IBEB Pty Ltd v Duncan

IBEB Pty Ltd (the vendor) appealed to the New South Wales Court of Appeal against a judgment awarded to the purchasers of a newsagency business. The dispute concerned allegations of misleading and deceptive conduct in relation to the sale of the business, specifically concerning representations made about the business's wage expenses.

The Court of Appeal was required to determine whether a schedule, forming part of a facsimile sent by the vendor's accountant to the purchasers prior to the sale, conveyed a misleading and deceptive representation of the business's wage expenses. Furthermore, the Court had to consider whether the purchasers relied on the terms of this facsimile. The appeal also addressed the quantum of damages awarded by the primary judge, specifically whether the purchasers had already been compensated for continuing losses through the award for overpayment of goodwill, and whether they were entitled to damages for losses incurred during their initial period of control of the business.

The Court of Appeal allowed the appeal in part. It found that the primary judge's assessment of damages was flawed, particularly concerning the overlap between compensation for overpaid goodwill and continuing losses. The Court determined that the purchasers were not entitled to recover for both the overpayment of goodwill and the continuing losses that were intrinsically linked to that overpayment. The Court also considered the purchasers' entitlement to damages for losses incurred during their initial period of control, indicating a modification to the original award.

The Court made no order as to the costs of the appeal. It provided a mechanism for the parties to agree on the revised judgment amount, including interest, within fourteen days. If agreement could not be reached, the parties were directed to lodge written submissions regarding the appropriate orders.