Can a General Release of Liability exclude Australian Consumer Law consumer guarantees?

Only to a limited extent. Under section 64 of the Australian Consumer Law (ACL, Schedule 2 to the Competition and Consumer Act 2010 (Cth)), any term of a contract that purports to exclude, restrict, or modify a consumer guarantee implied by the ACL is void to the extent of the exclusion, restriction, or modification. Consumer guarantees relevant to services include the guarantee that services will be provided with due care and skill (section 60), that they will be fit for a stated purpose (section 61), and that they will be delivered in a reasonable time (section 62). This means a general release cannot, as a matter of law, eliminate a party's ACL rights in relation to the supply of consumer services. However, section 64A provides a partial exception: where services are not ordinarily acquired for personal, domestic, or household use or consumption, a contract may limit (but not wholly exclude) liability for breach of a consumer guarantee to resupply of the services or payment of the cost of resupply. This limitation can be included in a general release for commercial contracts. Importantly, a general release CAN effectively discharge claims that are not statutory consumer guarantees — for example, common law negligence claims, contractual claims, and equitable claims — provided the release language is clear and unambiguous and the release is supported by adequate consideration.

What consideration is required for a General Release of Liability to be binding in Australia?

Under Australian contract law, a release of claims must be supported by consideration — something of value passing from the releasee to the releasor — to be legally binding as a contract. The consideration does not need to be of equal value to the claims being released; it simply needs to be real and not illusory. Common forms of consideration in a general release include: a monetary payment (lump sum settlement payment); the provision of goods or services; a mutual release of claims (each party releases the other, providing consideration to the other); waiver of a counterclaim; or any combination of these. If a party wishes to give an unconditional release without any consideration passing (for example, in a gratuitous settlement), the release should be executed as a deed rather than as a simple contract — a deed executed under seal does not require consideration to be binding. For a release to be executed as a deed in Australia, it must be clearly expressed to be a deed, signed by the party giving the release in the presence of a witness, and delivered to the other party. Most general releases in Australia are executed as deeds to avoid any argument about adequacy of consideration.

What claims cannot be released by a General Release of Liability in Australia?

Several categories of claims in Australia cannot be lawfully released by private agreement, even where the parties intend to do so. Workers' compensation claims under state and territory workers' compensation legislation (including the Workers Compensation Act 1987 (NSW), the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic), and equivalent legislation in other jurisdictions) generally cannot be settled or released by private agreement — formal approval of the relevant workers' compensation authority is required for a binding settlement. Superannuation entitlements under the Superannuation Guarantee (Administration) Act 1992 (Cth) cannot be released or waived by agreement. Certain unfair dismissal rights under the Fair Work Act 2009 (Cth) cannot be contracted out of, and a release of unfair dismissal claims must generally be approved by the Fair Work Commission. Consumer guarantees under the Australian Consumer Law (as discussed above) cannot be wholly excluded. Personal injury claims involving minors may require court approval of any settlement or release. Tax obligations cannot be contracted away. Practitioners drafting general releases should always consider whether any specific statutory regime applies to the claims being released, as failure to comply with applicable procedures may render the release wholly ineffective for those claims.

Should a General Release of Liability be executed as a deed in Australia?

In many cases, yes. Executing a general release as a deed provides significant advantages in Australia. First, a deed does not require consideration to be legally binding — so a deed of release can be effective even where no monetary payment or other benefit passes from the releasee to the releasor, for example where the parties simply wish to document that all claims are discharged upon conclusion of their relationship. Second, a deed is enforceable for 12 years after execution under the Limitation Act 1969 (NSW) and equivalent state legislation (compared with 6 years for a simple contract), providing longer protection for the releasee. Third, execution as a deed provides clearer evidence of the parties' intention to create binding legal obligations. For a document to be a valid deed in Australia, it must: clearly express on its face that it is a deed or executed as a deed; be signed by the executing party in the presence of a witness (who must not be a party to the deed and who signs as witness); and be delivered to the other party. For companies, execution in accordance with section 127 of the Corporations Act 2001 (Cth) (signing by two directors or a director and company secretary) enables a deed to be executed without a common seal. Where significant claims are being released, seek advice from a qualified solicitor about whether the release should be executed as a deed.

General Release of Liability (Australia) — Australia

Broad general release from all claims under Australian law. Covers Australian Consumer Law (ACL) limitations on excluding liability (s64 and s64A), known and unknown claims, consideration, mutual release option, confidentiality, and governing law.

What Is a General Release of Liability (Australia)?

An Australian General Release of Liability is a legal document by which one party (the releasor) unconditionally and irrevocably surrenders all present and potential future claims against another party (the releasee) arising from a specified matter, event, or period, in exchange for consideration. Unlike a prospective waiver signed before an activity occurs, a general release is typically used after a dispute has arisen or a relationship has concluded, to draw a final line under all possible claims and achieve a complete settlement between the parties.

In Australia, a general release must be carefully drafted to navigate the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) and applicable state and territory laws. Under section 64 of the Australian Consumer Law, any contract term that purports to exclude, restrict, or modify a consumer guarantee implied by the ACL is void. Consumer guarantees for services — including the guarantee of due care and skill (section 60) and fitness for purpose (section 61) — cannot be wholly eliminated by a private release agreement. However, for commercial contracts (services not ordinarily acquired for personal use), section 64A permits a limitation of liability for breach of a consumer guarantee to resupply of the services or the cost of resupply.

A general release is typically supported by consideration — something of value provided by the releasee to the releasor in exchange for the release of claims. This may be a monetary payment, the provision of goods or services, a mutual release of claims, or any other agreed benefit. Where no consideration passes, the release should be executed as a deed to ensure its legal enforceability, as a deed does not require consideration under Australian law.

A broad general release may cover both known claims (those the releasor is currently aware of) and unknown claims (those that may only emerge later, arising from the same matter). The inclusion of unknown claims is a significant legal step and should only be agreed to after the releasor has fully understood the potential scope of the claims being surrendered and, where appropriate, sought independent legal advice from a qualified solicitor.

For disputes involving employment, workers' compensation, or personal injury claims by minors, specific statutory regimes may restrict or govern the settlement process, and a private general release may not be sufficient without additional formal approvals.

When Do You Need a General Release of Liability (Australia)?

An Australian General Release of Liability is needed whenever parties wish to achieve a complete and final resolution of all claims arising from a particular matter, dispute, or relationship, and want legally binding confirmation that neither party will pursue further action.

Common situations where an Australian General Release of Liability is appropriate include: commercial dispute resolution — where two businesses have a contractual disagreement, a defective goods or services claim, or a payment dispute that they wish to resolve by mutual agreement without litigation; personal injury settlements — where an individual has suffered harm and the parties agree to a lump sum payment in full and final settlement of all claims (noting that workers' compensation and certain other personal injury claims may require additional statutory approvals); conclusion of a business relationship — where a consulting, supply, or service arrangement is ending and both parties wish to confirm that all obligations have been fulfilled and all claims discharged; property disputes — following disputes about damage to property, boundary issues, or unpaid rent where the parties reach a negotiated resolution; commercial property transactions — where a landlord and tenant wish to fully and finally resolve all claims on termination of a commercial lease; and employment separations (non-unfair-dismissal) — where an employee and employer agree to a full and final settlement of all contractual and common law claims arising from the employment relationship (noting that statutory entitlements such as unpaid wages, superannuation, and entitlements under applicable modern awards cannot be released).

A general release is most effective when both parties have had the opportunity to obtain independent legal advice, the consideration is fair and reasonable in the circumstances, the claims being released are clearly identified, and the release is executed as a deed to avoid any dispute about consideration or enforceability.

What to Include in Your General Release of Liability (Australia)

A well-drafted Australian General Release of Liability must contain several essential elements to be legally effective and provide the intended protection.

The identification of parties must be precise, including full legal names, registered addresses, and — for companies — Australian Business Numbers (ABN) or Australian Company Numbers (ACN) as they appear on ASIC records. Any ambiguity about who is bound by the release can undermine its effectiveness.

The description of claims being released should be as specific as possible, identifying the underlying matter, dispute, or relationship that gives rise to the claims, and the period to which the release applies. While a general release is intended to be broad, Australian courts will construe ambiguous release language narrowly — meaning that poorly described claims may not be effectively released.

The Australian Consumer Law notice is essential. The release must acknowledge that certain consumer guarantees under the ACL cannot be excluded, and that the release does not purport to exclude those guarantees. Where the matter involves a commercial contract (not a personal use supply), the release should include the section 64A limitation of liability clause.

The consideration clause should clearly state what the releasee is providing in exchange for the release, and should include an acknowledgment by the releasor that the consideration has been received and is satisfactory. If the release is to operate as a deed (which is recommended where no consideration passes, or for claims of significant value), it should be clearly expressed to be a deed and executed with a witness.

The unknown claims clause extends the release to claims arising from the same matter that the releasor does not currently know about — this is critical for a truly comprehensive settlement. Including this clause requires the releasor to acknowledge that they may be releasing claims they are not aware of.

The mutual release clause (where applicable) ensures that both parties release each other, preventing either from bringing claims against the other in the future.

The representations and warranties require each party to confirm that they have full authority to execute the release, that they sign freely and voluntarily, that they have had the opportunity to seek legal advice, and that they have not already assigned the released claims to a third party.

Frequently Asked Questions

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