Rafferty v Time 2000 West Pty Ltd (No 4)

The applicants, Rafferty, brought an application against Time 2000 West Pty Ltd and others for relief under the Trade Practices Act 1974 (Cth) and the Fair Trading Act 1999 (Vic), alleging misleading and deceptive conduct and breach of disclosure obligations under the Franchising Code of Conduct. The applicants entered into agreements with Time 2000 West Pty Ltd and others for the sale of portable accommodation units. The applicants claimed that Time 2000 West Pty Ltd and others engaged in misleading and deceptive conduct by making representations about the prototype unit and by failing to provide the required disclosure documents. The applicants also claimed that Madgwicks, a firm of solicitors who drafted the agreements, engaged in misleading and deceptive conduct by failing to advise the applicants that the Franchising Code applied. The court was required to decide whether the representations made by Time 2000 West Pty Ltd and others materially contributed to the applicants entering into the agreements, whether the applicants suffered loss or damage, and whether Madgwicks was liable for misleading and deceptive conduct. The court also had to determine whether the agreements were franchise agreements and whether Madgwicks was liable for breach of retainer.
The court found that the representations made by Time 2000 West Pty Ltd and others materially contributed to the applicants entering into the agreements, and that the applicants suffered loss or damage as a result. The court held that Time 2000 West Pty Ltd and Embleton were primary contravenors of the Trade Practices Act 1974 (Cth) and that Donovan was liable as a person involved in the contraventions. The court also found that the agreements were franchise agreements and that Time 2000 West Pty Ltd and Embleton were liable for breach of disclosure obligations under the Franchising Code of Conduct. However, the court dismissed the applicants' claims against Madgwicks, finding that the applicants did not have a reasonable expectation that Madgwicks would advise them on whether the Franchising Code applied and that Madgwicks owed a duty of confidence to Time 2000 West Pty Ltd and others. The court also dismissed the claims of Time 2000 West Pty Ltd and others against Madgwicks for breach of retainer and involvement in the contravention of the Trade Practices Act 1974 (Cth).
The court held that the applicants' claims against Time 2000 West Pty Ltd and others for contraventions of the Trade Practices Act 1974 (Cth) were valid and that Time 2000 Operations (Australia) Pty Limited was a proper party for the purposes of the relief claimed by the applicants. The court also held that the applicants' claims against Madgwicks under the Fair Trading Act 1999 (Vic) and the Trade Practices Act 1974 (Cth) must be dismissed. The court found that the cross-claim by Time 2000 Operations (Australia) Pty Limited against Rafferty must be dismissed. The court also dismissed the claims of Time 2000 West Pty Ltd and others against Madgwicks for breach of retainer and involvement in the contravention of the Trade Practices Act 1974 (Cth). The court held that s 75B(1) of the Trade Practices Act 1974 (Cth) does not enable the court to make orders for contribution or indemnity.
Each party is at liberty to make submissions on the final orders to be made in light of these reasons.