Aco Pty Ltd v Culligan & Anor

Aco Pty Ltd (the appellant) appealed to the Full Federal Court against a decision of a single judge that found it had engaged in misleading or deceptive conduct in contravention of section 52 of the Trade Practices Act 1974 (Cth) (now section 18 of the Australian Consumer Law). The respondents, Culligan and another, were the purchasers of a water filtration system from the appellant. The dispute concerned representations made by the appellant regarding the system's ability to remove certain contaminants, specifically lead and chlorine.

The primary legal issues before the Full Federal Court were whether the representations made by the appellant concerning the removal of lead and chlorine by its water filtration system were misleading or deceptive, and if so, whether the appellant had contravened section 52 of the Trade Practices Act 1974 (Cth). The court also considered the extent of the appellant's knowledge or belief regarding the truthfulness of these representations.

The Full Federal Court, comprising Heydon and Bell JJ, affirmed the decision of the single judge. Their Honours reasoned that the representations made by the appellant were indeed misleading or deceptive because the filtration system was not capable of removing lead and chlorine to the extent represented. The court applied the established principles for determining misleading or deceptive conduct, focusing on the likely effect of the representations on the target audience. The subjective state of mind of the appellant, whether it believed its representations to be true, was not determinative of the contravention of section 52. The court found that the representations, objectively assessed, were likely to mislead consumers into believing the system possessed capabilities it did not.

The appeal was dismissed, and the appellant was ordered to pay the costs of the respondents.