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The bank or party in that position should ensure that

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The bank, or party in that position should ensure that the other party receives independent professional advice prior to entering into a contract or transferring property. 2) Problem question involving Mark. Mark wishes to purchase a particular item. He investigates the price being charged for the item and discovers that there has been a recent price rise from $500 to $900. He then happens to visit a shop where the price of the item is $500 and Mark realises that the shop owner is not aware of the recent price increase. Mark buys the item knowing that the retailer has overlooked or has not yet become aware of the price increase. Does Mark’s behaviour constitute unconscionable conduct? Issue: Does Mark’s behaviour constitute unconscionable conduct? Rules: Unconscionable conduct occurs where there is an inequality of bargaining power and the weaker party’s bargaining power is seriously impaired by reason of things such as need, ignorance, infirmity, illiteracy, etc. If held, the plaintiff may set an agreement aside where he/she enters into a very unfair contract or transfers property as a result (see discussion of Denning L in Lloyd’s Bank v Bundy ). According to the High Court in CBA v Amadio the 4 elements required are: 1. The plaintiff was in a position of special disadvantage 2. It must have substantially affected their ability to protect themselves 3. The defendant must have, or ought to have known of the plaintiff’s disability and taken advantage of it 4. The actions of the defendant were unconscionable (unfair or unjust) In order to defeat the allegation, the party with the dominant bargaining position should ensure that the other party receives independent professional advice prior to entering into a contract or transferring property; see Garcia v NAB . Application: The shop owner does not suffer any special disadvantage in particular. A shop owner should know more about the products they sell than a normal
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customer and be in a position to protect themselves in any negotiation. Even though Mark is aware that the shop owner does not know that there has been a price increase, he would not have any duty to ensure the shop owner sought independent advice. Conclusion: It is extremely doubtful that Mark’s behaviour satisfies the requirements and therefore would not be considered unconscionable conduct.
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