Wormald v Maradaca Pty Ltd [2020] NSWCA 289

Wormald v Maradaca Pty Ltd [2020] NSWCA 289

The Court held the primary judge erred in characterising the 19 January 2015 conversation as an assurance providing a basis for a reasonable expectation of disclosure. No such assurance or expectation arose, particularly since further due diligence was expressly refused. The context was an arm's-length, commercial negotiation between sophisticated parties where Maradaca/ELB was made aware of and accepted significant risks. Even if there was non-disclosure, no causative link was shown between any misleading conduct and loss. The losses suffered were due to a calculated risk, not any misleading or deceptive conduct or breach of warranty by the appellants. Accordingly, the appeal and...

Jurisdiction
Australia
Judgment Date
13 November 2020
Procedural Posture
Appeal / Court of Appeal; Judgment on Appeal and Cross Appeal From Decision of Supreme Court of New South Wales, Equity Division
Outcome
Appeal and cross-appeal allowed; orders below set aside; substituted orders for payment of amounts and dismissal of cross-claim.
Legal Topics
['misleading or Deceptive Conduct' 'silence and Non Disclosure' 'share Sale Agreements' 'breach of Warranty' 'causation of Loss' 'remedies and Costs']
['commercial Law' 'contract Law' 'consumer Law'] ['misleading or Deceptive Conduct' 'silence and Non Disclosure' 'share Sale Agreements' 'breach of Warranty' 'causation of Loss' 'remedies and Costs']

Case Brief

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Procedural Posture

Appeal / Court of Appeal; Judgment on Appeal and Cross Appeal From Decision of Supreme Court of New South Wales, Equity Division

Legal Issues

  1. 1 ["Whether the primary judge erred in characterising a key conversation as providing 'assurances' to the purchaser; Whether there was a reasonable expectation of disclosure of contractual arrangements and developments post previous disclosure; Whether any misleading or deceptive conduct was causative of loss or damage; Whether the appellants breached any warranty under the SSA; Apportionment of liability and damages."]

Ratio Decidendi

The Court held the primary judge erred in characterising the 19 January 2015 conversation as an assurance providing a basis for a reasonable expectation of disclosure. No such assurance or expectation arose, particularly since further due diligence was expressly refused. The context was an arm's-length, commercial negotiation between sophisticated parties where Maradaca/ELB was made aware of and accepted significant risks. Even if there was non-disclosure, no causative link was shown between any misleading conduct and loss. The losses suffered were due to a calculated risk, not any misleading or deceptive conduct or breach of warranty by the appellants. Accordingly, the appeal and...

Court Disposition

Appeal and cross-appeal allowed; orders below set aside; substituted orders for payment of amounts and dismissal of cross-claim.

Orders

  • ['Appeal and cross-appeal allowed.' 'Judgments of 24 April 2020 and 8 May 2020 and the orders made on 8 May 2020 of the Court below be set aside.' 'First respondent to pay the second appellant $114,639.00 and interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW).' 'First respondent to pay the first...