Ann: Class Action Settlement, page-27

The word “unconscionable” seems to lack a clear legal definition, and hence it opens a Pandora's Box of nasty possibilities. I do not want to debate this issue, because nothing will be gained by it, but I may as well cut and paste some material that I wrote for myself this morning.

Since the Class Action became news I have wondered whether the argument in relation to the Rent-Try-$1Buy representation focused too much on the wording of the standard-form contract to the exclusion of how RR carried out the contracts. Googling for views in the past on this issue got me nowhere. This morning for the first time I found something that touched on this question in the Competition and Consumer Act 2010 at http://classic.austlii.edu.au/au/legis/cth/consol_act/caca2010265/sch2.html

If the Representation is that on expiry of a Consumer Lease the customer can acquire the goods for $1, and in reality RR gifts the goods to the customer at no charge, would a court deem the Representation to be unconscionable if pursuant to the National Credit Code, 9(1), which disallows a Consumer Lease to have a purchase option, the RR contract has no such option? 9(1) reads, “For the purposes of this Code, a contract for the hire of goods under which the hirer has a right or obligation to purchase the goods, is to be regarded as a sale of the goods by instalments if the charge that is or may be made for hiring the goods, together with any other amount payable under the contract (including an amount to purchase the goods or to exercise an option to do so) exceeds the cash price of the goods.”

It seems that the Rent-Try-$1Buy representation should be considered as unconscionable, or not, relative to the wording of both the subsequent contracts executed, and the subsequent behaviour of the supplier? 21(4)(c) of the Competition and Consumer Act 2010 - Schedule 2 reads, “in considering whether conduct to which a contract relates is unconscionable, a court's consideration of the contract may include consideration of:
.. (i) the terms of the contract; and
.. (ii) the manner in which and the extent to which the contract is carried out;
and is not limited to consideration of the circumstances relating to formation of the contract.