Need for unfair contract law

WHEN I first came home to practise law, one of the first things that struck me about Malaysian law was that we do not have an Unfair Contract Terms Act (UCTA). This is strange considering that we do have a Contracts Act when many other common law countries don’t.

A recent incident that I have been made privy to brought into sharp relief why there is an urgent need for a UCTA (of general application) to be promulgated.

This incident involved an artist who participated in an art competition that was promoted by the organiser as a platform to empower young aspiring artists to express themselves freely. A clause in the terms and conditions gives the organiser the right to sell the exhibited short-listed artworks at such price as the organiser may determine in its sole discretion.

The organiser sold this artist’s beautiful piece of artwork for an amount that works out to be about RM3 per hour for the artist’s efforts (after deducting what the artist had paid for framing the artwork, the canvas and transport).

Yes, the organiser acted well within its contractual rights. Yes, the clause in question was drafted in clear English and in a manner that makes it easy to understand. Yes, the artist should have read the fine print (she regrets not having done so) and yes, she should not have entered the competition if she was not happy with the terms and conditions.

However, the clause in question can hardly be said to be fair, particularly if one takes into account the fact that the organiser clearly had greater bargaining power compared to the artist.

Further, one needs to also bear in mind that a legal document is not a creature that most lay people can easily understand and even among lawyers, countless ill-drafted contracts have led to disputes (well, yes, litigation lawyers need to eat and have bills to pay too).

We have the Consumer Protection Act. We also have the Personal Data Protection Act. So why not a UCTA to protect those contracting with parties with greater bargaining strength than them?

It’s high time the Unfair Contract Terms provisions in Part IIIA of the Consumer Protection Act be extended to contracts generally so that the protection accorded a consumer falling within the purview of this Act is granted to everyone entering into any type of contract.

If countries such as Australia, Singapore and the UK see it fit to have a UCTA, I hope a government that rode to power on the back of a rakyat-friendly manifesto would also seriously look into introducing a UCTA that has universal application.

The rakyat need it.

LIM CHIN HAN

Kuala Lumpur