Enforcement of the provision Section 18 of ACL is arguably wide in its application, considering that it takes care of any individuals who participate in deceptive behaviour and or those intending to do so. Owing to the fact that the Competition and Consumer Act 2010 (CCA) is a statutory provision, section 51 of the Australian Constitution limit its enforcement. Nonetheless, section 18 of the ACL is premised upon the power of the business organizations as enshrined in the Constitution to operate freely in legal business and act in good faith.
Mardirossian, Robbins and Leibler (2010) noted that the condition imposed by “trade or commerce” is important to its enforcement. As Heinrich and Bracken (2009) have argued, parties may be indirectly liable for violations of s18 if the court establishes their knowledge of the breach before its commission or omission. Each of the federations and regions of Australia are covered under fair trading laws, which draws several similarities to the ACL, but whose mandates are limited. Misleading and Deceptive practices The outlaw of misleading practices as set out in section 18(1) of the ACL should be interpreted together with section 4(2)(a) of the CCA in order to give it a complete, productive meaning.
Under the latter provision, misleading or deceptive conduct is one where a party does or refuses to act in a reasonable way, including the drawing of, or the enforcement of a clause of an agreement; the generation of, or the implementation of a provision of, and knowledge of a binding agreement (Jones and Eagleton, 2012). Despite the seemingly clear definition of misleading conduct in the Act, Barker and Knight (2010) have noted that establishing whether an act meets the legal thresholds is left to the courts to decide, in which case, judges are obliged to examine all of the facts in question and the context within which such illegal practices were carried out.
As Morrison, Abraham and Sheargold (2010) have indicated, to be deceptive or misleading, the practice must comprise a distortion of fact capable of enticing the relevant victim into arriving at an erroneous judgment. In most cases, misrepresentations are inaccurate statements of information. Nonetheless, statements that are credible may also have the intent to misrepresentations if their use is capable of swaying consumers into making mistakes.
The appropriate test applied in common law with regard to misleading and deception practices is whether the practice is in itself erroneous; or has the potential to create an erroneous judgment in the consumer (Schaper, 2009/2010).
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