The branch of law concerned with the supply of goods and services in the most comprehensive sense for the personal use or consumption of individuals and their families is called consumer law. It differs from COMMERCIAL LAW in that in commercial transactions the participants engage in such transactions for the purpose of profit or otherwise in the course of a business. Consumer law in the modern sense is only 30 years old. Its growth reflects the tremendous changes in lifestyles and in the products and services offered in the modern marketplace since WWII.
Some of the important factors contributing to the rise of consumerism are the transition in North America from an agrarian to a predominantly urban lifestyle, mass production and the proliferation of new and often very complex products, a more affluent society with greater discretionary incomes, and the phenomenal growth of consumer credit.
Concerns about the vulnerability of consumers are not new; significant traces of it are found in the Bible (in the condemnation of usury, for example) and throughout medieval and modern European history.
In Canada both the Interest Act and the Food and Drugs Act, to give 2 important examples, originated in 19th-century concerns. Consumer problems today are more numerous and complex than those faced by consumers before WWII, and in most cases cannot be solved by an individual without governmental or other outside assistance.
At the federal and provincial levels, departments or ministries of consumer affairs and consumer-protection bureaus were rapidly established from about 1965 onwards. The federal Department of CONSUMER AND CORPORATE AFFAIRS was established in 1967. The institutional changes have been accompanied by the adoption of much new consumer-protection legislation and the revision of older legislation. Generally speaking, existing legislation is designed to promote one or more of the following objectives.
Protection Against Dangerous Products
Federal examples of this type of legislation include the Food and Drugs Act, the Hazardous Products Act, the Motor Vehicle Safety Act and the Motor Vehicle Tire Safety Act. Consumer protection is achieved by a variety of means, such as prohibiting the sale of dangerous, unsafe or adulterated products, limiting sales to prescribed outlets and on prescription, or by setting standards of safety and purity.
Protection Against Fraudulent and Deceptive Practices
The federal Weights and Measures Act is an early example of this type of legislation. More recent examples include the Competition Act with its important provisions concerning misleading advertising. From 1974 onwards a substantial number of the provinces also adopted "trade practices" or "business practices" acts with the same objectives but employing different enforcement techniques.
Protection Against Unconscionable Contracts
Many modern contracts are standardized and sometimes contain harsh or unreasonable terms. The average consumer would not know of their existence and would be powerless to change them even if he or she knew they were there (see CONTRACT LAW). Legislation directed against this and related types of abuse include the previously mentioned trade practice acts, as well as warranty provisions in the provincial consumer-protection acts and Part V of the federal Bills of Exchange Act. The latter provisions deal with the use of negotiable instruments in consumer credit sales.
Better Access to Information
Modern consumers are not always given sufficient information to make an informed choice between competing products or services, or else the information is presented in a confusing form. The "truth in lending" provisions in the provincial consumer-protection acts and the federal Banking Act (both now badly dated) are designed to provide the needed information in consumer-credit contracts. Important disclosure requirements with similar objectives are found in the federal Consumer Packaging and Labelling Act and the Textile Labelling Act.
Improved Sources of Advice and Access to Conflict-Resolution Agencies
Provincial consumer-protection bureaus have been created to provide general advice on consumer problems and to receive complaints. Community legal service clinics (now found in large cities across Canada) and, to a limited extent, provincial legal aid plans provide legal advice and other forms of assistance to those who cannot afford a private lawyer.
At the judicial level the jurisdiction of the SMALL CLAIMS COURTS has been substantially increased with respect to the size of claims; also noteworthy are the important procedural innovations introduced in the Québec Access to Justice Act of 1971 and the Class Actions Act (the first in Canada) adopted in 1978. Class action legislation now also exists in Ontario and British Columbia.
This description of postwar legislative developments may leave the impression that the modern Canadian consumer is well protected. The appearance is unfortunately misleading, and the picture is not as encouraging as a recitation of the legislation may suggest. The principal difficulty is that much of the legislation is only weakly enforced or not enforced at all.
Some of the legislation is also poorly drafted. Most of the provincial consumer-protection agencies have always suffered from inadequate funding; since the early 1980s situation has become progressively worse and both the federal and provincial governments have reduced or eliminated important programs altogether. In 1993, the federal government "merged" the Department of Consumer and Corporate Affairs with the Department of Industry. Although ostensibly only an efficiency step, it in fact highlighted the demotion of consumer concerns to minor status at the federal level - a precedent which the provinces were only too ready to follow.
This anticlimax to the postwar period of intense legislative activity is explained by some critics on the ground that much of the legislation was never really needed or that, in some cases, it went too far. A more persuasive explanation is that consumers are not politically a cohesive group and cannot match opposing interest groups in effectiveness and resources, particularly during periods of economic adversity.