In matters of honest trading, the Australian courts are steadfast in addressing misleading and deceptive conduct in Perth and Australia at large. It is one of the most litigated issues of Australian Consumer Law (ACL), and Litigation Lawyers Perth are presented with cases such as complaints of dishonest conduct by businessmen, individuals, and professionals daily.
Knowing how the courts of Australia define, evaluate, and determine such behaviour is crucial for any consumer or business operating in the business landscape.
The most important legislative provision that governs misleading and deceptive behaviour in Perth is Section 18 of the Australian Consumer Law (Schedule 2 of the Competition and Consumer Act 2010 (Cth)).
Above all, intent is not required; whether or not the party intended to mislead is irrelevant. The focus is on the effect, or probable effect, of the act on the consumer or business counterpart.
The Australian courts have created a considerable number of laws to address Section 18. Misleading and deceptive conduct in Perth can arise from:
The typical examples would involve exaggerating the abilities of a product, inaccurate financial forecasts, or even omitting significant risks in the sales process of a business.
Notably, the court considers the entire impression of the conduct at the expense of pulling statements and actions out of context in a vacuum. Technically correct statements are misleading when they give a false impression.
Section 18 can be used against any individual or organisation carrying on trade or commerce, such as:
Courts have also extended the liability to third parties in certain cases, like financiers or advisers, if they have been involved in the false representation.
Courts in Australia employ an objective test when deciding whether or not conduct is misleading or deceptive. In other words, would the conduct probably mislead or deceive a typical or reasonable member of the target market?
This test is different according to context. To illustrate, advertisements directed at the general consumer are examined from a reasonable person’s point of view. Contrarily, statements conveyed in a business-to-business transaction might be considered from a knowledgeable industry insider’s point of view.
This is important when courts determine whether the supposed misleading behaviour was capable of misleading, not only whether someone was actually misled.
Australian courts have considered that silence may be considered as misleading conduct in a given circumstance, whereby there exists a reasonable expectation concerning the disclosure of pertinent facts.
To illustrate, when a company sells machinery and knows that there is a defect in it, yet it does not specify this fact, then this omission can prove deceptive even without any explicit statement. This has been affirmed in other main judgments where silence and nondisclosure were emphasised in the judgment, like Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (1988).
Judges also distinguish between sales puffery and misleading conduct. Sales puffery is vague, exaggerating statements no reasonable person would count on, like describing something as “the best in the world.”
In contrast, these are statements that seem factual or specific (like “has done only 20,000 km on this engine”). These are more likely to be held to amount to representations and are actionable if false or misleading. Both categories may, however, be meant to induce a purchase.
Although Section 18 does not have a penalty attached to it (being a civil prohibition), there are various reliefs that aggrieved parties can apply to the court:
In the case where other provisions (such as falseness or misrepresentations at Sections 29 and 151 of the ACL) are breached in addition to the misleading conduct, the said court may penalise a business with large civil penalties.
Evidence is a strong element in commercial litigation cases to prove the misleading character of conduct. It may include:
Litigation lawyers Perth prefer to build robust evidentiary claims to show that the conduct caused actual or potential confusion and inflicted financial or reputation loss.
Misleading and deceptive conduct in Perth is critical, with courts focusing on the protection of consumers and fair dealings. Companies are required to be truthful, honest, and provide full disclosure in every transaction.
Trade communication, contracts, and advertising are subject to scrutiny in an attempt to avoid exposure to the law. Engaging experienced Commercial Litigation Lawyers Perth facilitates handling disputes effectively ahead of time and complying with Australian regulations.