Australian Competition and Consumer Commission v We Buy Houses Pty Ltd (No 2) [2018] FCA 1748

Australian Competition and Consumer Commission v We Buy Houses Pty Ltd (No 2) [2018] FCA 1748

The Court found that We Buy Houses Pty Ltd and Richard Otton systematically and deliberately contravened the Australian Consumer Law by making false or misleading representations to consumers through seminars, publications and advertising, and that serious penalties, injunctions, disqualification, corrective and compliance orders were warranted to protect the public, specifically: $12 million and $6 million penalties respectively, permanent injunctions against similar future conduct, disqualification of Otton from managing corporations for 10 years, and mandatory corrective advertising and compliance measures.

Parties
First Applicant: Australian Competition and Consumer Commission; Second Applicant: Scott Gregson; First Respondent: We Buy Houses Pty Ltd (ACN 094 068 023); Second Respondent: Richard Keith Otton
Jurisdiction
Australia
Judgment Date
15 November 2018
Procedural Posture
Civil Penalty and Injunction Proceeding Under Consumer Law / Relief (penalty, Injunctive, Corrective, and Ancillary Orders) Following Earlier Liability Judgment
Outcome
Declarations, injunctions, pecuniary penalties, disqualification, corrective and compliance orders granted; costs awarded to applicants.
Legal Topics
Misleading or Deceptive Conduct, False/misleading Representations, Testimonials and Advertising, Declarations and Injunctions, Pecuniary Penalties, Disqualification Order, Compliance Programs, Corrective Advertising, Findings of Fact for Evidential Purposes
Consumer Law Commercial Law Corporations Misleading or Deceptive Conduct False/misleading Representations Testimonials and Advertising Declarations and Injunctions Pecuniary Penalties +4 more

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Parties

Australian Competition and Consumer Commission

First Applicant

Scott Gregson

Second Applicant

We Buy Houses Pty Ltd (ACN 094 068 023)

First Respondent

Richard Keith Otton

Second Respondent

Procedural Posture

Civil Penalty and Injunction Proceeding Under Consumer Law / Relief (penalty, Injunctive, Corrective, and Ancillary Orders) Following Earlier Liability Judgment

Legal Issues

  1. 1 Whether the respondents contravened sections 18, 29(1)(f), 29(1)(g), 34 and 37 of the Australian Consumer Law by promoting real estate schemes with false or misleading representations; whether penalties and ancillary orders (injunction, disqualification, compliance, corrective) should be imposed and in what quantum or form.

Ratio Decidendi

The Court found that We Buy Houses Pty Ltd and Richard Otton systematically and deliberately contravened the Australian Consumer Law by making false or misleading representations to consumers through seminars, publications and advertising, and that serious penalties, injunctions, disqualification, corrective and compliance orders were warranted to protect the public, specifically: $12 million and $6 million penalties respectively, permanent injunctions against similar future conduct, disqualification of Otton from managing corporations for 10 years, and mandatory corrective advertising and compliance measures.

Court Disposition

Declarations, injunctions, pecuniary penalties, disqualification, corrective and compliance orders granted; costs awarded to applicants.

Orders

  • Leave to amend application granted to applicants
  • Declarations of contraventions by both respondents under ss 18, 29(1)(f),(g), 34, and 37 of the ACL