Harvard Nominees Pty Ltd v Nicoletti

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FEDERAL COURT OF AUSTRALIA

Harvard Nominees Pty Ltd v Nicoletti [2022] FCAFC 179

Appeal from: Harvard Nominees Pty Ltd v Tiller (No 4) [2022] FCA 105
File number: WAD 59 of 2022
Judgment of: BANKS-SMITH, COLVIN AND O'SULLIVAN JJ
Date of judgment: 8 November 2022
Catchwords: CONSUMER LAW - where on remitter primary judge found that first and second respondents were liable to pay damages arising from loss under the Australian Consumer Law - where primary judge held that the remitter did not disturb first instance findings as to the third respondent and therefore did not order damages against him - where appellant alleges that the primary judge erred in construing the nature and terms of the remittal - where the primary judge properly construed the reasons and orders of the Full Court - appeal dismissed
Cases cited:

Harvard Nominees Pty Ltd v Tiller (No 2) [2020] FCA 604

Harvard Nominees Pty Ltd v Tiller (No 4) [2022] FCA 105

Harvard Nominees Pty Ltd v Tiller [2020] FCAFC 229

Re The Spanish Club Ltd [2015] NSWSC 1858
Division: General Division
Registry: Western Australia
National Practice Area: Commercial and Corporations
Sub-area: Commercial Contracts, Banking, Finance and Insurance
Number of paragraphs: 110
Date of last submissions: 29 August 2022 (Appellant)
12 September 2022 (Third Respondent)
Date of hearing: 24 August 2022
Counsel for the Applicant: Mr RC Newlinds SC with Mr TM Rogan
Solicitor for the Applicant: Hotchkin Hanly Lawyers
Counsel for the Third Respondent: Mr MD Cuerden SC with Mr AM Freund
Solicitor for the Third Respondent: Lawton Gillon

ORDERS

WAD 59 of 2022
BETWEEN:

HARVARD NOMINEES PTY LTD (ACN 008 761 037)

Applicant
AND:

GIOVANNI BASILIO NICOLETTI

Third Respondent

ORDER MADE BY:

BANKS-SMITH, COLVIN AND O'SULLIVAN JJ

DATE OF ORDER:

8 NOVEMBER 2022

THE COURT ORDERS THAT:

1.The appeal is dismissed.

2.The appellant do pay the third respondent's costs to be assessed on a lump sum basis by a registrar if not agreed.

3.There be liberty to the appellant to apply within 14 days to vary the costs order should it maintain that there should be any different order as to costs.

4.The liberty to apply shall be exercised by filing and serving any submission of no more than three pages stating the costs order sought and the contentions advanced as to why the order should be made together with any affidavit in support.

5.If the liberty is exercised, then the third respondent shall file and serve any submission in response of no more than three pages together with any affidavit.

6.Unless otherwise ordered, any issue as to whether the costs order should be varied shall be determined on the papers.

THE COURT NOTES THAT:

A.These orders do not affect the costs and other consequences of the notices of discontinuance of the whole of the appeal as against each of the first and second respondents.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

THE COURT:

  1. Harvard Nominees Pty…

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Details
Case
[2022] FCAFC 179
Decision Date

CaseChat Overview and Summary

The appeal, Harvard Nominees Pty Ltd v Nicoletti, was brought by the appellant, Harvard Nominees Pty Ltd, against three respondents. The primary dispute arose from claims under the Australian Consumer Law, with Harvard alleging misleading or deceptive conduct by the respondents that caused loss. The case was heard in the Federal Court of Australia, where the primary judge found in favour of the respondents on various grounds, including that Harvard did not prove it suffered loss or damage from the alleged misleading conduct. Harvard appealed this decision, arguing that the primary judge misconstrued the remittal of the case by the Full Court. The primary judge had concluded that the Full Court's remittal did not affect the findings against the first and second respondents but did not disturb the findings as to the third respondent, hence no damages were ordered against him.

The legal issues before the court involved the interpretation of the remittal by the Full Court and whether the primary judge correctly applied it in his decision. Specifically, the court had to determine if the primary judge erred in his construction of the remittal and whether the findings and orders against the respondents were appropriate. The court also had to consider the nature of the loss claimed by Harvard and whether it was causally linked to the misleading conduct alleged.

The court found that the primary judge properly construed the remittal from the Full Court and upheld the findings against the first and second respondents. It was held that the primary judge's reasoning was sound in finding that Harvard did not suffer any loss or damage due to the misleading conduct. The court emphasised that the state of affairs before the alleged misleading conduct meant there was no ability to give vacant possession, and entering into the New Leases did not constitute loss or damage in itself. Consequently, the appeal was dismissed, and the primary judge's decision was affirmed.

The court made several orders, including dismissing the appeal, directing the appellant to pay the third respondent's costs, and granting the appellant liberty to apply to vary the costs order if it believed a different order should be made. The orders also noted that the costs and other consequences of the notices of discontinuance of the appeal as against the first and second respondents were unaffected.

Orders

Orders of the court

1. The appeal is dismissed.

2. The appellant do pay the third respondent's costs to be assessed on a lump sum basis by a registrar if not agreed.

3. There be liberty to the appellant to apply within 14 days to vary the costs order should it maintain that there should be any different order as to costs.

4. The liberty to apply shall be exercised by filing and serving any submission of no more than three pages stating the costs order sought and the contentions advanced as to why the order should be made together with any affidavit in support.

5. If the liberty is exercised, then the third respondent shall file and serve any submission in response of no more than three pages together with any affidavit.

6. Unless otherwise ordered, any issue as to whether the costs order should be varied shall be determined on the papers.

THE COURT NOTES THAT:

A. These orders do not affect the costs and other consequences of the notices of discontinuance of the whole of the appeal as against each of the first and second respondents.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Mr Tiller's wife was also a respondent on the basis that the relief sought may affect her interests. She was not alleged to have engaged in misleading conduct.Decision of primary judge After a final hearing, the application by Harvard was dismissed: Harvard Nominees Pty Ltd v Tiller (No 2) [2020] FCA 604. This was despite Harvard having enjoyed a considerable measure of success as to the matters in issue in the proceedings. For present purposes, it is sufficient to quote the summary of the outcome given by the primary judge at [9]:The outcome is that the application will be dismissed. Harvard's claim in respect of the first instance of misleading or deceptive conduct fails because, while it has established that it relied on misleading representations made by Mr Tiller and Dimension, it has not proved that it suffered any loss or damage because of that reliance. Also, it has not established that Mr Nicoletti or Mr Bryce had sufficient knowledge of the misleading or deceptive conduct to attract liability for the conduct under the ACL. Harvard's claim in relation to the second instance of misleading or deceptive conduct fails because, while the conduct was misleading or deceptive or likely to mislead or deceive, and while the entry into the 15 February Deeds was a breach of the New Leases, it was not a fundamental breach which would have permitted Harvard to re‑enter the Farms, had it been aware of it. Also, Harvard has not established that Mr Bryce engaged in the relevant conduct. It can be seen that, as to the First Claim, the primary judge found that Harvard relied on misleading conduct of Mr Tiller and Dimension. His Honour also found that there was a causal nexus between that conduct and a refusal to deliver possession based on the New Leases which prevented Harvard from receiving the additional rent under the Fowler Lease: at [506]‑[507]. However, his Honour did not accept that the additional rent claimed was a loss that was suffered because of the Main Conduct. The reasoning to support that conclusion involved two steps. First, a finding that the state of affairs in existence before the Main Conduct was that Mr Tiller and his wife had an enforceable lease and they enjoyed the financial support of Mr Nicoletti. Therefore, there was no ability to give vacant possession to another party, whether under the Fowler Lease or otherwise: at [510]‑[513], [531]. Second, there was no other detriment from entering into the new Leases. In particular, his Honour held that entry by Harvard into a contract that it would not have otherwise entered into (the New Leases) was not, of itself, loss or damage. This was not a case where Harvard could have been free of obligations of the kind expressed in the New Leases. This was because at the time of the Main Conduct, 'legal relations were already in place which were no different in their effect from the legal relations from which Harvard would have abstained': at [565]. In short, even if the Main Conduct had not occurred (being the arrangements made in early February 2019), the Tiller Lease would still be binding. It was for that reason that Harvard failed in its claim that it suffered loss by the misleading conduct the subject of the First Claim.

Ratio Decidendi

Legal Principle Established

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