National Consumer Credit Protection Act 2009

CHAPTER 3 - RESPONSIBLE LENDING CONDUCT  

PART 3-4 - LICENSEES THAT ARE LESSORS UNDER CONSUMER LEASES  

Division 4 - Prohibition on entering unsuitable consumer leases  

SECTION 156   PROHIBITION ON ENTERING UNSUITABLE CONSUMER LEASES  
Prohibition on entering unsuitable lease

156(1)    

A licensee must not enter a consumer lease with a consumer who will be the lessee under the lease if the lease is unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the lease is unsuitable

156(2)    
The lease is unsuitable for the consumer if, at the time it is entered:

(a) it is likely that the consumer will be unable to comply with the consumer ' s financial obligations under the lease, or could only comply with substantial hardship; or

(b) the lease does not meet the consumer ' s requirements or objectives; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances apply to the lease.

156(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer ' s financial obligations under the lease by selling the consumer ' s principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease is unsuitable

156(4)    
For the purposes of determining under subsection (2) whether the lease is unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer ' s financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 153(1)(d) or (e);

(b) at the time the lease is entered:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 153.

Consumer lease not unsuitable under regulations

156(5)    
The regulations may prescribe particular situations in which a consumer lease is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

156(6)    

A person commits an offence if:

(a) the person is subject to a requirement under subsection (1); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.