Commissioner for Fair Trading, Department of Commerce v Perrett - [2007] NSWSC 1130

No judgment structure available for this case.

CITATION: Commissioner for Fair Trading, Department of Commerce v Perrett [2007] NSWSC 1130

HEARING DATE(S): 8 October 2007

JUDGMENT DATE :
12 October 2007

JUDGMENT OF: Harrison J

DECISION: See paragraph 134.

CATCHWORDS: TRADE AND COMMERCE – misleading and deceptive conduct – representations concerning treatment and substances – whether capable of curing etc or delaying onset or progression of diseases including cancer, multiple sclerosis and Huntington's disease – alternative medical practitioner – limited declarations and orders made

LEGISLATION CITED: Evidence Act 1995
Fair Trading Act 1987 - ss 41, 42, 49, 50, 65
Trade Practices Act 1974 - s 51A

CASES CITED: ACCC v Danoz Direct Pty Ltd (2003) ATPR (Digest) 46-241; [2003] FCA 881
ACCC v Purple Harmony Plates Pty Ltd [2001] FCA 1062
Commissioner for Fair Trading, Department of Commerce v HMS Direct Limited, Hallstone Products Pty Ltd and David Stucky [2003] NSWSC 415
Commissioner for Fair Trading v Microwave Safe Australia Pty Ltd [2006] NSWSC 287
Commissioner for Fair Trading v Rowland Thomas and Ors [2004] NSWSC 479
Jones v Dunkel (1959) 101 CLR 298
Levick v Law Society of New South Wales [2002] NSWSC 481

PARTIES: Commissioner for Fair Trading, Department of Commerce (Plaintiff)
Paul John Perrett (Defendant)

FILE NUMBER(S): SC 20331 of 2006

COUNSEL: A I Tonking SC (Plaintiff)

SOLICITORS: I V Knight, Crown Solicitor (Plaintiff)

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
PROGRESSIVE LIST

HARRISON J

12 October 2007

20331 of 2006 Commissioner for Fair Trading, Department of Commerce v Paul John Perrett
JUDGMENT

1 HARRISON J: By its amended statement of claim filed on 8 October 2007 the plaintiff seeks a declaration that the defendant has engaged in misleading or deceptive conduct, and conduct which is likely to mislead or deceive, in contravention of s 42 of the Fair Trading Act 1987 ("the Act “) and a declaration that he has engaged in conduct that is liable to mislead the public as to the nature, characteristics, and suitability for their purpose of certain goods in contravention of s 49 of the Act.

2 Further, the plaintiff seeks an order that the defendant be restrained from representing in trade or commerce that he is able, whether with the assistance, or by the use, of any substance or article supplied by him or otherwise, to cure, alleviate the symptoms of, or prevent or delay the onset or progression of certain diseases and ailments, and an order that he be restrained from representing in trade or commerce that any substance or article, whether supplied by him or otherwise, is capable of, or will, cure, alleviate the symptoms of, or prevent or delay the onset or progression of, any disease or ailment in any person.

3 Finally, the plaintiff seeks an order pursuant to s 65 of the Act that the defendant be restrained from carrying on any business of supplying, or being involved in the supply, whether directly or by mail order or otherwise, of any goods or services with purported therapeutic effect including, but not limited to, the goods and services referred to in the Schedule to the amended statement of claim.

4 By his amended defence filed 15 February 2007 the defendant, in effect, puts the whole of the plaintiff’s pleaded case in issue. Notwithstanding his defence, the defendant filed no evidence in the proceedings nor did he appear at the hearing. An application to vacate the hearing date made to Hoeben J on Thursday 4 October 2007 was refused by his Honour. By letter dated 5 October 2007 addressed to the Common Law Registry, the defendant attached a copy of a holding summons for leave to appeal to the Court of Appeal that had been filed that day. The file does not reveal that the defendant made an application for a stay of his Honour's order. I am unaware of whether or not the defendant made any such application to the Court of Appeal. No such application was made to me.

Background

5 The plaintiff's case may be simply put. From time to time since at least 1998 the defendant has carried on a business, from premises at Suite 11, West Mall, Rutherford and elsewhere in New South Wales, known as "Rutherford Health Clinic" or "Rutherford Clinic", consisting of the supply for reward to people suffering or claiming to suffer from serious diseases or ailments, of goods and services, and the making of representations to those people as to the efficacy of the goods or services as a means of curing, alleviating the symptoms of and preventing the onset or progression of their diseases or ailments. The defendant is not a registered medical practitioner.

6 The goods included black oval shaped tablets, capsules, white powder, ampoules of red liquid for injecting, bags of yellow fluid for intravenous drips, bottles of "serum", green tea capsules, capsules of white powder described as "EMS-425", an opaque white substance described as "Stilbetol”, a black ointment, substances described as "Cerebro Vassetin”, “Hesbrotol”, “Amch-mgo”, “Stilbetol-Z1”, and other substances of unknown or uncertain composition. The goods also included a "radiation pulsation machine". The services included consultation and advice in relation to the diagnosis, prognosis and treatment of acute and chronic medical conditions and the application of ointments and the administering of intravenous injections.

7 The plaintiff relied upon a series of affidavits that, in the absence of the defendant or his representative, were read without objection. It is necessary to refer to these affidavits in some detail.

Owen Holbert – 22 September 2006

8 In about 1993 Mr Holbert was diagnosed with multiple sclerosis. He was seeing his local general practitioner and a neurologist for this condition. On 6 February 1998 he consulted the defendant. During the consultation the defendant said the following things to Mr Holbert:

"I trained to be a medical doctor but discovered I have an allergy to a drug that I would need to be able to use frequently as a medical practitioner. The drug [sic] is Formalin and my allergy makes it impossible for me to practice so I did not finish my training to formally qualify as a medical practitioner. I served in Vietnam as a helicopter pilot and I also work shifts on the Westpac rescue helicopter.

9 Mr Holbert said he told the defendant that he had multiple sclerosis and his main problem was weakness on the left side of his body. The defendant replied, "I have managed other multiple sclerosis patients and I have had many successful and positive outcomes."

10 Mr Holbert then said that he observed the defendant get several containers and hand them to him. They contained small black oval shaped tablets. The defendant gave Mr Holbert instructions as to how many of the tablets he should take. Mr Holbert paid the defendant $44 for the consultation and the tablets. He received a receipt. He read it and observed that it had a provider number on it. The defendant told Mr Holbert that he could claim it through his health fund. The defendant did not carry out a physical examination of him. Mr Holbert later lodged a claim with his health fund and received a refund of $26.

11 Around 24 March 1998 Mr Holbert went to see the defendant again. The defendant changed his medication to include daily injections of vitamin B12 in addition to the original medication he was given. Mr Holbert purchased several ampoules that contained a red coloured liquid. The defendant said:

“These are vitamin B12, they are injected and you'll need to take them daily. It benefits the nervous system. I synthesise and make the serum myself in consultation with the University of Newcastle. You'll need to take it daily and you can inject it yourself. As you inject the serum draw it out slowly so that it goes through the muscle.”

12 Mr Holbert paid $35 for that consultation and later lodged a claim with his health fund for which he received a $26 medical benefit refund.

13 In accordance with the defendant's direction, Mr Holbert purchased syringes and needles and gave himself a daily injection with the substance he was given. He felt that he had a bit more energy and continued to inject himself with the serum.

14 In about April 1998 Mr Holbert and his wife travelled overseas. The defendant gave him a letter describing the medication he had given to Mr Holbert so that he could take the medication with him wherever he went. Mr Holbert returned from overseas on 18 May 1998.

15 About 7 October 1998 Mr Holbert was still experiencing weakness and he attended the defendant's clinic. He was given another injection and more tablets. He paid the defendant $50 for that visit and received a $26 refund from his health fund.

16 About a week later Mr Holbert again consulted the defendant. The defendant said, "The intravenous drip is made from the bark of a tree in China. It has been further refined in Belgium. Its purpose is to kick-start the cells in the body that have ceased to function. I will give you a course of infusions through a drip over six weeks. I'll give you the first one today".

17 Mr Holbert then lay down on the couch while the defendant put a needle into his arm. The needle was connected to a plastic tube that was itself connected to a bag containing a yellow liquid. The defendant said, "I'll have to sit with you while the drip goes through so that I can regulate it. If it drips too quickly it can cause pain". Mr Holbert paid the defendant $40 for that visit and again received a refund from his health fund of $26.

18 On about 21 October 1998 Mr Holbert attended the defendant's office where he administered a second intravenous drip. The price and the refund were the same.

19 After he left the office Mr Holbert suffered a severe reaction. Later that morning and in the afternoon he broke out in a heavy sweat and felt nauseous, which was followed by a large bowel movement. Mr Holbert became very weak and shaky. He telephoned the defendant and complained to him that he had not been told about the side effects of the drip. The defendant said, "Good, your stomach would have been like a rusty water pipe. Now it's clean and pink and like a young man's stomach".

20 Around 20 October 1998 Mr Holbert returned to the defendant's office for the third intravenous drip treatment. The price and the refund were again the same. Following this treatment Mr Holbert developed cold sores all over his lips. He telephoned the defendant and told him about this. The defendant said, "Good, that is the latent virus coming out of your system".

21 About 4 November 1998, 11 November 1998 and 18 November 1998 Mr Holbert had a further three intravenous drip treatments. On each occasion he paid the defendant $48 and subsequently received a $26 refund from his health fund. He did not suffer any further adverse reactions.

22 On about 19 February 1999 Mr Holbert attended the defendant's clinic again and was supplied with more medication. He paid $48 for the consultation and received a $26 refund from his health fund. On this occasion the defendant said to him, "I have been in touch with an associate overseas and there is a new treatment being used and we should try it. It has a good chance of success".

23 Mr Holbert ceased visiting the defendant at his clinic after the defendant spoke in negative terms about a particular treatment that had been proposed by Mr Holbert's general practitioner.

Sheryl Anne Willson - 25 September 2006

24 In about December 2002 Ms Willson underwent a mammogram and fine needle aspiration biopsy at the Breast Screening Clinic in Parramatta. She was diagnosed with a malignant cancer of her left breast. On 3 February 2003 she underwent a lumpectomy for the removal of a mass from her breast.

25 About the end of February, or the beginning of March, 2003 Ms Willson consulted the defendant. She told him that she had undergone a lumpectomy and that she had been advised by her specialist to undergo a course of chemotherapy and radiation. The defendant said to her:

"I strongly oppose chemo and radiation because of what it does to your body and what it does to the cancer. Chemotherapy strips your immune system. With my help, I can restore your immune system, shrink the cancer and we can get rid of it. You have to come up and see me. I am very busy with patients but I can see you on Tuesday 18 March 2003. I am at the Rutherford Health Clinic at Rutherford."

26 On 18 March 2003 Ms Willson and her husband attended the clinic. On that occasion the defendant said the following:

"I worked for NASA for over eight years as a biochemist. That's where I got my training. I go to Japan and China several times a year to look into cancer remedies and antioxidant treatments. I grew up in China and I am a fifth generation medical practitioner. My mother was a midwife and my father was a doctor. Five generations of my family have been medical practitioners. With my family's medical background, knowledge and experience we have developed an ointment that will track down and up root live cancer cells. I am on the cancer board in Texas. The Mayor of Newcastle gave me these rooms to establish myself. I went to Vietnam where I was a coroner. I saw too much of death and became a biochemist. I flew helicopters in Vietnam. I got leukaemia while I was in Vietnam and I was treated by someone in Parramatta who was a master in alternative medicine and I am now cancer free".

27 The defendant showed Ms Willson colour photographs showing tumours and different types of cancers on people. The photographs showed the tumours falling out which left holes in the skin where the tumour had been.

28 The defendant then said to Ms Willson:

"You will need to have CA15.3 tumour marker tests and thermal imaging. These tests will keep track of what is going on with the cancer in your body and I will be able to tell if the cancer is shrinking and responding to my treatment. Your cancer is oestrogen fed. You will need to go off all dairy products because they're full of oestrogen. You will need to stop eating pork because it's full of hormones and eggs because they have hormones and antibiotics. Get free-range eggs and organic chicken. I will give you an oestrogen inhibitor medication. It will help build up your body and your immune system. Chemotherapy only works once. If we absolutely have to we’ll save it for last but you are nowhere near that stage, we’ll save that treatment for last if we absolutely have to use it".

29 The defendant gave Ms Willson a physical examination that involved removing her blouse and bra while he squeezed and poked at her left breast. He said, "Oh no, I don't think they've got all the cancer. All that hardness I can feel is not just scar tissue; there's cancer there they did not get it all".

30 The defendant then left the room and returned with a small glass jar containing a black coloured ointment. He said, "This is the ointment you will need for your breast. The government will only let me sell this amount of the ointment, no less. It costs $1400. You won't need it all but the government will only allow it me sell this quantity".

31 Ms Willson replied, "I don't have that much on me". The defendant replied, "I'm sorry but that is the cost. Fortunately, I won't have to charge you for the consultation because the Texas Cancer Board supports me financially and they reimburse me". Ms Willson said, "We do not know how long it will take us to raise the $1400 but we will get it somehow and we will ring you ".

32 Around 20 March 2003 Ms Willson went back to the defendant with a cheque for $1400 to purchase the ointment. She was offered a receipt but was not given one when she said she was not in a health fund. The defendant then put some of the black ointment on Ms Willson's breast and put a band-aid over it. The defendant said:

"Leave it for four days don't touch it. It will up root any cancer cells and kill them. If it tingles after 30 minutes then there are definitely active cancer cells there. If nothing happens then that's fine. Here is the ointment. Leave what I've put on for four days. Do not touch it. I'll make you up some other medications ".

33 The defendant then went out of his office and returned and gave Ms Willson three bags containing a powder. He said, "This is an anti-cancer treatment, I make them up myself. The instructions are on each container".

34 Ms Willson said that after three days her left breast became swollen and inflamed. She felt a burning sensation where the ointment contacted the skin. She removed the band-aid that the defendant had applied. She saw that there were holes in her skin.

35 Ms Willson telephoned the defendant and said, "I'm concerned about my breast. I took the band-aid off and my breast is inflamed and I'm in a lot of pain". The defendant replied:

"I said not to touch it dear as you have active cells. Put some rubber gloves on, take the old dressing with the ointment on it and just cover it with a clean dressing. Leave it two more days and let your husband put more ointment on and leave it for four days and let it take its course".

36 Ms Willson said that after two days when her husband re-applied the black ointment to her left breast and covered it with a band-aid, her breast began to burn with pain. Therefore, around the first week of April 2003, after the ointment had been on her left breast for four days, Ms Willson's husband took a series of photographs. Those photographs are annexed to her affidavit.

37 In the second week of April 2003 Ms Willson telephoned the defendant. This was about four days after she had taken the band-aid off her breast and had left a message on his answering machine. The defendant subsequently returned the telephone call and said, "Keep it clean and let it run its course. Keep taking the medicines and changing the bandage".

38 Around the end of April 2003 Ms Willson again went to see the defendant with her husband. The defendant said:

"Yep, that's fine it's not unusual I have treated larger tumours than this. I'm currently building a radiation pulsating machine for a woman. It puts out magnetic fields and is a healing device. The pulsator kills bacteria. I can stop your body from producing the cancer cells. You do not need to have invasive surgery to remove the lumps and tumours".

39 The defendant showed Ms Willson a device. It was round and had coils attached to it. The defendant said, "When it's finished you could buy one too". The defendant then went on to explain the electronic workings of the device in great detail. He also showed Ms Willson a fluoro light device.

40 Around the first week of May 2003 Ms Willson telephoned the defendant. He asked, "How is it going? Can you come up? I'd like to have a look at you". Ms Willson went to see the defendant about the middle of May 2003. At this time the defendant said:

"It's looking good keep it dry and it will heal by itself. Take some vitamin C and stick with the medications I have given you. Here are some more tablets. I'll send the thermal imaging scans and the test results to the Texas Cancer Board for comment and confer with them by e-mail. Keep taking the medicine but contact me before you run out and I'll send you some in the post".

41 Ms Willson replied, "So, the medicine you are giving me is like chemo in tablet form?" The defendant replied:

"Yes dear and there are no side effects. I always recommend that you have a thermal imaging scan and you don't need a doctor's referral to have it done. The results from the tumour markers and the thermal imaging tell me when to rotate the medications and change the dosage".

42 About September or October 2003 Ms Willson spoke to the defendant. He said, "Your latest blood test shows the tumour marker is rising, this needs to be treated. I have a drip that will help adjust your immune system; it will give a kick-start and be good for you. It's a peroxide drip, but it has other ingredients in it as well."

43 Several days later Ms Willson telephoned the defendant. He said, "You should have a drip treatment, it would be very good for you. It would be best if you had it once a day over a two-day period, you could stay up here over night." Ms Willson replied, "I don't know if I could stay that long because of the kids but I will have the drip treatment next time I come to see you".

44 About a week after that Ms Willson went to see the defendant for more medication. She was sitting in a chair in his office and told him that she had decided to have the drip treatment. The defendant then placed a drip stand beside the chair she was sitting on. He put the container on the stand which had some plastic tubing coming out of it. He took the medical cannula and stuck it into a vein in the back of her hand and attached the drip tube to the cannula. Ms Willson sat there for about half an hour while the fluid from the container went down the tube into her body.

45 After receiving the drip Ms Willson initially felt okay. During the two-hour drive home, however, she began to feel a bit odd. Within four hours of having the treatment she began feeling very ill and went to bed. She suffered extreme aches and pains. She alternated between having hot and cold flushes for the next 24 hours. Ms Willson did not have this treatment again even though the defendant suggested to her that it would be beneficial.

46 The defendant continued to dispense more medication to Ms Willson. He increased the dosage to 27 tablets a day. He said, "I want you to mix these powders with liquid and drink them three times a day and this infusion [is] made from mushrooms, it is to be taken three times a day". The defendant did not charge Ms Willson for the medication and said to her, "I won't charge you as I have other wealthy patients who can afford to pay”.

47 Ms Willson continued to see the defendant every month for about 12 months until March or April 2004. On each of her visits her husband accompanied her and was present during her consultation with the defendant.

48 On 15 May 2003 Ms Willson attended Dr Sidhu’s surgery at St Leonards and had a conversation with him about her treatment and whether she should have radiation and chemotherapy. Ms Willson consulted Dr Sidhu on 29 May 2003, 18 September 2003, 5 February 2004 and 27 May 2004.

49 In early April 2005 Ms Willson attended Dr Sidhu’s surgery. He informed her that she had a new primary cancer in her right breast as well as a recurrence of the original cancer in her left breast. Between 9 May and 29 June 2005 Ms Willson underwent chemotherapy at the Nepean Cancer Care Centre.

50 Around 25 July 2005 Ms Willson attended Dr Sidhu’s surgery and underwent a series of tests and a C.A.T. scan over one whole day. She commenced radiation treatment on 27 July 2005. That treatment finished in mid-September 2005.

51 The defendant telephoned Ms Willson sometime in July 2005. He said, "I'm being hounded by reporters and have had to change my phone number". He supplied Ms Willson with a new mobile telephone number.

52 Shortly after undergoing radiation treatment in about September 2005 Dr Shannon prescribed tamoxifen for Ms Willson. She told the defendant about this. He said, "You can't take tamoxifen for any more than 3-5 years". Ms Willson replied, "The oncologist said I could take it for five years. My surgeon, Dr Sidhu told me that it will help improve me by 70 per cent in conjunction with chemo". The defendant replied, "No, they're only offering you that over three years, and that's about 30 per cent of what they really could offer you".

53 On 1 November 2005 Dr Sidhu performed a bilateral mastectomy with an associated flap and skin graft. On 30 May 2006 Ms Willson underwent an operation for the removal of her ovaries and fallopian tubes.

Clare Denise Ellis -28 September 2006

54 In August 2002 Ms Ellis was receiving treatment from an endocrinologist and underwent an ultrasound that indicated an abnormal lump in her thyroid. She underwent a fine needle aspiration biopsy that confirmed the presence of the lump. In August 2002 she underwent an operation for the removal of the lump and much of her thyroid. A biopsy of that lump showed an oncocytic change within an atypical follicular pattern.

55 In early May 2005 Ms Ellis had an ultrasound, which diagnosed abnormal cells on the remaining part of her thyroid. A further fine needle aspiration biopsy showed that there was a malignancy and the remainder of her thyroid was surgically removed. She was advised to have radiation therapy.

56 In July 2005 Ms Ellis telephoned the defendant at the Rutherford Clinic. She informed the defendant that she had just been diagnosed with a malignant tumour in her thyroid and had been advised to have radiation treatment. The defendant said:

"Radiation can have an adverse effect on the body. The radiation process is like the whole body is being microwaved. The DNA is still vibrating six weeks after the process. You can have nausea, lack of coordination and your senses are distorted. It can affect the neighbouring vital organs such as the brain. There is a great chance that the radiation will cause damage to your brain".

57 Ms Ellis asked the defendant for some more information about what he did and his qualifications, what is in the tablets that he prescribes and why his medicine is not known generally. The defendant replied:

“I am a biochemist. I have been working from Newcastle for many years. It comes down to touting. I have to be very careful with medical practitioners because they will take away my business. I make home visits, so I can see you at home. How about 10.00am this Friday 29 July?"

58 The defendant visited Ms Ellis at her home on that day. Upon further enquiry by her the defendant said:

"I am a biochemist. I worked at the London morgue as a forensic scientist but I had a reaction from the formaldehyde. Then I went to work at NASA. I have a house in Newcastle and I'm looking after my eighty year old mother and my brother's son".

59 Ms Ellis explained her medical condition to the defendant. She told him that she was trying to decide which form of treatment she should undergo. The defendant said:

"I will give you liquid Stilbetol. It comes from Japan. It has a high potency and it will build up your immunity. It is freshwater seaweed star pod oil extracted from the heart of the seaweed plant. You will need to mix it with a liquid. I suggest you mix it with lemon juice and water and take it once a day one-hour before food. You also need green tea capsules. The green tea is from China and has a high concentration of cancer cell destroying agents. You will need to take three capsules twice a day morning and evening also before food".

60 The defendant then began drawing on a piece of paper. He said:

"This is what it looks like when the immune system does not recognise the healthy cells. The medication I will give you will stimulate the immune system. It will seek out radical cancer cells and deeply penetrate the cells of the marrow and match it with the DNA of healthy cells".

61 Ms Ellis showed the defendant a letter dated 11 July 2005 that she had received from her specialist explaining the results of a biopsy. The defendant glanced at the letter but did not appear to pay a great deal of attention to it. The defendant said to her, "You have some fight in you yet. Your body has already shown signs of fighting the malignant lump". Ms Ellis said, "Do you have any printed material that explains what you do?" The defendant replied, "No, I do not. That is why I don't have a webpage in case people copy my therapies". Ms Ellis said, "I appreciate you explaining things to me in lay terms so that I can understand it". The defendant replied, "Every now and then I have a patient who is a medical practitioner and I can talk in medical terms with them".

62 The defendant told Ms Ellis that the cost of the treatment was $3778. She asked if she could pay by instalments. To this the defendant replied:

"No, the Health Department does not like to look at my book and see part payments they prefer to see the money paid upfront. I can send you the medicine straight away and you can pay me when you are ready. I won't charge you for this consultation. I like to present what I do and give people a few days to think about it".

63 On 1 August 2005 Ms Ellis was feeling unwell and needed to make a decision about her treatment. She telephoned the defendant. She informed him that she would like to go ahead with the treatment. The defendant replied:

"Okay, that's good I can send you out some Stilbetol. I will also send you some EMS-425. This will also help you. It is yarrow powder in a capsule form. You will need to take three capsules twice a day, morning and evening, before food. You can pay me when you are able to get the money together. Six months treatment is what you need to kill any cancer cells and restore your health. You will need to stay off pork and pork products because it is full of bacteria that can transfer through the human digestive tract. Dairy is also a problem because it contains oestrogen, it's good for cows but the human body has difficulty digesting it ".

64 On about 2 August 2005 Ms Ellis received an Express Post envelope from the defendant containing quantities of the medications Stilbetol and EMS-425. A handwritten note accompanied the medication on the letterhead of Rutherford Clinic. The note explained how the medications were to be taken and was signed "Regards Paul". Each of the containers was labelled with instructions on how the contents should be taken. The Stilbetol was a white opaque glutenous substance which Ms Ellis believed to be the high potency seaweed extract and the EMS-425 was a standard size white coloured capsule which she believed to contain the yarrow powder.

65 On about 4 August 2005 Ms Ellis received another Express Post envelope. That envelope contained the green tea capsules and a handwritten note of Rutherford Clinic letterhead signed "Paul". The note stated that the green tea mixture was not for general drinking and that ten per cent nori had been added to the mixture for iodine content. The capsules were white in colour.

66 Ms Ellis commenced taking the defendant’s medications on 4 August 2005. At the same time she started taking a thyroid medication prescribed by a doctor. She began to feel well again and her symptoms began to ease.

67 On 16 August 2005 Ms Ellis drew a cheque in the sum of $3778 and sent it to the defendant.

68 Ms Ellis complained to the defendant in August 2005 about a thickness that she noticed in her throat. The defendant said:

"I will send you more of the EMS-425 and we will increase the dose from 500mg to 1000mg. I have also put your case before the medical board in Texas and they have determined that your treatment will take longer than six months. I will apply to the Health Department for a special grant".

69 Ms Ellis received the 1000mg dosage of the EMS-425 about 24 August 2005.

70 On about 19 September 2005 Ms Ellis telephoned the defendant and informed him that she would not be continuing with his treatment. She asked for a refund of what she had paid him. About 24 September 2005 Ms Ellis received a letter from the defendant enclosing a cheque for $3778. At the defendant's request, she returned most of the medication to him.

71 Around 9 December 2005 Ms Ellis received a visit from Ms Megan Turton, an investigator at the Office of Fair Trading. Ms Ellis gave her a small plastic container with about six white coloured capsules in it and a juice bottle containing about 300ml of the Stilbetol liquid.

Marilyn Jean Christie - 26 September 2006

72 On 16 December 2004 Ms Christie and her husband went to the Rutherford Health Clinic and had a conversation with the defendant. She told him that her husband had been diagnosed with lung, liver and bone cancer, that he had had six weeks of chemotherapy and a bone scan but had been informed that only palliative care could be recommended for him. The defendant said to her:

"Yes, chemotherapy does not help. I am a biochemist, there is a lot I can do to improve the function of the cells. I have helped many people with this condition. I cured a woman in Cardiff who had cancer and also a woman in Queensland. I go to an island between China and Japan every couple of months to purchase the medications for my patients. I am well known at Customs, I just breeze through on every trip. I use a dried seaweed preparation which alters the cells and retards the growth of the cancer, it will improve the lung and liver functions. It's a six-month course of treatment. I will provide you with the medications. I'll give you some to take home with you and I will post you further medications as you need them. [The cost is] $3778 for six months".

73 The defendant handed Ms Christie two containers with two different types of capsules and told her husband to start taking one of each capsule every four hours. The defendant said he would post more capsules to Mr Christie as he needed them. The defendant gave Ms Christie an information sheet telling her about the medication. That document is headed "ABOUT YOUR MEDICATION" and is in the following terms:

"As the medication begins to break down cancerous cells the by-product of that chemistry only has three exit routes from the body, the SKIN, the RESPIRATORY SYSTEM, or the DIGESTIVE SYSTEM.

When exiting through the skin a rash may appear. When going through the respiratory mucosa, cough, or colds are usually common and when through the digestive tract diarrhea [sic] or constipation sometimes appear.

These new symptoms may alarm the uninformed and may cause them to conclude the medication is harmful. This however, is not so and is a natural part of the elimination and healing and is a POSITIVE SIGN that a healing process has begun. It is important during this process to drink plenty of water. Some patients only develop minor discomfort and only for a few days.

Vitamin C is very helpful to the process of the medication and therefore it is recommended that ¼ to ½ teaspoon be taken with each dosage. One 500mg tablet would be sufficient if not taking powdered “C”.

74 The defendant did not physically examine Mr Christie or request to see any test results. On 17 December 2004 she sent the defendant a cheque for $3778 made payable to the Rutherford Health Clinic.

75 Just after Christmas 2004 Ms Christie telephoned the defendant and told him that the medication she had given her husband was making him sick. The defendant said, "We’ll vary the dosage of the capsules that you already have". In early February 2005 Mr Christie became sicker. He was admitted to the Mater Hospice. He died on 9 May 2005. Ms Christie asked the defendant to be reimbursed as an analysis indicated that the capsules he had provided to her husband contained no active ingredients.

76 Ms Christie subsequently received a letter from the defendant dated 30 May 2005 in the following terms:

"I am writing in response to your letter dated 8 May 2005. I would like to take this opportunity to express my deepest sympathy at the passing of your husband, Allen.

It is unfortunate that you feel aggrieved in circumstances where Allen clearly knew the limitations at his advanced stage of cancer and took decisions not to follow the course of treatment which I prescribed. All medication that I prescribed for patients is properly and intensively researched. It is not my practice to use placebos or to provide capsules without remedial properties. My treatments are unique and the advice that you have received from other practitioners may be from persons who do not understand my methods. Nevertheless, I have an open mind in discussing my treatment with other practitioners.

It has been my practice to work closely and collaboratively with other health care providers. I would be grateful if you could obtain the results of the tests undertaken by the medical students or ask them to contact me directly. I would also be grateful if you could return the remainder of the medication, so that I can undertake my own tests.

John Kimpton - 21 September 2006

77 In 1992 Mr Kimpton's wife Robyn was diagnosed with Huntington's disease, a terminal illness with no known cure. In August 2004 Mr Kimpton was diagnosed with prostate cancer and given a life expectancy of between two and four years. Mr Kimpton was advised to commence hormone replacement therapy.

78 Mr Kimpton made an appointment to see the defendant in September 2004. He recalled speaking to the defendant about his business. The defendant said, "Medical specialists are all bullshit and I can get you ten years at best. My business is word-of-mouth and I don't need to advertise for my business".

79 The defendant also said to Mr Kimpton, "I have been treating patients for cancer. I work at the Newcastle University. These are some of the people who had melanomas which I've cured". He showed Mr Kimpton some photographs of different people. On another occasion the defendant said to Mr Kimpton, "I worked as a biochemist for NASA for ten years. I am working on a machine for the CSIRO”. The defendant also said, "I'm working with Professor Albert Kirby in America, he is my father-in-law. My first wife died of cancer. I've cured myself of leukaemia".

80 The defendant placed Mr Kimpton on a strict eating program. He was advised that he could not have any foods with sugar, had to eat minimal carbohydrates and drink no alcohol except red wine. The defendant said, "Sugar feeds cancer". Mr Kimpton saw the defendant monthly and he would take his blood pressure from time to time. The defendant gave him some tablets. The container was made from a generic white coloured plastic and had a printed stick-on label on the side but it never had Mr Kimpton's name on it.

81 After Mr Kimpton had been taking the medication and started the diet that the defendant had recommended, his PSA count came down. Mr Kimpton lost 27kg in weight. The defendant said to him, "Your PSA levels are down; that means the tablets are working".

82 On about 4 February 2005 the defendant supplied Mr Kimpton six months of tablets. On the same day Mr Kimpton paid the defendant $3778. The defendant did not give him a receipt for that amount. Between February and August 2005 Mr Kimpton took the tablets that the defendant had dispensed as directed by him.

83 In August 2005 Mr Kimpton went to see the defendant to obtain a further supply. The defendant said, "The tablets will cost you about $4000. I'll put you on record by opening a file". For the twelve months that the defendant supplied the tablets to Mr Kimpton he could not recall the defendant ever telling him what the tablets were made from or what they were called. He always referred to them as "Chinese herbs". The defendant warned Mr Kimpton once about the potential side effects from taking the tablets. Mr Kimpton also recalled that the defendant changed what he put into the tablets at one time.

84 The defendant told Mr Kimpton, "The tablets might make you feel nauseous. If you feel nauseous call me". On another occasion the defendant said, "I am changing your tablets to take advantage of the new advances in cancer treatment that I have come across. [I have] consulted my colleagues all over the world".

85 The defendant also treated Mr Kimpton for a basal cell carcinoma on his shoulder. The defendant gave him a glass jar with some black ointment in it. The defendant said, "Put this on the spot and place a band-aid on it. Leave it for three days. It will take the cancer and out at the roots". Mr Kimpton was not charged for this ointment. The skin cancer disappeared.

86 During one of his visits to the defendant Mr Kimpton asked, "Why don't you have any of your qualifications displayed on your office wall like other doctors?" The defendant replied, "I have had a break-in and I don't want them stolen, besides I am in the middle of painting the place".

87 About 6 September 2005 Mr Kimpton said he read about the defendant in the newspaper and asked for his money back. The defendant subsequently handed Mr Kimpton a cheque to $3778.

Robyn Lynette Kimpton -22 September 2006

88 Ms Kimpton visited the defendant at his clinic in Rutherford. The defendant took a blood sample from her by pricking the tip of her finger. The defendant said to her, "I'm going to send the blood off to a Professor Albert Kirby in America to verify that you have Huntington's disease. I have treated people for a range of conditions with Chinese herbal tablets".

89 Ms Kimpton commenced seeing the defendant on a monthly basis. He charged $48 for each visit, which subsequently went up to $52. Ms Kimpton paid the defendant in cash at the completion of each visit and always received a receipt.

90 Ms Kimpton said that a symptom of Huntington's disease was that sometimes she would go into uncontrollable rages and break things. Initially after taking the tablets given to her by the defendant, she didn't get angry. That lasted for a while.

91 At no time did the defendant explain to Ms Kimpton what was in the tablets that he dispensed. The defendant said to her:

"I don't want you to give these tablets to anyone else. Someone has already tried to patent them. This medication will coat the DNA and will delay what triggers off the Huntington's disease. I can't cure the disease but I can stop the triggers".

92 Ms Kimpton continued to receive tablets from the defendant on a monthly basis for a period of five years. She paid the defendant about $3000 for the tablets over that period.

93 In about March 2005 during one of her monthly appointments with the defendant Ms Kimpton told him about a skin disease which he had. She had been diagnosed as a child as having cystic acne. When she told the defendant about it he took another blood sample. He said:

"I need the opportunity for the blood to grow and see what will happen. You probably have bacteria. That is causing your skin disease and I think I can treat you with an intravenous solution that will cleanse your blood".

94 The defendant told Ms Kimpton to sit in a chair. He stood beside her. Mr Kimpton was in the room at the same time. The defendant took a needle in his left hand. It had a tube attached to it at one end and the tube was attached to a bag that had some fluid in it at the other end. The defendant tried to insert the needle into the back of Ms Kimpton's hand. It was very painful as the fluid went into her hand and her forearm became extremely swollen. She told the defendant to take it out.

95 During her appointments with the defendant he would physically examine Ms Kimpton. He looked at her buttocks and waist where the cystic acne was the worst. In addition to the tablets, the defendant also gave her some ointment. The medication temporarily relieved the cystic acne but then it returned just as bad as before. The defendant said to her:

"I've worked with the CSIRO to formulate these ointments. This will reduce the blood supply to the area where it's applied. It is slow acting and will work over a period of time".

96 On 29 November 2005 Ms Kimpton gave some of the medications given to her by the defendant to Mr Alan White of the Office of Fair Trading. She handed him one glass bottle containing numerous capsules with the words Cerebro Vassetin 500mg on the label and one empty bottle that had formerly contained capsules. The stick-on label on the side of the bottle had the words “Esterydex 750mg" on it. She also gave him one small glass container with no label containing a cream substance and a bottle of de-mineralised water.

Susan Allison Turner -21 September 2006

97 On 27 December 2003 Ms Turner was diagnosed with sympathetic nerve dystrophy. Because of that condition she experienced severe pain on a daily basis. On 12 April 2005 Ms Turner visited the defendant at the Rutherford Health Clinic. She asked the defendant how much it was going to cost. He replied, "Look, I will do a special deal for you, I will charge $150 to start with and then charge you $50 per visit and $100 for medication". The defendant then asked her what she was suffering from. Ms Turner replied, "Sympathetic nerve disorder which causes me agonising pain". The defendant replied, "Yes, I know it".

98 Ms Turner showed the defendant the thermal imaging reports that she had brought with her. The defendant read them. He then said:

"I used to work for NASA, I am a NASA biochemist and scientist and I have lived over in the USA for four years. I recently returned for my family. I invented a urine analysis system for the NASA astronauts. I wanted to bring it out here but I sold it to NASA [as] they wanted to buy it off me”.

99 The defendant gave Ms Turner a number of medications including Cerebro Vassetin 1000mg. The defendant told Ms Turner to take one heaped teaspoon in half a glass of water. He also gave her Hesbiotol 1000mg and told her to take three tablets daily. She was also given Amch-mgo 500mg tablets and told to take one at bedtime and Stilbetol-Z1 500mg and told to take one capsule at breakfast.

100 After her fifth or sixth visit to the defendant the defendant said to Ms Turner, "Look the doctors can't help you, you're probably going to die anyway, I can only try and help you, within five years of being cured you can still die anyway".

101 Ms Turner estimated that she had paid about $2500 to the defendant over the course of her visits to him. She received rebates from health funds for visits up until July 2005 but not beyond that date.

102 During one of her visits Ms Turner showed the defendant a mark on her back that had been diagnosed as a melanoma. The defendant said, "I can give you some black ointment that I get from overseas. It will "eat out" the melanoma and it will be cured". Ms Turner did not use any of the ointment and had the melanoma surgically removed.

103 During one of her visits to the defendant he said to her, "I am a biochemist and I have studied in America for four years and I have a daughter in Asia who is a cancer specialist. I have a one hundred percent record in curing people and I am way better than any doctor you can find ".

104 On another occasion the defendant said to Ms Turner, "Look if you keep taking doctors’ medications they will act adversely with what I am prescribing for you so you had better give theirs away and only take mine. I am a cancer specialist and I will be able to help".

105 Ms Turner said that she ceased to see the defendant when she learned that he was not a properly trained medical practitioner or a biochemist.

The defendant's defence

106 The defendant responded in terms to the particulars contained in the statement of claim in his amended defence. With respect to Mr Holbert, the defendant denied the particulars and made the following points:

106.1 They did not represent the course of dealing between Mr Holbert and the defendant.

106.2 They were motivated by a desire for publicity and attention from Newcastle newspapers.

106.3 No-one caused Mr Holbert to continue with treatment if he considered the treatment useless.

106.4 The events occurred eight years ago and the evidence must be considered suspect.

107 The defendant said that Ms Willson's allegations derived from representations made to an investigator and were inadmissible as evidence in a court of law in accordance with s 138(3)(f) of the Evidence Act 1995 because they had not been tested by cross-examination and no opportunity to test them had been given to the defendant as required by Article 14 of the International Covenant on Civil and Political Rights.

108 The defendant said that Ms Ellis’ allegations arose from a media frenzy by Newcastle newspapers designed to discredit him and were the subject of defamation proceedings in which the paper had admitted certain imputations were untrue.

109 The defendant denied Ms Christie's allegations, contending that the evidence she would give under oath could not support them.

110 With respect to Mr and Ms Kimpton the defendant said that the particulars were the result of ongoing commerce freely entered into and supported either by results or improvement, and extended over nearly three years. The allegations that treatment was ineffective were “not supported by the period of time the commerce was carried on”.

111 Ms Turner's allegations were said to arise from sensationalist newspaper reports, the subject of defamation proceedings in the Supreme Court, and her allegations were denied.

112 The defendant also pleaded that the plaintiff had no jurisdiction to prosecute the present litigation. A document headed "Notice of Grounds of Defence" is appended to his amended defence. It is in the form of written submissions which set out a detailed argument concerning the laws pertaining to the use of the Royal Sign Manual, under which the Commission of Appointment of the Governor of New South Wales is issued. The defendant contended that those laws were solely domestic laws of the United Kingdom of Great Britain and Northern Ireland and therefore lay “outside the jurisdictional authority of the courts of New South Wales”. The defendant’s submission concludes with the following sentence:

"Until such time as the Plaintiff can verify the validity of the appointment of the previously mentioned Governors at the time of Royal Assent being given to the aforesaid Acts then this matter must be adjourned and stayed pending the production of the said Orders in Council to this court."

113 Somewhat curiously, par [1] of the statement of claim is not denied. It is in the following terms:

Fair Trading Act

The statutory regime

114 The plaintiff relied upon the following provisions of the Act:

4 Definitions

(1) In this Act, except in so far as the context or subject-matter otherwise indicates or requires:

"Director-General" means:

(a) the Commissioner for Fair Trading, Department of Commerce,

41 Interpretation

(1) For the purposes of this Part, where a person makes a representation with respect to any future matter (including the doing of, or the refusing to do, any act) and the person does not have reasonable grounds for making the representation, the representation shall be taken to be misleading.

(2) The onus of establishing that a person had reasonable grounds for making a representation referred to in subsection (1) is on the person.

(3) Subsection (1) shall not be taken to limit by implication the meaning of a reference in this Part to a misleading representation, a representation that is misleading in a material particular or conduct that is misleading or is likely or liable to mislead.

42 Misleading or deceptive conduct

(1) A person shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

(2) Nothing in this Part shall be taken as limiting by implication the generality of subsection (1).
49 Certain misleading conduct in relation to goods

A person shall not, in trade or commerce, engage in conduct that is liable to mislead the public as to the nature, the manufacturing process, the characteristics, the suitability for their purpose or the quantity of any goods.

50 Certain misleading conduct in relation to services

A person shall not, in trade or commerce, engage in conduct that is liable to mislead the public as to the nature, the characteristics, the suitability for their purpose or the quantity of any services.

65 Injunctions

(1) Where, on the application of the Minister, the Director-General or any other person, the Supreme Court is satisfied that a person has engaged, or is proposing to engage, in conduct that constitutes or would constitute:

(a) a contravention of a provision of Part 3, 4, 5, 5A, 5B, 5C, 5D, 5E, 5F or 8,

(b) attempting to contravene such a provision,

(c) aiding, abetting, counselling or procuring a person to contravene such a provision,

(d) inducing, or attempting to induce, whether by threats or promises or otherwise, a person to contravene such a provision,

(e) being in a way, directly or indirectly, knowingly concerned in, or party to, the contravention by a person of such a provision, or

(f) conspiring with others to contravene such a provision,

the Court may grant an injunction in such terms as the Court determines to be appropriate.

(2) Without prejudice to the generality of subsection (1), an injunction granted under that subsection may be, or include, an injunction restraining a person from carrying on a business of supplying goods or services (whether or not as part of, or incidental to, the carrying on of another business):

(a) for a specified period, or

(3) Where an application for an injunction under subsection (1) has been made, the Supreme Court may, if the Court determines it to be appropriate, grant an injunction by consent of all the parties to the proceedings, whether or not the Court is satisfied that a person has engaged, or is proposing to engage, in conduct of a kind specified in subsection (1).

(4) Where in the opinion of the Supreme Court it is desirable to do so, the Court may grant an injunction pending determination of an application under subsection (1).

(5) The Supreme Court may rescind or vary an injunction granted under subsection (1), (3) or (4).

(6) The power of the Supreme Court to grant an injunction restraining a person from engaging in conduct may be exercised:

(a) whether or not it appears to the Court that the person intends to engage again, or to continue to engage, in conduct of that kind,

(b) whether or not the person has previously engaged in conduct of that kind, and

The representations

115 The plaintiff submitted that the evidence set out above demonstrated that the defendant had made the following representations:

115.1 That in about February 1998 the defendant supplied Mr Holbert with a number of containers of small black oval shaped tablets and represented that if Mr Holbert administered the tablets to himself they would alleviate the symptoms of multiple sclerosis from which he had informed the defendant he was suffering.

115.2 That on about 24 March 1998 the defendant provided Mr Holbert with several ampoules of red coloured liquid and represented that if Mr Holbert administered daily injections of the liquid to himself in addition to administering the tablets they would alleviate the symptoms of multiple sclerosis which he said he continued to experience.

115.3 That between March 1998 and October 1998 the defendant provided Mr Holbert with additional containers of the tablets and represented to Mr Holbert that if he administered the tablets to himself they would alleviate the symptoms of multiple sclerosis from which he had informed the defendant he was suffering.

115.4 That on or about 14 and 21 October 1998 the defendant supplied Mr Holbert with a yellow liquid which the defendant injected into his arm and represented to Mr Holbert that the liquid would regenerate damaged cells in his body.

115.5 That on at least three occasions in November 1998 the defendant administered injections of the yellow liquid to Mr Holbert and represented to him that the injections of the liquid would alleviate the symptoms of multiple sclerosis and regenerate damaged cells.

115.6 That in about March 2003 to defendant supplied Ms Willson with a black ointment and represented to her that it would shrink and remove any cancerous breast tissue.

115.7 That in or about March 2003 the defendant supplied Ms Willson with bags of powder and represented to her that the powder was an anti-cancer treatment.

115.8 That in or about September or October 2003 the defendant administered an intravenous drip to Ms Willson and represented to her that the drip contained peroxide and would be beneficial in the treatment of her condition.

115.9 That on or about 29 July 2005 the defendant supplied a liquid substance called "Stilbetol" to Ms Ellis and represented to her that if she consumed the substance, mixed with lemon juice and water, once a day, as well as consuming green tea capsules, the substance would stimulate her immune system and prevent the spread of cancerous cells.

115.10 That on or about 29 July 2005 and 1 August 2005 the defendant offered to supply Ms Ellis with additional quantities of Stilbetol, sufficient for a course of treatment over a period of six months, together with capsules of a yellow powder described by the defendant as “yarrow powder” and as "EMS-425" and represented to her that if she consumed the Stilbetol and the capsules over the course of a period of six months any cancer cells in her body would be killed and her health would be restored.

115.11 That in or about 2003 the defendant supplied Ms Kimpton with certain tablets and represented to her that the tablets would delay the onset of Huntington's disease.

115.12 That in or about 2004 the defendant administered an intravenous drip to Ms Kimpton and represented to her that the intravenous solution so administered would cleanse her blood and assist in treating her for cystic acne and supplied Ms Kimpton with ointment for the treatment of cystic acne.

115.13 That in or about September 2004 the defendant supplied to Mr Kimpton certain tablets and represented to him that the tablets would assist in delaying the onset of prostate cancer for up to ten years.

116 Each of these representations is said to have been made in trade or commerce. Each of the representations is said to have related to a future matter or matters.

Plaintiff’s submissions

117 The plaintiff relied principally on s 41 of the Act. The plaintiff submitted that the effect of s 41 was to place upon the defendant the onus of establishing that he had reasonable grounds for making the representations, failing which the representations are taken to be misleading. The provision is based on, but differs from, s 51A of the Trade Practices Act 1974. The difference means that s 41 avoids the controversy referred to in some of the authorities on s 51A as to whether a defendant is required to do more than go into evidence on the issue of reasonable grounds: see ACCC v Danoz Direct Pty Ltd (2003) ATPR (Digest) 46-241; [2003] FCA 881. In the present case the issue does not arise, as the defendant has adduced no evidence. In that respect the plaintiff submitted that it was entitled to rely upon a Jones v Dunkel inference. The plaintiff relied upon what was said by Shaw J in Commissioner for Fair Trading v Rowland Thomas and Ors [2004] NSWSC 479 at [23] as follows:

" Jones v Dunkel

Jones v Dunkel

Ho v Powell

118 The plaintiff further submitted that it was unnecessary for it to adduce evidence that the persons to whom the representations were made were afflicted in the way they alleged or that the goods or services provided by the defendant were not capable of curing, or were not likely to cure, their conditions or alleviate them in any way. In the plaintiff's submission, it was sufficient that the patients who presented themselves to the defendant claimed to have, or to have been diagnosed as having, the ailments to which they referred. Having heard what they said, the evidence established that the defendant then made representations by way of direct response and in some cases did so without even examining the patients. According to the plaintiff’s submission, it then fell to the defendant to establish that he had reasonable grounds for making the representations: see ACCC vPurple Harmony Plates Pty Ltd [2001] FCA 1062.

119 In that case Goldberg J, referring to the representations with which he was dealing, said at par [17]:

"17 I consider that most of the representations have two characteristics. They assert that the products presently possess the performance characteristics claimed and they also make claims as to future matters. On a fair reading, the representations are stating that if a person buys these products, the person will derive the benefits from them. . .

120 The plaintiff also referred to the decision of Studdert J in Commissioner for Fair Trading v Microwave Safe Australia Pty Ltd [2006] NSWSC 287 at [18] as follows:

"18 In determining whether a particular representation is made, and in determining whether a representation made offends s 42(1) of the Fair Trading Act , the principles to be considered include the following:

(i) s 42 can be infringed by conduct capable of creating error in the recipient. Evidence that some person was in fact misled is admissible and may be persuasive, but it is not essential: see Taco Co. v Taco Bell (1982) 42 ALR 177 per Deane and Fitzgerald JJ at 202;

(ii) the test is objective and the court must decide the question for itself: again, see Taco at 202;

(iii) it is not necessary to establish that the defendant intended to mislead or deceive: Hornsby Building Information Centre v Sydney Building Information Centre (1978) 140 CLR 216 at 228;

(iv) conduct is likely to mislead or deceive if there is a real possibility of deception: Global Sportsman Pty Limited v Mirror Newspapers (1984) 2 FLR 82, and Domain Names v .au Domain Administration (2004) 139 FLR 215 at [17];

(v) s 42 will be infringed if in a particular case the language used is likely to convey to a significant number of those persons to whom the publication was made an erroneous belief: see Siddons Pty Limited v The Stanley Works Pty Limited (1991) 29 FCR 14 at 20 and Domain Names (supra) at [28];

(vi) where a representation is made to the public or a section of the public, it is necessary to assess the effect of the conduct on the “ordinary” or “reasonable” member of the group of recipients to determine whether misleading has occurred: see Campomar Sociedad Limitada v Nike International Limited (2000) 202 CLR 45 at [102];

(vii) the apparent tension between propositions (v) and (vi) was addressed in Domain Names at [28] where the court said that “a finding that reasonable members of the class would be likely to be misled carries with it the determination that a significant number of recipients of a representation would be misled”;

(viii) a representation that is true as far as it goes may still be misleading because of what is omitted: see Hornsby Building Information Centre (supra) at 227; see also Heydon, Trade Practices Law at [11,600];

(ix) to determine whether a representation is conveyed, it is necessary to consider the whole document and to determine whether a conclusion is reasonably open from such reading: see Aaron’s Reefs Limited v Twiss (1896) AC 273 per Lord Halsbury LC at 281; and see again Heydon, Trade Practices Law at [11,590];

World Series Cricket Pty Limited v Parish

Consideration

121 The plaintiff’s first proposition is that each of the alleged representations relates to a future matter. In my opinion, what is, and what is not, "a future matter" must be approached having regard to all the circumstances and by the application of commonsense principles. The setting in which the alleged representation is said to have been made may be particularly instructive.

122 In the present case, without exception, those to whom the alleged representations were made were patients of the defendant who had attended his clinic or sought his advice or treatment for particular medical conditions from which they suffered. It is tolerably clear that what the defendant said and did in this setting was said and done with respect to the particular medical conditions of which the patients complained and included statements about the future course of those conditions or the likely effect upon those conditions of the treatments recommended, administered, prescribed and supplied. With one exception, each of the representations is framed in terms of what would happen if particular advice were followed or particular courses of conduct were adopted. In terms of their formulation, these representations are definitively with respect to a future matter. I am satisfied, and I find, that the evidence supports the making of the representation by the defendant as alleged.

123 The one exception is the representation referred to at par [115.7]. Whereas the other representations, or most of them, appear to have the two characteristics referred to by Goldberg J at par [17] in ACCC v Purple Harmony Plates Pty Ltd (supra at [119]), this alleged representation appears only to suggest that the relevant product possessed a particular performance characteristic claimed by the defendant at the time it was made. However, having regard to the setting in which the representation was made, in which Ms Willson was seeking, and was being provided by the defendant with, treatment for cancer, a commonsense approach suggests that the "anti-cancer treatment" to which the defendant referred was supplied because it would have some effect, presumably beneficial, upon her disease in the future if she used it. The definition of "conduct" in s 4(4) of the Act arguably includes representations. The "nature", "characteristics" and "suitability" of goods or services might not normally be considered to have the character of "future matters". However, where the conduct consists of representations as to how those things may apply or operate in the future, that conduct (insofar as it consists of representations) can have a future aspect.

124 Although it may be tempting to form a view as a matter of commonsense about whether or not the defendant had reasonable grounds for making the representations, such an approach, in the absence of evidence to support it, cannot be taken. The plaintiff led no evidence to establish that the defendant did not have reasonable grounds for making the representations or any of them. Instead, the plaintiff relied upon the fact that the onus of establishing that he had reasonable grounds for making the representations as to any future matter is on the defendant. The defendant led no evidence, and made no submissions upon the basis of any of the plaintiff's evidence, that there were, or that he had, reasonable grounds for making the representations or any one or some of them. In the absence of such evidence, having regard to the onus that the defendant bears, the representations are by the terms of s 41(1) taken to be misleading.

125 In order to establish each of the contraventions alleged against the defendant, the plaintiff must prove on the balance of probabilities the making of the various representations and their misleading or deceptive character. Having regard to the evidence of the several deponents whose evidence is extracted earlier in these reasons, I am satisfied that the plaintiff has established that the defendant made the representations described in par [115] above. I am satisfied that the representations are misleading having regard to the terms of s 41(1) of the Act. It follows that I am also satisfied, having regard to the matters referred to by Studdert J, which are extracted at par [120] above, that the representations were misleading and deceptive, or at the very least likely to mislead or deceive, contrary to the terms of s 42 of the Act.

126 The plaintiff must also prove that any representation the subject of complaint was made in trade or commerce. In the present case it is clear that all statements made by the defendant and all goods supplied by him were made or supplied in the course of, and in the interests of, the defendants business. I am satisfied that the representations were made in trade or commerce.

127 Finally, the plaintiff submitted that the allegations of contravention of ss 49 and 50 of the Act did not go to any aspect of the relief sought by the plaintiff. Section 41, which is enacted "for the purposes of this Part", applies to those sections, since they involve "conduct liable to mislead the public".

Relief

128 In Commissioner for Fair Trading, Department of Commerce v HMS Direct Limited, Hallstone Products Pty Ltd and David Stucky [2003] NSWSC 415, Grove J at par [6] said:

"6 In ACCC v IMB Group Pty Limited 1999 ATPR 41-688, Drummond J observed:

Proceedings brought by the ACCC, as well as by private litigants alleging contraventions of the provisions of the Trade Practices Act here in question, do not involve matters concerned only with the private rights of the parties to the particular litigation.

.......

129 In my opinion, the plaintiff is entitled to the declarations sought in paragraphs 1 and 2, and to the orders sought in paragraphs 3 and 4, of the amended statement of claim. However, I am not prepared to make orders 3 and 4 without some appropriate limitation. Furthermore, I am not prepared to make an order pursuant to s 65 of the Act in the terms sought in paragraph 5 at all. There are at least two reasons for this.

130 First, the defendant did not appear at the hearing before me either in person or by his legal representative. Although the appearance of a defendant at a hearing is not in any sense a pre-requisite to the making of orders of the type sought, they are in my opinion orders that should only be made, apart from exceptional circumstances, with the benefit of submissions on behalf of a defendant or some suitable contradictor.

131 Secondly, the orders sought, in particular the order sought in paragraph 5 of the amended statement of claim, if made, may well have, and would appear likely to have, the effect of destroying or at the very least severely restricting the defendant’s business. The orders would certainly have a significant, adverse impact upon it. The evidence before me does not go as far as to establish, or even to suggest, that the whole of the defendant's activities contravened relevant provisions of the Act or were otherwise illegal or unauthorised. Indeed, the evidence suggests, to the extent that the services provided by the defendant entitled some of his patients to a refund from their health funds for a proportion of fees paid to him, that his business, and the services provided by him, were authorised or recognised by statue or regulation. Even though the affidavit of Betty Sarkissian sworn 9 November 2006 suggests that there is no legislative requirement for practising naturopaths to be registered in New South Wales, and that the defendant is not a "registered" naturopath, the evidence does not establish that the defendant’s practice of alternative medicine is wholly proscribed.

132 It would in these circumstances be unfair and inappropriate to make orders restraining the defendant from carrying on any business of providing treatment, or of supplying goods or services with purported therapeutic effect, that were not limited to the treatment, goods or services that are the subject of the present proceedings.

Miscellaneous

133 I referred earlier to what appears to be a challenge by the defendant to the authority of the plaintiff to present and prosecute these proceedings. The argument upon which the defendant appears to rely would seem, at least in part, to have been raised and dealt with unfavourably to the defendant's interest by O'Keefe J in Levick v Law Society of New South Wales [2002] NSWSC 481. In my opinion the argument is without merit and should be rejected.

Orders

134 I make the following orders: -

1. DECLARE that the defendant has, by representing in trade or commerce that he is able, whether with the assistance or by the use of certain substances supplied by him or otherwise to cure, alleviate the symptoms of, or prevent or delay the onset or progression of various diseases, including various forms of cancer, multiple sclerosis and Huntington's disease, engaged in misleading or deceptive conduct, and conduct which is likely to mislead or deceive, in contravention of s 42 of the Fair Trading Act 1987.

2. DECLARE that the defendant has, by representing in trade or commerce that certain substances supplied by him are capable of curing, alleviating the symptoms of, or preventing or delaying the onset or progression of various diseases, including various forms of cancer, multiple sclerosis and Huntington's disease, engaged in conduct that is liable to mislead the public as to the nature, characteristics, and suitability for their purposes of those goods in contravention of s 49 of the Fair Trading Act 1987 .

3. ORDER that the defendant, by himself, his servants or agents, be restrained from representing, in trade or commerce, whether expressly or by implication, that he is able, whether with the assistance or by the use of any substance or article supplied by him or otherwise to cure, alleviate the symptoms of, or prevent or delay the onset or progression of diseases, including various forms of cancer, multiple sclerosis and Huntington's disease in any person.

4. ORDER that the defendant by himself, his servants or agents, be restrained from representing, in trade or commerce, whether expressly or by implication, that any substance or article, whether supplied by him or otherwise, is capable of curing, or will cure, alleviate the symptoms of, or prevent or delay the onset or progression of diseases, including various forms of cancer, multiple sclerosis and Huntington's disease in any person.

5. ORDER that the defendant pay the plaintiff's costs.

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Citations

Commissioner for Fair Trading, Department of Commerce v Perrett [2007] NSWSC 1130

Most Recent Citation

Dib Group Pty Ltd v Ventouris Enterprises Pty Ltd [2011] NSWCA 300

Cases Citing This Decision

1

Dib Group Pty Ltd v Ventouris Enterprises Pty Ltd [2011] NSWCA 300

Cases Cited

13

Statutory Material Cited

3

Australian Competition and Consumer Commission v Danoz Direct Pty Ltd [2003] FCA 881

Commissioner for Fair Trading v Rowland Thomas [2004] NSWSC 479

Australian Competition and Consumer Commission v Danoz Direct Pty Ltd [2003] FCA 881

Cited Sections

CITATION:	Commissioner for Fair Trading, Department of Commerce v Perrett [2007] NSWSC 1130
HEARING DATE(S):	8 October 2007
JUDGMENT DATE :	12 October 2007
JUDGMENT OF:	Harrison J
DECISION:	See paragraph 134.
CATCHWORDS:	TRADE AND COMMERCE – misleading and deceptive conduct – representations concerning treatment and substances – whether capable of curing etc or delaying onset or progression of diseases including cancer, multiple sclerosis and Huntington's disease – alternative medical practitioner – limited declarations and orders made
LEGISLATION CITED:	Evidence Act 1995 Fair Trading Act 1987 - ss 41, 42, 49, 50, 65 Trade Practices Act 1974 - s 51A
CASES CITED:	ACCC v Danoz Direct Pty Ltd (2003) ATPR (Digest) 46-241; [2003] FCA 881 ACCC v Purple Harmony Plates Pty Ltd [2001] FCA 1062 Commissioner for Fair Trading, Department of Commerce v HMS Direct Limited, Hallstone Products Pty Ltd and David Stucky [2003] NSWSC 415 Commissioner for Fair Trading v Microwave Safe Australia Pty Ltd [2006] NSWSC 287 Commissioner for Fair Trading v Rowland Thomas and Ors [2004] NSWSC 479 Jones v Dunkel (1959) 101 CLR 298 Levick v Law Society of New South Wales [2002] NSWSC 481
PARTIES:	Commissioner for Fair Trading, Department of Commerce (Plaintiff) Paul John Perrett (Defendant)
FILE NUMBER(S):	SC 20331 of 2006
COUNSEL:	A I Tonking SC (Plaintiff)
SOLICITORS:	I V Knight, Crown Solicitor (Plaintiff)