Giourtalis v Vaitsis

The appeal in *Giourtalis v Vaitsis* concerned a dispute between a lender, Mr Giourtalis, and an accountant, Mr Vaitsis. Mr Giourtalis alleged that he had lent money to a company based on misleading and deceptive representations made by Mr Vaitsis, the company's accountant. The central issue was whether Mr Vaitsis's conduct caused Mr Giourtalis's loss, particularly in light of Mr Giourtalis's subsequent decision to release the company from its debt in exchange for shares that proved to be worthless. The matter was heard by the Court of Appeal of New South Wales.

The court was required to determine whether the accountant's conduct constituted misleading or deceptive conduct under the relevant legislation. Crucially, the court had to assess the causal link between the alleged misleading representations and the financial loss suffered by Mr Giourtalis. This involved considering whether the decision to release the debt and accept worthless shares was a novus actus interveniens, breaking the chain of causation from the accountant's initial representations.

The Court of Appeal found that the accountant's representations were indeed misleading and deceptive. However, the court held that the primary cause of Mr Giourtalis's loss was not the initial misleading representations, but rather his subsequent decision to release the debt in favour of accepting shares that had no value. This voluntary act was considered to be the decisive factor breaking the chain of causation.

Consequently, the appeal was allowed.