Sensis Pty Ltd v McMaster-Fay

This case involved an appeal by Sensis Pty Ltd, the publisher of the Yellow Pages, against a District Court decision that awarded damages to Dr. Roger McMaster-Fay. Dr. McMaster-Fay had contracted with Sensis for advertising listings in the 2000 and 2001 Penrith and Sydney Yellow Pages directories. He alleged that Sensis breached their agreement and an implied warranty under the Trade Practices Act 1974 by failing to include certain advertised listings, which he claimed resulted in a loss of opportunity to grow his practice and increase his income.

The central legal issues before the Court of Appeal were whether Dr. McMaster-Fay had proven that he sustained any loss as a result of Sensis's breaches, and if so, how the value of any lost opportunity should be assessed. Specifically, the court had to determine if the primary judge had a sound basis for awarding $25,000 in damages for the loss of an opportunity to increase the growth of his practice.

The Court of Appeal found that the primary judge had no proper basis for concluding that Dr. McMaster-Fay lost the opportunity to increase the growth of his patient base or that such a loss was caused by Sensis's breaches. Furthermore, the court held that there was no articulated or understandable basis for the assessment of the value of this alleged loss at $25,000, describing it as a figure "plucked from the air" and no more than a guess. The court applied the principle that the value of a lost chance must be ascertained by reference to probabilities or possibilities, and that such an assessment requires a reasoned basis, which was absent in the primary judge's decision.

Consequently, the Court of Appeal allowed the appeal, set aside the District Court's verdict and orders, and entered judgment for the appellant, Sensis Pty Ltd. Dr. McMaster-Fay was ordered to pay Sensis's costs in the District Court and on appeal.