Watt v Shepherd (No 2)

Watt v Shepherd (No 2) involved multiple applicants seeking relief against respondents for misleading and deceptive conduct under the Australian Consumer Law (ACL) and Competition and Consumer Act (CCA). The applicants alleged that the respondents made numerous false representations regarding the financial viability and profitability of a franchise agreement, intending for these representations to induce the applicants to invest and participate in the franchising structure. The applicants also claimed that the respondents failed to provide necessary disclosure documents and engaged in unconscionable conduct.

The court had to decide whether the respondents' conduct constituted misleading and deceptive conduct, unfair tactics, and unconscionable behaviour under the ACL, as well as whether the respondents were accessorially liable. Additionally, the court needed to determine whether the respondents' failure to provide disclosure documents constituted unconscionable conduct. The court also had to decide on the appropriate remedy, specifically whether the franchise agreements should be voided from a specific date or ab initio.

The court found that the respondents' representations were misleading and deceptive, constituting unfair tactics and unconscionable conduct. The court held that the respondents were accessorially liable and granted default judgment for damages to be assessed. The court declared the franchise agreements void from 30 June 2018, ordered the return of the website and business name to the applicants, and granted leave to file further evidence on damages and relief. Costs were reserved.

The court's decision was based on the respondents' failure to comply with orders, the unconscionability of their conduct, and the applicability of the relevant statutory provisions. The court noted that both the CCA and ACL provided the authority to void the franchise agreements, and the appropriate remedy was to void the agreements from 30 June 2018, ensuring the applicants' interests were protected while preserving the court's case management powers.