Gurr, Vera & Anor v Forbes, Richard & Anor [1996] FCA 240

Gurr, Vera & Anor v Forbes, Richard & Anor [1996] FCA 240

Mr Forbes contravened s.52 of the Trade Practices Act 1974 (Cth) and s.10 of the Fair Trading Act 1987 (W.A.) by falsely representing that casual workers were paid $11.51 or $11.52 per hour in accordance with the Contract Cleaners' Award 1986 and by failing to disclose that the business was being conducted in contravention of that award; he also overstated the average length of customer tenure. Those matters materially caused the applicants to enter into and comply with the contract. GMO was not liable because, in the circumstances, it was apparent that it was passing on Mr Forbes' information rather than adopting or verifying it, and it did not breach its admitted duty of care. Damages...

Jurisdiction
Australia
Judgment Date
12 April 1996
Procedural Posture
Application for Damages, a Declaration and Other Relief Concerning the Purchase of an Office Cleaning Business / Final Judgment After Hearing
Outcome
Judgment for the applicants against the first respondent; the applicants' claim against the second respondent dismissed.
Legal Topics
['misleading or Deceptive Conduct' 'sale of Business' 'business Broker Liability' 'industrial Award Compliance' 'causation' 'assessment of Damages' 'lost Commercial Opportunity']
['trade Practices' 'fair Trading' 'consumer Law' 'negligence' 'contract' 'damages'] ['misleading or Deceptive Conduct' 'sale of Business' 'business Broker Liability' 'industrial Award Compliance' 'causation' 'assessment of Damages' 'lost Commercial Opportunity']

Case Brief

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Procedural Posture

Application for Damages, a Declaration and Other Relief Concerning the Purchase of an Office Cleaning Business / Final Judgment After Hearing

Legal Issues

  1. 1 ['Whether the vendor engaged in misleading or deceptive conduct in representations about the profitability, required hours of work, industrial award compliance, business documentation, cleaning materials, client base and account payment period of the business.' 'Whether the business broker engaged in misleading or deceptive conduct by publishing advertising and brochure material or by remaining silent when the vendor made representations.' "Whether the business broker was negligent in failing to verify the vendor's information or disclose that it had not verified it." 'Whether the vendor breached contractual terms relating to representations, client records, telephone use, indemnity and the $5,000 held in trust.' "How damages should be assessed, including whether to take account of the applicants' lost opportunity to purchase an alternative profitable business."]

Ratio Decidendi

Mr Forbes contravened s.52 of the Trade Practices Act 1974 (Cth) and s.10 of the Fair Trading Act 1987 (W.A.) by falsely representing that casual workers were paid $11.51 or $11.52 per hour in accordance with the Contract Cleaners' Award 1986 and by failing to disclose that the business was being conducted in contravention of that award; he also overstated the average length of customer tenure. Those matters materially caused the applicants to enter into and comply with the contract. GMO was not liable because, in the circumstances, it was apparent that it was passing on Mr Forbes' information rather than adopting or verifying it, and it did not breach its admitted duty of care. Damages...

Court Disposition

Judgment for the applicants against the first respondent; the applicants' claim against the second respondent dismissed.

Orders

  • ['The first respondent pay to the applicants damages in the amount of $100,126 plus interest on the sum of $87,286 calculated from 1 January 1995 at the rate of interest from time to time payable in respect of judgments of the Court.' 'The first respondent shall forthwith give written instructions to MAS Ronson...