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Misleading and deceptive conduct explained

You might have come across the phrase ‘misleading or deceptive conduct’ before and wondered what it meant in the legal world. The answer lies in section 18 of the Australian Consumer Law:

A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

But where is the line drawn? When does advertising stop being merely creative and become deceptive? And what can you do if you have been led astray?

What is “conduct?”

Misleading and deceptive conduct is not limited to the supply of goods or services, but covers a wide range of business activities like advertisements and contractual arrangements. “Conduct” can also mean doing something or refusing to do something. It can include messages in advertisements, media statements, or even statements by an individual representing your business.

Was the conduct misleading or deceiving?

When deciding whether conduct falls foul of section 18, the key question is whether an ordinary or reasonable person would have been misled or deceived by the statement.

According to the Australian Competition and Consumer Commission (ACCC), it doesn’t matter if the person made the false or misleading statement intentionally or not. It is also irrelevant if the person complaining was actually misled or deceived.

One example of false and misleading claims is if your business makes inaccurate statements about the quality of your products or the benefits of your services.

Who can be liable under section 18?

An individual or a company can be pursued under section 18 for making misleading and deceptive statements. A person making misleading statements as a representative of a business can also be liable.

What remedies are available?

There are a few different outcomes for a successful claim under section 18. A person who makes a claim may recover the losses and damages they suffered as a result of the deceptive conduct. The company or individual may also be ordered to compensate the person who brought the claim.

Ultimately, as a consumer, you have a right not to be fed false, misleading or inaccurate information about the products, services or goods you are purchasing. If you have, the Australian Consumer Law is here to make sure those responsible for leading you astray are held to account.

Written by Shine Lawyers. Last modified: March 9, 2021.

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