T'ai Ho Construction Co., Ltd. violated the Fair Trade Law for its false advertising
Case:
T'ai Ho Construction Co., Ltd. violated the Fair Trade Law for its false advertising
Key Words:
"Joy Villas", obvious unfairness, return of contract
Reference:
Fair Trade Commission Decision of February 2, 2000 (the 431st Commissioners' Meeting) , Diposition (89) Kung Ch'u Tzu No. 016.
Industry:
Construction (housing) (4601)
Relevant Laws:
Articles 21 of the Fair Trade Law
Summary:
1. A consumer purchased a pre-sold house from Ch'iao Pao Construction Co., Ltd. at the "Joy Villa" development, which was located in Ta Li, Taichung County, in March 1998. In July 1998, the development was taken over by T'ai Ho Construction Co., Ltd. ("T'ai Ho") who agreed that the house would be made available to the purchaser in February 1999. On letters of 2 February 1999 and 8 February 1999 noticing that the house was available, T'ai Ho stated that before the purchaser occupied the house the document of the contract must be returned. A complaint was then filed against T'ai Ho in this regard accusing T'ai Ho of having violated the provisions of Article 24 of the Fair Trade Law that prohibit obviously unfair acts sufficient to affect the trading order.
2. At its 129th Commissioners' Meeting, the Fair Trade Commission (FTC) has decided that requiring house buyers to return their contracts in order to obtain their property deeds or make houses available was an obvious unfair act which violated Article 24 of the Fair Trade Law. The FTC has also provided administrative guidance to the housing construction industry stating that from 1 July 1994 onwards the FTC, according to Article 41 of the Fair Trade Law, would undertake to dispose of any such incident.
3. In a letter to the FTC, T'ai Ho argued that while it indeed requested the buyer to return the contract, the request was made for the tax authorities' investigation but not as a condition of the buyer's possession of the house. T'ai Ho, however, was unable to produce any document to prove that the tax authorities had in fact requested it to provide the contract as relevant material while investigating T'ai Ho's books. Consequently, T'ai Ho violated Article 24 of the Fair Trade Law that prohibits obviously unfair acts when it required the buyer to return the contract. After considering the intent of the act, the degree of injury, the circumstances of the act, T'ai Ho's size, and T'ai Ho's attitude after the offense, the FTC, pursuant to the forepart of Article 41 of the Fair Trade Law, ordered T'ai Ho to cease such acts immediately and imposed a fine of NT$100,000.
Summarized by Chuang Hsin-jung;
Supervised by Chu Wei-ching
Appendix:
T'ai Ho Construction Co., Ltd.'s Uniform Invoice No. 16539300