NAT: Unfair contracts, consumer protection and the impact on lot owners

This article and video explores the important discussion about unfair contracts, consumer protection and the impact on lot owners within the strata industry. We ask Todd Garsden, Partner at Mahoneys and Gerard Brody, an independent consultant working in the Consumer Advocacy, governance and public policy space for their thoughts.

Video: Unfair contracts, consumer protection and the impact on lot owners

We explore the complexities surrounding consumer protection and whether a body corporate or owners corporation qualifies as a consumer under the Australian Consumer Law (ACL).

Recent concerns about unethical practices in the strata industry highlight the need for clarity and potential reform in this area.

Gerard explains the legalities of unfair contract terms and how the legislative framework applies (or doesn’t apply) to owners corporations. He’ll also explore solutions implemented in specific jurisdictions like Victoria and discuss potential reforms, both for contract terms and broader consumer protection measures.

Todd sheds light on how these issues might unfold in everyday strata management scenarios. He offers valuable insights for committee members who may encounter unfair contracts or be pressured to enter into them.

During the interview, we cover the following questions:

• What are the specific types of unfair contract terms prohibited by the ACL?
• Why is there a current lack of protection for owners corporations under the ACL, even though they may enter into contracts for essential services?
• Building on the Victorian example, what’s happening in other jurisdictions? Who is addressing this issue?
• Looking towards the future, what reforms do you see as essential, not just for unfair contract terms, but also for broader unfair trading practices under the ACL?
• Can you walk us through some practical scenarios where unfair contract terms might arise in the context of a body corporate?
• What steps can a committee take if they suspect a contract might be unfair or are pressured to accept one?
• Given the current legal landscape, what proactive measures can committees implement to safeguard themselves and their owners from potentially unfair contracts?
• Is there a measure of hope for lot owners navigating potentially unfair contracts within the strata system?

Todd Garsden
Mahoneys
E: tgarsden@mahoneys.com.au
P: 07 3007 3753

Gerard Brody
Independent consultant
Email

This post appears in Strata News #697.

Have a question or something to add to the article? Leave a comment below.

Read next:

• NAT: Body corporate charged $16k for Strata Manager to send 5 emails
• NAT: Advocating for Change Against Unfair Practices
• NAT: SCA Comments on ethics, conflicts and the future of the strata industry

Visit Strata Committee Concerns OR Strata Topics by State pages.

Looking for strata information concerning your state? For state-specific strata information, try here.

After a free PDF of this article? Log into your existing LookUpStrata Account to download the printable file. Not a member? Simple – join for free on our Registration page.