The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court against JJ Richards & Sons Pty Ltd (JJ Richards) alleging that eight clauses in its standard form small business contract are void because they are unfair under the Australian Consumer Law (ACL).
JJ Richards is one of the largest privately-owned waste management companies in Australia and provides recycling, sanitary, and green waste collection services.
From 12 November 2016, the unfair contract terms provisions of the ACL were extended to cover standard form contracts involving small businesses.
The ACCC alleges that until at least April this year, JJ Richards entered into standard form contracts containing terms the ACCC alleges are unfair because they:
“This is the first time the ACCC has taken court action to enforce the new laws that protect small businesses from unfair contract terms,” ACCC Deputy Chair Dr Michael Schaper said.
“Where we identify large operators, like JJ Richards, using unfair contract terms that cause harm to small businesses, we will take appropriate enforcement action.”
The ACCC alleges JJ Richard’s standard form small business contracts contain eight unfair contract terms:
“In 2016 the ACCC engaged with a range of industries to encourage compliance with the new laws and reviewed small business contracts in a range of industries, including the waste management industry,” Dr Schaper said.
“This action should serve as a reminder to large businesses that haven’t already to review their standard form contracts to ensure they aren’t considered to be unfair under the changes to the law.”
The ACCC is seeking declarations that the terms are unfair and consequently void, and injunctions to prevent JJ Richards from relying on those terms or entering into future contracts with small businesses that contain them.