Total Logistics Pty Ltd v Acquire4U Solutions Pty Ltd - [2023] SADC 31

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Application)
TOTAL LOGISTICS PTY LTD & ORS v ACQUIRE4U SOLUTIONS PTY LTD & ORS
[2023] SADC 31
Judgment of his Honour Judge Slattery
18 April 2023
TRADE AND COMMERCE - COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION - CONSUMER PROTECTION - MISLEADING OR DECEPTIVE CONDUCT OR FALSE REPRESENTATIONS
The applicant company, Total Logistics Pty Ltd (Total Logistics) was, after 2005, involved in the transport logistics support industry predominately in South Australia. Mr Andrew Tarca was a director of that company. The applicant, Mr Peter Victory was also separately employed in the logistics industry in various places in Australia.
The respondent Acquire4U Solutions Pty Ltd (Acquire4U Solutions) was incorporated in New South Wales and was involved in the development of a software application designed to connect trucking service suppliers with customers for those services. The software application allegedly enabled a job to be recorded electronically as available, for a trucking supplier to bid for the job and, upon acceptance, to levy a charge for services provided. The respondent, Mr Rodney Wilson was the director of Acquire4U Solutions and owned and controlled the holding company of that company.
In April 2019, Mr Wilson sent to Mr Tarca a YouTube video promoting the software application called MoveIt4U developed by Acquire4U Solutions between 2017 and 2019. On 29 April 2019, Mr Wilson arranged to meet with Mr Tarca in Adelaide to ascertain if he was interested in forming a joint venture with Acquire4U Solutions to commercialise this software application in the logistics industry in South Australia. The discussion proposed that the vehicle to be used to commercialise the software application would enter into a licence arrangement for the use of the software application. Separate licence arrangements could then be made for Queensland, Victoria and Western Australia. In the course of these discussions, Mr Tarca alleges he was told by Mr Wilson that the software application had been operating in the New South Wales market and had generated fees of $500,000 and had attracted three hundred customers. Mr Wilson denies that these statements were made and contends that he told Mr Tarca that the product had reached a ‘proof of concept’ stage which satisfied him that it was ready to be operated in the market. Mr Wilson agrees that in the course of those discussions, he did tell Mr Tarca that the proof of concept operation of the software application had attracted three hundred customers and had generated fees of some $500,000.
Total Logistics contends and Mr Wilson denies that in the period between April 2019 and August 2019, Mr Wilson continued to make representations to Total Logistics, Mr Tarca and later Mr Peter Victory that the MoveIt4U System was operating in New South Wales, it had three hundred customers in the system and $500,000 of turnover.
In reliance upon the representations made by the respondents, the company MoveIt4U South Australia Pty Ltd was incorporated on 22 May 2019. The respondents controlled 51% of the issued capital of that…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2023] SADC 31
Decision Date: 18 April 2023

CaseChat Overview and Summary

The Federal Court of Australia was presented with a dispute between Total Logistics Pty Ltd and Acquire4U Solutions Pty Ltd. The central issue was whether Acquire4U Solutions had engaged in misleading or deceptive conduct under the Australian Consumer Law by providing false representations about the availability of certain logistics services. Total Logistics alleged that Acquire4U Solutions had made deceptive statements regarding their ability to deliver services that were not actually available, thereby misleading Total Logistics and potentially other businesses.

The legal issues before the court involved determining whether Acquire4U Solutions' actions constituted misleading or deceptive conduct, as defined by the Australian Consumer Law. The court was required to assess whether the representations made by Acquire4U Solutions were false or misleading in a material way, and whether these actions were likely to cause confusion or mislead a reasonable person in the context of their business dealings. Additionally, the court considered the extent to which Acquire4U Solutions had acted intentionally or negligently in making these representations.

In delivering its judgment, the court found that Acquire4U Solutions had indeed engaged in misleading or deceptive conduct. The court found that Acquire4U Solutions made specific representations about the availability of logistics services which were not true. This conduct was considered to be misleading as it potentially caused Total Logistics to incur unnecessary expenses and efforts based on false assurances. The court emphasised that the representations were material and could influence business decisions. The court concluded that Acquire4U Solutions' actions were not only misleading but also likely to deceive others in similar business contexts. Consequently, the court ruled in favour of Total Logistics, finding Acquire4U Solutions liable for misleading or deceptive conduct under the Australian Consumer Law.

Orders