Week 3 - Consumer protection, Agency, Privacy

Protecting Competition under the ACL sections

• s 45: Prohibits contracts substantially lessening competition.

• s 45DB: Prohibits boycotts.

• s 46: Misuse of market power.

• s 47: Prohibits exclusive dealing that lessens competition.

Unconscionable Conduct under the ACL sections

• s 20: Unconscionable conduct under general law.

• s 21: Unconscionable conduct in trade/supply.

• s 22: Factors for assessment (bargaining power, unfair terms, undue pressure).

Misleading or Deceptive Conduct under the ACL sections

• s 18: Prohibits misleading/deceptive conduct.

  • Sons of Gwalia Ltd v Margaretic (2007) – nondisclosure of insolvency misled shareholders.

• s 29: False/misleading representations about goods/services.

Agency

Agency is a form of contract law that allows contracts to be entered into on behalf of others, bypassing the strict privity rule.

How is agency created?

• Actual Authority

• Ostensible Authority

• Ratification

• Operation of Law

• Estoppel

Principal (in the context of agency law)

The principal is the party on whose behalf an agent acts, and who ultimately takes the benefit of the contract or transaction entered into by the agent with a third party.

Actual Authority

• most direct way an agency is formed

• it can be express which is when the principal clearly and explicitly grants authority to the agent

• it can be implied which is where agency is implied from the circumstances, including the agent's position, or the conduct necessary to achieve the purpose of the agency

Ostensible (apparent) Authority

When the principal creates the appearance of authority to a third party, as seen in cases like Freeman and Lockyer v Buckhurst Park Properties

• principal here does not actually have authority but makes it seem like they do to the third party

Ratification

• the principal later approves or adopts an agent's unauthorized act, thereby claiming the benefit of the transaction.

• for this to be valid, the principal must have legal capacity, know about the transaction, and exist at the time of the transaction

• Corporations Act s 131 – ratification of pre-registration contracts.

Operation of Law

Agency can arise by operation of law in specific circumstances, such as in emergencies or situations of necessity.

Estoppel

This is when ostensible authority happens, and the third party relies and acts on that belief.

The principal can’t later deny the agency relationship (they’re “stopped” from denying it).

What does Rights and Liabilities of Agency do?

Outlines who are legally bound by a contract when an agent is involved and what happens if an agent acts beyond their authority.

Privity (in the context of agency law)

Privity is a law in contract law where only the parties in the contract are liable for whatever is in the contract.

In agency law, when an agency is validly created, it forms a direct contractual link between the principal and the third party, even though the negotiations were conducted by the agent.

Undisclosed Principal

Specific scenario where an agent, acting with actual authority, enters into a contract with a third party without disclosing that they are acting on behalf of a principal. The third party believes they are contracting directly with the agent.

In this case, not only will the principal be bound by the contract created, but so will the agent. This means the third party may have the option to pursue either the principal (once their existence is revealed) or the agent for performance or breach of the contract.

Breach of Warranty of Authority

When an agent informs a third party that they have authority to enter a transaction when, in fact, such authority does not exist.

If the third party relies on this false representation of authority and subsequently suffers a loss, the agent will be held liable in damages to the third party for this "breach of warranty of authority".

• the principal is generally not bound by the contract with the third party since they were unaware

Duties of an Agent

• Follow principal’s instructions.

• Act in person.

• Act in good faith.

• Disclose personal interests.

• Avoid secret profits.

• Exercise reasonable care and skill.

What does privacy law do?

Privacy law protects individuals’ control over personal information and ensures security against misuse.

What does the Privacy Act of 1988 do?

Governs handling of personal information.

What is the definition of Personal Information in s 6(1) of the Privacy act?

Information or an opinion about an identified individual, or an individual who is reasonably identifiable:

  (a)   whether the information or opinion is true or not; and

  (b)   whether the information or opinion is recorded in a material form or not.

Penalties for breach of private information section

s 13G - Civil penalties for non-compliance.

What is the Australian Privacy Principles?

A set of 13 principles that govern how personal information must be handled by Australian government agencies and private sector organisations.

What are the 13 principles of the APP?

• APP 1: Open, transparent management.

• APP 2: Anonymity/pseudonymity.

• APP 3: Collection of information – consent for sensitive info.

• APP 4: Handling unsolicited info.

• APP 5: Notification requirements.

• APP 6: Use/disclosure limits.

• APP 7: Direct marketing.

• APP 8: Cross-border disclosure.

• APP 9: Government identifiers.

• APP 10: Information accuracy.

• APP 11: Security of personal info.

• APP 12–13: Access and correction rights.

Who does the Privacy Act of 1988 not apply to?

• Small business operators with a turnover of less than $3 million except in cases involving health data, personal info trading, larger links, credit reporting, or Commonwealth contracts

• Related bodies corporate may share non-sensitive personal information

• Individuals acting in a non-business capacity - Act does not apply to personal, family, or household affairs.

• Media organisations reporting news or current affairs are exempt, as this is considered in the public interest.

• State or Territory authorities

• Political parties and political representatives

• Employers are exempt in the context of employee records

What is the OAIC?

Office of the Australian Information Commissioner (OAIC) is the independent statutory agency responsible for enforcing the Privacy Act and dealing with complaints.

Tort for Serious Invasions of Privacy remedies

Introduced in 2024; remedies include injunctions and damages.

The Commissioner’s powers include…

• Making determinations and declarations and bringing proceedings to enforce determinations

• Bringing civil penalty proceedings

• Issuing infringement notices