Lucas, D.L. & Ors v Economic Freedom Pty Ltd & Ors [1986] FCA 237

Lucas, D.L. & Ors v Economic Freedom Pty Ltd & Ors [1986] FCA 237

The respondents, primarily through Mr. Clarke, made statements about the value of Economic Freedom Pty Ltd and its assets, and withheld vital information, which were misleading and induced the applicants to invest; damages were assessed at the sums paid, as the shares were found to be worthless given the lack of company assets.

Parties
First Applicant: David Leslie Lucas; Second Applicant: Michael Horace Rice; Third Applicant: Elias Doufas Nominees Pty. Ltd.; First Respondent: Economic Freedom Pty. Ltd.; Second Respondent: Alovera Queensland Pty. Ltd.; Third Respondent: John Garrett Clarke
Jurisdiction
Australia
Judgment Date
11 June 1986
Procedural Posture
Application / Judgment After Trial
Outcome
Judgment for the applicants.
Legal Topics
Misleading Statements, Inducing Acquisition of Shares, Valuation of Shares, Liability for Misrepresentation
Trade Practices Misleading Statements Inducing Acquisition of Shares Valuation of Shares Liability for Misrepresentation

Case Brief

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Parties

David Leslie Lucas

First Applicant

Michael Horace Rice

Second Applicant

Elias Doufas Nominees Pty. Ltd.

Third Applicant

Economic Freedom Pty. Ltd.

First Respondent

Alovera Queensland Pty. Ltd.

Second Respondent

John Garrett Clarke

Third Respondent

Procedural Posture

Application / Judgment After Trial

Legal Issues

  1. 1 Whether the respondents made misleading statements in contravention of the Trade Practices Act inducing the applicants to acquire shares and if so, the measure of damages.

Ratio Decidendi

The respondents, primarily through Mr. Clarke, made statements about the value of Economic Freedom Pty Ltd and its assets, and withheld vital information, which were misleading and induced the applicants to invest; damages were assessed at the sums paid, as the shares were found to be worthless given the lack of company assets.

Court Disposition

Judgment for the applicants.

Orders

  • The first and third respondents pay the first applicant $40,702.25.
  • The second and third respondents pay the second applicant $9,000.