The Australian Competition and Consumer Commission has acted to protect the interests of an intellectually impaired couple who, the ACCC alleges, have been subject to unconscionable conduct and undue harassment over the sale of a vacuum cleaner.
The ACCC has instituted legal proceedings against Lux Pty Ltd and one of its door-to-door sales agents, Mr Dennis Podger, alleging that, in securing the sale of a Lux vacuum cleaner to an intellectually impaired couple, they engaged in unconscionable conduct and also used undue harassment or coercion.
The couple, who currently live in Western Australia, are unable to read or write other than simple words and their respective names and are intellectually disabled such that they cannot understand basic contracts.
The ACCC alleges that in August 1999, Podger called upon the woman when she was alone at her then residence in Port Pirie South Australia and, in seeking to secure the sale for a new top of the range Lux vacuum cleaner,:
- repeatedly stated to the woman that her existing vacuum cleaner was going to blow up, or words to that effect;
- stood in close and prolonged physical proximity to her;
- repeatedly urged her to buy a new vacuum cleaner despite being told that she did not want to buy a new cleaner;
- made no indication that he would leave;
- did not explain the conditions of the contract to her, despite being told by her that she could not read or write;
- in response to being told that she could not read or write, Mr Podger claimed that "You don't need to read it, just sign it" or words to that effect; and
- failed to inform her of the relevant cooling off period that is applicable in such transactions.
The ACCC also alleges that it was, or ought to have been evident, to Lux, through its agent Mr Podger, that the woman was:
- intellectually disabled and illiterate such that she could not understand contracts;
- unable to make a voluntary, alternatively worthwhile, judgement as to whether purchasing the Lux vacuum cleaner would be in her or her husband's best interests; and
- threatened by Mr Podger's presence and persistence.
Although the couple signed the contract to buy the vacuum cleaner in August 1999, they have not made, as yet, any payments to Lux. The ACCC is seeking:
- declarations that Lux engaged in unconscionable conduct in contravention of s51AB of the Act and also engaged in undue harassment or coercion in contravention of s60 of the Act and that Mr Podger was a party to those contraventions;
- injunctions restraining Lux and Mr Podger from securing, or seeking to secure, sales from consumers where there is a belief that the consumers may not have the capacity make an informed decision as to the implications and benefits or otherwise on entering into a contract, and
- injunctions restraining Lux and Mr Podger from securing, or seeking to secure, sales from consumers by using persistent urging or maintaining a prolonged close physical presence to the consumer in respect of whom there is a belief that the consumers may not have the capacity make an informed decision as to the implications and benefits or otherwise on entering into a contract;
- that Lux to publish a corrective advertisement in a major daily newspaper in each capital city;
- that Lux to implement a trade practices compliance program; and
- a declaration that the contract between Lux and the couple is void ab initio.