CHANGES to national legislation that came into effect this month will make business-to-business agreements on the Sunshine Coast and beyond more fair.
It's a win for small businesses, which can be subject to arbitrary and unfair clauses when signing up to another company's general terms, according to Australian Small Business and Family Enterprise Ombudsman Kate Carnell.
But businesses who fail to update contractual terms could find themselves in big trouble, Sunshine Coast regional manager for EC Credit Control, Dale Rhall, says.
"The winners will be small business as they will now be able to negotiate the contents of a contract with the principle contractor as a lot of these will be deemed unfair,” he said.
But if a clause is deemed unfair the entire agreement - including requirement to pay for services rendered - could be deemed void.
For example, a subcontractor dealing with a building company could lose the ability to enforce payment if the subcontract agreement is deemed in a court of law to be unfair.
"A plumber relying on a sales agreement to be paid by a resident may not be able to enforce payment or compliance,” Mr Rhall said.
The changes to the unfair contract terms law, are undoubtedly positive for small businesses on the Coast, but only if these businesses make sure contracts signs on or after November 12 comply with the new Australian Consumer Law provisions, Mr Rhall said.
Contracts that don't comply will also be unable to validate a listing on the Personal Property Securities Register, which small businesses should be using to protect their assets, Mr Rhall said.
- ASIC: Visit www.asic.gov.au and search "unfair contract terms law” for information on the legal change.
- Local lawyers: Contact a corporate lawyer to go through any agreement your business is considering making.
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