| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : ABBOTT'S PTY LTD -v- GEL GROUP PTY LTD [2005] WADC 191 CORAM : MARTINO DCJ HEARD :14-16 SEPTEMBER 2005 14-16 SEPTEMBER 2005 DELIVERED : 11 OCTOBER 2005 FILE NO/S : CIV 2755 of 2003 BETWEEN : ABBOTT'S PTY LTD Plaintiff
AND
GEL GROUP PTY LTD
Defendant
Catchwords: Contracts - Incorporation of terms - Implied terms - Torts - Negligent misstatement - Trade practices - Misleading or deceptive conduct
Legislation: Trade Practices Act 1974 (Cth)
Result: Plaintiff's claim dismissed
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Representation:
Counsel:
Plaintiff : Mr A P Hershowitz
Defendant : Mr P Mendelow
Solicitors:
Plaintiff : Stewart Forbes
Defendant : Mullins Handcock
Case(s) referred to in judgment(s):
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266
Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197
Case(s) also cited:
Baltic Shipping Co "The Mikhail Lermontov" v Dillon (1991) 22 NSWLR 1
Brickhill v Cooke [1984] 3 NSWLR 396
Bryan v Maloney (1995) 128 ALR 163
Butcher v Lachlan Elder Realty Pty Ltd (2004) 212 ALR 357
Byrne & Frew v Australian Airlines Ltd (1995) 131 ALR 422
Causer v Browne [1952] VLR 1
Darlington Futures Ltd v Delco Australia Pty Ltd (1986) 68 ALR 385
Gardam v George Wills & Co Ltd (No.1)(1988) 82 ALR 415
Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1
Henville v Walker (2001) 206 CLR 459
Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41
JLW (Vic) Pty Ltd v Tsiloglou [1994] 1 VR 237
John G Glass Real Estate Pty Ltd v Karawi Constructions Pty Ltd & Ors (1993) ATPR 41249
Lezam Pty Ltd v Seabridge Australia Pty Ltd (1992) 35 FCR 535
March v E & M H Stramare Pty Ltd (1991) 171 CLR 506
Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494
Morey v Transuburban City Link Ltd (1997) ATPR 41-571
Mouritz v Hegedus [1999] WASCA 1061
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Nullagine Investments Pty Ltd v Western Australian Club Inc (1993) 177 CLR 635
Olley v Marlborough Court Ltd [1949] 1 KB 532
Pricom Pty Ltd v Sgarioto (1994) ATPR 41365
Pullen v Gutteridge Haskins & Davey Pty Ltd [1993] 1 VR 27
Reg Glass Pty Ltd v Rivers Locking Systems Pty Ltd (1968) 120 CLR 516
Secured Income Real Estate (Aust) Ltd v St Martin's Investments Pty Ltd (1979) 144 CLR 596
Sydney City Council v West (1965) 114 CLR 481
Wardley Australia Ltd v State of Western Australia (1992) 175 CLR 514
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Introduction 1 The plaintiff ("Abbott's") is a company that carries on business as chartered accountants. There are three directors of Abbott's: Mr Bradley Abbott, Mr Christopher Higham and Mr David Drake. All of the directors are accountants who work in Abbott's business. The defendant ("Gel") is a company that carries on the business of staff recruitment. 2 Abbott's claims from Gel damages of $7,694.28 for breach of contract, negligent misstatement and misleading or deceptive conduct arising out of the introduction of an accountant by Gel to Abbott's. 3 Gel introduced the accountant ("the employed accountant") to Abbott's in January 2003. Abbott's employed the employed accountant on 28 January 2003. On 25 February 2003 Gel rendered an account to Abbott's for $4,900.50 as a placement fee for the employed accountant. Abbott's paid that account. The employed accountant resigned on 29 August 2003. 4 The employment of the employed accountant was the first dealing between Abbott's and Gel. 5 Abbott's claims that the employed accountant was incompetent and required constant supervision. The damages it claims are the fees paid by it to Gel (for which $4,900.00 is claimed) and $2,794.28 advertising costs for a replacement employee. 6 Both Abbott's and Gel made several amendments to their pleadings prior to the trial commencing. By amendments made to the defence on the morning of the trial Gel pleaded for the first time that the contract between Abbott's and Gel included an exchange of emails between them. During the trial there was an issue as to whether an email was sent by Gel to Abbott's on 14 January 2003 and, if it was, whether Gel's terms of business were attached to it. Gel's case was that the email was sent to Mrs Eve Kent, Abbott's office manager. Mrs Kent married in or around January 2003. Her name before she married was Eve Stanley and she is so described in some documents. Mrs Kent was not called as a witness. At the time of the trial she was in Europe. In view of the time of the amendment to the defence and the fact that the reason for not calling Mrs Kent was explained by her absence from Western Australia, I draw no inference against Abbott's by its failure to call her.
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7 Neither party called the employed accountant as a witness. As a consequence she had no opportunity to answer the criticisms made of her during the trial. My findings in this action are findings as between Abbott's and Gel, the parties to the action. As the employed accountant has not had the opportunity to answer the criticisms made of her I have not identified her in these reasons.
The communications between Abbott's and Gel 8 In or around January 2003 the employed accountant provided her resume to Gel. It was Gel's practice to prepare a summary of the details of people it was seeking to place and to send that summary to prospective employers. It called the summary a Skillsell. 9 In January 2003 Ms Heidi Madeley, an account manager employed by Gel, prepared a Skillsell on the employed accountant and emailed it to several accounting firms. Abbott's was one of the firms to which Ms Madeley emailed the Skillsell. 10 On 14 January 2003 Ms Madeley sent an email to Mrs Kent in the following terms: 11 Later that day Mrs Kent sent a reply to Ms Madeley's email in the following terms:
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12 Ms Madeley's evidence was that she sent an email in reply on the same day and that attached to that email was a copy of Gel's terms of business. Ms Madeley no longer works for Gel. The only record that Gel has of the emails it sent to Abbott's is a database on which phone conversations and other communications are recorded. According to that database Ms Madeley sent the following email in reply to Mrs Kent's email:
13 Abbott's has no record of having received that email. 14 On 16 January 2003 Mr Higham and Mr Drake interviewed the employed accountant. They had read the employed accountant's resume before the interview. The interview began at approximately midday and lasted for approximately an hour. Mr Higham and Mr Drake decided to pursue further the possibility of employing the employed accountant. 15 Mr Drake telephoned Ms Madeley and requested a copy of the employed accountant's academic record and a reference. 16 Later in the afternoon of 16 January 2003 Ms Madeley sent by facsimile to Mr Drake a copy of the employed accountant's statement of academic record. The statement of academic record showed that the employed accountant had failed some units. Mr Drake read the statement and wrote on it: "Fails due to English Language Problems?" 17 In the same afternoon Ms Madeley sent an email to Mr Drake. The email's subject was "REFERENCE CHECK" and in it Ms Madeley wrote: "Please find the reference for [the employed accountant]. If you have any questions please feel free to call me on [telephone number]." 18 There was an attachment to the email. Mr Drake printed it out. It was titled "REFERENCE CHECK". It concerned the employed accountant and recorded that the position she had applied for was that of intermediate accountant. It identified the referee by name - Kim Tan - and occupation, - "Senior Accountant, Napoli, Fernanades (sic) and Moore". It also provided a telephone number for the referee.
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19 The reference check was in two columns. In the first column were questions or topics. The second columns contained answers to those questions or comments on those topics. The review was very positive. Beside the topic "Technical Abilities" the following comment was recorded:
"She is a competent Accountant. She has a good understanding of Accounting principles for the stage of her career. Also a solid understanding of Tax and tax laws and rulings." 20 For the topic "Management/Supervisory Skills" the following comment was recorded: "She was supervising one grad. She would overlook the grad's work. Train him on some of the office procedures and tax laws." 21 Beside the topic "Key Weaknesses" the following comment was recorded: "Can (sic: Can't) think of any at the moment. Nothing really stands out." 22 Beside the topic "Reason for Leaving" the comment recorded was that the employed accountant had a difficulty with a new Senior Manager, that Mr Tan felt that the employed accountant was not treated in the best way and that she had not had any issues with other managers in the past. 23 For the topic "Sorry to lose him/her" the following comment was recorded: "Yes, she is a hard working accountant; she was a definite asset to our firm." 24 For the question "Would you Re-Employ" the following answer was recorded: "Yes, absolutely." 25 Beside the topic "Comments on Suitability for Position Applied For" the following comment was recorded: "I see her in a medium to large firm where she has the ability to grow." 26 Ms Madeley's evidence was that after Mr Drake telephoned her on 16 January 2003, she telephoned the employed accountant and asked her to nominate a referee. The employed accountant nominated Mr Tan. Ms Madeley's evidence was that she telephoned Mr Tan and asked him
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questions or for his comments in accordance with a standard Gel reference check. She typed the answers or comments into Gel's reference check form as accurately as she could as Mr Tan provided them. 27 After Mr Drake received the statement of academic record and the reference check Abbott's made an offer of employment to the employed accountant. 28 On Friday 17 January 2003 at 12.52 Ms Madeley sent an email to Mr Drake in the following terms: "Hello David I have spoken to [the employed accountant] and her preference is with your firm. She is just waiting to speak to her parents tonight and will call me first thing Monday to confirm everything. Please find attached our Terms of Business. If you have any questions please feel free to call me. Regards, Heidi Madeley" 29 In fact it appears that there was no attachment to that email. Abbott's records include an email from Ms Madeley to Mr Drake sent at 12.56 on the same day. In the email sent at 12.56 Ms Madeley forwarded the email she had sent at 12.52 and also two attachments: "Terms permanent.dot" and "Schedule A.dot". Mr Drake's evidence was that he did not open the attachments and so did not read Gel's terms. His reason for not doing so was that he was busy as he was about to go on holidays and he was not interested in opening the attachments at that stage. 30 At 13.06 Mr Drake sent an email to Ms Madeley in the following terms:
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31 On Monday 20 January 2003, Ms Madeley sent an email to Mr Higham in which she congratulated him on securing the employed accountant for the role of Intermediate Accountant and asked for confirmation of her commencement date, time and salary. Gel does not have a copy of any reply received from Mr Higham but its database suggests that a reply was received, because it shows above Ms Madeley's email of 20 January 2003 the words:
32 These words are followed by an email address which appears to be Mr Higham's together with a confidentiality notice which includes a telephone number which is the number that Mr Drake provided to Ms Madeley on 17 January 2003 as the number for her to contact Mr Higham. 33 On 25 February 2003 Ms Madeley wrote to Mr Drake. The letter was a standard form of letter sent by Gel to an employer after Gel has placed an employee introduced by Gel has been employed. The letter included the following paragraphs: 34 With that letter were Gel's terms of business and Schedule A to those terms and a tax invoice. At the foot of the terms of business there was a space for signatures on behalf of Abbott's and Gel. It had been signed by Ms Madeley for Gel. Abbott's paid the invoice but did not sign the terms of business nor return them to Gel. 35 Clauses 9, 10 and 12 of the terms of business were as follows: "9. Every reasonable effort is made to ensure the suitability of the candidate and reference from past employers may be obtained. No representation or warranty is given by the Company as to the accuracy of any information about the candidates and the Company is not liable for any loss
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or damage of whatsoever nature, including negligence suffered by the Client out of the reliance on any representation, act or omission whether expressed or implied by the Company made about the attributes of the candidate including without limitations any opinion about the candidate. 10. The Company is not liable for any loss, damage, cost or expense whatsoever which is suffered by the Client arising out of any candidate appointed who is referred to the Client by the Company including without limitation any loss, damage, cost or expense arising from or relating to that candidate's lack of skills, negligence, criminal activities, mistakes, breach of contract or statutory duty or defamatory statements. 12. The Company may offer a guarantee, as per Schedule A, from the candidates date of commencement provided the Company's original invoice has been paid within seven (7) days of the date of the invoice ("the Guarantee Period"). Should a candidate hired on the Company's recommendation leave* the client's employment for any reason (subject to the change in job description mentioned below) within the Guarantee Period the Company will undertake to replace the candidate at no charge except for the costs and expenses of any advertising necessary. Should the candidate leave as a result of a change (however minor) in the original job description, no guarantee is offered. The guarantee is limited to one replacement per assignment. If a suitable replacement is not found, a credit for future placements will be offered. No money refund is offered. * In this context "leave" means the candidate hired must cease employment with the Client during the Guarantee Period. If the candidate hired gives notice of intended resignation during the Guarantee Period and ceases employment with the Client outside the Guarantee Period then the guarantee will have expired and no replacement will be provided." 36 Schedule A to the terms of business specified that the guarantee period for the purposes of cl 12 was three months.
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37 On 3 June 2003 Mr Drake spoke on the telephone to Ms Madeley. In that conversation he told her that he was dissatisfied with aspects of the employed accountant's work performance. On the same day Ms Madeley sent an email to Mr Drake in the following terms:
"Hello David, Thank your for returning my call this morning. Please find attached the reference that was conducted on [the employed accountant]. Have you spoken with [the employed accountant] in relation to your concerns about her progress? Regards, Heidi Madeley" 38 Attached to that email was a copy of the reference check.
The employed accountant at Abbott's 39 The employed accountant commenced employment at Abbott's on 28 January 2003 and signed an employment agreement on the same day. The agreement provided that either party could terminate it on giving two weeks' notice. 40 The employment of the employed accountant by Abbott's was not a success. The evidence of Mr Higham and Mr Drake was that she did not have the technical skills that they expected of her. She produced work that was not complete and her work required constant supervision. After mistakes in her work were pointed out to her, she would make the same mistakes on a different job. 41 The employed accountant was due to have a performance review on 8 September 2003. In preparation for that performance review Mr Drake prepared a document in which he assessed her performance. That assessment showed that her performance in the areas of client relations and team skills were at an acceptable standard but that her technical skills were unsatisfactory. 42 Prior to the scheduled performance review Mr Higham spoke to the employed accountant. He told her that she was not suited to a career in a public accounting firm and he encouraged her to look around for a career in a less demanding role.
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43 On 29 August 2003 the employed accountant gave two weeks' notice of her resignation from Abbott's. By letter dated 2 September 2003, Abbott's accepted that resignation "with regret" and wished the employed accountant all the best with her future career. As she had resigned, the performance review did not take place.
44 Following the employed accountant's resignation, Abbott's advertised for an accountant to employ an accountant as a result of the vacancy that arose when she left. The total spent on advertising was $2,794.28.
The employed accountant at Napoli, Fernandes and Moore 45 The employed accountant commenced employment as a graduate accountant at the firm of Napoli, Fernandes and Moore in February 2001. She ceased employment at the firm shortly before she commenced employment at Abbott's. 46 Mr Orlando Fernandes was a partner in the firm of Napoli, Fernandes and Moore when the employed accountant worked there. He gave evidence at the trial and was not cross-examined. I accept his evidence. His evidence was that the employed accountant was a very pleasant person who got on well with other workers at the firm and presented well to clients, but did not develop the technical skills that he expected her to develop with experience at the firm. After 12 months' employment the firm decided to move her from purely accounting work to corporate registry work. That move was of limited success. 47 After 18 months' employment, Mr Fernandes told the employed accountant that he felt her skills were not suited to working in the firm because she was struggling with her technical skills. The employed accountant took some time to consider what Mr Fernandes said and then resigned from employment with the firm. 48 Mr Fernandes did not agree with the description of the employed accountant's technical abilities in the reference check. He found that she was weak in the application of technical skills. For that reason he did not believe that the comments in the reference check on the topics of key weaknesses or on the topic of sorry to see him/her go were accurate. 49 Mr Fernandes' understanding of the employed accountant's reason for leaving was not as set out in the reference check. He understood she left because of his advice to her that she was struggling with her technical skills and that her skills were not suited to working in the firm.
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Mr Fernandes would not re-employ the employed accountant in a role as an accounting technician. 50 I also accept Mr Fernandes' evidence that Mr Tan was not authorised to give references on behalf of Napoli, Fernandes and Moore.
Findings of fact 51 I have set out earlier in these reasons matters that were established on the evidence without dispute. I now turn to matters upon which dispute arose during the course of the trial. 52 Abbott's and Gel used the term "intermediate accountant" in their communications about the employed accountant. It is not a term of precision but I am satisfied that when each of them used it they both meant an accountant who had some experience after graduation from university, but that experience was limited to approximately two years. I am satisfied that there was no misunderstanding between them on the meaning of the term. 53 As I have noted, there was no documentary record to evidence that Ms Madeley sent a copy of Gel's terms of business to Abbott's on 14 January 2003 other than Gel's database on which phone conversations and other communications are recorded. It is likely that Ms Madeley did send the terms of business to Abbott's because Ms Kent asked for her to advise her what Gel's terms were. I conclude on the balance of probabilities that Ms Madeley did do so. As Ms Kent had asked for Gel's terms, I conclude on the balance of probabilities that she read the terms of business when Ms Madeley sent them to her. 54 Counsel for Abbott's opened that Mr Tan was a colleague on a similar level of seniority to the employed accountant at the firm of Napoli, Fernandes and Moore and that they were social friends. The evidence of Mr Fernandes satisfies me that Mr Tan was a senior accountant while the employed accountant did not have that seniority. Mr Tan was senior to the employed accountant. I accept the evidence of Mr Fernandes that they were both members of a large social or business group and that he became aware that on a social level they were relatively close as friends. 55 Neither party called Mr Tan as a witness. Mr Tan was not an employee of either party. I do not draw an inference against either party by the failure to call Mr Tan.
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56 In his closing submission, counsel for Abbott's submitted that Ms Madeley was an evasive and unreliable witness. I do not accept that submission. My assessment of Ms Madeley was that she was an honest witness who did her best to recall events that occurred in 2003 when she was employed by her then employer Gel. Ms Madeley acknowledged that she did not make file notes of all her conversations as she should have.
57 I accept Ms Madeley's evidence as to her telephone conversation with Mr Tan on 16 January 2003 and that she typed Mr Tan's comments and answers as best she could as he provided them. The reference check is not a verbatim record of all that Mr Tan said, but I accept that it is substantially accurate. 58 As I have noted Mr Tan was not authorised to give references on behalf of Napoli, Fernandes and Moore. I conclude from Ms Madeley's evidence that he was not doing so. He was providing his views on the employed accountant. 59 I do not consider that the reference check purported to be a reference by the firm of Napoli, Fernandes and Moore. In my view it was clearly on its face the views of Mr Tan, who was shown on the document as being a senior accountant at the firm. 60 There were aspects of Mr Drake's evidence that I found to be unsatisfactory. As I have noted on 3 June 2003, Ms Madeley sent a copy of the reference check to Mr Drake. On the same day she made a file note in the following terms: "David called to say that he is not happy with [the employed accountant's] work …He said that he doesn't recall seeing the ref check so I have re sent it to him." 61 Mr Drake denied that he had forgotten seeing the reference check. His evidence was that he requested a copy of the reference check from Ms Madeley on 3 June 2003 because he did not have a copy in front of him at the time, as the file was on the other side of the office. 62 I am satisfied that Mr Drake did read the reference check soon after it was sent to him on 16 January 2003. That is because at that time it was a matter of interest to him as he was considering making an offer of employment to the employed accountant. 63 However, I found Mr Drake's evidence as to the reason for his request for another copy of the reference check on 3 June 2003 as
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implausible. I am satisfied that at 3 June 2003 Mr Drake had forgotten that he had seen the reference check, but he did not want to say that in evidence because he was concerned that to do so would not assist Abbott's case. 64 In his evidence in chief, Mr Drake said that the telephone conversation with Ms Madeley on 3 June 2003 was not the first occasion in which he had complained to her about the employed accountant's work. His evidence was that he could not recall specific incidents but he was sure that he did speak to Ms Madeley about the employed accountant "and the response was we needed time to settle in". Ms Madeley denied saying to Mr Drake that time to settle in was needed. My assessment is that this evidence was given on the basis of a reconstruction of events, rather than a memory of conversations. 65 My assessment is that Mr Drake wished at all times to ensure that his evidence assisted Abbott's case and gave his evidence on that basis rather than on the basis of a bona fide attempt to recall events. I prefer Ms Madeley's evidence to that of Mr Drake. 66 I do not accept Mr Drake's evidence that he did not open the attachments to Ms Madeley's email of 17 January 2003 sent at 12.56. It strikes me as implausible that he would not look at what he was being sent. His evidence is also inconsistent with Abbott's affidavit of discovery, sworn by Mr Higham on 17 February 2004 which includes the following in the list of documents annexed to the affidavit:
| "4. | Email H Madeley to Dave Drake encl schedule A and Terms of business | 17.01.03 | | 5. | Schedule A | 17.01.03 | | 6. | Terms of Business | 17.01.03 " | 67 Mr Higham's evidence was that the affidavit of discovery was prepared by Abbott's former solicitors. I accept that it was. Nevertheless it was sworn by Mr Higham. While it is possible to omit documents from an affidavit of discovery through mistake it is unlikely that documents that do not exist would be included in such a list. Items 5 and 6 bear the same date as Ms Madeley's email to Mr Drake attaching documents of that
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description. I conclude that the Terms of Business and Schedule were printed out the same day as Mr Drake received the email. 68 Schedule A to Gel's terms of business showed Gel's fee structure. There was space for completing details of the client and of the employee. One copy of Schedule A tendered in evidence had those details completed, while others did not. There was a dispute as to whether the copy enclosed with Ms Madeley's letter of 25 February 2003 was completed. There was no dispute that any copies of Schedule A sent earlier Abbott's were not completed, because at that time the employed accountant's salary had not been fixed. As the terms of business enclosed with Ms Madeley's letter were signed by her and had Abbott's name typed in at the place for signatures at the foot of the page I am satisfied on the balance of probabilities that the copy of the schedule enclosed with the letter had been completed. 69 I accept the evidence of Mr Higham and Mr Drake that they read the reference check and because it was so positive they decided to employ the employed accountant. I also accept their evidence that the employed accountant did not have the technical skills that they expected her to have. The fact that they did not terminate her employment and the fact that Mr Higham's letter to her of 2 September 2003 accepted her resignation with regret does not lead me to conclude otherwise. The employed accountant did not commit any breaches of her contract of employment. In the circumstances, it was entirely reasonable and appropriate for Abbott's not to terminate the contract but to explain to her what they saw as deficiencies in her skills and to write in the terms of the letter of 2 September 2003.
Whether Gel's terms of business were incorporated into the contract between Abbott's and Gel 70 The parties agreed that they entered into a contract but they disagreed as to its terms. Abbott's case was that it included conversations between January and 25 February 2003. Gel's case was that the agreement included a number of matters including Abbott's conduct in engaging the employed accountant on 28 January 2003. 71 Gel's case was that its terms of business were incorporated into the contract. Abbott's case was that they were not so incorporated. I have expressed earlier in these reasons my conclusions as to the forwarding of the terms by Gel to Abbott's.
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72 Abbott's did not sign the terms. For the terms to have been included in the contract Gel must show that it gave reasonable notice of the terms to Abbott's: Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197. In my view Gel did do so. Mrs Kent asked for Gel's terms and Abbott's provided them to her. In doing so pursuant to that request Gel was giving to Abbott's notice of its terms.
73 Further, Gel again sent a copy of the terms with the email of 17 January 2003, sent at 12.56. At that time both Gel and Abbott's knew that Abbott's might shortly engage the employed accountant. In my view by sending the terms to Abbott's on each of those two occasions, Gel gave to it reasonable notice of its terms. By entering into its contract with Gel after the terms were provided to it, Abbott's accepted those terms.
Implied terms 74 Abbott's case was that the following terms are to be implied into its contract with Gel: "(a) the candidate would be fit for the purpose of carrying out the Position;
(b) the Defendant would exercise reasonable care and skill in the recruiting of the candidate; (c) in carrying out the reference checks, the Defendant will carry out the checks with persons who were ultimately responsible for the employment of the candidate and would have knowledge of the reasons for her leaving; and (d) in interviewing, screening and appraising the candidates, the Defendant would ensure that the candidate had the requisite skills to carry out the Position; (e) the Defendant would not put forward a candidate who did not possess the required skills to carry out the functions and duties of an intermediate accountant."
75 The principles upon which terms are to be implied in a contract were set out in BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 283: "[F]or a term to be implied, the following conditions (which may overlap) must be satisfied:
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(1) it must be reasonable and equitable; (2) it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it; (3) it must be so obvious that 'it goes without saying'; (4) it must be capable of clear expression; (5) it must not contradict any express term of the contract." 76 Abbott's case is that it is entitled to damages for breaches of these terms. That claim is inconsistent with cl 9 and cl 10 of Gel's terms of business and cannot succeed because to imply these terms would contradict the express terms of the contract. 77 Even if Gel's terms of business were not included in the contract, it is my view that the terms pleaded in sub pars (a), (d) and (e) would not be implied. The effect of implying those terms would be that Gel guaranteed that a person it put forward was capable of carrying out Abbott's requirements. In my view such a term is neither reasonable nor obvious. Until an employee has spent time working for the employer, no one can know whether or not the employee has the skills that the employer needs. 78 Nor do I accept that the term pleaded in sub par (c) would be implied. In the absence of any express request by Abbott's or undertaking by Gel I do not accept that it is either reasonable or obvious that Gel would carry out checks with a person so responsible and with that knowledge. A reference is a statement about a person by a person who has some knowledge of the person. 79 I accept that the term pleaded in sub par (b) would be implied. However, Gel did not fail to exercise reasonable care and skill. It was reasonable for Gel to check on the employed accountant's work performance with Mr Tan and to forward the results of the check to Abbott's. 80 Gel passed on all information it received from Abbott's. In my view it was reasonable for it to do so.
Conclusion as to claim in contract 81 Gel did not breach its contract with Abbott's. Gel's terms of business were incorporated into its contract with Abbott's and these preclude
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Abbot's recovering damages for breach of contract. Even if those terms were not included in the contract Gel would not be in breach of contract.
The claim in tort 82 Gel's terms of business also mean that Abbott's claim in tort fails. Even apart from those terms it is my view that the claim in tort would fail. As I have noted it is my view that Gel did exercise reasonable care in its dealings with Abbott's.
The claim for damages for misleading or deceptive conduct 83 Abbott's claim for damages for misleading or deceptive conduct is based on the following pleading as to representations: "13. Further and alternatively, in and during January 2003, on a specific date which the Plaintiff can no longer recall, the Defendant represented by Heidi Madeley orally and in writing represented to David Drake of the Plaintiff that [the employed accountant] was a suitable candidate for the Position and possessed the relevant skills and experience to carry out the functions and duties required by the Position. ('the Representation').
PARTICULARS
(i) The written part of Representation is contained in an email from Heidi Madeley to Eve Stanley of the Plaintiff dated 14 January 2003; (ii) The written part of Representation is further contained in an email from Heidi Madeley to David Drake dated 14 January 2003; (iii) The Representation is further contained in a reference check prepared and submitted by Heidi Madeley dated 16 January 2003, which reference check the Defendant adopted as its own; (iv) The oral part of Representation was made during telephone conversations between Heidi Madeley and David Drake on more than one occasion during the period 14 January 2003 to 28 January 2003;
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(v) The reference check represented that [the employed accountant] was an asset to her previous employer, Napoli Fernandes Moore and Napoli Fernandes Moore would definitely re-employ her. 15A. Alternatively to paragraph 13, 14 and 15, in and during January 2003, on a specific date which the Plaintiff can no longer recall, Heidi Madeley of the Defendant, represented to David Drake of the Plaintiff that there existed reasonable grounds to believe that [the employed accountant] had the attributes suitable for the Position ('the alternative Representation').
PARTICULARS
(i) The alternative Representation is contained in an email from Heidi Madeley to David Drake dated 14 January 2004; (ii) The alternate Representation is further constituted by a resume of [the employed accountant] prepared by the Defendant and forwarded to the Plaintiff; (iii) The alternate Representation is further contained in a reference check prepared by Heidi Madeley dated 16 January 2003 and forwarded to the Plaintiff." 84 In my view none of the communications pleaded constitute the representations alleged. All that Ms Madeley did was provide to Abbott's information she had received about the employed accountant and convey to Abbott's that she was a pleasant person. On all the evidence the employed accountant is a pleasant person and no complaint is made by Abbott's about that aspect of her work performance. The complaint is that she did not have the technical skills that Abbott's were looking for. 85 There was nothing misleading or deceptive about the reference check. On its face it was a check made by Gel with a senior accountant at Napoli, Fernandes and Moore. It was not put forward as the views of Gel nor of the firm of Napoli, Fernandez and Moore or a partner of the firm. Mr Tan's views were accurately conveyed in the reference check.
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86 I conclude that there has been no misleading or deceptive conduct by Gel.
Damages 87 For the reasons I have given Abbott's has not succeeded in its claims for damages. If it had, it is my view that the only damages it could recover would be $2,794.28 for the cost of advertising for a replacement accountant. While the employed accountant did not have the technical skills Abbott's was looking for, in the period during which she worked for the firm Abbott's had the benefit of her services. Whether the damages are assessed in contract, tort or under the Trade Practices Act 1974 there would be duplication of damages for Abbott's to recover both the fee paid to Gel and the cost of advertising for a replacement employee.
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