Unfair contract terms rules void clause after customer lost $111,948
The Full Federal Court refused to force a customer class action into arbitration, upholding a ruling that the dispute clause was unfair.
In Plus500AU Pty Ltd v AghaeiRad [2026] FCAFC 125, released 16 September 2026, the Full Court dismissed appeals by Plus500AU Pty Ltd and its parent, Plus500 Limited, against orders refusing to stay a class action and refer it to arbitration.
The customer opened a trading account with Plus500AU in August 2020 and lost the $111,948 he deposited by June 2021. He checked a box confirming he had read Plus500AU's user agreement before trading, though he had not opened it. The agreement's clause 23 set out a staged dispute process ending in arbitration, with the Australian Financial Complaints Authority (AFCA) also available to customers.
He later brought a class action under Part IVA of the Federal Court of Australia Act 1976 (Cth), alleging misleading conduct, unconscionable conduct and breach of contract over the platform's operation. Plus500AU and Plus500 Limited applied to stay the action and refer it to arbitration under s. 8(1) of the Commercial Arbitration Act 2010 (NSW).
The primary judge found that the arbitration clause was an unfair contract term under s. 12BF of the Australian Securities and Investments Commission Act 2001 (Cth). The court held it void. The clause did not clearly tell customers that arbitration would block them from court or a class action. Arbitration was largely theoretical for most customers because its cost outweighed typical claim values. Plus500AU also failed to show the clause was reasonably necessary to protect its interests. Plus500AU received 566 complaints between September 2017 and March 2021. Of those, 289 went to AFCA. None proceeded to arbitration.
On appeal, the Full Court found no error in that reasoning. It agreed that the clause created a significant imbalance. The clause stopped customers from suing or joining a class action. It weighed far more heavily on customers than on Plus500AU, which the primary judge found would rarely need to sue one. The unfair-term finding alone was enough to dismiss the appeals. The court did not need to decide whether enforcing the clause was also unconscionable conduct.
The Full Court also found, independently of the arbitration ruling, that the relief sought was inconsistent with its role protecting absent group members. Group members had no chance to seek substitution or receive notice before the class action stopped entirely.
The court dismissed both appeals and ordered Plus500AU and Plus500 Limited to pay the costs of the appeals.
