What must a trader do if a term in a contract is deemed unfair?

When a term in a contract is deemed unfair under New Zealand's Consumer Law, the trader is required to remove that unfair term from their standard contracts. This requirement stems from the Fair Trading Act and the Consumer Guarantees Act, which aim to protect consumers from misleading and unfair practices. The focus is on ensuring that consumers are treated fairly, and one way to achieve this is by eliminating any terms that can be deemed as causing a significant imbalance in the parties' rights and obligations under the contract.

By removing the unfair term, a trader not only complies with legal obligations but also fosters trust and transparency with consumers, who might otherwise feel exploited or misled. This action reflects a commitment to ethical business practices and helps maintain a level playing field in the marketplace.

The other options do not fulfill this requirement as adequately as removing the term. Continuing to use the unfair term, simply informing consumers about it, or merely consulting legal counsel without taking further action do not protect consumers' rights or rectify the unfairness in the contract. Thus, the correct approach is to actively remove the term to ensure lawful and fair trading practices.