Legal Studies Essay Joey Agerholm Exclusion clauses determine the liability of something that might go wrong within a contract. They are used by sellers as an attempt to avoid or limit their liability. The seller has the advantage over the buyer who must agree to the clauses to purchase the product/service. Because of the buyers disadvantage the court takes such cases, involving exclusion clauses, very seriously, and the content of the clauses are carefully interpreted.
With the current Trade Practises Act and the Fair Trading Act the standard form of business contract is adequate and effective in protecting the buyer. The Trade Practise Act is the most effective legislation for the protection of the consumer. It implies to the following situations:- – A promise by the seller that the buyer will become the owner If a car dealer breaks a promise or part of a contract, for example that he has the right to sell a car, and the car is stolen then although the buyer will have to give the car back he/she will get her money back. – A promise by the seller that goods will fit the description supplied by the seller In this case the buyer is protected if the seller makes a promise, which is a condition of the contract, describing the product, and when the buyer receives the product, it does not match the description. – A promise where the seller is made aware of the purpose for which the goods are required, that the goods will be reasonably fit for that purpose This condition is implied when the buyer makes the purpose of the goods needed known to the seller, and the buyer then relies on the sellers judgement in providing the correct product.
For example it would not be reasonable if you made the seller aware that you wished to purchase something suitable for mowing the average suburban backyard and you were sold a tractor. – A Promise that goods are of merchantable quality According to this act a good is considered to be merchantable if they are suitable for the prospect for which other similar goods are sold, involving the description applied to them, the price and any other relevant information. This act does however does not protect the consumer if he/she has examined the product and missed any defects that should have been seen or if the seller made him/her aware of the defect prior to the purchase of the product. – A promise that goods purchased on the basis of a sample will match the sample Here the consumer is protected if he/she purchase, for example paint, on the basis that it matches the sample shown in a sample booklet. These terms do provide adequate protection if the buyer is effected in such circumstances.
There are a number of sellers who attempt to deceive the buyer through conditions of contracts however most standard form contracts contain reasonable exclusion clauses, meaning acts such as the Trade Practises Act are not necessary to resolve problems. For example the conditions of the attached RACQ advertising contract. Each condition is fair and to be expected. For example condition 8, which states that the advertiser may at any time cancel or alter an advertisement so long as the publisher is notified in writing prior to the deadline date. It is common sense that the publisher would need to be informed of any changes before the deadline so the buyer, in this case the advertiser, is not being hardly done by. It may be said that the buyer is effected by the condition when it states that the change must be in written form. It could be argued that if a decision is made within hours of the deadline it is unreasonable to expect the alteration in written form.
However with current technology a letter can be faxed and received within seconds. The Fair Trading Act along with the Trade Practises Act has been introduced to ensure that the consumer in particular is protected. For example Section 53 of the Fair Trading Act which states A person to whom unsolicited goods are supplied by another person in trade or commerce is not liable to make any