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Friday, 12 July 2013

What is misleading or deceptive conduct?

"Misleading or deceptive conduct" is a term of major importance in relation to all businesses' dealings with other parties. 

Its prohibition can be found in the Australian Consumer Law (which is contained in the Competition and Consumer Act) and the various State and Territory Fair Trading Acts, which prohibit businesses from engaging in misleading or deceptive conduct in trade or commerce.
Conduct will be misleading or deceptive if it induces error, or is capable of inducing error, in an ordinary reasonable person.  When determining whether conduct is misleading or deceptive:
  • it is the overall impression that counts;
  • the dominant message is the most important, not the "fine print".  
Misleading or deceptive conduct can consist of spoken or written words or any other conduct such as gestures, body language or even silence or lack of response. A company can engage in misleading or deceptive conduct by reason of the actions of its officers, employees or agents.

Conduct can give rise to liability even if:
  • it has not actually misled anyone.  All that is necessary is that the conduct is likely to mislead or deceive people;
  • the person making the representation acted honestly and reasonably.  All that is necessary for liability to arise is that the conduct did, in fact, mislead or deceive; and
  • the affected person did not make proper inquiries, or could have discovered that the conduct was misleading or deceptive had they investigated the matter.
  • The above definition is quoted from website Australia Gvt small business

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