The most expensive part of a contract is rarely the headline price. It's usually one of these eight clauses, quietly sitting in the section nobody reads before signing.
1. Cancellation fees
Check whether the fee is a genuine, reasonable estimate of the business's actual loss from early cancellation, or a flat, disproportionate penalty. A cancellation fee that looks punitive rather than compensatory is one of the clause types most likely to be challenged as unfair under the Australian Consumer Law.
2. Automatic renewal
Check the length of the window you have to cancel before renewal triggers, and how clearly that window is flagged. A short, quietly-disclosed cancellation window is a recurring pattern regulators watch closely.
3. Unilateral variation rights
Check whether the business can change price or terms without a stated reason, and whether you get an exit right if you don't accept the change. A one-sided variation clause with no reason and no exit is a strong candidate for a formal unfair-terms challenge.
4. Liability exclusions
Check what the clause actually excludes — a business generally cannot exclude the consumer guarantees the Australian Consumer Law provides automatically, and a clause attempting to do so may itself be unenforceable or unfair, regardless of how it's worded.
5. Deposits
Check what happens to your deposit if you cancel, if the business cancels, or if something goes wrong before the contract is fulfilled. A deposit with no clear refund conditions is a common source of disputes.
6. Warranties
Check the specific duration and what a warranty actually covers, and remember this operates alongside — not instead of — your automatic consumer guarantee rights, which a warranty clause cannot reduce or exclude.
7. Dispute resolution clauses
Check whether the clause forces disputes into a specific, possibly inconvenient process before you can escalate elsewhere, and whether it still leaves your tribunal or consumer authority options genuinely available.
8. Hidden charges
Check for administration fees, processing fees, or other charges not mentioned in the headline price but buried in a schedule or later section. These are exactly the kind of undisclosed cost that a transparency-focused review of the contract is designed to catch before you sign, not after the first invoice arrives.
How to actually use this list
- Read these eight clause types specifically, rather than reading the whole contract start to finish and hoping to notice problems.
- For each one, ask: is this proportionate, and would I have a genuine equivalent right if the situation were reversed?
- Note anything that seems one-sided or vague, even if the language itself is plain and easy to read.
- Remember that a term causing a significant imbalance, without a legitimate reason, and causing you detriment can be challenged as unfair — regardless of how the contract is worded.
What this means practically
- These eight clause types are where the real financial exposure in a contract most often hides — check them specifically rather than skimming the whole document.
- Plain, clear wording doesn't make a one-sided clause fair — Australia's unfair terms test looks at substance, not just readability.
- Consumer guarantees under the Australian Consumer Law can't be excluded by a liability or warranty clause, regardless of how it's phrased.
- A clause combining several of these weaknesses at once (no reason, no exit, poor disclosure) is a strong candidate for a formal challenge.
Sources
- ACCC — Unfair contract terms, examples and business guidance: accc.gov.au
Related Kibbo Tools
- Contract Red Flags Checklist — work through all eight clause types systematically before you sign.