1. What is compliance? Complete a research essay setting out the key areas of law and compliance in Australia.
2. Discuss the different areas of law.
Thus, the manager is liable under section 18 of the Australian Consumer law and section 54 of the Australian Consumer law which talks about misleading and deceptive conduct and guarantee to be in acceptable condition respectively (Latimer 2012). However, in the said case, the advertisement by Manny and Bella in which they changed the name of the oven they ordered was also misleading and deceptive and could attract the section 18 of the Australian Consumer laws.
Compliance is a vital part of conducting and managing a successful business in any country in the world. Compliance in relation to the business world is a term which refers to confirmation that a manufacturer, supplier or an individual in charge of a business or a company fulfills and meets all the requirements which are wither established legislation, common business usages and practices , specified standards, rules and regulations set by the government or terms of a contract (Vom Brocke and Rosemann 2010). Thus, in the present time, with the always increasing rules and legislations, compliance is become an important aspect which requires regular check irrespective the type of business one is running.
The basic purpose of introduction compliance in the business world was to make the corporate and business houses act responsibly. Thus, what compliance demands is that an individual who operates and manages a business initially identifies all the state and national laws that apply to his business along with identification of all the risks and legal issues which can be attached to the said business one is operating. Therefore, after all the said aspects are identifies one can plan for a compliance program or a strategy which is most suitable for the particular business however, the said policy requires regular checks and efficient trained employees who are well aware of the compliance regulations (El Kharbili 2012). Thus, having an intact compliance policy has many benefits to a business which include building a good reputation for the business and increase in its productivity. However, the consequences of non-compliance of rules, requires standards and legislation can be extreme like heavy penalties which can also include the state forcing the company to dissolve. The compliance in Australia is very strict and requires every business and company operative in Australia to be on a check as the penalties for non compliance are really huge. The basic legislations which require compliance in Australia are Consumer laws, Property laws, Sales of Goods Act and Intellectual property laws.
Thus, in the present case, I run a seafood restaurant in Sydney with my family. Thus, the property in which the said restaurant is build is a property which I own in joint tenancy with my wife and the said property is held by me as a freehold estate (Ghanavati, Amyot and Peyton 2011). Under the Australian Property Law, property is divided into two parts which is real property and personal property. The real property is termed for all such property which is owned in the form of land or things attached to the land. However, personal property is property which one owns in the form of chattels and intangibles. Thus, it is evident that under the Australia Property law, property refers to the legal right more than owning a thing. I have legal interest in the property in which I have build my restaurant. Thus, the said means that I have completed and fulfilled all the legal formalities established by the statute and common law in Australia. Thus, having ownership over a land or property gives one the authority to exercise all the legal rights available, thus as I own the said land under freehold estate as fee simple, it gives me exclusive right over the land which means I have most extensive legal interest in the said land (Bridge 2015). Owning a property in fee simple allows one to do as wished with the said land like sell, mortgage, lease, will or transfer the said interests. Moreover, the said property is owned by me in joint tenancy with my wife. Thus, according to the Australian Property Law, joint tenancy is termed to be a special kind of ownership where two or more people own the same property. Thus, the owners of the said property are called joint tenants and have equal share in the ownership along with an equal and undivided authority and right to either keep or dispose the property. Joint tenancy creates right of survivorship which means that if one of the co-owner dies, the remaining property passes on the surviving owner. This law makes it most ideal for couples to own a property in joint tenancy (MacDonald et al 2010).
When it comes to running a seafood restaurant business in Sydney, one has to keep check about the consumer laws which are applicable in the said state of Australia. Many consumer laws will be attracted in case a restaurant is serving unsafe and unhealthy food (Shopping 2013). Thus, with the introduction of Australian Consumer Laws on 1 January 2011, a single statute for consumer proportion was created that applies to the whole of Australia. According to the Australian Consumer Laws, a consumer is an individual who acquires goods and services that either cost $40,000 or less or are acquired for household a domestic purposes. Section 29(1)(a)(b) of the Australian Consumer Law state that the standard and quality of all the goods and services rendered by a service provider needs to be of acceptable quality (Bradbrook et al 2011). Section 54 of the Australian Consumer Laws guarantees which states that a product which is supplies or a service which is rendered is automatically considered to be of acceptable quality and failing to do the same, the violation attracts many penalties.
I have recently decided to call our seafood restaurant as “Good Catch”. Thus, we wish to protect the name of our restaurant under the intellectual property laws in Australia. Any exclusive right which an individual acquires over any work or thought or name or logo which has been created by his intellectual idea or effort is allowed to be protected under the intellectual property laws (Solomon, Russell-Bennett and Previte 2012). Thus, I wish to protect the name and logo of my seafood restaurant as a protected and registered trade mark. Trade mark is a sign which is maintained to distinguish the goods and services provided by a particular manufacturer or service provider in the course of business and trade. The sign which are trademarked include letters, words, signatures, names, logos, labels, brands, tickets, etc. Trade mark can be obtained for things like color, packaging, size, shape and sound too. The usual practice is that business names and logos are protected as trademarks which require compulsory registration. In case, any individual infringe someone’s registered trademark, heavy penalties are attracted.
Therefore, the compliance with consumer laws, intellectual property laws and property laws is very vital for the successfully running of any business. In case any of these laws are not complied with, the owner of the business suffers from penalties which affect the cost of the business and reduces profit margins. Thus, every business, irrespective of nature is required to comply with the statutory laws and statutes of Australia before incorporating a company or business in Australia.
In the present case, Manny and Bella, a married couple and are running a pizza business called the Perfect Domino Pizza since 2008. They felt the need of a new oven for their business and visited the showroom of Tuscan Ovens Pty. Ltd to purchase a new pizza oven. Both Manny and Bella asked the manager at Tuscan Ovens Pty. Ltd to provide them a pizza oven which is a heavy duty oven with cooking capacity of at least 30 pizzas every hour for sixteen continuous hours every day. The manager was told that if the oven did not satisfy the said need, many customers would be lost in peak hours. Thus, hearing the requirements the manager assures Manny and Bella that the new Tuscan XX commercial oven will satisfy their requirements. Thus, relying on the manager’s statement and recommendation, Manny and Bella purchased the said oven for $15,000.
While, Manny and Bella were still awaiting their new oven, they advertised the same with a different name in their restaurant calling it MB Oven and not mentioning it as its real registered name which was Tuscan XX commercial oven. However, when the new oven was installed, Manny and Bella soon realized that the said oven can only cook 12 pizzas in an hour and it’s highly unreliable. Eventually, Manny and Bella also started losing money in their pizza business due to inefficient pizza oven. Thus, the issue in the said case is whether the Tuscan Ovens Pty. Ltd is liable for wrongfully selling the oven to Manny and Bella under consumer protection laws in Australia (Corones 2013).
On 1 January 2011 the consumer laws in Australia were all made uniform under one single statute called the Australian Consumer Laws. . According to the Australian Consumer Laws, a consumer is an individual who acquires goods and services that either cost $40,000 or less or are acquired for household a domestic purposes. Section 18 found in schedule 2 of the Competition and Consumer Act 2010 talks about misleading and deceptive conduct by a seller, retailer or a service provider (Farrington and Palfreyman 2012). Thus, the said section restricts and prohibits conduct by corporations in relation to trade and commerce which are misleading or deceptive or likely to be so. Thus, misrepresentation of facts, true facts that give wrong impression and failure to disclose material facts and information about the product or service sold attracts the said provision.
In a famous case called Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd, plaintiff brought a lease from defendant to run a restaurant which was illegally operative as it seated more people than licensed (Schwartz 2012). However, the plaintiff was allowed to believe that the said unlicensed seating is legal. However, the plaintiff realized the true nature of the license being illegal only after the lease agreement was completed. Thus, the judgment in the said case was in favor of plaintiff and the judge stated that misleading or deceptive conduct generally consists of representations, irrespective of the fact whether it’s expressed or by silence. In the said case, the plaintiff has to just prove that he relied on the said representation to close the agreement which was misleading and deceptive (Turconi et al 2011). Thus, keeping in mind the above discussed judgment, the manger of Tuscan Ovens Pty. Ltd needs to keep in mind that misleading and deceptive facts are in violation of Competition and Consumer Act 2010 and the Courts never appreciate and duly punish the said conduct.
Moreover, advertising which is misleading and deceptive is also covered under the section 18 of the Australian Consumer Laws. Any advertisement published by a manufacturer, retailer or a service provided which is untrue, misleading or gives wrongful impression and information about facts is also covered under section 18 of the Australian Consumer Laws. Thus, this makes it illegal to publish advertisements about goods and services which are not intended to be provided in the manner in which it is advertised (Crosbie and Glantz 2012).
Thus, in the said case, Manny and Bella were willing to buy a heavy duty pizza oven which could make 30 pizzas at a time and work continuously for 16 hours in a day. On mentioning their said requirement to the manager of Tuscan Ovens Pty. Ltd, the manager introduced them to the new Tuscan XX commercial oven which was guaranteed by the manager to satisfy their requirements (Maskus 2012). However, after the said pizza oven was installed, Manny and Bella realized that the said pizza oven only cooked 12 pizzas at a time and was highly unreliable eventually leading to monetary and business loss in Manny and Bella’s pizza business. Thus, Manny and Bella are entitled to sue the manager of Tuscan Ovens Pty. Ltd long with the said company for selling their product with a conduct which is misleading and deceptive in nature. Thus, the statement made by the manager of Tuscan Ovens Pty. Ltd that the oven sold to Manny and Bella could make 30 times at a time when it could just make 12 pizzas was misleading and deceptive in nature and violated the guarantee which customers have automatically after a statement is made that the said statement while negotiation should be satisfied with the goods sold (Kolivos and Kuperman 2012). Thus, the oven in the said case has an automatic guarantee which required it to make 30 pizzas at a time. The fact that it failed to do so makes the manager and the company selling the said oven liable under consumer protection laws in Australia.
Reference List
Bradbrook, A.J., MacCallum, S.V., Moore, A.P., Grattan, S. and Griggs, L.D., 2011. Australian property law: cases and materials.
Bridge, M., 2015. Personal property law. OUP Oxford.
Corones, S.G., 2013. The Australian Consumer Law. Thomson Reuters, Lawbook Co..
Crosbie, E. and Glantz, S.A., 2012. Tobacco industry argues domestic trademark laws and international treaties preclude cigarette health warning labels, despite consistent legal advice that the argument is invalid. Tobacco control, pp.tobaccocontrol-2012.
El Kharbili, M., 2012, January. Business process regulatory compliance management solution frameworks: A comparative evaluation. In Proceedings of the Eighth Asia-Pacific Conference on Conceptual Modelling-Volume 130(pp. 23-32). Australian Computer Society, Inc.
Farrington, D. and Palfreyman, D. eds., 2012. The law of higher education. OUP Oxford.
Ghanavati, S., Amyot, D. and Peyton, L., 2011, August. A systematic review of goal-oriented requirements management frameworks for business process compliance. In Requirements Engineering and Law (RELAW), 2011 Fourth International Workshop on (pp. 25-34). IEEE.
Kolivos, E. and Kuperman, A., 2012. Consumer law: Web of lies-legal implications of astroturfing. Keeping good companies, 64(1), p.38.
Latimer, P., 2012. Australian Business Law 2012. CCH Australia Limited.
MacDonald, C., McCrimmon, L., Wallace, A. and Weir, M., 2010. Real property law in Queensland.
Maskus, K.E., 2012. Strengthening intellectual property rights in Asia: Implications for Australia. Welcome to the electronic edition of Australia’s Economy in its International Context, volume 2. The book opens with the bookmark panel and you will see the contents page/s. Click on this anytime to return to the contents. You can also add your own bookmarks., p.409.
Schwartz, M.S., 2012. The state of business ethics in Israel: A light unto the nations?. Journal of business ethics, 105(4), pp.429-446.
Shopping, I.H., 2013. Consumer. Retailer, and Manufacturer Incentives to Participate in Electronic Marketplaces.
Solomon, M., Russell-Bennett, R. and Previte, J., 2012. Consumer behaviour. Pearson Higher Education AU.
Turconi, S., Rentocchini, G., Manchala, S., Khimasia, M., Glass, A., De Fanti, J. and Braken, R., 2011. Intellectual property protection: Problems and prospects for China.
Vom Brocke, J. and Rosemann, M., 2010. Handbook on business process management. Heidelberg: Springer.
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