Dar Ing International Enterprise Co., Ltd. violated the Fair Trade Law for not giving its trading partners adequate time and opportunity to review the sales contract and by hiding promissory notes in the contract to obtain unintended signature
Chinese Taipei
Case:
Dar Ing International Enterprise Co., Ltd. violated the Fair Trade Law for not giving its trading partners adequate time and opportunity to review the sales contract and by hiding promissory notes in the contract to obtain unintended signature
Key Words:
deception, obvious unfairness, order of trade, hiding a promissory note
Reference:
Fair Trade Commission Decision of January 4, 1995 (the 169th Commission Meeting); Disposition (84) Kung Ch'u Tzu No. 008
Industry:
Retail Industry (5319)
Relevant Laws:
Summary:
1. The Consumers Foundation referred to this Commission complaints brought by seven consumers against Dar Ing International Enterprise Co., Ltd. (hereinafter the "Company"), for its deceptive and obviously unfair practice of misleading the consumers into signing unfair contracts by which the order of trade was affected. In addition, five consumers brought complaints directly to this Commission in respect of the same matter. According to its investigation, the Commission has the following findings:
(1) The Company, which had the advantage of knowing the contents of the contract, failed to give the consumers adequate time and opportunity to review the contracts during the transaction process, in which the consumers were enticed to sign their names by responding to questionnaires. The contracts were not entitled "Sales Contract," and the consumers were urged to sign their names and seal. During the entire process in which the contracts were signed, the consumers were not given adequate time for reviewing the details of the contracts or considering whether to sign the contracts. The terms and conditions of the contracts were withheld from the consumers deliberately for the purpose of closing the sales as soon as possible.
(2) The Company falsified a discount period in order to entice the consumers to close the sale, resulting in the consumers' misjudgment on the terms of transaction.
(3) Promissory notes were slipped into the contract. The title "promissory note" was printed in a very small font, and the monetary amount specified by the promissory note was the total amount of the purchase of the learning materials. Most consumers signed their names, mistaking them for basic information typical of a contract due to the limited time given for signing the contracts.
(4) Article 4 of the contract stipulated that "if the Buyer terminates the contract during the term of the contract, the Buyer agrees to compensate in the amount of the due payment and 50% of payment as a penalty." For the customers who terminated the contracts within seven days after the receipt of the products, the Company requested compensations in the amount of 50% of the payment for the remaining installments pursuant to the termination clauses set forth in the sales contract. By signing the promissory note, a customer was unable to exercise their legal rights to a seven-day money-back period for solicited sales under Article 19 of the Consumer Protection Law.
2. Such acts of Dar Ing constituted deceptive acts that undermined the order of trade. Pursuant to the decision of the 169th Commission Meeting, the Company is subject to a disposition under Article 24 of the Fair Trade Law. The Company is required to desist from such deceptive and obviously unfair acts on the next day upon receipt of this Decision, rectify the unfair termination clauses of the sales contract, stop the practice of hiding a promissory note in the contract, and submit an amended sales contract to this Commission for reference within 30 days in accordance with the first sentence of Article 41 of the same law.
3. In this case, the Company failed to give its trading counterparts adequate time and opportunity to review the sales contract during the Company's solicitation sales on the street for the promotion of its products. The Company has also falsified the discount period, made unfair termination provisions in the standard sales contract, and hidden promissory notes in a way that the consumers would sign their names unknowingly. Since most of such sales contracts were signed by parties with weaker bargaining power, subsequent disputes and controversies arose. The acts constituted violation of Article 24 of the Fair Trade Law.
Summarized by Yang, Hsiu-yun
Supervised by Liu, Chien-hsun
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