Curtin v University of New South Wales

[2009] NSWSC 269

CITATION:	CURTIN v UNIVERSITY OF NEW SOUTH WALES & ORS [2009] NSWSC 269
HEARING DATE(S):	Monday 30 March 2009
JUDGMENT DATE :	9 April 2009
JURISDICTION:	Common Law
JUDGMENT OF:	Hall J at 1
DECISION:	Application to amend the Amended Statement of Claim is refused.
CATCHWORDS:	PRACTICE AND PROCEDURE – application to amend pleadings – proposed causes of action under s.42 of the Fair Trading Act 1987 (misleading or deceptive conduct) and s.43 of the Act (unconscionable conduct) – outsourcing of work by first defendant – plaintiff previously employed by first defendant – new contract with outsourcing entity – subsequent dispute between plaintiff and defendants over commercial advantages of outsourcing – alleged misrepresentations by defendants were no made “in trade or commerce” – accordingly, leave to amend should be refused – application dismissed
LEGISLATION CITED:	Civil Procedure Act 2005 (NSW) Contracts Review Act 1980 (NSW) Fair Trading Act 1987 (NSW) Trade Practices Act 1974 (Cth) Uniform Civil Procedure Rules
CASES CITED:	Barto v GPR Managements Services Pty Limited (1991) 33 FCR 389 Bond Corporation Pty Limited v Thiess Contractors Pty Limited (1987) 14 FCR 215 Chappel v Hart (1998) 195 CLR 232 Concrete Constructions (NSW) Pty Limited v Nelson (1990) 169 CLR 594 Curtin v University of New South Wales [2008] NSWSC 586 Curtin v University of New South Wales (No 2) [2008] NSWSC 1236 Finishing Services Pty Limited v Lactos Fresh Pty Limited [2006] FCA FC 177 James v ANZ Banking Group Limited (1985) ATPR 40-504 Janssen-Cilag Pty Limited v Pfizer Pty Limited (1992) 37 FCR 526 McCarthy v McIntyre [1999] FCA 784 McCormick v Riverwood International Australia Pty Limited [1999] FCA 1640 Marks v GIO Australia Holdings Limited [1998] HCA 98; (1998) 158 ALR 333 Orison Pty Limited v Strategic Minerals Corporation NL (1987) 77 ALR 141 Queensland v J L Holdings Pty Limited (1997) 189 CLR 146 Stoelwinder v Southern Health Care Network (2000) 177 ALR 501 Trade Practices Commission v David Jones (Australia) Pty Limited (1985) 7 FCR 109 Village Building Company Limited v Canberra International Airport Pty Limited (2004) 139 FCR 330 Walker v Salomon Smith Barney Australia Securities Pty Limited [2003] FCA 1099
TEXTS CITED:	Bullen, Leake and Jacob, Precedents of Pleadings in the Queen’s Bench Division of the High Court of Justice (12th ed, 1975) at pp.702 to 707
PARTIES:	CURTIN, Peter John v UNIVERSITY OF NEW SOUTH WALES & ORS
FILE NUMBER(S):	SC No 20342 of 2007
COUNSEL:	P: P E King 1-3D: M A Izzo
SOLICITORS:	P: Russell McLelland Brown Lawyers 1-3D: Sparke Helmore

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

HALL J

THURSDAY 9 APRIL 2009

No 20342 of 2007

PETER JOHN CURTIN v UNIVERSITY OF NEW SOUTH WALES & ORS

JUDGMENT

1 HIS HONOUR: The plaintiff has applied for leave to amend the Amended Statement of Claim. The proceedings have developed a substantial interlocutory history arising from amendments made from time to time of the plaintiff’s claim.

2 The plaintiff, in the present application, seeks leave to amend the Amended Statement of Claim in two respects:-

(1) To insert proposed paragraphs 24E(a), (b) and (c) and paragraph 24EA to raise a “misleading and deceptive” conduct count under s.42 of the Fair Trading Act 1987 (NSW) ( “FTA” ).

(2) To insert proposed paragraphs 24K(g), (h) and (i) to raise a count of unconscionability concerning a Deed of Release executed by the plaintiff on 2 December 2003 pursuant to s.43 of the FTA.

3 I consider it is preferable to begin by referring to background matters and then to interlocutory judgments of Malpass AsJ ([2008] NSWSC 586) and of Johnson J ([2008] NSWSC 1236).

4 The plaintiff commenced proceedings on 2 October 2007. They arise out of the termination of his employment on or about 2 December 2003. He had initially been employed by the first defendant within the Educational Testing Centre of the University of New South Wales (“ETC”). On and after 1 July 2001, the ETC was administered by the second defendant, it is alleged by the plaintiff, for and on behalf of the first and second defendants. In the proposed Amended Statement of Claim, the plaintiff asserts that, on and after 1 July 2001, the responsibilities and staff of ETC were transferred by the first defendant to the second defendant.

5 The plaintiff was employed as Operations Manager between 28 January 1998 and June 2000 by the first defendant at the ETC and also between mid-2000 and 11 November 2001, as Manager, Planning and Budget of the ETC. He was employed under a contract with the second defendant dated 12 November 2001 from 12 November 2001 to 11 November 2003. The contract with the second defendant was expressed to be for a term of three years.

6 The plaintiff has, to date, unsuccessfully sought to rely upon causes of action based upon provisions of the Contracts Review Act 1980, the Trade Practices Act 1974 (Cth) (“TPA”) and the FTA.

Amendments to the Statement of Claim

7 The original Statement of Claim was dated 28 September 2007. It was filed on 2 October 2007 and has been amended on two occasions. For the purposes of the present application, it is necessary to identify, with some precision, the previous form of the pleadings that have been filed on behalf of the plaintiff.

(a) Proceedings before Malpass AsJ on 10 and 11 June 2008

8 When the proceedings were listed for hearing before Malpass AsJ on 10 June 2008, Mr P E King, of counsel for the plaintiff, sought and obtained leave to file in court an Amended Statement of Claim dated 10 June 2008. In his judgment, Malpass AsJ recorded:-

“20. Shortly before the commencement of the hearing, the plaintiff served a proposed amended statement of claim on the defendants. The purpose of this document was said to be to address the alleged pleading deficiencies in the statement of claim. Leave was given to file the document in court. It is a weighty document extending to 33 pages.
21. The defendants then proceeded with the notices of motion for summary dismissal. It seemed to become common ground that these two notices of motion should be first heard and, if necessary to do so, the Court would then deal with the plaintiff’s notice of motion.”

9 Malpass AsJ in paragraph 10 of his judgment, identified the relevant paragraphs in the Amended Statement of Claim in relation to the application that he was dealing with, namely, paragraphs 24 to 26. These related to the claims based upon the provisions of the FTA (s.41) and the TPA (s.51AA and s.52) – misleading or deceptive conduct and unconscionable conduct.

10 Those paragraphs and paragraph 12 alleged the making of “representations”.

11 Paragraph 24 specified a number of “representations” allegedly made to the plaintiff by the third defendant, Dr John Ingleson, each of which was said to have been “in error”.

12 Paragraph 24 repeated and relied upon “particulars of representation” set out in paragraph 12(c), (d), (e), (g) and (h) of the Statement of Claim. Additionally, it was alleged that the third defendant made the “representations” set out in paragraph 24(b) of the original Statement of Claim.

13 Malpass AsJ also referred to paragraphs 27A to 30 – an alternative claim – in which allegations of inducement to enter into a Deed of Release as a result of misrepresentations referred to in paragraph 24 were made and a failure by the second defendant to disclose “the real purpose of the restructure of the second defendant”.

14 Malpass AsJ considered the claims based on the TPA and the FTA in paragraphs 25 to 33, 45, 54 and 61 of his Honour’s judgment. The defendants against whom the claims were made sought orders for the summary dismissal of the proceedings. In relation to the causes of action pleaded under the TPA and the FTA, the defendants contended that the conduct alleged against them could not be characterised as “in trade or commerce” and relied in this respect upon the decision of the High Court in Concrete Constructions (NSW) Pty Limited v Nelson (1990) 169 CLR 594, in particular, dicta in the majority judgment (p.604) quoted in paragraph 32 of his Honour’s judgment.

15 Malpass AsJ accepted the submissions for the defendants and dismissed the claims for relief made pursuant to the FTA and the TPA and under the Contracts Review Act.

(b) Proceedings before Johnson J on 1 September 2008

16 On 11 July 2008, the plaintiff filed a Further Amended Statement of Claim. The document was dated 3 July 2008 and was filed on 11 July 2008. It made substantial amendments, including, in particular, the following:-

(1) The deletion of former paragraphs 24 to 27.

(2) The addition of new paragraphs 24A to 24N.

(3) The addition of a new paragraph 27A.

(4) The addition of a new sub-paragraph 32(e).

17 In response to the Amended Statement of Claim, a notice of motion was filed on 31 July 2008 on behalf of the first, second and third defendants. They sought in the alternative a revocation of or a strike out order in respect of parts of the Statement of Claim filed on 11 July 2008. The relief sought in the notice of motion was as follows:-

“1. To the extent leave was given to amend the Statement of Claim on 20 June 2008, revoke such leave in relation to the amendments contained in paragraphs 24A, 24B, 24C, 24E, 24F, 24G, 24I, 24J, 24K, 24L, 24M and 24N of the Amended Statement of Claim filed on 11 July 2008.
2. In the alternative to the above, that paragraphs 24A, 24B, 24C, 24E, 24F, 24G, 24I, 24J, 24K, 24L, 24M and 24N of the Amended Statement of Claim filed on 11 July 2008 be struck out pursuant to Pt 14 rule 28, Uniform Civil Procedure Rules 2005.
3. Such further order as the Court deems fit.
4. The Plaintiff pay the First, Second and Third Defendants’ costs forthwith.”

18 The defendants’ application was determined by Johnson J on 4 September 2008.

19 It is necessary for the purposes of the application with which I am dealing to identify the nature of the amendments made in paragraphs 24A to 24N of the Amended Statement of Claim filed on 11 July 2008 in respect of which Johnson J made orders. To that end, the following are noted:-

(1) The first matter concerned the “conduct by the ETC parties” said to have been misleading or deceptive or likely to be so respectively within s.52 of the TPA and s.42 of the FTA . Such conduct was identified by reference back in paragraph 24A to sub-paragraphs (c), (d), (e), (f), (g), (h) and (i) of paragraph 12. That paragraph was in the same form as paragraph 12 in the Amended Statement of Claim that was filed in Court on 10 June 2008 before Malpass AsJ.

(2) The next matter concerned the “representations” referred to in paragraph 12(c), (d) and (e). They were alleged to have been made prior to 12 November 2001, that is, before the plaintiff entered into the employment with the second defendant and then allegedly related to the terms and conditions of the plaintiff’s employment.

(3) The next matters concerned paragraphs 12(f), (g), (h),(i) and (j). These were said to have been “representations” or “warranties” related to the plaintiff’s employment status, to terms and conditions of employment, to superannuation entitlements and to the retention of conditions of employment with the first defendant as well as Enterprise Agreements of 2000 and 2003.

20 In the Amended Statement of Claim filed on 11 July 2008, there was an alternative cause of action pleaded in paragraphs 24A(a), (b) and (c). In paragraph 24E it was alleged that “… in 2003, the ETC parties by their servants or agents made certain misrepresentations of or in relation to the services supplied by the Plaintiff to the ETC parties and to the education testing market in the business of education assessment”.

21 Particulars were set out in relation to paragraph 24E as to alleged representations made “on or about 10 September 2003 …” (in relation to paragraph 24E(a) and (b) and in relation to paragraph 24E(c) to alleged representations made concerning “the Teaming Agreement” which was alleged to have been entered into with NCS Pearson “on or about 4 October 2003 …”).

22 Johnson J observed at [21] that no appeal had been lodged from the decision of Malpass AsJ and that time to do so had expired in mid-July 2008. A notice of motion seeking an extension of time to appeal the decision of Malpass AsJ, his Honour noted, was only made on the morning of the hearing before himself on 1 September 2008. Having noted the absence of explanation for the delay for lodging an appeal, Johnson J proceeded with the application by reference to the decision of Malpass AsJ.

23 Johnson J accepted that the “warranties” in paragraphs 24A to 24N, as specified in paragraph 24A, corresponded with the matters that had been raised in paragraph 24(a) of the original Statement of Claim. His Honour, accordingly, accepted the submissions made on behalf of the defendants that the paragraphs that had previously been struck out had, in effect, been re-agitated.

24 In relation to the submissions made concerning the concept under the TPA and the FTA of “in trade and commerce”, Johnson J stated:-

“31. The Defendants emphasise that Malpass AsJ relied upon Concrete Constructions, where the High Court explained that the phrase ‘trade or commerce’ encompasses only conduct undertaken in the course of transactions which, of their nature, bear a trading or commercial character. Paragraph [54] of the judgment of Malpass AsJ contains that part of his Honour’s reasons.
32. The Defendants submit that the fresh FTA and TPA claims allege substantially the same conduct against the First and Second Defendants as did the original Statement of Claim. It is submitted for the Defendants that it is significant that the Amended Statement of Claim alleges no new matter which would go to the conduct identifying the character of conduct ‘in trade or commerce’.”

25 Additionally, his Honour recorded:-

“38. I do not consider that the cases relied upon by the Plaintiff, including McCormick v Riverwood International Australia Pty Ltd [1999] FCA 1640 and Stoelwinder v Southern Health Care Network (2000) 177 ALR 501, assist him on the present application. The arguments advanced in that respect, it seems to me, echo arguments not accepted by Malpass AsJ. As I accept the Defendants’ submission with respect to the result of a comparison of the original pleadings with the current pleadings, those decisions continue not to assist the Plaintiff.

39. I accept the Defendants’ submission that the determination of Malpass AsJ that the conduct alleged by the Plaintiff does not itself bear a trading or commercial character is decisive of the fresh FTA and TPA claims, as it was with the previous claims. I accept the submission of the Defendants that the extended definition of ‘trade or commerce’ in the FTA does not eliminate or exclude the distinction drawn in Concrete Constructions : Houghton v Arms (2006) 225 CLR 553 at 565 [32] and the other cases referred to at [37] above, which have touched upon the FTA definition of ‘trade or commerce’.

40. I accept the submission of the Defendants that it follows that there remains a need, in the context of the FTA, to examine the pleaded and particularised conduct to determine whether or not it is relevantly internal or preparatory to something done in trade or commerce or as part of the business or professional activities of the Defendants. I accept the submission of the Defendants that the employment of the person for the purposes of that business was professional activity and not relevantly, conduct in the course of that activity .

41. I accept the Defendants’ submission that there is no material change in the particulars of conduct relied upon in terms of the representations alleged to have been made to the Plaintiff.

42. I do not accept the Plaintiff’s submission that the legal effect of Malpass AsJ’s order was that he dismissed nothing. I do not consider that Mr King’s arguments by reference to Mraz v The Queen (No 2) (1956) 96 CLR 62 and Connelly v DPP (1964) AC 1254 assist the Plaintiff’s case. His Honour summarily dismissed the claims under the FTA and TPA as they were contained in the original Statement of Claim. Those orders have legal effect when a Plaintiff seeks to plead again a claim which is, in effect, materially the same, in a later pleading.

43. I will, in due course, make orders striking out the paragraphs which I have held are affected in the manner contended for by the Defendants. In the circumstances of this case, I consider that the appropriate order is to strike out those paragraphs pursuant to r 14 r 28 Uniform Civil Procedure Rules 2005.” (emphasis added)

26 The terms of paragraph 24E, in respect of which leave to amend is now sought, require close consideration, especially in light of paragraph 24E in the Amended Statement of Claim which was considered by Johnson J.

27 Notwithstanding that the conclusion reached by his Honour coincided with that of Malpass AsJ on the “trade and commerce” point, Johnson J proceeded to separately consider the “representations” that were particularised in paragraphs 24E, which were said to have constituted misleading or deceptive conduct in terms of s.42 of the FTA.

28 Johnson J then determined submissions made by the defendants “on other grounds” at [44]. His Honour, firstly, dealt with particulars given in paragraphs 24E(a) to (c), which his Honour noted related to alleged representations to the effect that outsourcing was in the interests of the business of the defendants. I note, at this point, that paragraph 24E(a) to (c) in the proposed Amended Statement of Claim are in identical terms to the paragraphs that were considered by Johnson J at paragraph [45] and in subsequent paragraphs in his Honour’s judgment. Accordingly, observations made by his Honour in relation to those paragraphs are, of course, material to the present application.

29 His Honour, in respect of paragraphs 24E(a) to (c), stated:-

“45. The Defendants submit, firstly, that the particulars given in paragraphs 24E(a) to (c) relate to alleged representations to the effect that outsourcing was in the interests of the business of the Defendants. The Defendants submit, and I accept the submission, that it is not apparent how representations of this kind, if they were made, would be capable of sustaining any case in which the Plaintiff could have suffered loss or damage ‘by’ the alleged conduct within the meaning of s.68 FTA or s.82 TPA.”

30 His Honour then went on to state that in paragraphs 24E(a) to (c), there was no pleading of any reliance by either the plaintiff or the representees to whom the representations in the subject paragraphs were alleged to have been made. His Honour went on to state that this was fatal “… even on the so-called three party scenario, there must be reliance and/or a clear pleading that the alleged misleading or deceptive conduct, which is here said to be the representations to third parties, caused the plaintiff’s loss or damage” (at [45]).

31 His Honour, accordingly, concluded (at [48]) that he was satisfied that paragraphs 24EA(a) to (c) should be struck out as disclosing no reasonable cause of action.

32 Johnson J then dealt with alleged contraventions of s.43 of the FTA (paragraphs 24K to 24L). The matters particularised in paragraph 24K(b) were alleged to have constituted unconscionable conduct and they corresponded to matters that were pleaded in paragraph 25(a) to 25(e) of the original Statement of Claim. Similarly, his Honour accepted that paragraph 24M to 24N (unconscionable conduct) relied upon particulars in paragraph 24K and they raised the same matters as had been previously pleaded in paragraph 24(e) of the original Statement of Claim.

The present application to amend the Amended Statement of Claim

33 The plaintiff filed a notice of motion on 4 September 2008, which was initially returnable on 12 September 2008. In the application, alternative orders were sought including an order granting leave to amend the Statement of Claim (paragraph 3 of the notice of motion). The amendments sought are those that have been identified in paragraph [2] above.

34 On 4 September 2008, the transcript of proceedings before Johnson J records that an application was made by the plaintiff to re-plead paragraph 24E(a) to (c). His Honour did not determine that application but stated (p.10):-

“… that leaves the question of the application to re-plead 24E(a) to (c), which is in a different category to the others. Of course, the question is whether leave to re-plead is granted or whether there ought be a direction that if the plaintiff wishes to re-plead, then the proposed pleading should be served on your side before any leave to granted.” (emphasis added)

35 Although this was an application by the plaintiff to further amend the Amended Statement of Claim, the somewhat unusual course was pursued on this application before me of tendering documents in relation to a range of factual matters. Such documents may well be admissible at the final hearing, however, save for confirming dates of email correspondence referred to in paragraph [110], I do not consider that they are relevant to the application I am required to determine. The documents were objected to by Mr M A Izzo on behalf of the defendants. I admitted the documents subject to relevance. They were marked as Exhibit A. The bundle of documents has been re-marked for the purpose of identification as follows:-

Exhibit A1 – Deed of Release between New South Global Pty Limited and the plaintiff.
Exhibit A2 – Teaming Services Agreement (draft) 4 July 2003.
Exhibit A3 – Discussion paper – restructure of the Educational Testing Centre, October 2003.
Exhibit A4 - Email from the plaintiff dated 29 October 2003.
Exhibit A5 - Confidential paper entitled “Reply No 3 to ECT restructure discussion paper” , October 2003.
Exhibit A6 – letter from Dr Alan Bowen-James, General Manager, Educational Testing Centre dated 31 October 2003 to the plaintiff.
Exhibit A7 – memorandum from the plaintiff dated 4 September 2003 marked “strictly confidential” addressed to NSG Board and UNSW Council.
Exhibit A8 – copy memorandum from Alan Bowen-James to “All Staff” dated 10 September 2003.
Exhibit B – Report of Dr John D Pickering dated 28 November 2006.
Exhibit C – Report of Dr John D Pickering dated 14 August 2007.
Exhibit D – Accountant’s reports (Mr Ian Eislers) dated 13 May 2005 and 16 February 2007.

36 Before examining the proposed amending paragraphs in the present application, I will firstly deal with the powers in this Court to permit amendments to pleadings and the limitations on those powers.

Amendment of pleadings

37 This Court is empowered to order at any stage of proceedings that a document be amended: s.64(1), Civil Procedure Act 2005.

38 In deciding whether to make such an order, the Court must act in accordance with the dictates of justices: s.58(1), Civil Procedure Act. In determining what the dictates of justice require in a particular case, the Court is to have regard to the provisions of s.56 (the facilitation of “the just, quick and cheap resolution of the real issues in the proceedings”) and s.57 (the objects of case management, which includes the just determination of the proceedings). Subject to s.58, all necessary amendments are to be made for the purpose of determining the real questions raised by or otherwise depending on the proceedings: s.64(2), Civil Procedure Act.

39 The application for leave to amend arising as it does following the orders that were made by Johnson J on 4 September 2008 striking out the pleaded cause of action in relation to the FTA, the orders made by his Honour are to be borne in mind when determining the present application. Johnson J noted that no material facts had been pleaded in paragraphs 24E or 24I and, as noted above, determined that paragraphs 24E(a) to (c) should be struck out as disclosing no reasonable cause of action: Curtin v University of New South Wales (No 2) [2008] NSWSC 1236 at [48]. The conduct that had been alleged in paragraph 24E(a) to (c) was pleaded as a contravention of s.42 of the FTA.

40 The basis for, and the limits on, the exercise of the general discretion to grant leave to amend have been formulated in four propositions (see Ritchie’s Uniform Civil Procedure Rules, NSW at s.64.10):-

(1) The proposed amendment must not be so obviously futile that it would be liable to be struck out if it had appeared in the original pleading.

(2) The application for leave must be made for a proper purpose.

(3) The amendment must not cause prejudice to the other party that cannot properly be compensated by appropriate consequential orders, including costs orders.

(4) The amendment must not be contrary to the interests of the administration of justice.

41 In relation to the application of propositions (1) and (2) to the facts and circumstances of the present case, the following matters arise:-

(1) Whether the proposed amendments set out in paragraphs 24E and 24EC and paragraphs 24K(g), (h) and (i) of the document “Amended Statement of Claim” (MFI 1) for the purpose of causes of action under s.42 and s.43 of the FTA in fact seek to raise issues that have, in whole or in part, already been determined adversely to the plaintiff by the judgment of Johnson J of 4 September 2008.

(2) In relation to proposed paragraph 24E, three specific matters arise for consideration:-

(a) First, whether the conduct sought to be alleged in proposed paragraphs 24E(a), (b) and (c) can be said to have occurred in the course of “trade and commerce” within the meaning of the FTA .
(b) Second, whether paragraphs 24E and 24EC, on their face, pleaded reliance and/or causation.
(c) Third, whether proposed paragraphs 24E (and 24EC) plead the necessary material facts to support the allegation of a causal connection between the alleged contravening conduct and the plaintiff’s entry into the Deed of Release on 2 December 2003 and with the loss and damage claimed.

42 If 2(a) is answered in the negative, it follows that leave to amend should not be granted, for to do so would permit the inclusion of a futile cause of action.

43 If 2(b) and/or 2(c) are also answered in the negative, that would provide further grounds for refusing the grant of any leave to amend.

44 The determination of the present application for leave to amend requires, as a matter of primary importance, a determination as to whether the interests of justice require a judicial determination of the merits of the proposed causes of action under the FTA: Queensland v J L Holdings Pty Limited (1997) 189 CLR 146.

45 If the proposed paragraphs in their terms are capable of supporting the FTA causes of action in respect of both the Deed of Release and the claim for damages any deficiency in particulars, would not, in my opinion, preclude the granting of leave. The power to order amendments includes a power to amend particulars. The consideration of the more fundamental matters, including those to which I have referred in paragraph [41], will determine the proper exercise of the broad power to permit the amendments now sought.

Plaintiff’s submissions

46 The plaintiff relied upon the matters in brief written submissions dated 10 October 2008. In oral submissions, Mr King expanded considerably on the matters raised in that document.

47 Before dealing with the issues raised, there is a preliminary matter. Mr King stated that on 4 September 2008, Johnson J had “granted leave to the plaintiff to file and serve an amended statement of claim …” (transcript, 30 March 2009, p.1, lines 18 to 19). In his oral submissions, it was said that the representations now relied upon were “new representations”, and that “…his Honour granted leave to replead those issues” (transcript, 30 March 2009, p.5, line 42). At p.16, line 48, Mr King asserted that Johnson J “…gave the right to seek to look at these additional matters which were not advanced before Associate Justice Malpass”.

48 It is of some importance to observe that Johnson J did not, as I have earlier noted, grant leave to the plaintiff to re-plead paragraphs 24E and 24K, nor did his Honour express any view as to whether the plaintiff should have leave. His Honour stated on 4 September 2008 (transcript, p.10) that, as to an application to re-plead paragraph 24E(a) to (c), the “… question is whether leave to re-plead is granted or whether there ought be a direction that if the plaintiff wishes to re-plead, then the proposed pleading should be served on your side before any leave is granted”.

49 Accordingly, no determination was made by Johnson J as to the entitlement in the plaintiff to further amend and the question on this application is whether leave ought be granted or not.

50 In the course of his oral submissions, Mr King made a number of contentions including the following:-

(1) That the “misrepresentations” relied upon and pleaded in proposed paragraph 24E related to services supplied by the plaintiff to the ETC parties and to the education testing market in the business of education assessment and occurred in the course of “trade and commerce” .

(2) The “misrepresentations” were made in relation to the question of outsourcing ETC operations or services (or part thereof). The misrepresentations, accordingly, could not be said to have occurred in the context of “internal communications” . That factual scenario, accordingly, meant that the representations were made in the course of trade and commerce.

(3) That the outsourcing and restructuring led to the constructive dismissal of the plaintiff.

(4) That the constructive dismissal of the plaintiff was associated with his opposition to the outsourcing to the entity, Pearsons.

(5) In that respect, Mr King submitted “… Out [sic] case is that the defendants got rid of Mr Curtin so that the outsourcing could happen and that is why it is different from a mere foreman telling a man the grade [is] wrong. That is an internal question. Here the very outsourcing arrangements themselves were part of it …” (transcript, 30 March 2009, p.12, lines 15 to 20).

51 In relation to the bases or foundations for the plaintiff’s claim, Mr King also contended:-

(1) That, as a result of the “misrepresentations” and their significance, the Deed of Release was entered into.

(2) The plaintiff’s contention was that the “misrepresentations” occurred in relation to “services supplied” in the market of the business of education assessment which was within trade and commerce.

(3) That there was a causal connection between the alleged misrepresentations which it was contended destroyed Mr Curtin’s reputation in the context of his statements concerning “outsourcing” and that this “… led to the deed of release being required” (transcript, 30 March 2009, p.15, line 12):-

“… by making the false representations about Mr Curtin other persons involved in the University responsible for dealing with dismissals of, and termination of employment who had previously said that a deed of release wouldn't be required changed their mind and said would be required.” (Transcript, 30 March 2009, p.15, lines 26 to 30)

(4) That the requirement for the Deed of Release was motivated by the first and second defendants wishing to silence the plaintiff about the outsourcing agreement.

52 Mr King contended that Johnson J was not dealing with the misrepresentations in the way in which the plaintiff now seeks to proceed (transcript, 30 March 2009, p.14, lines 15 to 19 and p.16, lines 44 to 49). Given, as earlier noted, Johnson J’s observation in paragraph 45 of his judgment that the defendants had submitted that paragraphs 24E(a) to (c) then under consideration related to alleged misrepresentations “to the effect that outsourcing was in the best interests of the business of the defendants”, the validity of Mr King’s last-mentioned contention needs to be carefully considered.

53 Mr King referred to a number of authorities which he relied upon as supporting the contention that the alleged “misrepresentations” occurred in the course of trade and commerce. In particular, he cited the decision in McCormick v Riverwood International Australia Pty Limited [1999] FCA 1640 and Orison Pty Limited v Strategic Minerals Corporation NL (1987) 77 ALR 141, 157 (transcript, 30 March 2009, pp.17 to 18).

54 In the course of his oral submissions, Mr King did accept that the alleged misrepresentations did not arise in the context of negotiations “in the classical sense” (transcript, 30 March 2009, p.19, lines 20 to 23).

55 In relation to the concept of causation, Mr King re-affirmed his earlier submissions that the “misrepresentations”, he claimed, had been relied upon by a Mr Ward “and others including the industrial staff” and that “… that led to the requirement of the deed of release, and so the mis-representations were directly causative” (transcript, 30 March 2009, p.19, lines 38 to 43).

56 As earlier noted, Mr King tendered a number of documents. I note that, apart from a copy of an email dated 31 October 2003 addressed to the plaintiff from Dr Alan Bowen-James copied to Mr Ward, he did not refer to any pleaded material fact or evidence said to relate to such a fact which supported any reliance by Mr Ward on anything said to him about the alleged misrepresentations or which was passed on to him as to what had been said or passed between any of the defendants and the plaintiff.

57 Mr King stated that, in relation to the causal connection “between the representation and the misrepresentation, and the entry into the deed …” (transcript, 30 March 2009, p.22, lines 23 to 24), the plaintiff put his case in three ways:-

(1) Firstly, that the “industrial relations persons” had been influenced by the “misrepresentations” and they had required the Deed of Release.

(2) Secondly, that the misrepresentations “directly led to the imposition or requirement that a deed of release be entered into so as to protect the outsourcing negotiations with third parties … who had received … misrepresentations” (transcript, 30 March 2009, p.22, lines 27 to 31).

(3) Thirdly, that “… it affected Mr Curtin's capacity personally in the circumstances in which he found himself to cope and look after his own interests” .

58 Mr King acknowledged that the plaintiff’s case was “different to the usual misrepresentation case” (transcript, 30 March 2009, p.22, line 49). He, however, stated that the plaintiff was entitled to proceed upon third party reliance principles. These principles are discussed below.

59 Mr King responded to submissions made on behalf of the defendant and disputed the claimed insufficiency of particulars in respect of the elements relied upon in pleading the statutory count under the FTA.

60 I will deal below with submissions made on causation and the terms of proposed paragraph 24EA.

Defendants’ submissions

(a) Proposed paragraph 24E

61 In the defendants’ written submissions dated 26 September 2008, it was contended on behalf of the first, second and third defendants that, Johnson J having struck out paragraph 24E of the Amended Statement of Claim filed on 11 July 2008 (MFI 4), proposed paragraph 24E of the Amended Statement of Claim, “… reinstates it as far as sub-paragraph 24E(a) to (c) are concerned”: Defendants’ written submissions, paragraph 5. Having regard to the terms of proposed paragraph 24E in the present application, I agree with the defendants’ contention.

62 In paragraph 6 of those submissions it was contended:-

“It is apparent that the paragraph has been reinstated on the basis that there is now an attempt to articulate a causal connection between the matters complained of in paragraph 24E and the loss alleged in paragraph 24I (Johnson J had struck out paragraphs 24E(a) to (c) on the ground that they disclose no such causal link: see paragraphs 45 to 48 of his Honour’s judgment). However, paragraph 24E remains objectionable for at least two reasons.”

63 Mr Izzo, in his oral submissions, stated that, not only does the proposed amended pleading seek to “resuscitate” matters which were struck out by Johnson J, but additionally, the matter described as “… the outsourcing of the business of ETC” had been dealt with by Johnson J.

64 Insofar as the “conduct” sought to be relied upon related to what Mr Izzo described as “… an attempt to outsource the business” (transcript, p.34), he contended that Malpass AsJ had also dealt with the matter, in particular, in paragraph 54 of his judgment and dismissed the claim.

65 Mr Izzo, by reference to the judgment of Johnson J delivered on 4 September 2008, contended that such issues arising under the proposed amendments had, in fact, been the subject of his Honour’s determination in the strike out application.

66 The defendants then contended that the particulars of the “representations” alleged in paragraph 24E are patently inadequate. In particular, it was argued there are no particulars of when or where the alleged representations were made or to whom they were made, let alone whether they were written or oral or express or implied. It was also contended that the “representations” were described inadequately, and were in vague and general terms such that the defendants would not be in a position to know the nature of the case against them for the purpose of pleading to the representations in their defence.

67 It is also said that it was insufficient to state, as the proposed paragraph did, that full particulars would be given after discovery.

68 On the issue of causation, Mr Izzo contended that proposed paragraphs 24E(a), (b) and (c) do not disclose a causal link between the alleged representations and the claimed loss including the plaintiff’s entry into the Deed of Release. He argued that the generality of the proposed paragraphs did not identify to whom it is alleged the representations were made. If, for example, he stated it was to be contended that the representations were made to Mr Ward, the Chief Executive Officer of New South Global Pty Limited, the other party to the Deed of Release, then the material facts supporting that matter had to be pleaded, but had not been disclosed in the proposed amendments.

69 Accordingly, Mr Izzo in his oral submissions, opposed proposed paragraph 24E, amongst other grounds, on the basis of their generality as well as their failure to disclose the material facts relied upon. Without such facts being pleaded, he contended, it was not possible to discern the basis relied upon for the element of causation or third party reliance.

70 In summary, he contended:-

• The terms of paragraphs 24E(a), (b) and (c) containing the alleged “representations” are unclear and do not disclose material facts.

• One particular difficulty is that it is not possible to discern the facts said to have caused the loss claimed. Additionally, it was argued “who exactly is said to have received the representations” and what impact any such alleged representations had on them or their actions are not disclosed in the proposed pleading.

• The proposed pleading does not disclose how or on what basis it is contended the “representations” caused the plaintiff to enter into the Deed of Release. By way of illustration, Mr Izzo posed the question, if by some means it was contended that the “representations” had an impact on Mr Ward, the Chief Executive Officer of New South Global, the signatory to the Deed, which had impacted on or caused Mr Ward to make certain decisions, the proposed pleading does not disclose the effect of any alleged representation or the decision(s), if any, made by him and how any decision he may have made had any bearing upon the Deed of Release. It was contended that there was only a broad statement as to the plaintiff’s reputation having been destroyed but no material facts identified in relation to these issues.

• The principles of pleading require that all material facts constituting a cause of action must plainly be stated in the pleading itself: Trade Practices Commission v David Jones (Australia) Pty Limited (1985) 7 FCR 109 at 112 to 113. It was noted that, in that case, Fisher J (at p.114) drew the distinction between a mere statement of a conclusion drawn from facts on the one hand and a statement of material facts that supported a reasonable cause of action on the other. Mr Izzo contended that conclusions of a speculative nature only were to be found in proposed paragraphs 24E(a) to (c). There was no proposed pleading of material facts that established any link between the “representations” and the fact that the plaintiff signed the Deed of Release or, as he claims, that his feelings or psychological state were such that he felt emotionally pressured to sign the Deed.

71 Finally, the defendants also contended that paragraphs 24EA to 24EC do not allege “… any comprehensible basis on which the representations alleged in paragraph 24E could be said to be causative of any loss suffered by the plaintiff” (paragraph 9 of the defendants’ written submissions).

72 Finally, in relation to the proposed paragraphs directed to establishing a cause of action based on unconscionable conduct within the meaning of the FTA, Mr Izzo observed that proposed paragraph 24K (in relation to paragraphs 24K to 24L all concerned with alleged unconscionable conduct), the wording of that paragraph was precisely the same as former paragraph 24K in the Amended Statement of Claim before Johnson J. The only difference was that sub-paragraphs (a) to (c), (e) and (f) had been struck out. Johnson J, Mr Izzo contended, struck out paragraph 25K “for a second time” (transcript, p.36).

(b) Proposed paragraph 24EA

73 Proposed paragraph 24EA is in the following terms:-

“24EA As a consequence of the misrepresentations made in sub-paragraphs (a), (b) and (c) alleged in paragraph 24E herein the Plaintiff’s reputation was destroyed and in particular with those in the University and/or those instructed by the Second Defendant to negotiate his cessation of employment with the ETC parties whereby the Second and/or Third Defendant demanded that the Plaintiff sign the deed of release dated 2 December 2003 contrary to prior statements made to him that such deed of release was unnecessary and/or would not be required from him.”

74 Mr King argued that, as the relief claimed in prayers 1, 2, 3 and 4 of the proposed Amended Statement of Claim made plain, the plaintiff seeks to plead, inter alia, alleged deceptive or misleading conduct which was causally related to the plaintiff having entered into the Deed of Release on 2 December 2003.

75 In this way, the alleged misleading or deceptive conduct (if established) would be the foundation for an entitlement to the relief claimed in relation to the Deed of Release thereby preventing it from, in effect, operating as a shield against the plaintiff’s claim for damages.

76 It is, accordingly, necessary to determine whether the proposed Amended Statement of Claim in fact sufficiently pleads the statutory cause of action of alleged misleading or deceptive conduct (including, in particular, in that respect the elements of reliance and/or causation) such that the defendants are able to formulate or frame a defence to the cause of action.

77 It is necessary in considering proposed paragraph 24AE to examine the nature of the representations that the plaintiff seeks to rely upon as referred to in paragraphs 24E(a), (b) and (c) of the proposed Amended Statement of Claim. (Johnson J undertook a similar inquiry in his judgment at paragraphs [45] and [45].) In that respect, that paragraph contains the following elements:-

(1) That the persons making the “representations” are said to have been Dr Alan Bowen-James (the fourth defendant) and Cognitive Systems Pty Limited (the fifth defendant).

(2) In or about September 2003, Dr Bowen-James and Cognitive Systems Pty Limited are said to have acted as agents for “the ETC parties” , namely, the University of New South Wales (the first defendant) and New South Global (the second defendant) in making the representations.

(3) Representations were allegedly made, in addition to the ETC staff, to the third defendant (Professor John Ingleson) and also to “… persons in the market …” (ie, “education testing market in the business of eduction assessment” ).

(4) The subject matter or target of the “representations” was allegedly a statement or a communication by the above defendants to the effect that “advice” that had been given by the plaintiff “to ETC” in or about September 2003 and on prior occasions (unspecified) to the effect that commercial outsourcing was not in the interests of ETC, was entirely false advice, the defendants’ statement or communication itself allegedly being erroneous.

78 The defendants, in their written submissions, contended:-

“11. The difficulty is that the representations alleged in paragraph 24E are representations alleged to have been made by the ETC parties, ie, the First and Second Defendants themselves. Paragraph 24EA, therefore, amounts to a contention that the First and Second Defendants misled themselves into requiring the Plaintiff to sign the Deed of Release – a proposition that is plainly nonsensical.”

79 Paragraph 24EA in relation to the 24E(a) to (c) “representations” states that, as a consequence of “the misrepresentations”, the plaintiff’s “reputation was destroyed”. Paragraph 24EA proceeds further to contend for another causal consequence which was expressed in these terms “… whereby Second and/or Third Defendant (New South Global and Professor Ingleson) demanded that the Plaintiff sign the Deed of Release …”.

80 The issues of who made representations to whom and the alleged effect of such representations have been drafted in the most unusual terms. It was contended by Mr King for the plaintiff that, by reason of the alleged misrepresentations made by the fourth and fifth defendants, the second and/or third defendants were moved to demand that the plaintiff sign the Deed of Release. In effect, it was argued that the second and third defendants, in reliance upon the statements made by the first and second defendants concerning the plaintiff, caused damage to him. Accordingly it was said, he was entitled to rely upon the effect of the misrepresentations said to have been made to the second or third defendants.

Third party reliance

81 The plaintiff’s claim based on the alleged representations in proposed paragraph 24E and the issue of causation purportedly pleaded in proposed paragraph 24EA is an unorthodox one. That, of course, is not intended as suggesting that third party reliance cannot be established if there are material facts capable of establishing it.

82 Relevant case law has examined the question of third party reliance. In Janssen-Cilag Pty Limited v Pfizer Pty Limited (1992) 37 FCR 526, Lockhart J observed at 529:-

“What emerges from an analysis of the cases (and there are many of them) is that they do not impose some general requirement that damage can be recovered only where the applicant himself relies upon the conduct of the respondent constituting the contravention of the relevant provision.
Also, a perusal of the provisions of Pts IV and V, the contravention of which gives rise to an entitlement to an applicant for compensation for loss or damage, points to the conclusion that applicants may claim compensation where the contravener’s conduct caused other persons to act in a way that led to loss or damage to the applicant.”

83 Lockhart J observed in that case (at 530) that the use of the preposition “by” in s.82(1) is important. His Honour there noted:-

“… It indicates the requirement that there be a sufficient cause or link between the respondent’s conduct and the recoverable loss or damage …”

84 His Honour also there added:-

“… Loss or damage must directly result from or be caused by the respondent’s conduct. The respondent’s conduct must be the real or direct or effective cause of the applicant’s loss; it must have been ‘brought about by virtue of’ the conduct which is in contravention of s.52 …”

85 See also further observations in that case at 530, 531 and 532.

86 In McCarthy v McIntyre [1999] FCA 784, the Full Court of the Federal Court (Hill, Sackville and Katz JJ) in the reasons for judgment of the Court at [48] expressed agreement with the observations of Lockhart J in Janssen-Cilag (supra) to the effect that s.82 of the TPA (or s.87 or their State equivalents) did not require that a person who alleges damage must rely upon the misrepresentation. The passage from the judgment of Lockhart J in Janssen-Cilag (supra) was cited with approval by Gummow J in Marks v GIOAustralia Holdings Limited [1998] HCA 98; (1998) 158 ALR 333 at 359.

87 In McCarthy (supra), their Honours observed at [48]:-

“All that is necessary, in our opinion, is that there be a sufficient and direct link (ie, causation) between the loss or damage alleged to have been suffered by the claimant and the misleading or deceptive conduct.”

88 In the same case, their Honours observed at [50]:-

“Where a claimant is able to show that, but for the misleading or deceptive conduct, he or she would not have entered into a transaction, then such loss as flows directly to the claimant from the transaction will satisfy the requirement of causation. This is so where the claimant relies upon the misleading or deceptive conduct (the usual case). It is also so where a third party whose action was a sina qua non of the entry by the claimant into the transaction (the present case as alleged) relies upon the misleading or deceptive conduct.”

89 More recently, the question of third party reliance and the issue of causation was considered by the Full Court of the Federal Court (Kiefel, Sundberg and Edmonds JJ) in Finishing Services Pty Limited v Lactos Fresh Pty Limited [2006] FCA FC 177. In that case, the appellant, Finishing Services, was the lessor of premises to the first respondent, Lactos Fresh. The appeal concerned the notification by Finishing Services of a new and higher rent purportedly pursuant to a rent review clause in the lease agreement. An alternative case brought by Lactos Fresh was against the second respondent (Colliers Victoria) who had advised Finishing Services as to an appropriate rental market.

90 In dealing with the claim by Lactos Fresh in the cross-appeal, it was observed that it was not that Lactos Fresh had been misled but rather Finishing Services had been. The submission at first instance had been that it was sufficient for Lactos Fresh to demonstrate that Finishing Services had relied upon its agent’s advices and that Lactos Fresh had suffered loss and damage by reason of that reliance.

91 The Court in that case discussed the tests to be used to judge what constitutes a sufficient cause or connection between the misleading conduct and the outcome. Following reference to authority, including Janssen-Cilag (supra) and McCarthy (supra), the Court observed:-

“… However the authorities require there to be a ‘sufficient and direct link’ or a ‘requisite element of proximity’ in order for the section to be satisfied.”

92 The judge at first instance had identified as an “insurmountable hurdle” in relation to causation the fact that Lactos Fresh had failed to object to the notice and that such failure would constitute a break in the chain of causation. At [33], the Court on appeal observed that, whilst negligence on the part of a “victim” of the contravention was not a defence to a claim for damages under s.82 of the TPA, “this did not apply where the victim’s conduct operates so as to destroy the causal connection between the contravention and the loss …”. The trial judge, accordingly, had concluded that, had the notice been valid, Colliers Victoria would not, by its conduct, have caused Lactos Fresh’s loss.

93 The Court also observed (at [35]) that the cases did not deny that the “but for” test for causation may have some use but that it cannot operate exclusively for the reason that it is not a comprehensive test. Reference was made in that respect to dicta of Gummow J in Chappel v Hart (1998) 195 CLR 232 at [62]. If that test is not satisfied, then it is unlikely that there is the necessary causal connection.

94 Accordingly, as the Full Court observed in Finishing Services (supra), something more is required than the application of the “but for” test. Authority indicates that an application of the commonsense approach to causation has been mandated. Applying the appropriate test, it must be shown that the misrepresentation in the present case caused in a direct way or materially contributed to the plaintiff entering into the Deed of Release.

95 There are, in my opinion, two difficulties in permitting, by way of amendment, the pleading of the misrepresentations in paragraph 24E in association with the purported formulation of causation in paragraph 24EA.

96 The first difficulty is that paragraphs 24E and 24EA do not identify the material facts that are said to establish the necessary causal link. It is clear that such material facts must be pleaded: Bond Corporation Pty Limited v Thiess Contractors Pty Limited (1987) 14 FCR 215 per French J (as his Honour then was) at 222.

97 In relation to proposed paragraph 24E(a), the material facts concerning the “misrepresentations” are not identified. There is a general reference to “advice” given by the plaintiff to ETC in or about September 2003 (said to have been given three months before the Deed of Release was signed) without stating specifically what the advice was or how the alleged misrepresentations about the “advice” was received by others or what influence or operation it is claimed they had upon them in the making and/or the implementation of any such decisions.

98 This situation is compounded by the failure to specify what were the “prior occasions” upon which representations were made or what were the material facts as to what was said by the plaintiff on such “occasions” concerning the subject of outsourcing and what effect they may have had on a particular individual.

99 Further, there is no reference to material facts concerning the content of any particular communication or statement allegedly made by the fourth and fifth defendants as agents for the first and second defendants about the plaintiff’s “advice” or the material facts as to how any statements or communications about the plaintiff’s advice were said to be related to the execution of the Deed of Release.

100 In summary, proposed paragraph 24E does not state or otherwise identify the material facts capable of giving rise to a probable inference that the statements or communications by the fourth and fifth defendants on behalf of the first and second defendants operated on others, in particular, on those who negotiated on behalf of the first and second defendants, such, for example, that they engaged in any conduct by allegedly making a “demand” to the plaintiff that, as a term of negotiated settlement, he was required to enter into the Deed of Release and that it was in consequence of that demand, that he entered into it.

101 The proper pleading of material facts is essential to the issue of causation as an essential element in a cause of action under the FTA.

102 In this regard, in Bond Corporation (supra), French J, as his Honour then was, observed at 222:-

“The material facts establishing the necessary causal link should be pleaded. In cases of contravention of s.52 said to be constituted by misrepresentation this will generally require more than appears in the opening words of par 50: ‘by reason of such conduct …’
Some guidance to the proper approach may be derived from the ordinary rule of pleading applicable in cases of fraud of which Lord Watson said in Dow Hager Lawrance v Lord Norreys [1890] 15 App Cas 210 at 221:-
‘… the ordinary rule of pleading applicable to cases of fraud, … was thus expressed by Earl Selborne in Wallingford v Mutual Society …: ‘general allegations, however strong may be the words in which they are stated, are insufficient to amount to an averment of fraud of which any court ought to take notice.’ It is not a sufficient compliance with the rule to state facts and circumstances which merely imply that the defendant, or someone for whose action he is responsible, did commit a fraud of some kind. There must be a probable, if not necessary, connection between the fraud averred and the injurious consequences which the plaintiff attributes to it; and if that connection is not sufficiently apparent from the particulars stated, it cannot be supplied by general averments .’ Facts and circumstances must in that case be set forth, and in every genuine claim are capable of being stated, leading to a reasonable inference that the fraud and the injuries complained of stood to each other in the relation of cause and effect.’
...”

103 French J in Bond Corporation (supra) stated that relevant precedents in Bullen, Leake and Jacob, Precedents of Pleadings in the Queen’s Bench Division of the High Court of Justice (12th ed, 1975) at pp.702 to 707, supported the view that “the approach enunciated by Lord Watson is equally applicable to actions for negligent misrepresentation” (p.222).

104 His Honour also referred to dicta of Toohey J in James v ANZ Banking Group Limited (1985) ATPR 40-504 at 46,034 as follows:-

“While the Bank is not required to plead specifically to particulars of damages, it is entitled to know with some certainty what is being claimed and the basis of the claim.”

105 French J concluded (at 222):-

“In my opinion, the statement of claim in par 50 does not plead the necessary material facts to establish the causal relationship between contravention and loss which is necessary to the cause of action …”

106 In summary, I do not consider that the matters pleaded in the proposed paragraphs 24E and 24EA reveal the material facts concerning the alleged representations or that are necessary to establish the requisite causation inherent in the phrase “… loss or damage by conduct of another person” within the meaning of s.72(1) of the FTA. Relief available under s.72(5) of the FTA is contingent on a proper pleading and proof of third party reliance or a causal connection being established.

107 In particular, proposed paragraph 24EA which purports to establish causation by the use of the phrases “as a consequence of …” and the words “… whereby the Second and/or Third Defendant demanded that the Plaintiff sign the Deed of Release …” is not sufficient to comply with the principles of pleading referred to by French J in Bond Corporation (supra). Such phraseology is similar to that was rejected by his Honour in that case (“by reason of such conduct”).

108 Finally, proposed paragraph 24E(c) does not meet the causative tests required or meet the principles which require the pleading of material facts. The observations made above in relation to proposed paragraph 24EA also apply to that proposed sub-clause.

109 I have earlier referred to the conclusion reached by Malpass AsJ and Johnson J in which their Honours rejected submissions to the effect that the alleged representations were made “in trade or commerce” applying the narrow construction referred to by the High Court in Concrete Constructions (supra). The conclusion reached by their Honours, in my opinion, has equal application to the proposed amendments in respect of paragraphs 24EA and 24EC. Whilst Mr King emphasised that the alleged representations arose out of and concerned the question of outsourcing such as to amount to statements made in trade and commerce and not as a mere internal communication, the essential facts out of which the dispute between the plaintiff and his former employer arose support the conclusions reached by Malpass AsJ and Johnson J on this question. The outsourcing of staff occurred, as I have earlier stated and as asserted in the proposed pleading, in 2001, at which time the plaintiff agreed to enter the employment of the second defendant although, of course, he also alleges that he did so on the basis and understanding to which he refers in the facts as pleaded.

110 In proposed paragraph 24E, he states that the “misrepresentations” were made “in 2003”. The particulars suggest, as earlier noted, the relevant period was in September and October 2003. The documents forming part of Exhibit A to which Mr King sought to draw attention including, in particular, an email dated 10 September 2003 confirms that this was the relevant period. Mr King, in that respect, drew attention to a letter written by the plaintiff on 4 September 2003.

111 Accordingly, it is clear that, at about that time (September/October 2003), a dispute arose between the plaintiff and others as to the advantages and disadvantages claimed concerning the outsourcing that had commenced on and after 1 July 2001. It is clear that the “misrepresentations” sought to be relied upon by the plaintiff in the proceedings did not occur at the time of the outsourcing negotiations and decisions made in 2001 or during a negotiation for alternative employment, or in any renegotiations of a contract such as, for example, were discussed in Orison (supra) or in Barto v GPR Managements Services Pty Limited (1991) 33 FCR 389 or in the course of a company structure involving the transfer of a long-term employee to another company as occurred in McCormick (supra). See also Stoelwinder v Southern Health Care Network (2000) 177 ALR 501 and Walker v Salomon Smith Barney Australia Securities Pty Limited [2003] FCA 1099.

112 As the High Court emphasised in Concrete Constructions (supra), the provisions proscribing misleading or deceptive conduct is concerned with the conduct of a corporation towards others with whom it “… has or may have dealings in the course of those activities or transactions which, of their nature, bear a trading or commercial character …” (at p.604).

113 In this case, the expanded definition of trade and commerce in s.4 of the FTA is to be borne in mind. However, as Johnson J observed at [37], the requirement that the conduct must itself bear a trading or commercial character applies equally in the context of the FTA, notwithstanding that expanded definition.

114 The dispute that arose in 2003 in the present matter occurred in the course of the plaintiff’s employment with the second defendant and did not involve misrepresentations being made in the context of pre-contract negotiations or in the context of commercial dealings of the nature referred to by the High Court in Concrete Constructions (supra). In other words, the context in which the plaintiff alleges that the misrepresentations were made was in the course of the plaintiff’s employment. That context was not one of a commercial character in the sense explained in Concrete Constructions (supra). That, of course, does not mean that the fact that a person is employed precludes the possibility of conduct falling within s.42 of the FTA. It is sufficient, in relation to the application of the principles in the employment context, to refer to the observations made in Orison (supra) at 157 to 158, in Barto (supra) at 393, in McCormick (supra) at [28] to [30] and to the decision of the Full Court of the Federal Court in Village Building Company Limited v Canberra International Airport Pty Limited (2004) 139 FCR 330 at [50] to [55].

Proposed paragraphs 24K(g), (h) and (i)

115 In relation to proposed paragraphs 24K(g), (h) and (i) (unconscionable conduct), insofar as the plaintiff seeks to rely upon the unconscionability provisions in the FTA to establish such conduct in relation to the of the Deed of Release, it is necessary to apply the principles in Concrete Constructions (supra) as enunciated by the High Court and as discussed and applied in other cases in determining whether or not the alleged conduct made in the course of employment discussions, negotiations and arrangements to terminate an employment contract (including releases) falls within the provisions of the FTA. There is authority that supports the proposition that, in particular circumstances, statements made in the course of employment negotiations which prove to be misleading or deceptive may fall within the provisions of s.52 of the TPA (see Walker (supra) and the authorities referred to at [180]) that is not a proposition of general application. As Kenny J in that case observed at [181], whether negotiations in relation to employment contracts (whether with existing or prospective employees), come within the scope of s.52 of the TPA depends on whether the particular negotiations can be characterised as being “in trade or commerce”.

116 I do not consider that discussions and agreement between employee and employer concerning the termination of that employee’s employment contract without more constitute dealings in the course of activities which, of their nature, bear a trading or commercial character. As has been observed, whatever difficulties there may be in applying the broad statements of principle laid down by the High Court in Concrete Constructions (supra) the mere fact that a misleading statement was made by one employee to another in the course of employment does not, of itself, make the statement one within the ambit of the expression “in trade or commerce” in s.52 of the TPA. The focus of the phrase “in trade or commerce” is on “commercial activity”: Toohey J in Concrete Constructions (supra) at 613.

117 I am of the opinion that the matters raised in proposed paragraphs 24E(a), (b) and (c) were the subject of determination by Johnson J. I refer in that respect to paragraphs [35] to [39] of his Honour’s judgment of 4 September 2008. I have no reason to arrive at any different conclusion to those expressed by his Honour concerning those matters. Indeed, for reasons I have stated, I have reached the same conclusion. I would refuse the application to include proposed paragraphs 24E(a), (b) an d(c) and 24EA

118 In relation to proposed paragraphs 24K(d), (g), (h) and (i), I am also of the opinion that paragraphs that included those paragraphs were considered and determined adversely to the plaintiff by Johnson J. For reasons expressed by Johnson J (including on the issue of “supplier” discussed in paragraph [49] of his Honour’s judgment) and for the reasons I have expressed, I am of the opinion that the application to amend as sought in paragraphs 24K(d), (g), (h) and (i) should be dismissed.

119 I, accordingly, do not consider that the plaintiff has established a basis for the grant of leave to amend the Amended Statement of Claim as proposed. An application of the principles to which I have earlier referred to the facts and circumstances relied upon in this matter lead to the conclusion that the application to amend should be refused. Accordingly, the application is dismissed.

120 I will hear the parties as to costs.

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