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consumer

Fine print: How small can conditions legally be?

Key Takeaway

New Zealand law doesn't specify a minimum font size for 'fine print,' but conditions must be clear, legible, and not misleading. The Fair Trading Act 1986 prohibits misleading conduct and regulates unfair contract terms. The Consumer Guarantees Act 1993 ensures certain consumer rights cannot be removed, regardless of fine print.

Understanding 'Fine Print' in New Zealand Consumer Law

'Fine print' commonly refers to the detailed terms and conditions accompanying a contract for goods or services, often presented in a smaller font or less prominent way than other information. In New Zealand, while there is no specific legal minimum font size, the law requires that all contractual terms, including those in 'fine print,' are presented in a manner that is not misleading, deceptive, or unfair to consumers.

Fair Trading Act 1986 and Misleading Conduct

The Fair Trading Act 1986 (FTA) is a key piece of legislation that protects consumers from unfair trading practices. It broadly prohibits conduct by businesses that is misleading or deceptive, or likely to mislead or deceive [Source: Fair Trading Act 1986, s 9]. This applies to all aspects of trade, including how contract terms are presented.

If important conditions are hidden in extremely small, illegible print, or if they contradict more prominent statements made by a business, this could be considered misleading conduct. For example, if a headline promotion promises one thing, but the 'fine print' effectively negates that promise, the business may be in breach of the FTA. The Act also prohibits unsubstantiated representations, meaning businesses must have reasonable grounds for any claims they make about their goods or services [Source: Fair Trading Act 1986, s 12A].

Unfair Contract Terms under the Fair Trading Act 1986

Part 2A of the FTA specifically addresses unfair contract terms (UCTs) in standard form consumer contracts. A standard form consumer contract is a contract prepared by one party and presented to the consumer on a 'take it or leave it' basis, with little or no opportunity for negotiation [Source: Fair Trading Act 1986, s 46J]. Many everyday consumer agreements, such as mobile phone plans or gym memberships, are standard form contracts.

A term in a standard form consumer contract may be declared an unfair contract term if it meets three criteria:

  1. It causes a significant imbalance in the parties' rights and obligations arising under the contract.
  2. It is not reasonably necessary to protect the legitimate interests of the party who would be advantaged by the term.
  3. It would cause detriment (whether financial or otherwise) to a party if it were to be applied or relied on [Source: Fair Trading Act 1986, s 46L].

While the physical size of the print itself is not explicitly listed, a term that is difficult to read or locate due to its presentation (e.g., tiny font, lack of prominence) could contribute to a finding of unfairness, especially if it creates an imbalance or detriment that a consumer would not reasonably expect. The FTA specifies that in deciding whether a term is unfair, the court must consider the extent to which the term is transparent [Source: Fair Trading Act 1986, s 46M(2)(a)]. A term is transparent if it is expressed in reasonably plain language, legible, and presented clearly and accessibly [Source: Fair Trading Act 1986, s 46L(3)].

If a court declares a term to be unfair, that term is void, meaning it is treated as if it never existed [Source: Fair Trading Act 1986, s 46K].

Consumer Guarantees Act 1993 and Non-Excludable Rights

The Consumer Guarantees Act 1993 (CGA) provides a set of automatic guarantees for goods and services purchased by consumers. A consumer is generally defined as someone who acquires goods or services of a kind ordinarily acquired for personal, domestic, or household use or consumption, and not for resupply in trade, or for use or transformation in a manufacturing or repair process [Source: Consumer Guarantees Act 1993, s 2].

Crucially, many of the rights provided by the CGA cannot be contracted out of, meaning businesses generally cannot use 'fine print' or any other contractual term to remove or limit a consumer's rights under the Act [Source: Consumer Guarantees Act 1993, s 43]. For example, guarantees regarding acceptable quality, fitness for purpose, and reasonable care and skill in service provision will apply regardless of what a business tries to state in its terms and conditions.

General Principles of Readability and Prominence

While specific font sizes are not legislated, the overarching principle is that contract terms, regardless of their location or size, should be communicated effectively to the consumer. This means:

  • Legibility: Terms should be easy to read for a person with normal eyesight.
  • Clarity: Terms should be expressed in reasonably plain language, avoiding excessive jargon where possible.
  • Prominence: Important terms, particularly those that might be unexpected or onerous, should be brought to the consumer's attention and not hidden or buried in extensive text.

The law aims to ensure that consumers can make informed decisions and are not unfairly disadvantaged by obscure or misleading contract provisions.

When to Seek Independent Legal Advice

Individuals facing issues with contract terms, misleading representations, or unfair trading practices, or those who believe they have been disadvantaged by 'fine print,' should seek independent legal advice. Organisations such as the Commerce Commission, Consumer Protection, or Community Law Centres can provide guidance on consumer rights and obligations. Community Law Centres offer free legal assistance to eligible individuals.

Key Resources