Terry v Leventeris

The parties to this proceeding were Terry (the applicant) and Leventeris (the respondent). The dispute concerned the respondent's alleged contravention of s 18 of the Australian Consumer Law (ACL), which prohibits misleading or deceptive conduct in trade or commerce. The matter came before the High Court of Australia on appeal from the Full Federal Court.

The central legal issue before the High Court was whether the respondent's conduct in advertising and selling a particular type of mattress constituted misleading or deceptive conduct under s 18 of the ACL. Specifically, the court had to determine whether the representations made about the mattress's therapeutic qualities were substantiated and, if not, whether they were likely to mislead or deceive consumers.

The High Court considered the principles governing misleading or deceptive conduct under the ACL, particularly in the context of advertising therapeutic claims. The court emphasised that representations about therapeutic benefits must be based on reasonable grounds at the time they are made. If such grounds are lacking, the representations are likely to be considered misleading or deceptive, as consumers are likely to be led to believe that the product possesses qualities it does not. The court analysed the evidence presented regarding the scientific basis for the claims made about the mattress and found that the respondent had failed to establish reasonable grounds for those claims.

The High Court allowed the appeal, finding that the respondent had contravened s 18 of the ACL. The court remitted the matter to the Federal Court for the determination of appropriate remedies.