality can be sold to a purchaser, as long as the

defect or lack of quality is drawn to the attention of the purchaser, or where it is obvious by

the price or labelling that it lacks acceptable quality.

c) A seller must verify that goods are of an acceptable quality, that they are safe, but has no

liability for their durability according to legislation.

d) If the purchaser discovers that the goods are not of an acceptable quality but they have

partly consumed the goods, then they cannot get a refund for the goods.

Question 5

What is the guarantee existing as to repairs and spare parts? Which of the following is

correct?

a) The manufacturer of goods must be able to guarantee the supply spare parts for goods sold

for a minimum of 20 years.

b) The supplier of goods is not responsible for the supply of spare parts; it is up to the

consumer to request information on this.

c) The supplier must guarantee that the goods supplied can be repaired, but there is no

requirement that spare parts will be supplied.

d) The seller of goods in trade or commerce must guarantee that the manufacturer of goods

can reasonably supply spare parts for repair for a reasonable period of time

Question 6

Ned visits a hairdresser for a haircut, he describes to the barber that he wants a small

amount of hair off; he needs to look smart for a job interview. The barber accidently uses

the wrong hair clipper and all of Ned's hair needs to be shaved off? His head shows

various cuts from the razor blade. Ned is very upset and cannot attend his job interview.

What redress might Ned have? Which of the following is correct?

a) Ned needs to invoke the tort of negligence; the hairdresser appears to have acted

negligently and Ned needs to see his lawyer to invoke his rights under the negligence

provisions of the ACL.

b) Ned might invoke the guarantee as to services, it appears not to have been rendered with

due care and skill, and further it has not achieved the outcome or purpose which had

described to the hairdresser - he would not need to pay and might seek damages.

c) Ned will need to be award that while a hairdresser is providing a service, it is risky and that

under the ACL the hairdresser must do his or her best to achieve the appropriate outcome.

d) Ned might invoke the health and safety standards which are set out in the ACL; the cuts,

etc would be actionable as a breach of community standards when providing services to the

public.

23

Question 7

What remedies are provided for under consumer law? Which of the following is correct?

a) Where there is a breach of a guarantee for a provision of a good or service (a major failure)

then generally the consumer can receive back the price of the transaction or something

equivalent.

b) If goods or services provided are inappropriate then the consumer must prove beyond the

balance of probabilities that the good or service was not of good quality and judged by the

relevant consumer affairs authorities.

c) The consumer loses all remedies if they have in any way used a good before informing the

supplier that the good does not work.

d) For a consumer to receive a remedy they must always inform the supplier of a defect, but

only for the provision of goods, not for a provision of services.

Question 8

Match the statements on the left hand column with the ones on the right hand column.

1

Conduct is misleading when it lead the

persons at whom it is directed into error.

A

Concrete Constructions (NSW) Pty

Ltd v Nelson.

2

It is not relevant to prove that the conduct was

either intentional or negligent.

B

Campomar Sociedad, Limitada v

Nike International Ltd.

3

Misleading conduct is prohibited only if it takes

plain 'in trade or commerce'.

C

Twentieth Century Fox Film

Corporation & Anor v The South

Australian Brewing Co Ltd & Anor.

4

Where the relevant conduct is directed at the

public at large, the relevant test is a

reasonable person test, taking into account

the class of consumers likely to be affected by

the conduct.

D

McWilliam's Wines Pty Ltd v

McDonald's System of Australia

Pty Ltd.

5

Misleading and deception conduct.

E

Yorke v Treasureway Stores Pty

Ltd.