Rexstraw v Johnson

This case involved appeals concerning negligence, fiduciary duty, and misleading conduct in relation to a property transaction. The primary parties were Rexstraw, Johnson, Provident, O'Sullivan, and Johnsons, with the dispute arising from a property sale and subsequent mortgage investment. The matter was heard in the Court of Appeal.

The court was required to determine the scope of the duty of care owed by a mortgage broker, whether it was coextensive with that of a solicitor, and the extent of a director's responsibility for a company's tortious acts. Additionally, the court considered whether a statement that a valuation was "independent" constituted misleading conduct under the Trade Practices Act, and the nature and scope of a solicitor's fiduciary duty, including whether it encompassed a duty to exercise reasonable care and skill, and a duty owed by an agent to a principal solicitor.

The court reasoned that the duty of care owed by a mortgage broker was not necessarily coextensive with that of a solicitor, and that a director could be held responsible for the tortious acts of their company. The court also found that the statement regarding the "independent" valuation was misleading. In apportioning responsibility for the loss suffered by the investors, the court allocated 42.5% to Provident/O'Sullivan, 33.5% to Rexstraw, and 24% to Johnsons. The court also ordered that the Registrar forward a copy of the judgment to the Law Society of New South Wales and the Legal Services Commissioner.