Prior to its amendment in 1986, the Trade Practices Act 1974 (Cth) was aimed at protecting corporations and big businesses against unfair trading. The amendment led to the incorporation of section 52A, which was then later "repealed in 1992 when sections 51AA and 51 AB were enacted to replace it. The new section did not really extend the law a great deal and only section 51AA contained anything new" .
"Section 51AB is an exact re-enactment of section 52A⦠it prohibits a corporation acting in trade or commerce, in connection with the supply or possible supply of goods or services to a person, from engaging in unconscionable conduct. It therefore applies specifically to consumer transactions."The amendment to the Trade Practices Act 1974 (Cth) created a new protection for consumers, who had otherwise not been safeguarded against unconscionable trade practises. It has also led to state and territories passing fair trade acts which incorporate identical provisions and apply in circumstances where the Commonwealth legislation cannot.
English: Map of the first European corporations an...
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English: Via Amadio Baldanzi Italiano: Via Amadio ...The amendment will also be argued in relation to the speech given by The Honourable Lionel Bowen, in which he indicated that, the amendment will "strengthen the protection afforded to consumers against unscrupulous trade practices".
The concept of unconscionability, meaning "against good conscious", was finally given statutory recognition, in the form of section 51AB, after the High Court handed down its decision in Commercial Bank of Australia Ltd v Amadio (1983).
"This case involved an elderly migrant couple with poor business and English speaking skills. They were induced to execute a mortgage and guarantee in favour of the appellant bank to secure an overdraft facility that had been granted to their sons building company. At the time of the agreement, they believed that the company was in a solid financial situation and that their liability was...