Consumer law and practice and procedure – unfair contract terms – summary dismissal application – whether finding that terms are unfair is possible without identifying particular contracts between identified parties

In Australian Competition and Consumer Commission v Fuji Xerox Australia Pty Ltd [2021] FCA 153 (3 March 2021) the court dismissed the interlocutory application for summary dismissal of the proceeding brought by the respondent (FX).

The applicant (ACCC) sought declarations and injunctions concerning the use by FX of nine different template forms of contract with its customers which were said by the ACCC to be “small business contracts” within the meaning of s23(4) of the Australian Consumer Law (ACL) (Sch.2 to the Competition and Consumer Act 2010) and “standard form contracts” within the meaning of s27 of the ACL. The ACCC’s case was that a number of the terms of the template form contracts were “unfair terms” within the meaning of s24 of the ACL. The ACCC also relied on analogous provisions of the Australian Securities and Investments Commission Act 2001 (Cth).

FX submitted that the ACCC’s case was fundamentally flawed because (other than in an amendment to the relief in an amended originating application) it did not identify any particular contract between FX and any particular customer (at [16]). It argued that it was impossible to apply the relevant provisions to any given “contract” unless the contract in question had been identified (at [13]-[14]).

FX submitted the court was impermissibly being invited to give an advisory opinion on wholly abstract questions, namely whether if a term of the kind which appears in FX’s template document features in a contract which happens to have the characteristics of a standard form contract and happens also to satisfy the requirements for a small business contract, would that be an unfair term within the meaning of s24 of the ACL (at [16]; see also [40]).

Stewart J considered that an obstacle to FX in advancing its argument was that courts had on previous occasions ordered similar relief to that which was sought in this case, referring to ACCC v JJ Richards & Sons Pty Ltd [2017] FCA 1224 and ASIC v Bendigo and Adelaide Bank Ltd [2020] FCA 716 (at [41]-[56]).

The application for summary dismissal was dismissed. The court held it is possible under the statutory scheme that the impugned terms were unfair notwithstanding that no actual contracts between identified parties were proved (at [57]). The relief sought was not too uncertain (at [59]-[64]). Further, the relief sought by the ACCC would decide a real controversy, being the controversy between the ACCC (as “regulator” referred to in s250(2)(b) of the ACL) and FX with regard to whether the impugned terms in the identified template contracts were unfair (at [65]). The criticisms of the relief that FX made were not being finally dealt with at this stage. Rather, Stewart J was not satisfied at this stage that there was no reasonable prospect that the relief that was sought would ultimately be granted (at [66]).

Dan Star QC is a Senior Counsel at the Victorian Bar, ph 03 9225 8757 or email danstar@vicbar.com.au. The full version of these judgments can be found at austlii.edu.au. Numbers in square brackets refer to a paragraph number in the judgment.

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