(1) If there is a default in payment under a consumer lease and the regulations prescribe a way of working out a limit on the amount that may be recovered for the default, the lessor must not recover more than the limit for the default.
Civil penalty: 5,000 penalty units.
(2) Any provision of the lease that confers a greater right is void to the extent that it does so. If an amount is in fact recovered in excess of this limitation, it may be recovered back.
(3) This section does not apply to enforcement expenses.
Note: Section 179R deals with enforcement expenses.
Subdivision D—Postponement of enforcement proceedings
179H Postponement of exercise of rights
Postponement request
(1) A lessee who has been given a default notice under section 179D may, at any time before the end of the period specified in the notice, request (a postponement request), orally or in writing, that the lessor negotiate a postponement of:
(a) the enforcement proceedings; or
(b) any action taken under such proceedings; or
(c) the operation of any applicable acceleration clause.
Lessor’s notice about postponement
(2) If the lessee gives the postponement request, the lessor must, within 21 days after the day of receiving the request, give the person a written notice:
(a) that states whether or not the lessor agrees to negotiate a postponement; and
(b) if the lessor does not agree to negotiate—that states:
(i) the name of the AFCA scheme; and
(ii) the person’s rights under that scheme; and
(iii) the reasons for not agreeing to negotiate.
Criminal penalty: 30 penalty units.
Enforcement proceedings
(3) If the lessee gives the postponement request, the lessor must not begin enforcement proceedings unless:
(a) the lessor has given the lessee a notice under subsection (2) in response to the postponement request; and
(b) the period of 14 days, starting on the day the lessor gives the notice under subsection (2), has expired.
Criminal penalty: 50 penalty units.
Note: The lessor must allow the lessee at least 30 days from the date of the default notice to remedy the default—see section 179D. The 14‑day period in subsection (3) may end before, at the same time as, or after the end of the period for remedying the default specified in the default notice.
(4) However, the lessor may take possession of goods hired under the consumer lease if the lessor reasonably believes that:
(a) the lessee has removed or disposed of the goods, or intends to remove or dispose of them; or
(b) urgent action is necessary to protect the goods.
Strict liability
(5) Subsections (2) and (3) are offences of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
179J Effect of negotiated postponement
(1) A default notice under section 179D is taken, for the purposes of this Code, not to have been given if a postponement is negotiated with the lessor under section 179H and the lessee complies with the conditions of postponement.
(2) A lessor must give written notice of the conditions of a postponement referred to in subsection (1) not later than 30 days after agreement is reached on the postponement. The notice must set out the consequences under subsection (5) if the conditions of the postponement are not complied with.
Criminal penalty: 100 penalty units.
(3) Subsection (2) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
(4) A lessor that is required to give notice under section 177A (which deals with changes to leases by agreement) in relation to a postponement is not required to comply with subsection (2).
(5) If any of the conditions of a postponement are not complied with, a lessor is not required to give a further default notice under this Code to the lessee with whom the postponement was negotiated before proceeding with enforcement proceedings.
179K Postponement by court
(1) If the lessee is unable to negotiate a postponement, the lessee may apply to the court for a postponement.
(2) After allowing the applicant and the lessor a reasonable opportunity to be heard, the court may:
(a) order the postponement to which the application relates; or
(b) refuse to order the postponement; or
(c) make such other orders as it thinks fit.
(3) The court may, if it thinks it appropriate in the circumstances, stay any enforcement proceedings under the consumer lease until the application has been determined.
179L Lessor may apply for variation of postponement order
(1) A lessor that is subject to an order under this Subdivision may apply to the court for variation of the order.
(2) On such an application, the court may:
(a) vary the order to which the application relates as it thinks fit; or
(b) refuse to vary the order; or
(c) revoke the order.
Subdivision E—Enforcement procedures for goods hired under a consumer lease
179M Information as to location of goods hired under a consumer lease
(1) A lessor may, by written notice to a lessee, require the lessee to inform the lessor, within 7 days after the day the notice is given to the lessee, where the goods hired under the consumer lease are and, if the goods are not in the lessee’s possession, to give the lessor all information in the lessee’s possession that might assist the lessor to trace the goods.
(2) A lessee who contravenes a notice under this section commits an offence.
Criminal penalty: 50 penalty units.
(3) Subsection (2) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
179N Entry to residential property to take possession of goods
(1) A lessor, or an agent of a lessor, must not enter any part of premises used for residential purposes for the purpose of taking possession of goods hired under a consumer lease unless:
(a) the court has authorised the entry; or
(b) the occupier of the premises has, after being informed in writing of the provisions of this section, consented in writing to the entry.
(2) The regulations may provide for procedures for the obtaining and giving of consent for the purposes of this section and may set out the circumstances in which consent is or is not taken to have been given.
(3) If premises are entered in contravention of this section by a lessor or an agent of a lessor, the lessor commits an offence.
Criminal penalty: 50 penalty units.
(4) Subsection (3) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
179P Court may order entry
The court may, on the application of a lessor that is entitled to take possession of goods hired under a consumer lease, authorise the lessor to enter residential premises for the purpose of taking possession of the goods.
179Q Order for possession
(1) The court may, on the application of a lessor that is entitled to take possession of goods hired under a consumer lease, order a person who has possession of the goods to deliver them to the lessor:
(a) at a specified time or place; or
(b) within a specified period.
(2) The court may, on the application of a lessor or other person required to deliver goods to a lessor, by order vary the place at which or time or period within which goods must be delivered to the lessor.
(3) A person who contravenes an order under this section commits an offence.
Criminal penalty: 30 penalty units.
(4) Subsection (3) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
Subdivision F—Enforcement expenses
179R Recovery of enforcement expenses
(1) A lessor must not recover or seek to recover enforcement expenses from a lessee in excess of those reasonably incurred by the lessor. Enforcement expenses of a lessor extend to those reasonably incurred by the use of the staff and facilities of the lessor.
(2) Any provision of the consumer lease that appears to confer a greater right is void. If enforcement expenses are in fact recovered in excess of this limitation, they may be recovered back.
(3) If there is a dispute between the lessor and the lessee about the amount of enforcement expenses that may be recovered by the lessor, the court may, on application by any of the parties to the dispute, determine the amount of that liability.
Division 9—Linked lessors and tied consumer leases
Subdivision A—Interpretation and application
179S Linked lessors and tied consumer leases
(1) For the purposes of this Code, a linked lessor of a supplier means a lessor:
(a) with whom the supplier has a contract, arrangement or understanding relating to:
(i) the supply to the supplier of goods in which the supplier deals; or
(ii) the business carried on by the supplier of supplying goods; or
(iii) the provision to persons of a consumer lease for the hire of goods supplied by the supplier to the lessor; or
(b) to whom the supplier, by arrangement with the lessor, regularly refers persons for the purpose of being provided with a consumer lease; or
(c) whose forms of contract or forms of application or offers for a consumer lease are, by arrangement with the lessor, made available to persons by the supplier; or
(d) with whom the supplier has a contract, arrangement or understanding under which applications for a consumer lease or offers to be provided with a consumer lease from the lessor may be signed by persons at the premises of the supplier.
(2) A tied consumer lease is a consumer lease entered into between a lessor and a lessee where:
(a) the lessee enters into the lease to hire goods supplied by the supplier to the lessor; and
(b) at the time the lease is entered into the lessor is a linked lessor of the supplier.
Subdivision B—Liability of lessors for suppliers’ misrepresentations
179T Lessor liable for supplier’s misrepresentations about hired goods
(1) If there is a tied consumer lease, any representation, warranty or statement made (whether orally or in writing) by the supplier, or any person acting on behalf of the supplier, to the lessee in relation to:
(a) goods hired under the lease; or
(b) the lease; or
(c) services, supplied or arranged by the lessor, that are incidental to the hire of goods under the lease;
gives the lessee the same rights against the lessor as the lessee would have had if it had been made by the lessor.
(2) Without prejudice to any other rights or remedies to which a lessor may be entitled, a lessor is entitled to be indemnified by the person who made the representation, warranty or statement, and any person on whose behalf it was made, against any damage suffered by the lessor through the operation of this section.
Division 10—Conduct relating to consumer leases
179U False or misleading representations
(1) A person must not make a false or misleading representation:
(a) in relation to a matter that is material to entry into a consumer lease or a related transaction; or
(b) in attempting to induce another person to enter into a consumer lease or a related transaction.
Civil penalty: 5,000 penalty units.
(1A) A person commits an offence if:
(a) the person is subject to a requirement under subsection (1); and
(b) the person engages in conduct; and
(c) the conduct contravenes the requirement.
Criminal penalty: 50 penalty units.
(2) For the purposes of subsections (1) and (1A), it is a defence if a person charged proves that he or she reasonably believed that the representation was not false or misleading.
(3) A person who suffers loss as a result of a contravention of this section by another person may recover the amount of the loss from:
(a) that other person; or
(b) any other person involved in the contravention.
179V Harassment
(1) A lessor or supplier must not harass a person in attempting to get that person to:
(a) apply for a consumer lease; or
(b) enter into a consumer lease or a related transaction.
Civil penalty: 5,000 penalty units.
(2) A person commits an offence if:
(a) the person is subject to a requirement under subsection (1); and
(b) the person engages in conduct; and
(c) the conduct contravenes the requirement.
Criminal penalty: 100 penalty units.
179VA Canvassing of consumer leases for household goods
Requirement
(1) A lessor must not make, or arrange for the making of, an unsolicited communication to consumer if:
(a) the communication is for the purpose of inducing the consumer to apply for, or obtain, a consumer lease for household goods; and
(b) when the consumer receives the communication, the consumer is in the physical presence of the lessor or the person making the communication; and
(c) when the consumer receives the communication, the consumer is in:
(i) a public place; or
(ii) a place that is not a business premises of a business of the lessor; or
(iii) a stall that is being used by the lessor or by the person making the communication; or
(iv) an aircraft, vehicle or vessel that is being used by the lessor or by the person making the communication.
Offence
(2) A person commits an offence if:
(a) the person is subject to a requirement under subsection (1); and
(b) the person engages in conduct; and
(c) the conduct contravenes the requirement.
Criminal penalty: 100 penalty units.
Strict liability offence
(3) A person commits an offence of strict liability if the person contravenes subsection (1).
Criminal penalty: 10 penalty units.
Loss of certain amounts
(4) If:
(a) a lessor makes, or arranges for the making of, an unsolicited communication to a consumer in contravention of subsection (1); and
(b) the lessor enters into a consumer lease for household goods with that consumer within 30 days after that unsolicited communication is made;
then:
(c) the consumer is not liable (and is taken never to have been liable) to pay any amount under that consumer lease that exceeds the base price of the goods hired under that consumer lease (whether or not the liability is imposed consistently with the National Credit Code); and
(d) the consumer may recover as a debt due to the consumer any amounts paid by the consumer that, in accordance with paragraph (c) of this subsection, the consumer is not liable to pay (or is taken never to have been liable to pay).
179VB Using postal, telegraphic, telephonic or other like services to enter into a consumer lease for an indefinite period
Requirement
(1) A lessor must not use postal, telegraphic, telephonic or other like services (within the meaning of paragraph 51(v) of the Constitution) to enter into a consumer lease for an indefinite period if the lessor is not a constitutional corporation.
Civil penalty: 5,000 penalty units.
Offence
(2) A person commits an offence if:
(a) the person is subject to a requirement under subsection (1); and
(b) the person engages in conduct; and
(c) the conduct contravenes the requirement.
Criminal penalty: 100 penalty units.
179VC Entering into a consumer lease for an indefinite period in the course of constitutional trade and commerce
Requirement
(1) A lessor must not, in the course of constitutional trade and commerce, enter into a consumer lease for an indefinite period unless the lessor is a constitutional corporation.
Civil penalty: 5,000 penalty units.
Offence
(2) A person commits an offence if:
(a) the person is subject to a requirement under subsection (1); and
(b) the person engages in conduct; and
(c) the conduct contravenes the requirement.
Criminal penalty: 100 penalty units.
Division 11—Other Code provisions applicable to consumer leases
179W Application of certain Code provisions to consumer leases
(1) Part 12 (relating to miscellaneous matters) and subsection 204(2) (definition of associated) apply in relation to a consumer lease in the same way as they apply in relation to a credit contract.
(2) For the purposes of the application of those provisions:
(a) references to a credit provider are to be read as references to a lessor; and
(b) references to a debtor are to be read as references to a lessee; and
(c) references to a credit contract or contract are to be read as references to a consumer lease; and
(d) references to a linked credit provider are to be read as references to a linked lessor.
Part 12—Miscellaneous
Division 1—Tolerances and assumptions
180 Tolerances and assumptions relating to information
Disclosures generally
(1) Information disclosed in a precontractual statement, contract document, mortgage document or guarantee, statement, notice or consumer lease, or otherwise disclosed for the purposes of this Code, is taken to be correctly disclosed if:
(a) it is within tolerances allowed by the regulations; and
(b) the disclosure is made as at a date stated in it.
Disclosure of interest charges
(2) Disclosures for the purposes of this Code relating to interest charges may be made on the following assumptions (and such other assumptions under this section as are applicable):
(a) that, in the case of an annual percentage rate or default rate, there will be no variation in the rate as disclosed over the whole term of the contract or any shorter term for which it applies;
(b) if a change to a variable rate is provided for by the contract, that the variable rate applicable over the term for which it applies is the same as the equivalent variable rate as at the date disclosure is made;
(c) that the debtor will make the repayments required by the contract at the times required by the contract.
Disclosure of repayments
(3) Disclosures for the purposes of this Code relating to repayments may be made on the assumption that the debtor will pay the repayments required by the contract at the times required by the contract and on such other assumptions under this section as are applicable.
Disclosures of credit fees and charges
(4) Disclosures relating to credit fees and charges for the purposes of this Code may be made on the following assumptions (and on such other assumptions under this section as are applicable):