The Australian Consumer Law lists a number of factors for a court to consider when assessing whether conduct is unconscionable.

They include:

  • the relative bargaining strength of the parties
  • whether the weaker party could understand the documentation used
  • the use of undue influence, pressure or unfair tactics by the stronger party
  • whether any conditions were imposed on the weaker party that weren't necessary to protect the stronger party's legitimate interests
  • the willingness of the stronger party to negotiate
  • the extent to which the parties acted in good faith.

This is not an exhaustive list, and courts may also consider any other factor they think relevant.

Case studies

  1. Business-to-business: Beacon Products and Zandox Group used unsolicited telemarketing to pressure small businesses into buying printer cartridges and cleaning products they did not request or need. The businesses’ conduct targeted small businesses, made false representations about order confirmation and customers’ right to return unwanted goods, and accepted payment from those who had not agreed to purchase. The conduct of these two companies was unconscionable, misleading and deceptive. (ACCC v Beacon Products Pty Ltd, Zandox Group Pty Ltd & Warren Skry).
  2. Business-to-consumer: Captain Cook College was found to have used misleading and unfair enrolment practices to sign students up to government-funded diploma courses. The College deliberately removed consumer safeguards from its enrolment and withdrawal processes, which resulted in thousands of students incurring substantial debts, despite the fact they were not engaging with their courses. This conduct exploited vulnerable consumers and created an unfair power imbalance, making the conduct systemically unconscionable. (ACCC v Captain Cook College).

Learn more about unconscionable conduct.