Consumers and Contracts

Other Consumer Protection Legislation

Pawnbrokers

Pawnbroking in the ACT is governed by the Pawnbrokers Act 1902 (originally a New South Wales Act).

Definition

A pawnbroker is a person who carries on the business of lending money on the security of an article taken by the person by way of pawn, pledge or as security. This definition does not apply to a person who holds securities for loans in the course of commercial and banking business if the interest rate does not exceed 14 per cent (s 4).

Licensing of pawnbrokers

Pawnbrokers must be licensed (s 6) and the name must be displayed outside the premises (s 7). It is illegal to carry on the business of pawnbroking other than at the licensed premises (s 8(1)). The licence must be produced on demand made by the police (s 8(2)).

Application for a licence is made to the commissioner of fair trading on the approved form (s 5). The commissioner must be satisfied as to the character of the applicant before issuing a licence. The licence is valid for one year only and a separate licence is needed for each premises used for the business.

Part 4 of the Act deals with various matters relevant to licensing, including defining who is a suitable person to hold a pawnbroker's licence.

Protection of borrowers

A pawnbroker must not lend to children under 14 or to someone who is drunk (s 8(3)).

A. Record of transaction

A record book must be kept by the pawnbroker and when an article is accepted a numbered record must be made giving a reasonable description of the article, the date of pledge, the time for redemption if it is to exceed three months, the money advanced, the rate of interest and the name and residence of the person pawning the article (s 9). A duplicate of the entry must be signed by the pawnbroker and given to the customer (s 10).

The duplicate must be produced when the article is redeemed (s 11(1)). The holder of the duplicate is deemed to be the owner of the goods and is, subject to what is said below about lost records, entitled to redeem them (s 12(2)). A person who attempts to redeem an item when that person is not the rightful owner may be apprehended by the pawnbroker and delivered to the police (s 20).

B. Lost or stolen record

If the duplicate has been lost or stolen, the customer must swear a statutory declaration setting out the circumstances of the loss. If the pawnbroker is satisfied of the veracity of the declaration, he or she must give the customer a new record of the pawned item so long as the item has not already been redeemed (s 11(2) and (3)).

If the pawnbroker refuses to redeem a pawned item, he or she must immediately inform the police and provide the name and address of the person who attempted to redeem the item (s 12(4)).

C. Redemption period and sale

If the item is not reclaimed by repaying the money within three months (or such longer period as is specifically agreed) it will be forfeited to the pawnbroker and may be sold (s 13). It is illegal to agree to a shorter period than three months. It is illegal to sell the item before the expiry of the redemption period (s 14).

If an item is forfeited and the loan to which it related was more that $500, the item must be sold by public auction after proper advertisements have been placed in an ACT newspaper (s 15).

It is illegal for the pawnbroker to buy a forfeited item (s 16).

If the sale price exceeds the amount owing by the customer, the customer can apply to be paid the excess within 12 months of the sale (s 17).

The pawnbroker must keep full records of items sold and must make the relevant record available to a person whose goods have been forfeited if that person requests to see the record (ss 18-19).

Sale of Motor Vehicles

Sale of motor vehicles by dealers is regulated by the Sale of Motor Vehicles Act 1977 (ACT). This Act is fully discussed in chapter 20.

Energy and Water Supply

Sale of electricity, gas, water and sewerage services in the ACT is regulated by the Utilities Act 2000 (ACT) and Codes made under the Act. The Consumer Protection Code, made under the Utilities Act by the Independent Competition and Regulatory Commission, includes significant consumer protection provisions for energy and water customers. This Act and the Code are discussed in chapter 57.

Codes of Practice

Under Part 3 of the Fair Trading (Australian Consumer Law) Act 1992 (ACT), 3 codes of practice for various activities can be established. Some of these relate to consumers. There are codes of practice for the fitness industry, cemeteries and crematoria, drinking water, sexual services, driving instruction and pet grooming. A consumer of these services can complain to the Commissioner for Fair Trading if not satisfied with the services. The Commissioner has the power to seek undertakings from the supplier, including to stop certain conduct and to implement remedial action (s 24).