E.R. Squibb & Sons Pty Ltd v. Tully Corporation Pty Ltd & Anor [1986] FCA 96

E.R. Squibb & Sons Pty Ltd v. Tully Corporation Pty Ltd & Anor [1986] FCA 96

Tully, by its representative Mr Green, engaged in misleading conduct under s.52 Trade Practices Act 1974 by representing that the Ovascan and Boveg machines could be used by stud masters for predicting ovulation and detecting conception without adequate qualification as to their actual limitations and the significant expertise required to operate them effectively. These representations induced Squibb to contract and caused loss. The remedy is to declare the contracts void and order repayment, together with damages and interest. No personal liability attaches to Mr Green, as the requisite mental element is not established.

Parties
Applicant: E.R. Squibb & Sons Pty. Ltd.; First Respondent: Tully Corporation Pty. Ltd.; Second Respondent: John Green
Jurisdiction
Australia
Judgment Date
26 March 1986
Procedural Posture
Civil / Reasons for Judgment After Trial
Outcome
Judgment for the applicant against the first respondent; claims against second respondent dismissed.
Legal Topics
Misleading or Deceptive Conduct, Remedies, Damages, Rescission of Contract, Liability Under Trade Practices Act
Trade Practices Contract Sale of Goods Misleading or Deceptive Conduct Remedies Damages Rescission of Contract Liability Under Trade Practices Act

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Parties

E.R. Squibb & Sons Pty. Ltd.

Applicant

Tully Corporation Pty. Ltd.

First Respondent

John Green

Second Respondent

Procedural Posture

Civil / Reasons for Judgment After Trial

Legal Issues

  1. 1 Whether Tully engaged in misleading or deceptive conduct under s. 52 Trade Practices Act 1974 in representations about Ovascan and Boveg machines; Whether Squibb reasonably relied on the representations; Whether damage flowed from representations; Whether literally true representations can be misleading if they require qualification; Whether representations were corrected; Appropriate remedy under Trade Practices Act; Whether the natural person respondent (Mr Green) was personally liable under s.75B.

Ratio Decidendi

Tully, by its representative Mr Green, engaged in misleading conduct under s.52 Trade Practices Act 1974 by representing that the Ovascan and Boveg machines could be used by stud masters for predicting ovulation and detecting conception without adequate qualification as to their actual limitations and the significant expertise required to operate them effectively. These representations induced Squibb to contract and caused loss. The remedy is to declare the contracts void and order repayment, together with damages and interest. No personal liability attaches to Mr Green, as the requisite mental element is not established.

Court Disposition

Judgment for the applicant against the first respondent; claims against second respondent dismissed.

Orders

  • Declaration that each contract for sale of Ovascan and Boveg machines between Squibb and Tully made in and between May and August 1983 is void and of no effect.
  • Order that Tully repay Squibb $397,800.00, being the purchase price of the machines.