ACCC GETS DOWN AND DIRTY FOR TEST OF NEW LAWS
AUSTRALIA’S biggest private waste management company, JJ Richards, is being sued by the Australian Competition and Consumer Commission for the use of unfair contracts.
The legal action is set to be the first major test case of new laws about the fair treatment of small businesses.
JJ Richards, which operates across the nation and in New Zealand, is alleged to have asked customers to sign contracts that included eight unfair clauses.
“Where we identify large operators, like JJ Richards, using unfair contract terms that cause harm to small businesses, we will take appropriate enforcement action,” ACCC deputy chairman Michael Schaper said.
“This is the first time the ACCC has taken court action to enforce the new laws that protect small businesses from unfair contract terms.”
The commission is asking the Federal Court to rule that contracts JJ Richards made with small businesses after laws changed last year are void.
It is also asking for injunctions to prevent the company from enforcing the unfair terms or from entering into future contracts with small businesses on the same terms.
The commission alleges the contracts gave JJ Richards an advantage over its small business customers, and that relying on the terms could cause significant financial detriment to small businesses.
The ACCC highlighted clauses that allowed JJ Richards to unilaterally increase prices, allowed the company to charge its customers for services not rendered if prevented by reasons beyond the customers’ control.
It also highlight clauses granting the company exclusive rights to remove customers’ waste, and binding customers to subsequent contracts unless they cancelled up to 30 days before their contracts were due to end.
The Australian Consumer Law was changed last November to extend unfair contract terms to cover standard contracts involving small businesses.
But the ACCC alleges JJ Richards had been using the unfair contracts up to April this year.