The Great Australian Bite Pty Ltd & Anor v Menmel Pty Ltd & Ors [1996] FCA 499

Menmel contravened s.52 because, through Sydney Griff, it allowed and reinforced the false impression that the restaurant premises could lawfully be used as a nightclub or discotheque and for liquor sales not associated with meals, when special authorisation was required and absent. Griff was a knowing and intentional participant. The applicant company relied on those representations and would probably not have entered the transactions had the truth been disclosed. The fifth respondents were negligent because a reasonably careful solicitor would have read the inventory and equipment leases, recognised the licensing risk, and advised the applicants in time to avoid or alter the...

Jurisdiction: Australia
Judgment Date: 24 June 1996
Procedural Posture: Action Under S.52 of the Trade Practices Act, 1974 and Professional Negligence Claim / Reasons for Judgment After Hearing; Applicants Ordered to Bring in Short Minutes of Orders
Outcome: The Court found the first and second respondents liable for misleading conduct and involvement, found the fifth respondents liable in negligence, considered it appropriate to set aside the lease as from 31 December 1992, assessed a fair amount of $600,000 for business losses plus renovation and equipment amounts and...
Legal Topics: ['misleading or Deceptive Conduct Under S.52' 'involvement Under S.75 B' 'relief Under S.87' 'sale of Restaurant Business and Lease of Premises' 'entertainment Approval and Liquor Licence Requirements' "solicitor's Duty of Care" 'mitigation of Damages' 'setting Aside Lease']

['trade Practices' 'consumer Protection' 'professional Negligence' 'leases' 'liquor Licensing' 'damages'] ['misleading or Deceptive Conduct Under S.52' 'involvement Under S.75 B' 'relief Under S.87' 'sale of Restaurant Business and Lease of Premises' 'entertainment Approval and Liquor Licence Requirements' "solicitor's Duty of Care" 'mitigation of Damages' 'setting Aside Lease']

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Procedural Posture

Action Under S.52 of the Trade Practices Act, 1974 and Professional Negligence Claim / Reasons for Judgment After Hearing; Applicants Ordered to Bring in Short Minutes of Orders

Legal Issues

1 ['Whether Menmel engaged in misleading conduct by allowing inspection of premises fitted out for nightclub or discotheque use and referring to past nightclub and liquor takings without disclosing that such use was unlawful without special authorisation.' "Whether Sydney Griff was knowingly involved within s.75B in Menmel's contraventions." 'Whether the applicant company relied on the express and implied representations when entering the purchase and lease transactions.' 'Whether the fifth respondents, as solicitors, were negligent by failing to read the inventory and equipment lease documents and warn of the need for entertainment and liquor authorisations.' 'Whether the lease should be set aside under s.87 after substantial time had elapsed.' 'Whether the claimed business losses and expenditure flowed from the contraventions and negligence, and whether the applicants failed to mitigate loss.']

Ratio Decidendi

Court Disposition

The Court found the first and second respondents liable for misleading conduct and involvement, found the fifth respondents liable in negligence, considered it appropriate to set aside the lease as from 31 December 1992, assessed a fair amount of $600,000 for business losses plus renovation and equipment amounts and...

Orders

['The applicants bring in, on a date to be fixed, short minutes of orders appropriate to be made in the light of the reasons of the court.']