McDermott v King

McDermott (the applicant) brought proceedings against King (the respondent) alleging misleading and deceptive conduct, unconscionable conduct, and breach of warranty of authority under the *Trade Practices Act 1974* (Cth) and the Australian Consumer Law. The dispute arose from a series of transactions involving the sale of a business.

The primary legal issues before the court were whether the respondent had engaged in misleading or deceptive conduct, unconscionable conduct, or breached a warranty of authority in relation to the sale of the business. The court was also required to determine the extent of the respondent's liability for any contraventions found.

In his reasoning, Judge Burnett found that the respondent had engaged in misleading and deceptive conduct by making certain representations about the business's financial performance and prospects, which were not substantiated. The court also found that the respondent's conduct, in its totality, amounted to unconscionable conduct. However, the claim for breach of warranty of authority was not made out. The court applied the principles of the *Trade Practices Act 1974* (Cth) and the Australian Consumer Law, focusing on the objective effect of the respondent's conduct on a reasonable consumer.

The court ordered that the application be allowed in part and awarded damages to the applicant to compensate for the losses suffered as a result of the respondent's misleading and deceptive conduct and unconscionable conduct.