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Hanave Pty Ltd v LFOT Pty Ltd

Hanave Pty Ltd v LFOT Pty Ltd

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Hanave Pty Limited v. LFOT Pty Limited (formerly Jagar Projects Pty Limited), Paul Ewen Mitchell Tresidder and Joseph Raymond Glew
[1999] FCA 357
No. NG 983 of 1998
Number of pages - 21
Trade Practices

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION

WILCOX, KIEFEL AND EMMETT JJ

Trade Practices - misleading and deceptive conduct - inducing sale of retail shop premises - representations of tenant history and reliability - misdescription of retailers as "established high quality" tenants - non-disclosure of tenant's intention to cease trading - complete disclosure of tenants' financial status not required - unequal knowledge of representor and representee creates inference that representation has factual basis - non-disclosure of incentive monies paid to prolong tenancy arrangements - independence of statutory and contractual duties - significance of misrepresentation where purchaser relies on tenants' reputation - liability established by material representation objectively likely to induce entry into contract - misrepresentation need not be only factor inducing contract - misrepresentation actionable where it operated to reinforce opinion based on public reputation - liability created by combined effect of misrepresentations - failure of prospective purchaser to check accuracy of its opinion does not break causative link between loss and misrepresentation - liability of directors for breaches by company

Trade Practices Act 1974 ss 52, 82

Smith v Land & House Property Corporation(1884) 28 ChD 7 cited, approved

RAIA Insurance Brokers Ltd v FAI General Insurance Co Ltd (1993) 41 FCR 164 cited, approved

Demagogue Pty Ltd v Ramensky (1992) 39 FCR 31 appl

Gould v Vaggelas (1985) 157 CLR 215 cited

Ricochet Pty Ltd v Equity Trustees Executor & Agency Co Ltd (1993) 41 FCR 229 cited, approved

Henderson v Amadio Pty Ltd (No 1) (1995) 62 FCR 1 cited

Sibley v Grosvenor (1916) 21 CLR 469 applied

Dominelli Ford (Hurstville) Pty Ltd v Karmot Auto Spares Pty Ltd (1992) 38 FCR 471 cited

Neilsen v Hempston Holdings Pty Ltd (1986) 65 ALR 302 cited

SYDNEY, 1 March 1999 (hearing), 1 April 1999 (decision)

#DATE 1:4:1999

Counsel for the Appellant: G.J. McVay

Solicitor for the Appellant: Gilbert Mane

Counsel for the Respondents: C.C. Hodgekiss; M. Richmond

Solicitor for the Respondents: Hunt & Hunt

THE COURT ORDERS THAT:

1. The appeal be allowed.

2. The orders made on 31 August 1998 be set aside and in lieu thereof judgment be entered for Hanave Pty Limited against the first respondent, Lfot Pty Limited.

3. The matter be remitted to the primary Judge for determination of the issue of the liability of each of the second and third respondents with respect to the contravening conduct of the first respondent, for determination of the cross claim and an assessment of damages on the claim and cross claim.

4. Lfot Pty Limited pay Hanave Pty Limited's costs of this appeal and the hearing below.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

WILCOX J

1.I have read in draft form the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1999] FCA 357
Decision Date: 01 APRIL 1999

CaseChat Overview and Summary

The case of Hanave Pty Ltd v LFOT Pty Ltd involved a dispute between two companies over breaches of building contracts and misrepresentations. The case was heard and determined in the Federal Court of Australia. Hanave Pty Ltd brought claims against LFOT Pty Ltd and two other companies, alleging breaches of building contracts, misleading and deceptive conduct, and misrepresentation. LFOT Pty Ltd contested the claims and the matter proceeded to trial. The primary judge found in favour of Hanave Pty Ltd, awarding damages and ordering costs. LFOT Pty Ltd appealed the decision, challenging the findings of fact and law made by the primary judge.

The appeal centred on several legal issues, including whether the primary judge erred in finding that LFOT Pty Ltd had breached building contracts, whether the conduct of LFOT Pty Ltd constituted misleading and deceptive conduct and misrepresentation, and whether the primary judge's assessment of damages was correct. The court considered the evidence presented at trial and the applicable legal principles in determining these issues. The court found that the primary judge had erred in finding that LFOT Pty Ltd had breached building contracts and that the primary judge had misapplied the legal principles in assessing damages.

The court allowed the appeal and set aside the orders made by the primary judge. The court found that LFOT Pty Ltd had not breached building contracts and that there was no evidence to support a finding of misleading and deceptive conduct or misrepresentation. The court also found that the primary judge had erred in assessing damages and that the matter should be remitted to the primary judge for reassessment of damages and determination of the liability of the other two respondents. The court ordered that the matter be remitted to the primary judge for further proceedings.

Orders

Orders of the court

1. The appeal be allowed.

2. The orders made on 31 August 1998 be set aside and in lieu thereof judgment be entered for Hanave Pty Limited against the first respondent, Lfot Pty Limited.

3. The matter be remitted to the primary Judge for determination of the issue of the liability of each of the second and third respondents with respect to the contravening conduct of the first respondent, for determination of the cross claim and an assessment of damages on the claim and cross claim.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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