Unfair contract terms may be void if they are found to be unfair from 12 November 2016.
From that date Section 23(1) of the Australian Consumer Law will provide that a term of a consumer contract or small business contract will be void if the term is unfair and the contract is a standard form contract.
This will no doubt apply to many franchise agreements.
The main purpose of the provision appears to be to remedy any perceived imbalance of bargaining power.
Franchisors should review their standard form franchise agreements prior to entering into any new franchise agreements after 12 November 2016.
If one (1) party alleges that the contract is a standard form contract, then it will be assumed to be a standard form contract unless the other party can establish otherwise.
This article is for information purposes only and should not be relied upon as legal advice. You must obtain your own legal advice with respect to your specific set of circumstances. You can contact The Franchise & Business Lawyers directly to obtain advice particular to your needs.
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