JJ Richards con­tract terms de­clared un­fair and void

Pro­tec­tion for small busi­ness is re­viewed

Big Rigs - - NEWS -

BULK WASTE giants JJ Richards & Sons have had a num­ber of con­tract terms used to en­gage small busi­nesses voided by the fed­eral court.

The Fed­eral Court this month de­clared, by con­sent, that eight terms in con­tract used by the com­pany to en­gage small op­er­a­tors are un­fair, and there­fore void fol­low­ing ac­tion by the ACCC.

This in­ves­ti­ga­tion is part of a wider ACCC re­view of small busi­ness con­tracts in a range of in­dus­tries.

JJ Richards is one of the largest pri­vately-owned waste man­age­ment com­pa­nies in Aus­tralia and pro­vides re­cy­cling, san­i­tary and green waste col­lec­tion ser­vices.

“This is the first court ac­tion by the ACCC to en­force new laws that pro­tect small busi­nesses from un­fair con­tract terms,” ACCC Deputy Chair Dr Michael Schaper said.

“Un­der Aus­tralian Con­sumer Law, terms that cre­ate a sig­nif­i­cant power im­bal­ance be­tween par­ties, are not nec­es­sary to pro­tect le­git­i­mate in­ter­ests, and which would cause sig­nif­i­cant fi­nan­cial detri­ment to a small busi­ness if re­lied on, are un­fair and void.”

“The Court’s de­ci­sion serves as a re­minder to large busi­nesses to re­view their stan­dard form con­tracts and make sure they don’t in­clude any un­fair terms.

“The ACCC will not hes­i­tate to take ap­pro­pri­ate ac­tion to en­sure large busi­nesses are com­ply­ing with the un­fair con­tract terms pro­vi­sions,” Dr Schaper said.

The con­tract terms deemed un­fair by the court were found to bind cus­tomers to sub­se­quent con­tracts un­less they can­cel the con­tract within 30 days be­fore the end of the term.

Al­lowed JJ Richards to uni­lat­er­ally in­crease its prices and re­moved any li­a­bil­ity for JJ Richards where its per­for­mance is “pre­vented or hin­dered in any way”.

The dis­puted terms also al­lowed JJ Richards to charge cus­tomers for ser­vices that did not take place, even when beyond the cus­tomer’s con­trol, granted exclusive rights to re­move waste from the premises and al­lowed the com­pany to sus­pend its ser­vice but con­tinue to charge the cus­tomer if pay­ment is not made af­ter seven days.

The con­tract terms also stip­u­lated un­lim­ited in­dem­nity in favour of JJ Richards, pre­vented cus­tomers from ter­mi­nat­ing their con­tracts if they have pay­ments out­stand­ing.

His Hon­our also found that “the Im­pugned Terms tend to ex­ac­er­bate each other, in­creas­ing the over­all im­bal­ance be­tween the par­ties and the risk of detri­ment to JJR Cus­tomers.”

JJ Richards con­sented to or­ders re­strain­ing it from re­ly­ing on the un­fair terms in ex­ist­ing small busi­ness con­tracts and from us­ing the terms in fu­ture con­tracts with small busi­nesses.

PHOTO: CONTRIBUTED

WASTE COL­LEC­TION: JJ Richards & Sons, one of Aus­tralia’s largest pri­vately-owned waste man­age­ment com­pa­nies has at­tracted ACCC at­ten­tion.

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