M. and D. Davidson v B. Daisley, D. Wilson, T.Gaze

The applicants, M. and D. Davidson, sought to strike out the defence and enter summary judgment against the respondents, B. Daisley, D. Wilson, and T. Gaze, in proceedings before the Supreme Court of Queensland. The dispute concerned allegations of misleading and deceptive conduct in contravention of the *Trade Practices Act 1974* (Cth) and the *Fair Trading Act 1989* (Qld). The applicants contended that the respondents had made false representations regarding the financial viability of a business opportunity, inducing the applicants to invest.

The central legal issue before the Court was whether the respondents' defence, which asserted that the applicants had independent legal and financial advice and therefore could not have relied on the alleged representations, disclosed a real question to be tried. The applicants argued that reliance was not a necessary element for establishing a contravention of the relevant provisions, and that the defence was therefore without merit and should be struck out.

The Court considered the principles governing summary judgment and the striking out of defences. It noted that a defence should only be struck out if it is demonstrably without merit or discloses no reasonable answer to the claim. The Court found that while reliance may not be a necessary element for establishing a contravention of section 52 of the *Trade Practices Act 1974* (Cth) or its state equivalent, the question of whether the applicants actually relied on the representations was central to the assessment of damages. Therefore, the defence, by raising the issue of independent advice, did disclose a relevant question to be tried in relation to the quantum of loss.

Accordingly, the Court dismissed the application to strike out the defence and enter summary judgment.