Hill, Dennis Ronald & Anor v Tooth & Co Ltd & Ors [1998] FCA 653

Hill, Dennis Ronald & Anor v Tooth & Co Ltd & Ors [1998] FCA 653

Tooth, through its employee and agent, engaged in misleading and deceptive conduct by providing the applicants with the trading figures from page 5 of the 1991 valuation in circumstances that represented they continued to reflect the current and future maintainable earnings of the hotel up to purchase. Hill relied on that conduct, and his failure to investigate did not sever causation. The separate $508 overstatement of the stated historical average was not material. Roberts was not liable because he did not know or ought not be taken to have known that page 5 would be shown and relied on by the applicants as his figures, and no duty of care arose between Roberts and the applicants....

Jurisdiction
Australia
Judgment Date
04 June 1998
Procedural Posture
Application Alleging Misleading and Deceptive Conduct Under the Trade Practices Act 1974 (cth) and Fair Trading Act 1987 (nsw), and Negligence, Arising From the Sale of a Hotel / Final Judgment After Hearing
Outcome
Judgment for the applicants against the first respondent Tooth & Co Ltd in the sum of $400,000; claims against Roberts failed; Tooth's cross-claim against Roberts dismissed.
Legal Topics
['misleading and Deceptive Conduct' 'hotel Sale' 'business Valuation by Capitalisation of Future Maintainable Earnings' 'reliance and Causation' 'negligent Misstatement' 'duty of Care to Third Parties' 'economic Loss' 'assessment of Damages']
['trade Practices' 'consumer Protection' 'negligence' 'damages'] ['misleading and Deceptive Conduct' 'hotel Sale' 'business Valuation by Capitalisation of Future Maintainable Earnings' 'reliance and Causation' 'negligent Misstatement' 'duty of Care to Third Parties' 'economic Loss' 'assessment of Damages']

Case Brief

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Procedural Posture

Application Alleging Misleading and Deceptive Conduct Under the Trade Practices Act 1974 (cth) and Fair Trading Act 1987 (nsw), and Negligence, Arising From the Sale of a Hotel / Final Judgment After Hearing

Legal Issues

  1. 1 ['Whether provision of page 5 of the 1991 valuation containing average weekly trading figures amounted to misleading and deceptive conduct by Tooth.' 'Whether the applicants relied on the misleading conduct and whether their own failure to investigate severed causation.' 'Whether the overstatement of average weekly takings by about $508 was sufficiently material to constitute misleading and deceptive conduct.' "Whether Roberts was liable for misleading and deceptive conduct or for aiding and abetting Tooth's conduct." 'Whether Roberts owed the applicants a duty of care in negligence in respect of the valuation and trading figures.' 'How damages should be assessed where misleading and deceptive conduct induced the purchase of the hotel.']

Ratio Decidendi

Tooth, through its employee and agent, engaged in misleading and deceptive conduct by providing the applicants with the trading figures from page 5 of the 1991 valuation in circumstances that represented they continued to reflect the current and future maintainable earnings of the hotel up to purchase. Hill relied on that conduct, and his failure to investigate did not sever causation. The separate $508 overstatement of the stated historical average was not material. Roberts was not liable because he did not know or ought not be taken to have known that page 5 would be shown and relied on by the applicants as his figures, and no duty of care arose between Roberts and the applicants....

Court Disposition

Judgment for the applicants against the first respondent Tooth & Co Ltd in the sum of $400,000; claims against Roberts failed; Tooth's cross-claim against Roberts dismissed.

Orders

  • ['Judgment be entered for the applicants in the sum of $400,000.' "The first respondent pay the applicants' costs arising from all claims made by the applicants." "The first respondent pay the third respondent's costs arising out of his cross-claim and of the proceedings brought against him by the applicants."]