Compass Marinas Australia Pty Ltd v State of Queensland

Compass Marinas Australia Pty Ltd and Mr Harburg appealed against a decision of the Primary Judge which found in favour of the State of Queensland in a claim for unpaid rent and on a guarantee. The appellants argued that the State was estopped from recovering the rent and on the guarantee on the basis of a false representation made by the State which induced them to enter into a deed of variation. The appellants argued that the State was estopped both at common law and in equity from denying the truth of the representation. The appellants also argued that their damages claim was not statute-barred.

The Court found that the primary judge was correct to dismiss the common law estoppel claim. The representation made by the State was not sufficiently clear and the appellants had not demonstrated detrimental reliance on the representation such that the State was estopped from contradicting the truth of that representation. The Court found that the appellants could have had no assumption or expectation that the amount of rent was anything other than that which was stated in the leases and there was no room for equitable estoppel to operate as a defence in the way which the appellants had argued. The Court found that the appellants’ damages claim was statute-barred and that the same conclusion applied to Mr Harburg’s claim. The appeal was dismissed, with costs.

The Court noted that the appellants’ case on appeal sought to avoid the difficulties with their estoppel claims by characterising the estoppel as an estoppel by representation in equity and then by submitting that, in equity, the State must be required to “make good the representation” in a way which had the pecuniary consequences for which they contend. However, the Court found that there was no jurisdiction in equity to award pecuniary compensation to a plaintiff for the falsity of an innocent misrepresentation relied on by the plaintiff to its detriment. The Court found that the primary judge was correct to dismiss the appellants’ claims and that there was no basis to grant leave to adduce further evidence on appeal.