As a consumer you probably enter a number of contracts every day on-line or in a store – even if you do not realise it.
For example every time you hire a car, join a gym or sign up for a mobile phone plan you are entering a contract. The Fair Trading Act helps us protect you against unfair terms in standard form consumer contracts.
If the contract is for goods or services that you would normally acquire for personal or domestic use, then it is likely to be a standard form consumer contract.
If you have little or no opportunity to negotiate the terms of the contract with the business then it is likely to be a standard form consumer contract. You may be offered a contract on a "take it or leave it" basis. The contract is likely to be the same as, or similar to, the contracts the business offers to other customers.
The Commerce Commission can take action to stop a business using an unfair term in a standard form consumer contract. If a court declares the term to be unfair then it will not be legally binding on you.
Only the Commission can apply to the court to have a term declared unfair.
How can I tell if a term in my contract might be unfair?
Generally terms are unfair if it puts you at an unfair disadvantage by creating a significant imbalance in the rights and obligations between you and the business, if it would cause you detriment if the business relied on it and if the term is not reasonably necessary to protect the businesses needs. Terms that are unclear or hidden are more likely to be unfair than terms that are upfront and written in plain language.
Some terms cannot be declared unfair, namely those describing the main subject matter and setting the price. There is also an exemption for terms which are required or expressly permitted by law. To find out more read our guidance.
Standard form consumer contract examples
Standard form consumer contracts are common in many industries, including:
daily deal or coupon specials
events and entertainment
motor vehicle sales
online and mobile apps and software
rental of appliances or goods
residential tenancy and real estate
travel and tourism (such as airfares, rental cars and tours)
utilities, such as electricity or gas services.
If you wish to contact us with a complaint about a potentially unfair contract term, you can call us on 0800 943 600 or make a complaint online.