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Department of Justice and Community Safety

MISLEADING CONDUCT

Every consumer has the right to receive factual information about goods and services on offer. This allows consumers to make informed choices about the purchases they make. It is illegal for a business to mislead or deceive the consumer. It is even illegal to give information that is likely to mislead or deceive, through oral, written or advertising claims made about goods or services.

 

GOODS AND SERVICES

Under section 19 of the Fair Trading Act (the Act) it is an offence for a person to do anything which might mislead someone about goods on offer. This includes giving out misleading information about the nature, manufacturing process, characteristics or quantity of the goods as well as information about whether the goods will perform as expected.

Section 20 of the Act deals with misleading conduct relating to services. This section outlaws any conduct by businesses which might mislead consumers

about services on offer, including misleading them as to the nature, characteristics, suitability for their purpose or quantity of any services on offer.

Does the cash price of goods & services have to be stated?

Yes. It is an offence for a business to advertise part of the price of goods or services without also stating the full cash price. For example, if a business advertises an appliance at "$500 or $10.00 per week" the advertisement must also contain the total price which would be paid if the consumer chose to make weekly payments. It is not sufficient to state how long the payments would continue for or what the interest rate would be. Under section 17 of the Act, the full price that would be paid under a repayment option must be stated.

Is the offering of gifts and prizes to induce sales illegal?

No. However if a business person offers gifts, prizes or other free items in order to encourage a consumer to purchase goods or services, he/she must provide them to the consumer exactly as they were offered. If he/she did not do this, then he/she would be breaching section 18 of the Act.

This provision is important, because the offer of gifts and prizes may play a large role in the consumers decision making. Someone might decide to purchase one item rather than another because of the free gifts. It would be unfair for the retailer, having received the money, to not provide the gift.

 

EMPLOYMENT

If a person is offering employment, it is illegal to mislead prospective employees about details relating to any aspect of the employment. Under section 16 of the Act it is an offence to do anything which might mislead an applicant with regards to the availability, nature or terms and conditions of the employment. This means that, for example, a person cannot tell a potential employee that he/she would be paid a set amount per week, when in reality he/she would be working on a commission basis.