Session 1: Intro to the ACL; meaning of ‘in trade or commerce’, ‘conduct’ &
‘misleading or deceptive’
Agenda
• Chapters 1-‐3 Moore
• Reps directed to classes of persons (the advertising cases) & proof likely effect of representation (chapt 4 & 9)
• Remember – every case turns on its own facts
• Also for M/D conduct – it turns on the reasonable person; there will inevitably be the people that hoplessly mix up two products for e.g. but its about what the reasonable person would respond to something
Note -‐ The fact that you could have found out the correct information with further
investigations doesn’t negative the relief you can seek (if it satisfies misleading & deceptive conduct)
Read robin and Glorie cases – and Nelson Trade Practices -‐ ACL
Remedial difference under new ACL
• Remedies are much more far-‐reaching under ACL
TPA ACL
S52 S18
S51 A S4 (definition section)
Damages -‐ but way you work out damages is basically the same
S82 S236
Damages against any person involved in the contravention (more ppl can be sued for damages under the statute)
S2 (accessorial liability)
S82(1)B S137B CCA
Court can re-‐write contracts, award injunctions (w/out person hving a particular standing for e.g. or property interest); i.e. court re-‐writing loan contracts for it to be in aus dollars rather than swiss franks
S87 ss237-‐234
Phrases from s52 TPA that = problematic
S52 says ‘a corporation shall not’ (corporation – person) ‘in trade or commerce’ ‘engage in conduct’ ‘that is misleading or deceptive’ ‘or is likely to mislead or deceive’
Conduct is broader than representations
Is it a corporation or is it a person? – Chapter 1
Remember constitutional law – Cth has power to enact laws in regards to corporations but not in regard to persons? Therefore how to make s52 valid under the corporation’s power? Say that a corporation cannot mislead or deceive in trade & commerce
Then states and territories passed their own fair trading act, complimentary to the cth act – therefore they filled up the holes that the Cth couldn’t legislate about (non-‐corporate persons that weren’t involved in inter-‐state…)
S42 Fair Trading Act was basically the same as s52TPA, except for the one word – FTA said ‘A person…’ – TPA said ‘A corporation’
However nearing 2010, the Cth came together and reasoned that it was ridiculous that all of these legislative frameworks, whilst achieving the same purpose (tackling unconscionability) were in various different frameworks – therefore came up with the ACL (2nd schedule of the CCA)
Meaning of ‘in trade or commerce’; cases that deal with this phrase – Chapter 2 It is not a constitutional meaning attributed to 51 of the constitution – it is a bit different
Early years/ crunch case Nelson v Concrete Constructions (1990) 169 CLR 594
Selling land
If your selling your own land (and your not a developer/ sub-‐divider) then you are not in trade or commerce
O’Brien v Smolonogov Argy v Blunts (1990)
Red Cross & Royal Prince Alfred Hospital E v Australian Red Cross (1991)
The Noah’s Ark Case
Fasold v Roberts (1997) – then the appeal case in the Full Federal Court Plimer v Roberts (1997)
Nelson v Concrete Constructions (1990) 169 CLR 594
• Nelson = employee of big company CC = injured
• Prior to being injured – Workers Compensation legislation = amended to greatly reduce the scope for large pay outs
• Nelson went to union lawyers who told him of the unfortunate situation he is in but suggested different avenue
• Argument: CC made representations to Nelson that they were providing a safe system of work. And it wasn’t (this day). And therefore they misled or deceived by CC
• Accepted that CC had represented that it was a safe system of work & they misled/deceived Nelson
Issue
• Point however on appeal to HC was whether the direction CC gave to Nelson (and thus an employor telling an employee what to do) in trade & commerce?
Reasoning
• CC is a big commercial player in the commercial world – therefore in trade &
commerce, BUT was the specific direction given to Nelson – his relationship with CC, in trade or commerce?
• Majority said that the direction given to Nelson as an employee was an employment relations issue, & not CONDUCT in TRADE & COMMERCE
• Might be in trade & commerce, if CC entered into a contract with UTS to build a new building in 2016
• In trade & commerce doesn’t extend to an employer direction an employee, even though the defendant may be a player in trade & commerce
Selling land
O’Brien v Smolonogov
• When I sell land on which I live, then its not going to be in trade or commerce
• Vendor owned land in Snowy Mountains area. Decided to sub-‐divide part of his land. He wasn’t a developer/ sub-‐divider. When sold this property, he put ad in SMH. Prospective buyer, calls interested in his land & asks what the access is to the land. Owner, says no real problem. Buyer, buys w/out inspecting. Gets real shock when gets there and realises you need a big 4wd to access the land
• Vendor had misled/deceived but was he in trade or commerce? No
E v Australian Red Cross (1991)
• E = private ward person, that receives tainted blood transfusion
• When he got the transfusion he was a months before the duty came into effect that hospitals had to check it – therefore court wasn’t prepared to say that the hospital should’ve checked & therefore court rejected the negligence claim in torts)
• Brought claim under m&d conduct against a no. of defendants – the Red Cross, the Hospital
• Remember that – conduct can be misleading without the intent to mislead Issue
• Was the Red Cross & Royal Prince Alfred Hospital conduct misleading & were they misleading in T&C?
Held
• RC wasn’t in T/C. Yes they were M/D
• Hospital charged fees (private wing) therefore was in T/C. Hospital = no M/D
Fasold v Roberts (1997) – then the appeal case in the Full Federal Court Plimer v Roberts (1997)
• Dr Plimer = professor of geology & very much in favour of evolutionary theory (not creation)
• Roberts = creation science theorist; purports theories around this, & propogates his ideas through for e.g. selling his books, holding gatherings, etc.
• Touches on the notion of freedom of speech
• Roberts argued the defense – its not in trade & commerce (even if M/D) Held
• Full Federal Court held that some of these statements were arguably M/D but wasn’t in T/C
Robin v Canberra International Airport [1999]
• CIA was privatized during time of Howard Government
• Permission (put in application to council) to sub-‐divide the land right under the flight path
• CIA puts in lobby against council approving this application (having residents living under the flight path is different to having sheep under it)
Issue
• Is participating in local council affairs, in T/C?
Held
• Everyone is allowed to make a submission to local council – therefore not in T/C when participating in local council processes by making a submission
• Giles – was he wrong to say that Glorie would be wrong post Nelson, or can Glorie be reconciled with Nelson?
Meaning of ‘misleading and deceptive conduct’
Hornsby Building Info Centre (1978) – High Court authority
World Series Cricket v Parish (1977)
Taco Co v Taco Bell (1982)
Parkdale v PUXU (1982)
Hornsby Building Info Centre (1978) – High Court authority
• Conduct can be misleading without the intent to mislead
• The Sydney Building Information Centre
• Similar organisation – called themselves the Hornsby Building Information Centre
• SBIF argued that the HBIC was holding out that they were associated with SBIF
• Stevens gave main judgment – you can be guilty of M/D conduct w/out intent Held
• However, on the facts of this case, the SBIF, used such general words & therefore they failed, & HBIC successfully defended the claim
World Series Cricket v Parish (1977)
• Kerry Packer signed up … super test
• Series of test series cricket
• In these days, Kerry Packer owned Womens Weekly & was using this to advertise, ‘come and watch the super test’
• Parish (chairman of the Australian Cricket …) as a person brought a claim against World Series Cricket arguing that your ads about the super test in the Womens Weekly was M/D against a specific class of persons
• There would have been a section of the readership of womens weekly that wouldn’t have picked up on this
• ACL is public interest legislation – nothing stopping a competitor from bringing a claim for M/D conduct
• Injunctive relief granted
Taco Co v Taco Bell (1982) -‐ Full Federal Court Decision
• Main judgment given by Dean & Fitzgerald
• Taco Bell = big thing in America at the time
• Aussie guy inspired by this success & so estbalsihed a taco shop in Bondi (which dvlped a successful following)
• American Taco Bell = then opened up more in Austraia
• Brought a claim against each other
• Taco Bell – how dare you M/D the public that you were associated with us
• Taco Co – how dare you M/D the public that you were associated with the success of the bondi store
Reasoning & decision
• Judges set out a criteria/ guidelines to how to identify whether M/D P. 40-‐41 s 1. Who is the relevant section of the public?
2. Once you’ve worked out the relevant section – you have to consider everyone that comes w/in that section
3. It will be for the court to decide whether the conduct was M/D – not for the litigators to argue that ppl have been M/D
4. Have to recognise that sometimes the misconception is based on the individuals just misconceiving the situation rather than M/D conduct
• Court held in this case, that the Americas (Taco Bell) had M/D the Australians, becaue Taco Co got here first
• Therefore there should be an injunction awarded to restrain the Americans from using this name
Parkdale v PUXU (1982)
• Different quality between the two items, but same appearance – in clear covering (outwardly the product looks similar)
• Court by majority, held it wasn’t M/D conduct – person could read the label &
decipher the different even if outwardly similar
Campomar Sociedad v Nike (2000)
• Fragrance for applying after workout
• Adidas already had one, and Nike introduced a fragrance that didn’t have anything to do with Nike
Held
• M/D conduct
Janssen-‐Cilag v Pfizer (1992)
• 1 competitor successfully argued that the other competitor was M/Ding third parties -‐ & therefore getting damages (rather than the normal awarding of injunctions)
• Pfizer was bad-‐mouthing the products of JC
• JC argued that Pfizer was M/D others about their own products
Session 2: what is M/D conduct with regards to/ involving a contractual relationship Agenda
• Chapters 5-‐8
• A finding of M/D conduct could reverse the finding that contract law/ RP/ tort law etc. could bring – therefore important/ attractive
• Remember that the ACL, is public interest legislation – therefore objective = to protect the interest of the public. Because its statutory legislation outlawing unconscionable behaviour, its not as strict on things that apply in other areas of common law, such as disclaimer clauses limiting liability in property transactions
• Note – why may someone for e.g. pursue s18 as opposed to estoppel or other causes of actions? Sometimes its easier to establish s18, for e.g. you don’t even need to prove intent for M/D conduct, just that it was established on the facts
• Note – can mislead w/out intent but deceive seems to carry some sort of intent – but see Lockheart’s extracts 5.04
• Note – how CL works in regards to vendor v purchaser – there is duty to disclose at CL where fiduciary obligation exists but NOT just where vendor v purchaser (buyer beware instead) therefore s18 very important
• S237 starts to come up (originally s87 TPA) = courts ability to re-‐write contracts as a remedy