In this episode, Richard Wells, a Partner in MinterEllisonRuddWatts’ technology team, talks to Shona Foster, a Senior Associate in the same team, about the interaction between standard form small trade contracts and the unfair contract terms regime, with a focus on the use of such contracts by tech companies and online businesses.
[1:22] Richard and Shona start off by giving a brief overview of the unfair contract terms (UCT) regime itself. They cover what it is, and when and where it applies, especially in the context of companies doing business in New Zealand. They also discuss why standard form contracts might be used.
[2:10] They then move on to discuss what are the elements of an unfair term: what is the statutory “test” that might make a term in a contract unfair? Richard and Shona explore the three limbs to this test, focusing on the challenge of protecting a legitimate interest without creating a term that is “unfair”.
[3:20] Richard and Shona explore the test in the context of actual contract terms, discussing the “grey list” of types of clauses likely to be considered unfair terms and what these might look like in practice.
[5:40] The two discuss the management of risk, in light of what they describe as a paradigm shift towards standard form contracts that are now more balanced between parties. They also look at some key contractual terms and touch on what might be a fair scenario for those terms.
[8:30] Richard and Shona explore the topic of the apportioning of liability while complying with the UCT regime – noting that this is a particularly complex area.
[11:00] Finally, they look at international vendors, and how the consideration of the UCT regime in New Zealand may require them to make changes to how they deal with New Zealand businesses. They also set the scene for a further podcast looking at this issue from a business customer’s perspective: what are your options when presented with a standard form contract that contains terms you think are likely to be UCTs.
Information in this episode is accurate as at the date of recording, 20 February 2024.
Please contact Richard or Shona or any of our Technology team if you need legal advice and guidance on any of the topics discussed in the episode.
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