Ian Donaldson Johnston v Filaria Pty Limited & Ors;; Henry Posch v Filaria Pty Limited & Ors;; Alison Jane Whittle and ROSILIE Patricia Munday v Filaria Pty Limited

The Court of Appeal of the Australian Capital Territory heard appeals by Ian Donaldson Johnston, Henry Posch, Alison Jane Whittle, and Rosilie Patricia Munday against Filaria Pty Limited and others. The dispute arose from the appellants' purchase of units in a refurbished hotel, induced by a brochure issued by the respondents in 1993. The appellants alleged that the brochure contained false and misleading representations upon which they relied to their detriment, leading to losses. They claimed that the brochure projected reasonable profits and capital gains, including a guaranteed return for three years, which was later extended to five years, with optimistic projections for future economic trends.

The central legal issue before the Court of Appeal was whether the representations made in the "Investment Report" brochure were false and misleading, and if so, whether they caused the losses suffered by the appellants. Specifically, the court considered whether the projected financial figures and optimistic outlook presented in the brochure constituted actionable misrepresentations, particularly concerning the returns expected beyond the initial five-year guarantee period. The court also examined the causal link between any alleged misrepresentations and the decline in the economic value of the units.

The Court of Appeal dismissed the appeals, agreeing with the findings of the learned trial judge. The court held that while the brochure contained some "glowing puffery" which should be disregarded, the underlying assumptions for the economic projections were reasonably based. The court found that the trial judge's factual findings were open on the evidence and that there was no error in the application of legal principles to those facts. The court concluded that the appellants had not established any actionable misrepresentations that caused their losses, noting that factors such as competition and a lack of support from unit holders, alongside general economic conditions, were identified as primary causes for the decline in unit values. The appellants were ordered to pay the respondents' costs of the appeal, with the decision on indemnity costs reserved.