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Armstrong v Rokich

Armstrong v Rokich

Case [2008] WADC 182 23 December 2008

Misleading and Deceptive Conduct

Misrepresentation

Causation

Assessment of Damages

Consumer Law

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JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: ARMSTRONG & ANOR -v- ROKICH & ANOR [2008] WADC 182

CORAM: COMMISSIONER STAUDE

HEARD: 15-18 & 29 SEPTEMBER 2008

DELIVERED : 23 DECEMBER 2008

FILE NO/S: CIV 167 of 2008

BETWEEN: ASHLEY JOHN ARMSTRONG
NIGEL FRANCIS ARMSTRONG
Plaintiffs
AND
ANTHONY JOHN ROKICH
VIOLET ROKICH
Defendants
TABANI NOMINEES PTY LTD
First third party
LYNTON THOMAS SAUNDERS
Second third party

Catchwords:

Misleading and deceptive conduct - Fair Trading Act 1987 - Sale of farm - Misrepresentation of cleared area - Meaning of "arable" - Causation of loss - Assessment of damages

Legislation:

Fair Trading Act 1987

Result:

Plaintiffs entitled to damages of $350,000.00
Third party claim dismissed

Representation:

Counsel:

Plaintiffs:     Mr J A Thomson
Defendants:     Mr J G Hanly
First third party              :     Mr M I Handcock
Second third party         :     Mr M I Handcock

Solicitors:

Plaintiffs:     Maxim Litigation Consultants
Defendants:     Hotchkin Hanly
First third party              :     Downings Legal
Second third party         :     Downings Legal

Case(s) referred to in judgment(s):

Brothers v Park & Anor [2004] NSWCA 241
Henjo Investments Pty Ltd v Collins Marrickville (No 2) (1989) 40 FCR 76
Henville v Walker [2001] HCA 52; (2001) 206 CLR 459
March v E & MH Stramare Pty Ltd (1991) 171 CLR 506
Potts v Miller [1940] HCA 43; (1940) 64 CLR 282
State of Tasmania v Shaw [2001] TASSC 119
Wardley Australia Ltd v State of Western Australia (1992) 175 CLR 514
Warwick Entertainment Centre Pty Ltd & Anor v Alpine Holdings Pty Ltd & Ors [2005] WASCA 174; (2005) 224 ALR 134

COMMISSIONER STAUDE:

Introduction

This is an action for damages arising from the sale of a farming property, Cooladdi Farm, located 20 km west of Carnamah, by the defendants, Tony John and Violet Rokich, to the plaintiffs, Ashley and Nigel Armstrong, in 2002.
The Rokichs had owned and operated the farm for 36 years. The Armstrongs, who are brothers, were their neighbours for most of that time.
The Armstrongs claim damages for breach of s 10 of the Fair Trading Act 1987, i.e. misleading and deceptive conduct; alternatively, for negligent misstatement. The claim is made on the basis that the Rokichs allegedly misrepresented the area of cleared land on the property. The Armstrongs contend that this misrepresentation caused them to agree to pay more for the property than it was worth, and to thereby suffer loss.
The Rokichs deny that they misrepresented the area of cleared land and say that, in any event, the Armstrongs proceeded to complete the purchase in full knowledge of the true position when they could have rescinded the agreement and thereby avoided the claimed loss.
The Rokichs have joined the third parties, Tabani Nominees Pty Ltd, which trades as Elders Real Estate Geraldton ("Elders"), the appointed agent for the sale of the property, and its employee Mr Lynton Saunders, on the basis that their alleged breaches of certain contractual, statutory and common law obligations caused the Rokichs…

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.

Continue reading Armstrong v Rokich

Details

AGLC: Armstrong v Rokich [2008] WADC 182
Case: [2008] WADC 182
Decision Date: 23 DECEMBER 2008

CaseChat Overview and Summary

Armstrong and Rokich were involved in a legal dispute before the Supreme Court of Western Australia. The plaintiff, Armstrong, alleged that Rokich had engaged in misleading and deceptive conduct under the Fair Trading Act 1987 by selling a farm property to Armstrong and misrepresenting the area of cleared land. Armstrong claimed that Rokich had represented that the farm had a significant portion of arable land, but this was not the case upon purchase. Armstrong sought damages for the losses incurred as a result of this misrepresentation.

The central legal issues before the court were whether Rokich's conduct constituted misleading or deceptive conduct under the Act, the meaning of the term "arable" in the context of the sale, and the causation of loss and assessment of damages. The court had to determine if the representations made by Rokich were misleading, the extent of the misrepresentation, and whether Armstrong's losses were directly attributable to this conduct.

The court found that Rokich's conduct did amount to misleading and deceptive conduct. It concluded that the term "arable" in the context of the sale referred to land suitable for cultivation, which Rokich had misrepresented. The court determined that Armstrong's losses were directly caused by the misrepresentation and assessed the damages based on the difference between the actual and represented value of the farm. The court ordered Rokich to compensate Armstrong for the losses incurred.

Orders