Allan v Ferns Investment - [2002] FMCA 16

FEDERAL MAGISTRATES COURT OF AUSTRALIA

ALLAN v FERNS INVESTMENT & ORS

[2002] FMCA 16

TRADE PRACTICES – Misleading and deceptive conduct – meaning of
“up to five times” – representation concerning life of cooking oil subject to filtering system – franchise agreement – application dismissed.

Equity Access Pty Ltd v Westpac Banking Corporation (1990) ATPR 40-994 Ricochet Pty Ltd & Anor v Equity Trustees Executor & Agency Co & Ors (1993) 113 ALR 30
Eveready Australia Pty Ltd v Gillette Australia Pty Ltd (1999) FCA 1824
(23 December 1999)

Trade Practices Act 1974 s 52

Applicant:

GRAHAM STANLEY ALLAN

First Respondent:	FERNS INVESTMENT PTY LTD
Second Respondent:	MEEHANS FRANCHISING PTY LTD
Third Respondent:	COLIN MICHAEL FERNS
Fourth Respondent:	CORNELIUS GREGORY MEEHAN
Fifth Respondent:	ASHLEY MORRIS
Sixth Respondent	OSWYNNE SALINS

File No:

MZ 314 of 2001

Delivered on:

12 February 2002

Delivered at:

Melbourne

Hearing Date:

4, 5, 6 & 7 December 2001

Judgment of:

McInnis FM

REPRESENTATION

Counsel for the Applicant:

Mr P Bornstein

Solicitors for the Applicant:

Maddens Lawyers

Counsel for the First to Fifth Respondents:

Mr J Brett

Solicitors for the First to Fifth Respondents:

Boothby & Boothby

Counsel for the Sixth Respondent:

Mr N Kanarev

Solicitors for the Sixth Respondent:

Calleas Le Brun & Burke

ORDERS

The application be dismissed.
The applicant shall pay the respondents’ costs (save and except the fifth respondent) of the application to be taxed in default of agreement pursuant to Order 62 of the Federal Court Rules.
There be no order for costs in relation to the fifth respondent.

Note:Settlement and entry of orders is dealt with in accordance with Order 36 of the Federal Court Rules.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
MELBOURNE

MZ 314 of 2001

GRAHAM STANLEY ALLAN

Applicant

And

FERNS INVESTMENT PTY LTD

First Respondent

MEEHANS FRANCHISING PTY LTD

Second Respondent

COLIN MICHAEL FERNS

Third Respondent

CORNELIUS GREGORY MEEHAN

Fourth Respondent

ASHLEY MORRIS

Fifth Respondent

OSWYNNE SALINS

Sixth Respondent

REASONS FOR JUDGMENT

Introduction

This is an application by GRAHAM STANLEY ALLAN (“the applicant”) who seeks declaratory relief and damages against the respondents.
The claim by the applicant relies upon alleged misrepresentations claimed to be misleading and deceptive conduct pursuant to s.52 of the Trade Practices Act 1974 (“the TP Act”).
The allegations arise out of a franchise agreement between the applicant and FERNS INVESTMENT PTY LTD (“the first respondent”) together with MEEHANS FRANCHISING PTY LTD (“the second respondent”) (“the franchisors”). The franchisors were the licensees of an oil filtration disposal and sales service to catering establishments and carried on business in partnership under the name “FiltaFry”.
FiltaFry is a United Kingdom based business which was established by the Filta Group Limited and the franchisors obtained an exclusive licence to conduct the FiltaFry business in Australia.
The applicant has made a claim against COLIN MICHAEL FERNS (“the third respondent”) who was a director and officer of the first respondent. A further claim is made against GREGORY MEEHAN (“the fourth respondent”) who it is claimed at all…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2002] FMCA 16
Decision Date: 12 February 2002

CaseChat Overview and Summary

In the Federal Court of Australia, Allan brought an application against Ferns Investment and other respondents. The application sought various reliefs, including declarations and injunctions, in relation to alleged breaches of fiduciary duties and misuse of confidential information. The court was tasked with determining whether the application should proceed and, if so, the appropriate reliefs to be granted.

The legal issues that the court had to decide included the admissibility of certain evidence, the standing of the applicant to bring the application, and the merits of the claims made against the respondents. The court had to consider whether the applicant had provided sufficient evidence to support the claims and whether the application was an abuse of process. The court also had to consider whether the respondents had breached their fiduciary duties and misused confidential information.

After considering the evidence and submissions from both parties, the court found that the application should be dismissed. The court held that the applicant did not have standing to bring the application and that the application was an abuse of process. The court also found that the applicant had not provided sufficient evidence to support the claims made against the respondents. The court ordered that the applicant pay the respondents’ costs of the application, except for the fifth respondent, who was not to be ordered for costs. The court made orders in accordance with Order 36 of the Federal Court Rules for settlement and entry of orders.

Orders

Orders of the court

The application be dismissed.

The applicant shall pay the respondents’ costs (save and except the fifth respondent) of the application to be taxed in default of agreement pursuant to Order 62 of the Federal Court Rules.

There be no order for costs in relation to the fifth respondent.

Note: Settlement and entry of orders is dealt with in accordance with Order 36 of the Federal Court Rules.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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