MLL217 Study Guide - Final Guide: The Seller, Executive Car, Tobacco Institute
2 Jun 2018
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Specifically Prohibited False or Misleading Representations
Preliminary points
▪ Provisions in Part 3-1 of the ACL prohibit specific false representations or other
unfair selling practices.
▪ A breach of these sections gives rise to civil liability
▪ Replicated as criminal offence provisions in Part 4-1
▪ Governed under Criminal Code Act 1995 (Cth)
▪ Can be pleaded in the alternative to Section 18 in a civil claim
▪ Financial services dealt with under ASIC Act
▪ Civil sanctions and stand alone
▪ Relevant provisions: ss 29 - 34, 47, 48
▪ Often pleaded in the alternative to s 18
▪ ACCC can seek remedies - Topic 9
▪ Public remedies
▪ Private individuals can seek all civil remedies - Topic 10
▪ Main significance of Part 3-1:
▪ Some remedies available to the ACCC (Topic 9) are only available for a
contravention of Part 3-1, not s 18, e.g. civil pecuniary penalties
▪ Part 3-1 provisions (but not s 18) also reproduced as criminal provisions in
Part 4-1 – criminal penalties available
Section 29
Preconditions to Liability
▪ Section 29 prohibits a corporation acting in trade or commerce from making false
and misleading representations on certain matters in connection with the supply, or
possible supply, of goods or services, or the promotion of goods or services.
▪ The corresponding criminal liability provision is s 151
Mens Rea
▪ It is unnecessary to prove a guilty mind; being, that the corporation knew the
representation was false or was reckless as to the falsity of the representation
▪ Intention, knowledge, recklessness
▪ The criminal provision provides that the offence is one of strict liability
▪ For the meaning of strict liability, see Section 6.1 Criminal Code
▪ (1) If a law that creates an offence provides that the offence is an offence of
strict liability:
(a) there are no fault elements for any of the physical elements
of the offence; and
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(b) the defence of mistake of fact under section 9.2 is available.
▪ (2) If a law that creates an offence provides that strict liability applies
to a particular physical element of the offence:
(a) there are no fault elements for that physical element; and
(b) the defence of mistake of fact under section 9.2 is available
in relation to that physical element.
▪ (3) The existence of strict liability does not make any other defence
unavailable.
▪ s 6.2 absolute liability
▪ same as s 6.1
Persons Liable
▪ All those associated with the representation are prima facie liable, but note s 38
▪ The effect of s 38 is to provide an exemption to information providers with respect to
the publication of material that would otherwise be false or misleading
▪ The defence of relaying information would apply to Section 29
▪ The respondent will have a defence if it can establish that it made it
clear that it was not the source of the information and that it had no
knowledge of the truth or otherwise of that information: Saints Gallery
Pty Ltd v Plummer , Butcher
Definitions of Terms
▪ The terms goods and services are both defined very broadly in Section 2(1) as
follows:
▪ "Goods" includes:
(a) ships, aircraft and other vehicles;
(b) animals, including fish;
(c) minerals, trees and crops, whether on, under or attached to land or not; &
(d) gas and electricity
(e) computer software
(f) second hand goods
(g) any component part of, or accessory to goods.
▪ "Services" includes any rights (including rights in relation to, and interests in, real or
personal property), benefits, privileges or facilities that are, or are to be, provided,
granted or conferred in trade or commerce.
(a) a contract for or in relation to:
(i) the performance of work (including work of a professional nature), whether
with or without the supply of goods;
(ii) the provision of, or the use or enjoyment of facilities for, amusement,
entertainment, recreation or instruction; or
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(iii) the conferring of rights, benefits or privileges for which remuneration is
payable in the form of a royalty, tribute, levy or similar exaction;
(b) a contract of insurance;
(c) a contract between a banker and a customer of the banker entered into in the
course of the carrying on by the banker of the business of banking; or
(d) any contract for or in relation to the lending of moneys,
but does not include rights or benefits being the supply of goods or the performance
of work under a contract of service.
▪ Note that the definition of services excludes rights or benefits to be provided under
an employment contract
▪ These are specifically dealt with in s 31.
▪ The term supply is also defined broadly in s 2(1) to include supply by way of sale,
exchange, lease, hire or hire purchase.
Section 29(a) and (b) – particular standard, quality, value, grade, etc.
▪ Section 29(1)(a) prohibits a person from falsely representing that goods are of a
particular standard, quality, value, grade, composition, style or model or have had a
particular history or particular previous use.
▪ Section 29(1)(b) prohibits a person from falsely representing that services are of a
particular standard, quality, value or grade.
Particular standard
▪ A representation that goods are of a particular standard is a representation that the
goods comply with an indicated or certain standard:
▪ Gardam v George Wills & Co Ltd (1988)
▪ A standard is an ascertained or definite degree of quality
▪ Section 29(1)(a) applies where the respondent has represented that the goods have
reached a particular benchmark that is used to judge the quality of that type of
product.
▪ P. 349 of text
▪ Hartnell v Sharp
• Microwaves had not been tested or approved in the way that they had
represented
▪ A representation that a product complies with a standard promulgated by an official
body such as the Standards Association of Australia will contravene this section, but
the operation of Section 29(1)(a) is not restricted to standards that have been
officially promulgated by government authorities.
▪ Section 29(1)(a) will be contravened where the respondent falsely represents
compliance with a standard that has come to be generally accepted within an
industry for that type of product:
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