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Australia’s consumer protection law – a potent weapon in construction law disputes

by Donald Charrett

Dr Donald Charrett (2011) 3 CLInt 23

Arguably the most significant of its many impacts is that the TPA set norms for acceptable behaviour that impact every aspect of commercial transactions, including the negotiations that culminate in a contract. Although originally based on American legislation, the Australian TPA/CCA has no direct counterpart in the common law world in terms of the extent to which it potentially impacts upon contractual relationships.

For many purposes under this Commonwealth legislation (and equivalent State and Territory legislation), ‘consumers’ include commercial entities of all kinds and sizes.  Accordingly, some aspects of the TPA/ CCA are of seminal importance to the practice of construction law. Perhaps most significantly, the TPA/ CCA may provide a statutory cause of action for a wrong that does not exist under the common law, or remedies otherwise unavailable under contract or tort law for damage suffered ‘by’ misleading or deceptive conduct.

Since 1974, Australia has had one of the most far-reaching ‘consumer’ laws in the world.  The ambit of the Trade Practices Act 1974 (Cth) (TPA) – now, the Competition and Consumer Act 2010 (Cth) (CCA) – is very broad, encompassing, among other things, operations of the Australian Competition and Consumer Commission and other statutory bodies that promote and monitor competition, restrictive trade practices, unconscionable conduct, consumer protection, liability for defective goods, international liner cargo shipping, a competition code and the telecommunications industry.

Knowledge of the ambit and power of the TPA/CCA is, therefore, fundamental to an understanding of the practice of construction law within Australia.  Moreover, it has significant extraterritorial reach: by virtue of s 5 of the CCA, it extends to certain ‘conduct’ in breach of the prohibitions on restrictive trade practices or in breach of the Australian Consumer Law (discussed below) outside Australia. Commercial entities incorporated or carrying on business within Australia, and Australian citizens and persons ordinarily resident within Australia are subject to the Australian Consumer Law, even outside Australia.  Thus, the CCA may provide a remedy under Australian law to a foreign entity who has suffered loss ‘by’ infringing conduct engaged in by an Australian company or resident outside Australia.

 The CCA is also of interest to construction lawyers from other jurisdictions as an example of convergence, achieved via statute, between the common law and civil law.  In many ways, the CCAis a legislative code that defines in considerable detail the way in which many types of commercial practice may be legally carried out.  As judges have made clear in many judgments, the provisions of the TPA/CCA are not necessarily to be construed by reference to the common law; rather the specific legislative intent needs to be discerned from the words and meaning of the Act. TheTPA/CCA thus operates in parallel to the common law, providing remedies for damage caused ‘by’ infringing conduct that may, or may not, parallel or overlap the established remedies for breach of contract or negligence.

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