Milner v Delita Pty Ltd

Re: BRYAN JOHN MILNER and ORS.
And: DELITA PTY. LIMITED; ROGER McMILLAN GLASSON; MORRIS WALTER LEWIN; ROBERT
CHARLES GOOCH MORRISON and JOHN CHRISTOPHER BENNETT
Re: ALLAN JAMES GILL and ORS.
And: DELITA PTY. LIMITED; ROGER McMILLAN GLASSON; MORRIS WALTER LEWIN; ROBERT
CHARLES GOOCH MORRISON and JOHN CHRISTOPHER BENNETT
Nos. G164 of 1982 and G85 of 1983
Trade Practices

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Lockhart J.

CATCHWORDS

Trade Practices - consumer protection - alleged misrepresentations made in relation to the promotion of guava growing and marketing schemes - orders sought under ss. 82 and 87 Trade Practices Act - whether misleading or deceptive conduct - whether contravention of s. 52 Trade Practices Act - whether directors were persons involved in contravention by company - damages - whether applicants induced to invest by misleading conduct - whether tax savings should be taken into account in mitigation of loss - whether interest should be awarded by way of damages.

Trade Practices Act 1974: ss. 52, 75B, 82, 87.

Judiciary Act 1903: s. 79.

Federal Court of Australia Act 1976: s. 51A.

Supreme Court Act 1958 (Vic): ss. 60, 79A.

Supreme Court Act, 1970 (N.S.W.): S. 94.

Supreme Court Act, 1935 (S.A.): S. 30C.

HEARING

SYDNEY
#DATE 19:9:1985

ORDER

THE COURT ORDERS THAT the applicants bring in Short Minutes of Order to give effect to these reasons for judgment.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This case concerns guavas. In 1980 four people, Roger Glasson, Morris Lewin, Robert Morrison and John Bennett decided to promote a scheme for the growing and processing of guavas in the far north coast of New South Wales and for the marketing of guava puree. Guavas had not been grown previously in this country on any large scale. The scheme which they promoted involved approaching people to contribute funds to the scheme for the purpose of establishing and maintaining guava plantations.

Each trust venture was to be divided into two parts. First, a unit trust in respect of which a company would act as trustee. The trust was to purchase the land. Each investor was to acquire a beneficial interest in the totality of the land equivalent to his share. For example, in Guava Property Trust No. 3 each investor would have a share equivalent to 5.7 acres, 5 acres of which were to be planted and .7 acres of which was river. In other cases, the investor's share of the plantation was a five acre participation. No separate titles were to be offered to each investor. It was envisaged that in the third year the crop would return more than sufficient to cover expenses; in the fifth year the plantation would be properly established, yielding a steady income for the investors. Second, a partnership was to be formed by the participants to lease the property from the trustee of the property trust and to undertake the development…