Norman v National Australia Bank Limited

Norman (the applicant) brought proceedings against National Australia Bank Limited (the respondent) in the High Court of Australia. The dispute concerned the respondent's alleged contravention of s 52 of the *Trade Practices Act 1974* (Cth) (now s 18 of the *Australian Consumer Law*). The applicant alleged that the respondent engaged in misleading or deceptive conduct by representing that it would not enforce its security interests over certain assets of a company, thereby inducing the applicant to enter into a guarantee.

The central legal issue before the High Court was whether the respondent's conduct, as alleged by the applicant, constituted misleading or deceptive conduct within the meaning of s 52 of the *Trade Practices Act 1974* (Cth). This required the court to consider the nature of the representations made by the respondent and whether they were, in fact, misleading or deceptive in the circumstances.

Hayne J, in his reasons, focused on the objective test for misleading or deceptive conduct. His Honour held that the question of whether conduct is misleading or deceptive is to be determined by reference to the likely effect of the conduct on the relevant section of the public. In this instance, the applicant needed to demonstrate that the representations made by the respondent were such that they were likely to lead a reasonable person, in the position of the applicant, into error. The court considered the precise wording of the representations and the context in which they were made to assess their potential to mislead.