Yorke v Ross Lucas Pty Ltd

Re: MILES RICHARD YORKE and SUE ELIZABETH YORKE
And: ROSS LUCAS PTY. LTD.; ROSS MELVILLE LUCAS; TREASUREWAY STORES PTY. LTD.
and KEVIN THOMAS MAHONY (1983) 68 FLR 268
No. SA G38 of 1981
Trade Practices

COURT

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Fisher J.(1)

CATCHWORDS

Trade Practices - consumer protection - misleading and deceptive conduct - sale of a business - misrepresentations as to turnover - judgment entered against corporation - question of liability of its managing director - primary offence requiring no mens rea - whether liability of director absolute - "involvement" and "participation" in the commission of the primary offence - whether he was aware or had reason to suspect information incorrect - meaning of "aider or abettor" and "person knowingly concerned" - actual or constructive knowledge required - structure of s.75B.

Trade Practices Act 1974 ss. 75B, 82(1) and 52

Johnson v Youden (1950) 1 KB 544 (1950) 1 All ER 301

Reg v Glennan (1970) 91 WN (NSW) 609

Lenzi v Miller (1965) SASR 1 considered.

Trade Practices - Misleading or deceptive conduct - Incorrect weekly turnover figures relayed by respondent - Whether respondent "aided, abetted, counselled or procured" contravention of s. 52 by other persons - Whether respondent was "knowingly concerned in" contravention - Whether respondent was "involved in contravention" - Judgment entered against two respondents - Whether judgment should be entered against another respondent - Actual or constructive knowledge required to establish contravention - Trade Practices Act 1974 (Cth), ss 52, 75B, 82(1), 84(2).

HEADNOTE

Section 82(1) of the Trade Practices Act 1974 (Cth) provides as follows:

"A person who suffers loss or damage by conduct of another

person that was done in contravention of a provision of Part IV

or V may recover the amount of the loss or damage by action

against that other person or against any person involved in

the contravention".

On 16 September 1982, judgment was entered in favour of the applicants against the first and third respondents after a single judge of the Federal Court of Australia found that the second respondent, Mr Lucas, by acting as agent for the third respondent company, had unwittingly engaged in misleading conduct and thereby contravened s. 52 of the Trade Practices Act 1974 (Cth) (the Act). The applicants sought judgment against Mr Lucas (who was managing director of the third respondent) jointly and severally with the other three respondents for the amount of damages awarded them. The applicants contended that Mr Lucas had aided and abetted, counselled or procured or was knowingly concerned in or a party to such contravening conduct. The question for the court was whether, assuming that s. 75B of the Act was within the constitutional power of the Commonwealth, the court was obliged, on the facts as found, to enter judgment against Mr Lucas. Evidence showed that Mr Lucas was not aware and had no reason to suspect that the information he received from the fourth respondent concerning the accuracy of…