Property Focus – New Unfair Terms In Small Business Contracts

By Kathleen Ready

From 12 November 2016, the Australian Consumer Law is being amended so that businesses which employ up to 19 people are provided the same protections as ordinary mum and dad consumers from unfair terms in standard form contracts for the sale or lease of land.

The protections will be afforded where the upfront price payable under any contract is:

1. more than $300,000; or

2. the contract has a duration of more than 12 months; and

• cause a significant imbalance in the parties’ rights and obligations;

• not be reasonably necessary to protect the legitimate interests of the party advantaged by the term,

• cause financial or other detriment (such as delay) to a small business if it were relied on.

• terms that enable one party (but not another) to avoid or limit their obligations under the contract;

• terms that enable one party (but not another) to terminate the contract;

• terms that penalise one party (but not another) for breaching or terminating the contract;

• terms that enable one party (but not another) to vary the terms of the contract.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Kathleen Ready is a Senior Partner in Property, Planning & Environment Law at Brisbane law firm Dowd & Co. 

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