Professional Liability Guide

CHAPTER 1 – DUTIES

Basic principles In ACCC v Dukemaster Pty Ltd , 119 Gordon J restated the following principles as applicable to a contravention (that is, misleading or deceptive conduct in the context of the TPA): ƒ A contravention is established by ‘ conduct ’ that is misleading or deceptive or likely to mislead or deceive. 120 The conduct, in the circumstances, must lead, or be capable of leading, a person into error 121 and the error or misconception must result from the conduct of the corporation and not from other circumstances for which the corporation is not responsible. 122 ƒ The conduct is likely to mislead or deceive if there is a ‘ real or not remote chance or possibility regardless of whether it is less or more than fifty per cent’ . 123 ƒ Section 52(1) is concerned with the effect or likely effect of conduct upon the minds of that person or those persons in relation to whom the question of whether the conduct is or is likely to be misleading or deceptive falls to be tested. The test is objective, and the Court must determine the question for itself. 124 Section 52 is not designed for the benefit of persons who fail in the circumstances of the case to take reasonable care of their own interests. 125 Moreover, it would be wrong to select particular words or acts that, although misleading in isolation, do not have that character when viewed in context. 126 ƒ Precisely the same principles control the operation of section 52(1) to statements involving the state of mind of the maker when the statement was made (such as promises, predictions and opinions). A statement that involves the state of mind of the maker ordinarily conveys the meaning (expressly or impliedly) that the maker had a particular state of mind when making the statement and, commonly, that there was a basis for that state of mind. 127 ƒ A statement of opinion will not be misleading or deceptive or likely to mislead or deceive merely because it turns out to be incorrect, misinforms or is likely to do so. 128 An incorrect opinion does not of itself establish that the opinion was not held by the person who expressed it or that it lacked any, or any adequate, foundation. 129 An expression of an opinion that is identifiable as such conveys no more than that the opinion is held and perhaps that there is a basis for it. If so, an expression of opinion, however erroneous, misrepresents nothing. 130 ƒ However, an opinion may convey that there is a basis for it, that it is honestly held and, when expressed as the opinion of an expert, that it is honestly held upon rational grounds involving an application of the relevant expertise. If the evidence shows that the opinion was not held or that it lacked any, or any adequate, foundation, particularly if the opinion was expressed as an expert, a statement of opinion may contravene section 52 of the TPA. 131 121 Hannaford (t/as Torrens Valley Orchards) v Australian Farmlink Pty Ltd [2008] FCA 1591 [252], citing Taco Company of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177, 200; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 198. 122 Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 2 FCR 82, 91. 123 Ibid 87. 124 Ibid 87. 125 Elders Trustee and Executor Co Ltd v E G Reeves Pty Ltd (1987) 78 ALR 193, 241. 126 Ibid 242, citing Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 199. 127 Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 2 FCR 82, 88. 128 Elders Trustee and Executor Co Ltd v E G Reeves Pty Ltd (1987) 78 ALR 193; Bateman v Slatyer (1987) 71 ALR 553, 559. 129 Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 2 FCR 82, 88. 130 Ibid 88. 131 Elders Trustee and Executor Co Ltd v E G Reeves Pty Ltd (1987) 78 ALR 193, 242. See also Hannaford (t/ as Torrens Valley Orchards) v Australian Farmlink Pty Ltd [2008] FCA 1591 [253]; RAIA Insurance Brokers Ltd v FAI General Insurance Co Ltd (1993) 41 FCR 164; Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388. 119 [2009] FCA 682 [10]. 120 Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 2 FCR 82, 87.

21

© Carter Newell 2023