What Remedies Are Available for Misleading and Deceptive Conduct in Australia?

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If someone has misled you in a business transaction — whether it was a false representation during a sale, misleading financial projections, or a supplier who overstated what they could deliver — you have powerful legal remedies under Australian law. Section 18 of the Australian Consumer Law (ACL), contained in Schedule 2 of the Competition and Consumer Act 2010 (Cth), prohibits misleading or deceptive conduct in trade or commerce. And as of March 2026, the consequences for businesses that breach it have never been more severe.

For Queensland business owners, directors, and investors, understanding the full range of remedies available — and the dramatic increase in penalties that took effect this year — is essential to both protecting your rights and managing your own compliance risk.

What Is Misleading and Deceptive Conduct?

Section 18(1) of the ACL provides:

“A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.”

This is one of the most frequently used provisions in Australian commercial law — and for good reason. Unlike fraud, you do not need to prove that the other party intended to mislead you. You only need to show that the conduct was, objectively, misleading or deceptive or likely to mislead or deceive.

The conduct can take many forms:

• False statements — about a business’s revenue, a product’s capability, or a property’s characteristics
• Half-truths — disclosing some facts while concealing material information
• Silence — failing to disclose information that, in context, creates a misleading impression
• Misleading conduct — conduct beyond words, such as presenting misleading documents, projections, or visual representations
• Future predictions — making predictions or forecasts without reasonable grounds (s 4 ACL)

Critically, section 18 applies to conduct “in trade or commerce.” This covers virtually all business transactions — negotiations, sales, advertising, contract performance, and pre-contractual representations. It captures corporations, individuals, partnerships, and sole traders.

What Remedies Are Available?

If you have suffered loss because of misleading or deceptive conduct, the ACL provides several distinct remedies. Understanding which remedy applies — and which combination of remedies to pursue — is critical to maximising your recovery.

1. Damages Under Section 236

Section 236 of the ACL gives any person who has suffered loss or damage “because of” a contravention of section 18 the right to recover damages. This is the most commonly sought remedy.

To succeed, you must prove:

• The respondent engaged in conduct that was misleading or deceptive (or likely to mislead or deceive)
• You suffered loss or damage
• There is a causal connection — the loss was suffered “because of” the contravening conduct

Importantly, reliance is typically required — you must show that you relied on the misleading conduct when making your decision. If you would have acted the same way regardless of the misrepresentation, the causal link is broken.

Damages under section 236 are compensatory. They aim to put you in the position you would have been in had the conduct not occurred. This can include:

• The difference between what you paid and the true value of what you received
• Lost profits or business opportunities
• Costs incurred in reliance on the misleading conduct
• Consequential losses flowing from the transaction

2. Compensation Orders Under Section 237

Section 237 empowers the court, on application by an “injured person” (or the ACCC), to make orders for compensation for loss or damage caused by misleading conduct. Unlike section 236, section 237 also allows the court to make orders to prevent or reduce loss that is likely to be suffered — making it a forward-looking remedy.

This is particularly useful where the full extent of damage has not yet crystallised, or where the court considers that specific orders (rather than a lump-sum damages award) better address the harm.

3. Injunctions Under Section 232

Section 232 of the ACL allows the court to grant an injunction restraining a person from engaging in misleading conduct, or requiring them to do a specific act. Injunctions can be:

• Prohibitory — ordering the respondent to stop the misleading conduct
• Mandatory — requiring the respondent to take corrective action (such as issuing corrective disclosures)
• Interlocutory — interim orders to preserve the status quo while the matter is resolved

Injunctions are critical where misleading conduct is ongoing — for example, a competitor making false claims about your business, or a franchisor continuing to make misleading representations to prospective franchisees.

4. Rescission or Variation of Contracts

Under section 243 of the ACL, the court may declare a contract (or part of a contract) void from the beginning, or vary its terms. This is the remedy of rescission — unwinding a transaction that was entered into because of misleading conduct.

Rescission is powerful because it can reverse the entire deal. If you bought a business based on inflated revenue figures, rescission can (in principle) return you to your pre-transaction position — returning the business and recovering your purchase price.

However, rescission is a discretionary remedy. Courts will consider whether it is practically possible and whether third-party rights would be affected. The longer you wait after discovering the misleading conduct, the harder it becomes to obtain rescission.

5. Other Court Orders

Section 243 also empowers the court to make a range of other orders, including:

• Ordering the refund of money or return of property
• Directing that a contract be varied to correct the misleading element
• Declaring that a person is not bound by a contract term
• Ordering supply of specified goods or services

The breadth of the court’s discretion under section 243 is significant. It allows the court to craft remedies that fit the specific circumstances — which is why experienced legal advice on the right combination of remedies is essential.

The 2026 Penalty Increase: What Changed on 28 March

On 28 March 2026, the Treasury Laws Amendment (Doubling Penalties for ACCC Enforcement) Act 2026 took effect. It doubled the maximum civil penalties for breaches of the ACL, including misleading or deceptive conduct.

The new maximum penalty for a corporation is now the greater of:

• $100 million (up from $50 million)
• Three times the value of the benefit obtained from the contravening conduct
• If the benefit cannot be determined, 30% of the corporation’s adjusted turnover during the breach period (up to 12 months)

For individuals, penalties have also increased substantially.

This is not a theoretical change. The ACCC secured a record $349.8 million in court-ordered civil penalties in the second half of 2025 alone — the highest six-month total in ASIC and ACCC history. The regulator has been explicit: these new penalty levels will be sought in every appropriate case.

For Queensland business owners, this means two things:

1. If you have been misled, the increased penalty regime strengthens your bargaining position. Respondents facing potential ACCC action on top of private claims have a stronger incentive to resolve matters commercially.
2. If you are making representations in business, your compliance risk has doubled overnight. Every claim in your marketing, every representation in a contract negotiation, every financial projection in a sale process — all of it now carries significantly greater exposure.

Common Scenarios Where Section 18 Claims Arise

Misleading and deceptive conduct claims arise across virtually every area of commercial life. These are the scenarios we see most frequently in Queensland:

Business Sale Disputes

A vendor overstates revenue, understates liabilities, or fails to disclose material problems with the business. The buyer discovers the truth post-completion and faces a business worth significantly less than the purchase price. This is one of the most common — and highest-value — categories of section 18 claims.

Franchise Disputes

A franchisor makes representations about expected earnings, foot traffic, supplier costs, or territory exclusivity that turn out to be false or misleading. Franchisees who relied on those representations when investing have strong grounds for a claim.

Property and Development Transactions

Misleading representations about land use, zoning, environmental conditions, rental income, or development potential. Sunset clause manipulation in off-the-plan contracts is another area where section 18 has been applied.

Supplier and Contract Disputes

A supplier or service provider makes misleading claims about the quality, capability, or delivery timeline of goods or services. When the product or service fails to match the representation, the buyer suffers loss.

Investment and Financial Products

Misleading representations about investment returns, risk profiles, or the nature of a financial product. Following ASIC’s permanent ban of a Noosa-based operator in May 2026 for running an unregistered managed investment scheme for eight years, this area is under heightened regulatory scrutiny in Queensland.

The Mistakes That Cost Business Owners Their Remedies

We regularly see business owners who had strong section 18 claims but compromised their position through avoidable mistakes:

1. Waiting too long to act. The limitation period for a section 18 claim is 6 years from the date of the contravening conduct (s 236(2) ACL). But the practical limitation is much shorter. Evidence degrades. Witnesses forget. Documents are lost. And if you continue to trade on the basis of the misleading representation after discovering the truth, you may be found to have “affirmed” the transaction — weakening a rescission claim.

2. Failing to document the representations. If the misleading conduct was oral — a verbal promise during negotiations, a statement at a meeting — you need contemporaneous notes, emails, or witness evidence to prove what was said. The sooner you record the representations (and your reliance on them), the stronger your case.

3. Confusing misleading conduct with breach of contract. These are distinct causes of action with different elements, different limitation periods, and different remedies. A breach of contract claim requires a contractual term that has been broken. A section 18 claim requires conduct that is misleading — which may include pre-contractual representations that never became contractual terms. Pursuing the wrong cause of action (or failing to plead both) can leave money on the table.

4. Not seeking legal advice before responding. When you discover you have been misled, the temptation is to confront the other party immediately. This can be counterproductive. A carefully drafted letter from an experienced commercial lawyer — setting out the misrepresentations, the loss suffered, and the remedies sought — carries significantly more weight than an angry email. It also preserves your litigation options.

5. Ignoring the proportionate liability defence. Under the Civil Liability Act 2003 (Qld) and equivalent federal provisions (s 137B CCA), defendants in misleading conduct claims can argue that other parties contributed to the loss. For example, if your accountant failed to conduct proper due diligence on a business you purchased based on misleading representations, the seller may argue that liability should be apportioned. Understanding this defence early allows you to structure your claim to account for it.

How to Protect Yourself — Whether You Are Making or Receiving Claims

If You Have Been Misled

• Document everything immediately. Gather all representations — written, oral (record in a contemporaneous file note), visual, and digital. Preserve emails, text messages, brochures, and website screenshots.
• Quantify your loss. Calculate the difference between what you were told and what you received. Include direct losses, consequential losses, and out-of-pocket costs.
• Get legal advice before you negotiate. Early advice ensures you plead the right causes of action, preserve your remedies (including rescission), and do not inadvertently affirm the transaction.
• Consider interim relief. If assets are being dissipated or the misleading conduct is ongoing, an urgent application for an injunction or freezing order may be necessary.

If You Are Defending a Claim

• Review every representation you made. Pre-contractual emails, marketing materials, verbal statements during negotiations — all of it is potentially relevant.
• Assess whether the claimant actually relied on the conduct. If the claimant conducted their own due diligence and made an independent assessment, the causal link may be broken.
• Consider proportionate liability. If third parties (accountants, valuers, advisers) contributed to the claimant’s decision, a proportionate liability defence may reduce your exposure.
• Respond strategically. An early, well-structured response can resolve the matter before litigation escalates. Ignoring a claim or responding aggressively often increases costs and narrows settlement options.

How Boss Lawyers Can Help

Boss Lawyers regularly acts for Queensland business owners, directors, and investors in misleading and deceptive conduct disputes — both as claimants pursuing remedies and as respondents defending claims. With over 17 years of experience in commercial litigation and more than 3,000 clients served, we bring practical, strategic advice focused on achieving the best commercial outcome.

Whether you have been misled in a business transaction or are facing a section 18 claim, early advice is essential.

Call Mark Harley directly on 1300 267 711 or contact us online to discuss your situation.

Frequently Asked Questions

Do I need to prove the other party intended to mislead me?

No. Section 18 of the ACL does not require proof of intention, negligence, or fault. The test is objective: would a reasonable person in the target audience have been misled by the conduct? If the conduct was misleading or deceptive — or likely to mislead or deceive — the prohibition is contravened regardless of the respondent’s intention.

How long do I have to bring a misleading and deceptive conduct claim?

Under section 236(2) of the ACL, a claim for damages must be commenced within 6 years of the date of the contravening conduct. However, the practical window is often much shorter. Evidence degrades over time, and continuing to deal with the other party after discovering the misleading conduct can weaken claims for rescission. We strongly recommend seeking legal advice as soon as you become aware of potentially misleading conduct.

Can silence or failing to disclose information be misleading conduct?

Yes. In certain circumstances, silence or a failure to disclose material information can constitute misleading conduct under section 18. This is particularly the case where the parties are in a relationship where disclosure is reasonably expected — such as vendor-purchaser negotiations, franchise disclosure, or pre-contractual dealings where one party holds material information that the other party would reasonably expect to receive.

What is the difference between a section 18 claim and a breach of contract claim?

A breach of contract claim requires a binding contractual term that has been broken. A section 18 claim requires conduct in trade or commerce that is misleading or deceptive. The key advantage of section 18 is that it captures pre-contractual representations — statements made during negotiations that may never have become contractual terms but that induced you to enter the contract. The two claims are not mutually exclusive. In many commercial disputes, both should be pleaded to maximise recovery.

Can the ACCC take action for misleading conduct as well as private parties?

Yes. The ACCC can bring proceedings for injunctions, civil penalties, and other orders for contraventions of section 18. Since 28 March 2026, the maximum civil penalty the ACCC can seek against a corporation is $100 million. Private parties can also bring their own claims for damages and compensation under sections 236 and 237. In practice, the ACCC tends to focus on systemic or consumer-facing misconduct, while private business-to-business disputes are usually pursued by the affected party directly.

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This article contains general information only and does not constitute legal advice. You should seek specific legal advice tailored to your circumstances. Boss Lawyers Pty Ltd ACN 143 136 645.

Written by Mark Harley, Principal Solicitor, Boss Lawyers.