• The Australian Consumer Law (ACL) applies to all businesses in Australia. It includes national laws for unfair contract terms, consumer rights, product safety and telemarketing.
  • Under the ACL, there are some causes of action available to consumers, including defective goods actions, manufacturers liability and the consumer guarantees regime.
  • The ACL applies to all Australian states and territories.

Product Liability in Australia

The ACL protects consumers by ensuring fair trading in Australia. Under the ACL, consumers have the same protections across Australia for unfair contract laws, standards of business conduct and regulation of business-to-consumer transactions.

There are some goods and services guarantees to protect consumers, including guarantee as to acceptable quality for goods and to due care and skill for services. Businesses can protect itself from product liability claims by reducing its exposure to such claims.

There is a statutory right of action against the manufacturers of goods that have a safety defect. If a consumer suffers loss or damage because of defects in a manufacturer’s goods, they can take the manufacturer to court or make a complaint to a consumer protection agency. Goods have a safety defect if their safety is not something a person would be entitled to expect. The product must be unsafe, rather than just be of poor quality or inoperative.

Key Issues

  • Did the manufacturer or distributor supply a product that was unsafe, defective or come without appropriate warnings?
  • Does the consumer contract include an express acknowledgement of the potential application of the ACL?
  • When is a manufacturer not liable for the defective product?
  • Who can bring an action for compensation? What type of loss may be compensated?

Consumer Protection Right

There are a number of provisions under the ACL that regulate or prohibit a range of unfair trade practices, including:

  • misleading and deceptive conduct
  • the making of false representations about the sale of goods and services
  • unconscionable conduct; and
  • unfair terms in consumer contracts and standard form consumer contracts.

Consumers may seek a defective goods action against a manufacturer under the ACL. This may include an action for loss or damage suffered by an individual who is physically injured by a defective product, or as a result of damage to other goods or property. As a consumer, you can seek damages for any loss reasonably foreseeable as a result of the failure with a consumer guarantee.

Frequently Asked Questions about Product Liability

Q: Who is a manufacturer?
A: A manufacturer is any person that manufactures the goods, holds itself out to the public as a manufacturer, permits someone else to promote the goods as being manufactured by it or imports products.

Q: What is the role of the Australian Consumer and Competition Commission in product liability?
A: The ACCC can bring representative actions on behalf of one or more people who suffer loss or damage as a result of defective goods.

Q: What is the difference between the Australian Consumer Law and the Trade Practices Act?
A: The Australian Consumer Law (ACL) replaced Commonwealth, State and Territory consumer protection legislation in fair trading acts and the Trade Practices Act 1974 on 1 January 2011. The ACL is contained in a schedule to the Competition and Consumer Act 2010.

Q: What defines a consumer?
A: If the good or service is purchased for less than $40,000, the person will be considered a consumer for the purposes of the consumer guarantees regime.

How can LegalVision help me?

LegalVision provides businesses and individuals with tailored online legal advice, including consumer protection and product liability. LegalVision can also assist you to minimise the risk of product liability and protect your business against such claims.

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