Ruberto v Hesonne Pty Ltd

In *Ruberto v Hesonne Pty Ltd*, the New South Wales Court of Appeal considered a dispute arising from a contract for the sale of a business. The appellant, Mr Ruberto, was the vendor and the respondent, Hesonne Pty Ltd, was the purchaser. The core of the disagreement concerned whether the purchaser had validly terminated the contract due to alleged misrepresentations made by the vendor regarding the business's financial performance.

The Court was required to determine whether the representations made by the vendor constituted actionable misrepresentations that entitled the purchaser to rescind the contract. Specifically, the issues included whether the representations were false, whether they were material to the purchaser's decision to enter into the contract, and whether the purchaser had affirmed the contract after becoming aware of the alleged falsity of the representations.

The Court of Appeal found that the representations made by the vendor were indeed false and that they were material to the purchaser's decision to buy the business. The Court applied the principles of contract law relating to misrepresentation, emphasizing that a party induced to enter a contract by a false statement of fact, which is material and relied upon, may be entitled to rescind the contract. The Court also considered whether the purchaser's subsequent conduct amounted to an affirmation of the contract, ultimately concluding that it did not. The appeal was dismissed.