It is unlawful to make false or misleading representations about goods and services when supplying, offering to supply or promoting those goods or services.
For instance, a business must not make false or misleading representations about:
- the standard, quality, value or grade of goods or services;
- the composition style, model or history of goods;
- whether the goods are new;
- a particular person agreeing to acquire goods or services;
- testimonials by any person relating to goods or services;
- the sponsorship, approval, performance characteristics, accessories, benefits and uses of goods or services;
- the price of goods or services;
- the availability of repair facilities or spare parts;
- the place of origin of a product - for example, where it was made or assembled;
- a buyer's need for the goods or services; and
- any guarantee, warranty or condition on the goods or services.
Courts have found false and misleading representations in these cases:
- a manufacturer sold socks, which were not pure cotton, labelled as ‘pure cotton’;
- a retailer placed a label on garments showing a sale price and a higher, crossed-out price. However, the garments had never sold for the higher price;
- a business made a series of untrue representations about the therapeutic benefits of negative ion mats it sold; and
- a motor repairer told a customer more repair work was needed on their car than was necessary.
What are false or misleading representations?
Whether a representation is considered false or misleading will depend on the circumstances of each case, and what misleads one group of consumers may not necessarily mislead others.
Example:
People concerned about their body image may be more vulnerable to products claiming to enhance beauty. Whether a representation about a beauty product was misleading would depend on whether it would mislead a reasonable person within this group.
A representation can be misleading even if it is true or partly true.
Example:
On the front of their product packaging, a business claimed their batteries lasted as long as those of two other competitors. The claim was supported by tests, but only against some (not all) of the competitors’ batteries. This was explained on the back of the packaging. A court found the message on the front of the packaging had misled consumers, even though there was a clearer message on the back of the packaging.