What defines a term in a consumer contract as being unfair under New Zealand law?

A term in a consumer contract is defined as being unfair under New Zealand law if it causes a significant imbalance in the rights and obligations of the parties to the detriment of the consumer. This notion is rooted in the idea of ensuring fairness and protecting consumers from contract terms that disproportionately favor the supplier or create undue burdens on the consumer.

In practical terms, a significant imbalance means that the terms are unjustly skewed in favor of one party—typically the seller or service provider—which can lead to situations where consumers are left without adequate protection or recourse. This unfairness may manifest through various means, such as allowing the provider to unilaterally change contract terms without consent or limiting the consumer's ability to seek redress for issues that arise.

On the other hand, factors such as aligning with market trends or providing equal advantages to all parties do not inherently indicate unfairness in contract terms. A lengthy summary alone does not determine the fairness of a term; rather, it must be scrutinized within the context of how it affects the balance of rights and obligations in the contract. Thus, the focus on significant imbalance is central to assessing fairness under New Zealand's consumer contract legal framework.