Legal Research
Cases
James Honner Nominees Pty Ltd v Geard

James Honner Nominees Pty Ltd v Geard

Link copied

Case Copied 21 June 2019 58 min read

Contents

On this page

District Court of South Australia
(Civil)
JAMES HONNER NOMINEES PTY LTD v GEARD
[2019] SADC 78
Judgment of His Honour Judge Tilmouth
21 June 2019
TRADE AND COMMERCE - TRADE AND COMMERCE GENERALLY - STATUTES RELATING TO MISLEADING OR DECEPTIVE CONDUCT IN TRADE
The defendants entered into a Motel Agreement to run the Stansbury Holiday Motel in 2014. This agreement contained a clause that the defendants needed to obtain at least 50% occupancy for the agreement to be continued after the first year and that they would receive a bonus if 60% was achieved. The plaintiff claims breach of contract in that the defendants failed to remit a specified percentage of proceeds as required by the Motel Agreement. The defendants claim they were misled prior to the formation of the contract as to the achievable occupancy rates, motel earnings and motel turnover.
Held:
1. It is proven that representations were made that the Motel had a minimum 40 per cent occupancy rate, when that was not in fact the case.
2. There was an additional misrepresentation by failing to correct the misrepresentation.
3. Breaches of s 18(1) of the Australian Consumer Law and s 7 of the Misrepresentation Act are proven.
4. The plaintiff’s claim is dismissed.
5. The defendant’s claim for set-off be dismissed as unproven.
6. The Motel Agreement is declared unenforceable at the instance of the plaintiff pursuant to s 243(c) of the Australian Consumer Law.
Retail and Commercial Leases Act 1995 (SA); Misrepresentation Act 1972 (SA) s 13; Competition and Consumer Act 2010 (Cth) ss 1, 236, 243, Schedule 2 Australian Consumer Law; Trade Practices Act 1974 (Cth) ss 51, 52; Brown v Jam Factory Pty Ltd (1981) 53 FLR 340; Australian Securities and Investment Commission v PFS Business Development Group Pty Ltd (2006) 57 ACSR 553; Skinner v Redmond Family Holdings Pty Ltd (2017) ACSR 593, referred to.
Parkdale Custom Built Furniture Pty Ltd v Puxu Ltd (1982) 149 CLR 191; Marks v GIO Australia Holdings Ltd (1988) 196 CLR 494; Australian Competition and Consumer Commission v Telstra Corporation Ltd (2004) 208 ALR 459; Campomar Sociedad Ltd v Nike International Ltd (2000) 202 CLR 45; Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357; Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640, applied.
Slinger v Southern White Pty Ltd (2005) 92 SASR 303; Jacques & Ors v Cut Price Deli Pty Ltd (1993) ATPR (Digest) 46-102, discussed.
Bugg v Day (1949) 79 CLR 442; Jones v Dunkel (1959) 101 CLR 298; Spence v Demasi (1988) 48 SASR 536; Nominal Defendant v Clements (1960) 104 CLR 476; Transport & General Insurance Co Ltd v Edmondson (1961) 106 CLR 23; Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304; Sheen v Fields Pty Ltd (1984)…

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.

Keep reading for free

Create a free CaseChat account to read James Honner Nominees Pty Ltd v Geard and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2019] SADC 78
Decision Date: 21 June 2019

CaseChat Overview and Summary

- Parties: James Honner Nominees Pty Ltd (plaintiff) v Geard (defendants)
- Nature of the dispute: The plaintiff is claiming damages for breach of contract, while the defendants are defending on the grounds of misrepresentation and seeking set-off.
- Court: District Court of South Australia (Civil)

The legal issues in this case are:

1. Whether the defendants were misled prior to the formation of the contract regarding the achievable occupancy rates, motel earnings, and motel turnover.
2. Whether the plaintiff breached the Australian Consumer Law and the Misrepresentation Act.
3. Whether the defendants are entitled to set-off for their labour expended in the motel.
4. Whether the Motel Agreement should be declared unenforceable.

The court held that:

1. The defendants were misled prior to the formation of the contract regarding the achievable occupancy rates, motel earnings, and motel turnover.
2. The plaintiff breached the Australian Consumer Law and the Misrepresentation Act by making misleading and deceptive representations and failing to correct the misrepresentations.
3. The defendants are not entitled to set-off for their labour expended in the motel, as they failed to provide evidence to quantify their claim.
4. The Motel Agreement should be declared unenforceable in the hands of the plaintiff, pursuant to s 243(c) of the Australian Consumer Law.

The final orders of the court are:

1. Dismiss the plaintiff’s claim for judgment in the sum of $156,882.
2. Dismiss the defendants’ claim to set-off.
3. Declare the Motel Agreement counter-signed by Mr Honner on 24 February 2014 is unenforceable at the instance of Honner Nominees Pty Ltd, pursuant to s 243(c) of the Australian Consumer Law.
4. The parties are entitled to be heard on the question of costs.

Orders