ACCC wins Lux unconscionable conduct appeal

In a significant decision with implications for all businesses, the Full Federal Court has allowed an appeal by the Australian Competition and Consumer Commission (ACCC) in its case against Lux Distributors Pty Ltd (Lux), a seller of vacuum cleaners. In doing so, the Full Court has provided a measure of clarity on the prohibition against unconscionable conduct in the Australian Consumer Law (ACL).

The approach taken by the Full Federal Court may well have implications not only for business-to-consumer agreements, but also to business-to-business arrangements.

UNCONSCIONABLE CONDUCT UNDER THE ACL AND THE ACCC'S ALLEGATIONS

Section 21 of the ACL provides that a person must not, in trade or commerce, in connection with the supply of goods or services to another person, engage in conduct that is, in all the circumstances, unconscionable.