Unfair business practices encompass

fraud In law, fraud is intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right. Fraud can violate civil law (e.g., a fraud victim may sue the fraud perpetrator to avoid the fraud or recover monetary compen ...

misrepresentation In common law jurisdictions, a misrepresentation is a false False or falsehood may refer to: * False (logic), the negation of truth in classical logic *Lie or falsehood, a type of deception in the form of an untruthful statement * false (Unix), ...

, and oppressive or unconscionable acts or practices by business, often against

consumer A consumer is a person or a group who intends to order, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, who is not directly related to entrepreneurial or business activities. ...

s, and are prohibited by law in many countries. In the

European Union The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been ...

, each member state must regulate unfair business practices in accordance with the

Unfair Commercial Practices Directive The Unfair Commercial Practices Directive 2005/29/ECOfficial Journal of the European Union, L149/22 – L149/39, 11 June 2005 regulates unfair business practices in EU law, as part of European consumer law. It requires corresponding laws to be ...

, subject to transitional periods. In the United States, the Federal Trade Commission's Bureau of Consumer Protection works to prevent unfair business practices by: "collecting reports from consumers and conducting investigations, suing companies and people that break the law, developing rules to maintain a fair marketplace, and educating consumers and businesses about their responsibilities." Individual states within the U.S. are also responsible for protecting consumers against unfair practices. The Consumer Protection Act, protects Alberta, Canada consumers from being taken advantage of. Unfair business practices may arise in many areas, including: *

Tenancy A leasehold estate is an ownership of a temporary right to hold land or property in which a lessee or a tenant holds rights of real property by some form of title from a lessor or landlord. Although a tenant does hold rights to real property, a ...

matters *Matters involving the advertising and sale of products and services to consumers *Matters involving

insurance Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to hedge ...

claims and the settlement thereof * Debt collection in cases of default In addition to providing for the award of compensatory

damages At common law, damages are a remedy in the form of a monetary award to be paid to a claimant as compensation for loss or injury. To warrant the award, the claimant must show that a breach of duty has caused foreseeable loss. To be recognised a ...

, laws may also provide for the award of punitive damages as well as the payment of the plaintiff's legal fees. At

common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omniprese ...

, individuals were not entitled to attorney's fees or punitive damages for wrongful acts committed by businesses in most states. Most often, laws prohibiting unfair business practices require consumers to send a demand letter to the business prior to commencing a lawsuit. If the business fails to make a reasonable offer of settlement within a specified period of time, and is subsequently found liable in court, it may be liable for punitive damages and the injured party's reasonable attorney's fees under many statutes. In some instances, the statutes provide for prevailing plaintiffs to recover double or triple the actual damages against non-settling defendants. When statutes prohibiting unfair and deceptive business practices provide for the award of punitive damages and

attorney's fee Attorney's fee is a chiefly United States term for compensation for legal services performed by an attorney (lawyer or law firm) for a client, in or out of court. It may be an hourly, flat-rate or contingent fee. Recent studies suggest that when l ...

s to injured parties, they provide a powerful incentive for businesses to resolve the claim through the settlement process rather than risk a more costly judgment in court.

See also