Thinking | 28 November 2012
Updating terms and conditions
Recent changes to various laws have had a significant effect on how terms and conditions should be drafted. Non-compliant terms and conditions run the risk of being unenforceable and exposing a business to substantial fines.
As an example, the Australian Competition and Consumer Commission has been active in enforcing the Australian Consumer Law (ACL). Since January 2010, over $18 million in fines have been imposed for breaches of the ACL. Of these, at least six companies were fined over $1 million.
Another change, the introduction of the Personal Property Security Act 2009 (PPSA), means that if goods are sold on credit or terms contain retention of title provisions, these provisions may be ineffective.
We strongly suggest that all businesses conduct a review of their existing terms and conditions, particularly if there has been no such review since January 2011.
Terms may need updating if they contain:
- a limitation or exclusion of liability clause;
- retention of title provisions;
- warranties against defects;
- a refund, exchange and repair policy; or
We would be pleased to discuss the recent changes with you and how they may affect your business.
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