Abusive Clauses

Abusive clauses

Abusive clauses are unfair contract terms that may create an imbalance in between the rights and obligations of the contracting parties. These tend to be particularly relevant in B2C contracts, where consumers may not always be able to negotiate the terms. It is extremely important to be able to detect these unfair terms and understand how they can be prevented as well as resolved.

These kinds of clauses take multiple forms, they usually aren’t transparent nor clear and have detrimental implications for the consumer or weaker contracting party. Generally, unfair terms occur in contracts which are drafted solely by one of the parties (e.g. the business providing the service) and are limited to the second party simply accepting or rejecting the contract as a whole. They go against the principle of good faith in contracting and are often ambiguous, hence the term is not expressly agreed to. Consequently, when a clause is found to be in bad faith and imbalanced, it is found to be null and void.

Unfair clauses may hold important legal and economic implications for the unaware consumer, such as permanence clauses with phone contracts or penalties for discontinuing a contracted service. Luckily, insofar as the consumer is acting in good faith when contracting, there is plenty of available recourse to manage such mistaken contracting.

Under EU law there are various recourses to deal with abusive clauses. The easiest and most preventive approach consists of drafting contract terms in plain, clear and understandable language. Hence, there is no room for differing interpretations nor unknown and surprising legal implications. It is important to note that EU regulation interprets ambiguities in favour of the weaker party.

Spanish national law provides for a basic regulation on consumer protection under the National Law for the Defense of Consumers and Users. Here, abusive clauses in contracts concern economic penalties of different degrees. Said law offers an Action Plan, adopted in the 13th Spanish Consumption Sectoral Conference that eliminates unfair clauses in contracts with consumers. This Action Plan offers a mechanism through which the general contracting conditions of different sectors such as financial sectors, general services, housing, etc. can be examined with the participation of all involved parties, administrators, businesses and consumers alike. Moreover, as of 2017, the Supreme Court established as legal doctrine that the administration has the power to sanction the use of abusive clauses in consumer contracts without the need of a previous judicial declaration from the civil order. Hence, when encountering an abusive clause one may go directly to court and begin a judicial proceeding against the company at fault and otherwise may file a report to the Spanish Consumption Administration which may exercise sanctions against the company but cannot nullify the clauses as this can only be done by a civil court.

It is hence relieving to know that there is such a safeguarding of consumers when it comes to falling into contractual traps in Spain and other EU countries, nonetheless it is always more favourable to prevent having to take action against unfair contractual terms by attentively avoiding them entirely.

By | 2019-11-15T11:46:23+00:00 November 15th, 2019|Sin categoría|