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Fair Trading Act 1986

Unfair conduct - Unfair contract terms

26A: Unfair contract terms in standard form consumer contracts

You could also call this:

"What happens to unfair terms in consumer contracts"

Illustration for Fair Trading Act 1986

If a court decides a term in a standard form consumer contract is unfair, you must not include that term in a new contract. You also must not apply, enforce, or rely on that unfair term in a contract. This rule does not apply to contracts made before this law started, but it does apply if you change or renew the contract after this law started. If you have a contract of insurance made before this law started, the rule about unfair terms does not apply to that contract or any changes to it. It also does not apply if you renew the contract or make a new one that is like a renewal. You can find out what a contract of insurance is by looking at section 7 of the Insurance (Prudential Supervision) Act 2010. If a court has already decided a term is unfair under section 46I, you need to follow the court's decision when you include that term in a contract.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6410735.

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Topics:
Money and consumer rights > Consumer protection
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26B: Unfair contract terms in standard form small trade contracts, or

"Rules about unfair parts in small business contracts"

Part 1Unfair conduct
Unfair contract terms

26AUnfair contract terms in standard form consumer contracts

  1. If a court has declared, under section 46I, that a term in a standard form consumer contract is an unfair contract term, a person must not—

  2. include the unfair contract term in a standard form contract (unless the term is included in a way that complies with the terms (if any) of the decision of the court); or
    1. apply, enforce, or rely on the unfair contract term in a standard form contract.

      1. The prohibitions in subsection (1) do not apply to any contract entered into before this section comes into force; but if the contract is varied or renewed on or after this section comes into force, the contract must be treated as a new contract for the purposes of subsection (1).

      2. However, in the case only of a contract of insurance (as defined in section 7 of the Insurance (Prudential Supervision) Act 2010) entered into before this section comes into force, the prohibitions in subsection (1) do not apply to—

      3. the contract; or
        1. any variation of the contract; or
          1. any new contract that has the effect of operating as a renewal of the contract, and any subsequent renewal.

            Notes
            • Section 26A: inserted, on , by section 14 of the Fair Trading Amendment Act 2013 (2013 No 143).