Fair Trading Act 1986

Enforcement and remedies - Declaration of unfair contract terms

46M: Examples of unfair contract terms

You could also call this:

“List of ways a contract can be unfair to one person”

This section of the Fair Trading Act 1986 gives examples of terms that might be unfair in a consumer contract or small trade contract. These are terms that:

Let one party avoid or limit doing what the contract says, but not the other party.

Allow one party to end the contract, but not the other party.

Punish one party for breaking or ending the contract, but not the other party.

Let one party change the contract terms, but not the other party.

Give one party the choice to renew the contract or not, but not the other party.

Allow one party to change the price without letting the other party end the contract.

Let one party change what goods or services they provide, or change details about land being sold, without the other party’s agreement.

Allow one party to decide if the contract has been broken or what it means, without the other party’s input.

Limit one party’s responsibility for people working for them.

Let one party give the contract to someone else in a way that hurts the other party, without asking them first.

Limit one party’s right to take the other party to court.

Limit what evidence one party can use if there’s a problem with the contract.

Make one party responsible for proving things if there’s a dispute about the 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=DLM6410749.

Topics:
Business > Fair trading
Money and consumer rights > Consumer protection

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“When a contract term is not fair to one side”


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Part 5 Enforcement and remedies
Declaration of unfair contract terms

46MExamples of unfair contract terms

  1. Without limiting section 46I, the following are examples of the kind of terms that, if in a consumer contract or small trade contract, may be unfair contract terms:

  2. a term that permits, or has the effect of permitting, one party (but not another party) to avoid or limit performance of the contract:
    1. a term that permits, or has the effect of permitting, one party (but not another party) to terminate the contract:
      1. a term that penalises, or has the effect of penalising, one party (but not another party) for a breach or termination of the contract:
        1. a term that permits, or has the effect of permitting, one party (but not another party) to vary the terms of the contract:
          1. a term that permits, or has the effect of permitting, one party (but not another party) to renew or not renew the contract:
            1. a term that permits, or has the effect of permitting, one party to vary the upfront price (as defined in section 46K(2)) payable under the contract without the right of another party to terminate the contract:
              1. a term that permits, or has the effect of permitting, one party unilaterally to vary the characteristics of the goods or services to be supplied, or the interest in land to be sold or granted, under the contract:
                1. a term that permits, or has the effect of permitting, one party unilaterally to determine whether a contract has been breached or to interpret its meaning:
                  1. a term that limits, or has the effect of limiting, one party's vicarious liability for its agents:
                    1. a term that permits, or has the effect of permitting, one party to assign the contract to the detriment of another party without that other party's consent:
                      1. a term that limits, or has the effect of limiting, one party's right to sue another party:
                        1. a term that limits, or has the effect of limiting, the evidence one party can adduce in proceedings relating to the contract:
                          1. a term that imposes, or has the effect of imposing, the evidential burden on one party in proceedings relating to the contract.
                            Notes
                            • Section 46M: inserted, on , by section 36 of the Fair Trading Amendment Act 2013 (2013 No 143).
                            • Section 46M: amended, on , by section 19 of the Fair Trading Amendment Act 2021 (2021 No 32).