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Entering into contracts

There are many important agreements that community organisations might enter into. We'll help you get the details right from the start.

Content last updated 29/03/2022

Understanding contracts

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Understanding contracts

Contracts are part of everyday operations for many not-for-profits. It’s important to know what issues to look out for when signing on the dotted line. 

Although your organisation may not have much power to negotiate when signing contracts, especially standard form contracts, there are some key principles to consider. If a contract is too risky, your organisation can always choose not to sign. 

If your organisation is not incorporated, an individual will normally be required to sign a contract on behalf of the unincorporated group. This can mean that the individual is personally liable for rights and obligations under the contract. If this has become an issue, your group should consider incorporating. For more information go to our page on the Incorporation Decision.  

For more detailed guidance on contracts, download our fact sheet on understanding contracts. This fact sheet includes information on: 

  • general principles of contract law 
  • reviewing a contract and approval processes for contracts, and 
  • specific types of contracts 
Fact sheet: Understanding contracts (276.8KB)

Consumer Guarantees and not-for-profit organisations

The Australian Consumer Law (ACL) is a national law that aims to protect consumers and ensure fair trading throughout Australia. It’s enforced by the Australian Competition and Consumer Commission (ACCC) at a national level, and by mirror legislation enforced by the fair trading bodies in the states and territories. The ACL contains some very important statutory protections for consumers, called 'consumer guarantees'. 

Our fact sheet explains consumer guarantees and how they apply to not-for-profits.

Fact sheet: Consumer Guarantees and not-for-profit organisations (259.3KB)

Unfair contract terms

A community organisation may take the view that a term of a standard form contract is 'unfair'.  If this can be demonstrated under the ACL, the organisation may seek for the term to be void (not valid or legally binding).  

Our fact sheet outlines:

  • who is covered by the Unfair Contract Term protections?
  • what is an unfair contract term?
  • what do you do if you think a term in your contract is unfair?
Fact sheet: Unfair Contract Terms (301.8KB)

The content on this webpage was last updated in March 2022 and is not legal advice. See full disclaimer and copyright notice.

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