Petera Pty Ltd v EAJ Pty Ltd

The case of Petera Pty Ltd v EAJ Pty Ltd involved an application by Petera, a restaurant business acquired by the applicant from the respondents, E.A.J. Pty Limited, and its directors, Edward Ashley Jackson and Cynthia Jackson. Petera alleged that the respondents engaged in misleading or deceptive conduct by providing false representations regarding the average gross takings of the restaurant during the financial year 1982-1983. The applicant also alleged deceit and negligence and sought damages. The respondents argued that the representations were true or, alternatively, that an exclusion clause in the contract of sale precluded any claim based on the alleged misrepresentation.

The court considered the two sets of accounts presented by the parties, with one set of accounts showing higher gross takings and the other set showing lower takings. The court found that the higher takings were likely false and designed to defraud. The court also noted that Dr Jackson, one of the respondents, engaged in significant tax evasion by understating income and wages. However, the court found that the lower takings were accurate and that there was no misrepresentation by the respondents to the applicant. As a result, the application was dismissed.

In relation to the respondents' tax evasion, the court found it was obligated to bring the matter to the attention of the executive government for appropriate action. The court also considered whether the respondents' tax conduct should affect the award of costs but ultimately decided that it should not, as the conduct did not impact the applicant's decision to bring or maintain the proceedings. The court ordered that the applicant pay the respondents' costs and directed the Principal Registrar of the Court to forward a copy of the reasons for judgment and evidence to the Attorney-General and make available the full transcript of proceedings and exhibits for inspection by authorized officers.