Section 18 ACL misleading conduct: examples and what to do

You were told the product had a feature it didn't have. The listing said "ocean view" and the balcony faced a car park. The salesperson assured you the plan had no lock-in period — and then a $400 exit fee appeared. In each of these situations, the business may have breached section 18 of the Australian Consumer Law — one of the broadest provisions in Australian consumer law.

Section 18 doesn't require the business to have lied deliberately. It doesn't require a contract to have been signed. It doesn't even require you to have lost money yet. What it requires is that the conduct was misleading or deceptive, or likely to mislead or deceive. To claim compensation, you also need to show the conduct caused you loss. Understanding how this works in practice gives you a significant advantage when a business tries to brush off your complaint.

Quick answer

Two things decide what you can do: whether the conduct was likely to mislead, and whether it caused you loss. Section 18 of the ACL prohibits businesses from engaging in conduct that is misleading or deceptive, or likely to mislead or deceive, in trade or commerce. You don't have to prove the business intended to mislead you — only that its conduct was likely to mislead a reasonable person in your position. If you relied on a false or misleading representation and suffered loss as a result, you may be able to seek compensation or other orders, depending on what you can prove you lost because of it. This applies to advertising, verbal statements, product descriptions, contracts, and silence where you would reasonably expect disclosure.

What the law actually says

Section 18 of the Australian Consumer Law reads simply: a person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

That brevity is deliberate. Courts and tribunals have interpreted it broadly over decades, and the result is a provision with a very wide reach. Here is what that means in practice:

"In trade or commerce" means the conduct must happen in a commercial context. A car dealer's verbal assurances are covered. A genuine one-off private sale, such as your neighbour selling their old car, is generally not in trade or commerce. But sole traders and people selling as a business (even on Gumtree or Marketplace) usually are. The question is whether the seller is acting in a business context, not whether they are incorporated.

"Conduct" includes far more than outright lies. It covers:

• Written or verbal statements (advertisements, listings, sales pitches, emails)
• Omissions — staying silent about a fact where, in the circumstances, you would reasonably expect it to be disclosed
• Half-truths — a statement that is technically accurate but creates a false overall impression
• Conduct itself — for example, displaying a product in a way that implies it has capabilities it doesn't

"Misleading or deceptive, or likely to mislead or deceive" is an objective test. The question isn't whether the business intended to mislead you — it's whether the conduct was likely to mislead a reasonable person in your position, seeing or hearing what you did. Honest mistakes still count.

Reliance and loss aren't required to establish a breach, but to get compensation or a refund order you need to show you suffered (or are likely to suffer) loss because of the conduct, usually by showing you relied on it. If you relied on the misleading conduct and suffered loss — you paid money, entered a contract, or made a decision you wouldn't otherwise have made — you may be able to claim compensation or other relief.

Section 18 sits alongside more specific provisions in the ACL. Section 29 lists specific false representations that are prohibited (about the standard, quality, grade, or composition of goods; about price; about testimonials; and so on). Section 29 targets specific kinds of false representation, and breaches of it can attract pecuniary penalties. Section 18 is the general prohibition, and both often apply to the same conduct.

For goods and services that fall short of what was promised, the consumer guarantees in sections 51 to 62 may also apply alongside section 18 (if you acquired the goods or services as a consumer under section 3 of the ACL). The two sets of rights are separate and can both be relevant to the same dispute.

When this applies (and when it doesn't)

Section 18 is breached when:

• A business (or someone acting in trade or commerce) made a representation to you — in an ad, a listing, a verbal statement, a contract, or an email.
• That representation was false, misleading, or created a false impression, even if it was technically accurate in isolation.
• It was likely to mislead a reasonable person in your position.

You may be able to claim compensation if, in addition, the conduct caused you loss or damage, usually because you relied on it: for example, you paid money or entered a contract you wouldn't otherwise have entered.

Real examples where section 18 commonly applies:

• A real estate agent describes a property as "fully renovated" when only the kitchen was updated and the rest is original 1970s fittings. See real estate misrepresentation for more on this specific context.
• A holiday booking platform advertises "beachfront accommodation" when the property is a 15-minute walk from the beach. The holiday accommodation false advertising article covers this in detail.
• A gym salesperson tells you there's no lock-in period, but the contract you sign contains a 12-month minimum term. See gym membership cancellation rights for the full picture.
• A software product is advertised as compatible with your operating system, but it isn't. The software didn't work as advertised article applies here.
• A mattress is described as "100% natural latex" when it contains a significant proportion of synthetic materials. This also engages section 56 of the ACL (goods must match their description) — see mattress doesn't match description.

Section 18 generally does not apply when:

• The conduct isn't in trade or commerce. A genuine one-off private sale between individuals is generally outside section 18, though people selling as a business on Gumtree or Facebook Marketplace usually are covered.
• The representation was clearly an opinion or puffery — "best coffee in Sydney" is not a factual claim a reasonable person would rely on. But "award-winning coffee" could be, if no award exists.

A compensation claim generally fails when:

• You didn't rely on the representation. If you knew the claim was false before you bought, you can't later say you were misled by it.
• The loss you suffered was caused by something other than the misleading conduct.

What to do today

If you believe a business has misled or deceived you, the steps that work are the same ones that work in most ACL disputes — but the framing matters.

1. Write down exactly what was said or shown to you, and when. Memory fades. Note the date, the channel (in-store, online, phone call), and the specific words or images used. If it was in writing — an email, a listing, an advertisement — save a copy or take a screenshot immediately.

2. Identify the gap between what was represented and reality. The clearer you can articulate this, the stronger your position. "The listing said X, but the product/service is actually Y" is the core of your claim.

3. Gather evidence of your reliance. This might be the purchase receipt, the contract you signed, or a record of the decision you made because of the representation. The question you're answering is: "What did I do because I believed what they told me?"

4. Calculate your loss. This could be the full purchase price, the difference in value between what was promised and what was delivered, or costs you incurred as a result (for example, accommodation costs if a property wasn't as described), if you can show they were caused by the conduct, can evidence them, and took reasonable steps to limit them.

5. Write to the business. A written demand letter citing section 18 of the ACL, describing the misleading conduct specifically, and stating what remedy you're seeking is far more effective than a phone call. It creates a record, signals that you know your rights, and gives the business a clear path to resolve the matter without escalation.

fairgo can help you draft that letter — start here. The wizard identifies the relevant ACL provisions based on what happened and produces a letter you send under your own name.

6. Give a reasonable deadline. Fourteen days is a common choice (a practical default, not an ACL requirement). State clearly what you'll do if the deadline passes without a satisfactory response.

What if the business refuses

If the business ignores your letter or refuses your claim, you have several escalation options:

• Your state or territory consumer protection body. It may help, for example by contacting the business or conciliating, if your complaint meets its criteria. Most expect you to have tried to resolve the matter with the business first, and eligibility rules vary by state and dispute type (in the ACT, for example, statutory conciliation applies only where the remedy you seek is worth $5,000 or less). These bodies don't make binding orders in ordinary consumer disputes and can't make the business settle. Contact details are at /agencies. This often resolves disputes.

• A tribunal or court with jurisdiction. In NSW, Victoria, Queensland, the ACT and the NT, a tribunal (NCAT, VCAT, QCAT, ACAT or NTCAT) hears many consumer claims within its limits; in Western Australia, South Australia and Tasmania, ordinary consumer claims go to the Magistrates Court. Jurisdiction depends on each forum's enabling legislation, the type of claim and the amount, so confirm the forum and its current thresholds on the official site before filing. You can usually run a claim without a lawyer, though some forums restrict legal representation (QCAT, for example, requires permission). Check current filing fees on the official site, and ask about fee exemptions, waivers or deferrals if cost is a concern. Our guide to choosing the right tribunal or court has more.

• The ACCC. The Australian Competition and Consumer Commission enforces section 18 at a national level, but it focuses on systemic conduct affecting many consumers rather than individual disputes. An ACCC complaint can be useful for flagging a pattern of behaviour, but the ACCC doesn't resolve individual disputes. For that, use your state or territory consumer body and, if needed, a tribunal or court with jurisdiction.

• Courts for larger claims. Larger section 18 claims can be taken to court. Which court can hear a claim depends on the amount and each court's rules. This is rarely practical for individual consumers without legal representation, but it is an option for larger disputes.

The demand letter is often enough. Some businesses that know they've made a misleading representation — and that you can prove it — prefer to resolve the matter quietly rather than have it aired before a tribunal or court.

Common mistakes

A few patterns come up repeatedly in section 18 disputes:

• Assuming intent matters. The most common misconception is that you have to prove the business deliberately lied. You don't. If the conduct was objectively misleading — regardless of what the business intended — section 18 is engaged. "We didn't mean to mislead you" is not a defence.

• Confusing section 18 with the consumer guarantees. Section 18 is about misleading conduct in trade or commerce (most often before or during the sale). The consumer guarantees (sections 51 to 62) are about the quality and fitness of the goods or services themselves. Both can apply to the same situation, but they're separate rights with separate remedies. If a product was described inaccurately and also fails to work properly, you may have claims under both.

• Not keeping evidence of the original representation. Websites change, listings get updated, and verbal assurances are denied. Screenshot everything at the time of purchase. If the ad has already changed, the Wayback Machine (web.archive.org) sometimes preserves earlier versions.

• Waiting too long. Under section 236 of the ACL, a damages claim for misleading conduct must be started within 6 years after the day the cause of action accrued (generally when you first suffered loss, not when you discovered it). Forums may have shorter time limits of their own. And evidence degrades, memories fade, and businesses change. Acting promptly gives you a much stronger position.

• Asking for the wrong remedy. If section 18 is breached, section 236 of the ACL lets you recover the loss caused by the conduct — not necessarily a full refund in every case. If you received some value from what you bought, the remedy may be the difference in value, not the entire purchase price. Calibrate your demand to your actual loss.

• Going straight to a negative review instead of a demand letter. A public review might feel satisfying, but it doesn't get your money back and can sometimes complicate a later legal claim. The demand letter first, escalation second, is the sequence that actually works. If the business still refuses, the business refused refund article covers what comes next.

Related reading

• Real estate misrepresentation in Australia — your rights
• Holiday accommodation false advertising — what the ACL covers
• Business refused your refund? Here's what to do next
• Section 18 ACL deep dive: misleading or deceptive conduct explained
• Section 56 ACL: when goods don't match their description

This article is general information about Australian Consumer Law, not legal advice. It also touches on complaint and escalation pathways (state and territory consumer bodies, tribunals and courts, the ACCC) and forum time limits, whose scope, rules, thresholds and processes sit outside the ACL or can change. Confirm the current position with the relevant body before lodging. For advice on your specific case, see your state or territory consumer body — full list at /agencies.