{"id":1664,"date":"2020-12-21T01:50:50","date_gmt":"2020-12-21T01:50:50","guid":{"rendered":"http:\/\/nz.legalvision.com.au\/?p=1664"},"modified":"2025-04-01T11:55:29","modified_gmt":"2025-03-31T22:55:29","slug":"what-is-misleading-or-deceptive-conduct-in-new-zealand","status":"publish","type":"post","link":"https:\/\/legalvision.co.nz\/regulatory-and-compliance\/what-is-misleading-or-deceptive-conduct-in-new-zealand\/","title":{"rendered":"What is Misleading or Deceptive Conduct?"},"content":{"rendered":"\n<p><span style=\"font-weight: 400\">Throughout your interactions as a business or with other businesses, it is common to hear an array of legal phrases. One such phrase is \u2018misleading or deceptive conduct\u2019. You must know what this conduct is to prevent your business from misleading consumers and to recognise when you are the subject of deceptive actions. This article will set out:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">what misleading or deceptive conduct is;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">when misleading conduct is relevant or applicable; and<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">the consequences of committing misleading or deceptive conduct in New Zealand.\u00a0<\/span><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">What is Misleading or Deceptive Conduct?<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">Although it is a phrase that commonly arises in NZ law and business guidelines, there is not a clear definition of misleading or deceptive conduct.\u00a0<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">The phrase merely refers to conduct that, if viewed objectively, would be perceived as:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">misleading;\u00a0<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">deceptive; or<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">likely to mislead or deceive.\u00a0<\/span><\/li>\n<\/ul>\n\n\n\n<div  class=\"box box--icon box--star\">\n    <p>In summary, it generally refers to actions or statements that are likely to mislead or deceive a person into forming an incorrect belief or making a decision they otherwise would not have made.<\/p>\n<\/div>\n\n\n\n<p><span style=\"font-weight: 400\">When evaluating whether an action or conduct was misleading, a court will evaluate whether a reasonable person with the characteristics of the \u2018victim\u2019 of the conduct would have been misled on reasonable grounds.<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">However, it is not necessary to demonstrate that the conduct in question actually misled this person. Instead, it merely has to have had the capacity to mislead or deceive. Furthermore, the person or business who committed the act in question does not have to intend for their conduct to be deceptive for it to qualify as misleading conduct.<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Examples of Misleading or Deceptive Conduct&nbsp;<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">As the definition of misleading conduct is so broad, looking at examples to understand what constitutes misleading or deceptive conduct is useful.<\/span> These examples can help clarify how certain actions, such as false advertising or providing incorrect information, may lead to misinterpretation or unfair business practices.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Misleading Packaging<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">For example, imagine a product\u2019s packaging states that the bottle contains 500mL of top quality, certified organic, extra-virgin olive oil. However, it actually contains 300mL of cheap, processed oil. In such an instance, the packaging was misleading as to the quantity and quality of the product. The retailer of this oil would have committed misleading conduct as they deceived customers as to the contents of that product.<\/span><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Misrepresentation<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">Misleading or deceptive conduct also extends to misrepresentations. A misrepresentation is a false statement or representation about a past or present matter of fact.<\/span><\/p>\n\n\n<div class=\"box box--info box--icon\">\n<p>For example, a supplier of televisions tells their customers that their TVs were $600, but are now $450. However, you were in the store before this sale had started and the TVs were only $500. In this scenario, the supplier misrepresented the previous price of the TVs. In doing so, they have created a false impression about their products and committed misleading conduct.<\/p>\n<\/div>\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Silence<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">In certain circumstances, silence may also constitute misleading or deceptive conduct. This will be the case when an individual or business has some duty to disclose to the other person a piece of relevant information.\u00a0Silence will amount to misleading conduct where a true statement is made, but other matters that make it misleading are omitted.\u00a0<\/span><\/p>\n\n\n<div class=\"box box--info box--icon\">\n<p>For example, an individual offers to sell you their hotel. They specify quite a high sale price, which you believe is reasonable as the hotel had a very high turnover in the last three months. However, they fail to mention that there was such a high turnover because the hotel next door was under construction. The hotel accommodated all of the construction workers from that project for those three months. Therefore, this turnover figure was misleading as it did not accurately represent the hotel&#8217;s average income.<\/p>\n<\/div>\n\n    <div class=\"my-7 lg:my-10 border-y-2 border-gray-100 py-7 lg:py-10 flex flex-col sm:flex-row items-start gap-10\">\n                    <img decoding=\"async\" class=\"w-52 mx-auto my-0! rounded\" src=\"https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/2\/2023\/05\/22210201\/guide-to-resolve-business-disputes-560x792-1.jpg\" alt=\"Front page of publication\"\n                 loading=\"lazy\" width=\"208\" height=\"298\">\n                <section>\n            <div class=\"text-2xl font-bold\">Guide to Resolving NZ Business Disputes<\/div>\n            <div class=\"body-text\">\n                <p>Commercial disputes are costly, stressful and can damage your business reputation. 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       } else {            triggerPostRender();        }    } );} );\n<\/script>\n<\/div>\n<\/div>\n<div id=\"content-next\"><!-- scroll anchor --><\/div>\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">When Does This Apply?<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">There are specific circumstances in which a person who has committed misleading or deceptive conduct can be legally liable for those actions.<\/span> This includes situations where the conduct affects consumers, businesses or other parties who may have relied on false or misleading information to make decisions.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">In Trade<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">An individual or business will be liable for their misleading conduct or statements if they are in trade.<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">Being in trade refers to any:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">trade;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">business;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">industry;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">profession;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">occupation;\u00a0<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">activity of commerce; or\u00a0<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">undertaking, relating to the supply of goods or services.\u00a0<\/span><\/li>\n<\/ul>\n\n\n\n<p><span style=\"font-weight: 400\">This definition of trade also extends to the sale of land or any interest in land.<\/span><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">In Employment<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">There is also a prohibition on misleading conduct for <a href=\"https:\/\/legalvision.co.nz\/employment\/reviewing-employment-agreement\/\">offers of employment<\/a>.&nbsp;<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">Any offer of employment will be misleading if it involves conduct which is misleading or likely to mislead or deceive the recipient of the offer as to matters relating to that employment, such as the:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">availability;\u00a0<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">nature; or<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">terms and conditions.<\/span><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Conduct of Others&nbsp;<\/span><\/h3>\n\n\n\n<p><span style=\"font-weight: 400\">There are also certain circumstances where an individual or business will be liable for conduct that they did not actually commit.&nbsp;<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">A person will be liable for the misleading conduct of another if they have aided, counselled, induced or conspired with that person in relation to that conduct.<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">Furthermore, there is an assumption that the <a href=\"https:\/\/legalvision.co.nz\/commercial-contracts\/agency-agreement-new-zealand\/\">conduct of an agent<\/a> will be the conduct of their principal. As such, the principal will be responsible for conduct the agent committed on the principal\u2019s behalf. However, in such a scenario, it still needs to be established that the principal was involved in trade.\u00a0<\/span>An example where this could occur is in real estate, where the agent is acting on behalf of a vendor.\u00a0<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">The Consequence of Misleading or Deceptive Conduct<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">If you have committed misleading or deceptive conduct in trade or in an offer of employment, or if an individual has committed such conduct on your behalf, you will have committed a <a href=\"https:\/\/legalvision.co.nz\/regulatory-and-compliance\/what-is-the-fair-trading-act-in-new-zealand\/\">breach of the law<\/a>.&nbsp;<\/span><\/p>\n\n\n\n<p><span style=\"font-weight: 400\">If it is demonstrated in court that you have committed misleading or deceptive conduct, you may be subject to:<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><span style=\"font-weight: 400\">criminal proceedings;<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">an <a href=\"https:\/\/legalvision.co.nz\/disputes-and-litigation\/what-is-an-injunction-in-new-zealand\/\">injunction on the misleading conduct<\/a>;\u00a0<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">a court order; or<\/span><\/li>\n\n\n\n<li><span style=\"font-weight: 400\">a large fine.\u00a0<\/span><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"font-weight: 400\">Key Takeaways&nbsp;<\/span><\/h2>\n\n\n\n<p><span style=\"font-weight: 400\">Misleading or deceptive conduct in NZ refers to any conduct that, when objectively viewed, would likely mislead or deceive the recipient of that conduct or statement. However, this conduct must have occurred in trade or employment to constitute an offence. As a business, it is crucial that you evaluate whether your conduct in trade or in the provision of an offer of employment could be perceived as misleading. Doing so ensures that you will avoid the time-consuming and expensive process of litigation. <\/span><\/p>\n\n\n\n<p>If you are advertising to consumers, our experienced\u00a0<a href=\"https:\/\/legalvision.co.nz\/regulatory-lawyers-lp\">regulatory and compliance lawyers<\/a> can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on\u00a0<a href=\"tel:+64800005570\">0800 005 570<\/a>\u00a0or visit our\u00a0<a href=\"https:\/\/legalvision.co.nz\/membership\/\" target=\"_blank\" rel=\"noreferrer noopener\">membership page<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Frequently Asked Questions<\/h2>\n\n\n\n<div class=\"wp-block-group is-layout-flow wp-block-group-is-layout-flow\">\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1606880228344\"><strong class=\"schema-faq-question\"><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong>What does misleading conduct mean?\u00a0<\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong> <p class=\"schema-faq-answer\">Misleading conduct refers to conduct that, when viewed objectively, would likely mislead or deceive the recipient of that conduct or statement.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1606880258379\"><strong class=\"schema-faq-question\"><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong>What is false and misleading advertising?<\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong> <p class=\"schema-faq-answer\">False or misleading advertising is when an advertisement misleads a reader as to the nature, size, quality or quantity of the product or good in question.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1606880271477\"><strong class=\"schema-faq-question\"><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong>Are misleading ads illegal?<\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong> <p class=\"schema-faq-answer\">If the contents of an advertisement mean that the advertiser is committing misleading conduct, the advertiser is committing an offence under the Fair Trading Act.\u00a0<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1606989773267\"><strong class=\"schema-faq-question\"><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong><strong>What are the consequences of false advertising?\u00a0<\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong><\/strong> <p class=\"schema-faq-answer\">False advertising may lead to civil proceedings, criminal prosecution, being subject to a court order or injunction, or\u00a0having to pay a large fine.<\/p> <\/div> <\/div>\n<\/div>\n\n\n\n\n<div class=\"not-prose m-feedback-prompt\">\n    <!-- Thumbs up\/down bar -->\n    <div class=\"m-feedback-prompt__main\">\n        <div class=\"m-feedback-prompt__title\">Was this article helpful?<\/div>\n        <div>\n            <!--span class=\"m-feedback-prompt__button--text\">Thanks!<\/span-->\n            <button type=\"button\" class=\"m-feedback-prompt__button m-feedback-prompt__button--yes\"\n                    data-analytics-link=\"feedback-prompt:yes\" aria-label=\"Agree\">\n                <i class=\"fa-regular fa-thumbs-up fa-3x\"><\/i>\n            <\/button>\n            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value=\"https:\/\/legalvision.co.nz\/regulatory-and-compliance\/what-is-misleading-or-deceptive-conduct-in-new-zealand\/\" type=\"hidden\" name=\"currenturl\"\n                   id=\"currenturl\">\n            <input value=\"What is Misleading or Deceptive Conduct?\" type=\"hidden\" name=\"currenttitle\"\n                   id=\"currenttitle\">\n            <label>\n                <!-- display on thumbs-up -->\n                <span class=\"m-feedback-prompt__feedback m-feedback-prompt__feedback--yes\">\n                    Can you tell us <span class=\"font-semibold\">why<\/span> you found it helpful?\n                <\/span>\n\n                <!-- display on thumbs-down -->\n                <span class=\"m-feedback-prompt__feedback m-feedback-prompt__feedback--no text-lg\">\n                    How can we better improve this article?\n                <\/span>\n                <textarea name=\"feedbackmessage\" id=\"feedbackmessage\" required><\/textarea>\n            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One such phrase is \u2018misleading or deceptive conduct\u2019. You must know what this conduct is to prevent your business from misleading consumers and to recognise when you are the subject of deceptive actions. This article<a href=\"https:\/\/legalvision.co.nz\/regulatory-and-compliance\/what-is-misleading-or-deceptive-conduct-in-new-zealand\/\">Continue reading <span class=\"sr-only\">&#8220;What is Misleading or Deceptive Conduct?&#8221;<\/span><\/a><\/p>\n","protected":false},"author":13496,"featured_media":228278,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","editor_notices":[],"footnotes":""},"categories":[8],"tags":[25,54,270,271,272],"class_list":["post-1664","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-regulatory-and-compliance","tag-small-business","tag-medium-business","tag-misleading-conduct","tag-misrepresentations","tag-misleading-packaging"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.1.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What is Misleading or Deceptive Conduct? | LegalVision New Zealand<\/title>\n<meta name=\"description\" content=\"What does misleading or deceptive conduct mean in New Zealand? 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