Re Anton Bosnich v Bailey and Cartwright (Holdings) Pty Limited and Peter Highland Real Estate Pty Limited Trading As Richardson and Wrench, Hurstville [1986] FCA 409 (26 November 1986)

FEDERAL COURT OF AUSTRALIA

Re: ANTON BOSNICH
And: BAILEY AND CARTWRIGHT (HOLDINGS) PTY LIMITED and PETER HIGHLAND REAL
ESTATE PTY LIMITED trading as RICHARDSON AND WRENCH, HURSTVILLE
No. G289 of 1986
Trade Practices

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Evatt J.

CATCHWORDS

Trade Practices - Consumer protection - Misleading and deceptive conduct - Sale of business premises - Statements during negotiations - Statements of opinion in respect of future rents - Whether statements relied upon by purchasers - Trade Practices Act 1974 (Cth) ss 52, 53A, 75B.

Trade Practices Act 1985 ss. 52, 53A, 75B

Evidence Act (NSW) s.14B

Pappas and Anor v. Soulac Pty Ltd and Anor 50 ALR 231 ' 234

Bill Acceptance Corporation Ltd v. GWA Ltd 50 ALR 242 ' 246

HEARING

SYDNEY
26:11:1986

COUNSEL FOR THE APPLICANT: Mr Glissan QC and Mr Formosa

SOLICITORS FOR THE APPLICANT: Richard E & Rhys G Williams

COUNSEL FOR THE FIRST RESPONDENT: Mr Bruce QC and Mr Anderson

SOLICITORS FOR THE FIRST RESPONDENT: Owen D Hodge & Son

COUNSEL FOR THE SECOND RESPONDENT: Mr Colquhoun

SOLICITORS FOR THE SECOND RESPONDENT: Murray Stewart & Fogarty

ORDER

THE COURT ORDERS THAT:

1. The application by the applicant be dismissed.

2. The applicant pay each of the respondents costs.

As to the first named respondent's cross-action against the applicant ...

THE COURT DECLARES:

(i) that Mr Bosnich, as purchaser, wrongfully repudiated the
subject contract dated 19 April 1985 made between him
and the first named respondent; and

(ii) that the first named respondent is entitled to forfeit
the deposit of $56,100 paid by the applicant pursuant to
the said contract.

AND THE COURT ORDERS THAT:

3. The second named respondent pay to the first named respondent
the said sum of $56,100 together with any interest accrued
thereon, less any proper and agreed commission due and owing
to the second respondent.

Note: Settlement and entry of orders is dealt with in Order 36 of

the Federal Court Rules.

DECISION

In this matter the applicant, Anton Bosnich, seeks certain declarations against Bailey and Cartwright (Holdings) Pty Limited, the first named respondent and Peter Highland Real Estate Pty Limited trading as Richardson and Wrench, Hurstville, the second named respondent in respect of certain conduct claimed to have been engaged in by the respondents that was allegedly misleading or deceptive or likely to be misleading or deceive in contravention of s.52 and s.53A of the Trade Practice Act 1974.

2. The first named respondent was the owner of certain commercial premises situated at 380/390 West Botany Street, Rockdale which was auctioned at public auction held on 19 April 1985 through an estate agent, the second named respondent following advertisements by it inserted in the Sydney Morning Herald on at least four occasions on and prior to Saturday, 13 April 1985. That advertisement reads:

ROCKDALE Investment
380-390 WEST BOTANY STREET

Complex 9 Factory Units zoned 4B2 income $60696
P.A. Land approx. 33613 sq. ft. Factories 20834
sq. ft. tenants pay proportion outgoing. Unique
opportunity for huge increase rent and capital
value. Phone for brochure.

Vendor's Solicitor: J.O. Anderson
AUCTION: 10.30am FRIDAY APRIL 19, AUSTRALIA SQUARE
RICHARDSON & WRENCH, HURSTVILLE 579 4177

3. Mr J Glissan of Queens Counsel with Mr Formosa appeared for the applicant; Mr V Bruce of Queens Counsel with Mr Anderson appeared for the first respondent, whilst Mr Colquhoun appeared for the second respondent.

4. The applicant, who came to Australia some 30 years ago from Yugoslavia, gave evidence without the aid of an interpreter. It was clear that his understanding of and his command of the English spoken word was quite good although at times his pronunciation, especially when he appeared to be excited, was such that it was often necessary for him to repeat his answers. Nevertheless, the Court is satisfied that he was well aware of questions asked of him and of the trend of the questions put to him in cross-examination.

5. The applicant has been in the construction business and has operated as a developer for most of his working life. Since coming to Sydney he has built and developed multi-storey buildings and factories. In addition he has built factory complexes and two eight storey blocks of flats in Brisbane, but the bulk of his development work has been done in the lower north shore area of Sydney where he has built multi storey home units at Wollstonecraft, Kirribilli, Alfred Street, North Sydney, Neutral Bay, Lane Cove and Mosman. In addition he has built homes for sale at Riverview, Lane Cove, Belrose and other suburbs. These business enterprises have been very successful and at times have involved the granting of leases by him or one of his companies. It is clear that at all relevant times he was quite well versed in the effect and consequences of written leases and the standard term of modern leases dealing with CPI increases in rental fees and how and when other increases of such fees might be effected.

6. He agreed that it was his belief that he could only increase the rent of leased premises if the subject lease permitted such increase. As will appear later, he at no time inspected or caused to be inspected any of the leases in respect of any of the subject factories even though copies of the subject contract with its annexures (including such leases) was available for prospective purchasers from the agents prior to auction and at the auditorium at Australia Square on 19 April 1985. In addition, as will appear, he at no time inspected the subject premises prior to auction yet was prepared to make a bid of $561,000.00 therefor, site unseen.

7. The applicant claimed that on Monday, 16 (sic) April 1985, after reading the above advertisement on Saturday, 13 April 1985, he rang the office of Richardson and Wrench at Hurstville on the number shown in the advertisement. He then spoke with a Mr Vincent Highland asking him particulars of the property. He gave evidence of that conversation. He again, so he claimed, spoke to Mr Highland on 17 April and 18 April and that at about 9.00 am on 19 April, the day of the auction, Mr Highland rang him at his Mosman home when a further conversation took place.

8. The transcript of his evidence in respect of these alleged conversations reads:

MR GLISSAN: Having seen that advertisement, did you do
something in relation to it?---Yes, I did.

What was that?---Not that particular day. I ring up
following Monday, I believe that is 16 April 1985. I ring up
Richardson and Wrench and speak with Mr Vince Highland.

You spoke to somebody who identified himself as Vince
Highland on the telephone?---On the telephone. I have not
seen Mr Highland before.

You had a conversation with him about that
property?---Correct.

Do you recall the terms of that conversation?---Yes.

What was said?---I talked to Mr Highland and asked him
particulars of the property. Mr Highland say to me, that is
property very good and very handy; very close to the airport,
no problem to letting, present rent $60,000 something per
year but below rental value, can be increased value
immediately to $88,000 per year. (Emphasis added).

Did you have any conversation with him about viewing or
visiting the property?---Not that particular day. Second
day, that is 17 April, I give a ring again and tell him, Mr
Highland I be very interesting to see property. He tells me,
when. I say this morning. He say, sorry, I am very busy I
cannot do it today, but you contact me another time.

When was the property due to be auctioned?---19th of the
fourth.

That was the Friday of that week?---Friday, yes.

Did you have any further telephone conversations with Mr
Highland in relation to the property before the auction?---Oh
yes: 16, 17 and 18. On 17 I ring him up again tell him, Mr
Highland, I want to inspect the property.

HIS HONOUR: This is the second phone call that
day?---Correct, in my memory. If not same day, definitely
the next day but my memory I believe so, same on second day.
I asked him, I have to inspect property. Mr Highland say, I
cannot show you property because I have to make an
appointment with the owner of the property and tenants.

I missed a bit of that. Would you say it more slowly?---I
have to contact the owner of the property and mark in
suitable time with occupants of the factory to inspect
factory.

Mark means make I take it; make a suitable appointment with
the occupants?---When I do that I let you know.

He said, "I will let you know"?---Correct.

He knew your name, I take it?---Yes.

How did he know where to contact you, or what?---Because I
contacted him before, I gave him my name, address,
everything.

What does everything mean?---I gave him my address, my living
and my telephone number. Then ---

That is on the second phone call, you think it was?---Second
or third.

It would be the third phone call but you think it is the
second phone call of the 17th, you think your memory
says?---My memory, yes.

9. There was then some discussion about notes said to have been made by the applicant in regard to the phone calls. This is discussed later herein.

MR GLISSAN: Just going back to your memory for a moment,
you have told his Honour about subsequent conversations that
you had. What was the next thing that happened?---Next thing
happened, the Thursday I ring up Mr Highland and tell to him
again when I inspect property, when I got details of the
property, and Mr Highland ---

Pausing there for a moment, I do not want to take you away
from that conversation too far, but at that stage what
information did you have about the property?---I got
information of the property, that property was in the paper,
60,000 rent ---

...

You have the information that was in the advertisement, did
not you?---Yes.

And you had been told some things on the telephone by Mr
Highland?---The same thing what is got in the paper, yes.

You said you had been told something about ability to
increase the rent immediately by Mr Highland on the
telephone?---Correct. (Emphasis added).

Did you have any other documents or any other written
information up to the Thursday when you had not inspected the
property about it?---Not.

You had a telephone conversation ---

HIS HONOUR: So there is no misunderstanding, that is
information at all whether you got it from Mr Highland or
from other sources?---Not, just which I got from the papers.

MR GLISSAN: And the telephone conversation you have already
told us about?---Correct, yes.

You say on the Thursday you had another telephone
conversation?---Yes.

Were all these telephone conversations so far as you were
aware with the same Mr Highland?---Correct.

What was that conversation?---Thursday, I said again, when I
see details of the property and details of the leasing. He
say to me, nothing to worry about, Mr Bosnich, everything I
got in office. I got plan approved for nine factories and
plus I got certificate of Fire Commission. And then he tells
me, "That is a very good property, nothing wrong with them;
can increase rent a lot more of what it says in the paper.
But I tell to you that is a gold mine; if you know by that -
unfortunately, I buy something last week for myself. If I
not buy anything by myself last week I would have bought that
property because one of the unique properties in that area".

This person you were speaking to you understand to be Mr
Highland?---Definitely.

Did you go to his office before the auction and inspect any
documents?---No. Before auction, about 9 o'clock, could
before 9 o'clock, on 19 April, Mr Highland ring me up and
say, "Are you still interested? No miss that opportunity
because this property value. Just lined as I say $680,000".

HIS HONOUR: I missed that last bit.

MR GLISSAN: Would you say that again, slowly please?---Mr
Highland rang you up?---Ring me up and say, "Are you still
interested?". I tell him, "Yes I am". He say to me, "No
miss that opportunity because value of that property
$680,000. No risk can you increase rent immediately up to
market value $88,000". (Emphasis added).

Did you have any further conversations with him before the
auction?---No.

HIS HONOUR: Can I just ask you this. When he rang you on
the 19th, you say at about 9.30, was it?---In the morning
before auction, yes.

Was that the first time he had rung you?---Correct.

10. It will be seen then that the applicant alleges that prior to auction he had had five telephone conversations with Mr Highland, four of which were originated by the applicant and one, the final one, at about 9.00 am on the morning of the auction originated by Mr Highland.

11. After the alleged phone call from Mr Highland on the morning of 19 April, the applicant attended the auction of the subject premises at Australia Square. On his arrival the applicant picked up a schedule of the order of sales for auction that day. Item 11 of that schedule reads:

11. ROCKDALE, 380-390 West Botany St, 9 factory units, zoned
4B2, income $60,696 p.a., land approx. 33,613 sq. ft,
buildings 20,834 sq. ft.

12. He also picked up a coloured brochure headed in red "For Auction" with the name "Richardson and Wrench, Hurstville" with an address and telephone number printed in blue across the bottom. A facsimile of that brochure (front and back) is set out.

(BROCHURE AND DRAWING OMITTED)

13. It is clear from the plan set out on the reverse side of the brochure that the subject property was a battle-axe being some 92 feet wide with access to the property from West Botany Street, the access being some 20 feet wide by 120 feet deep. The total depth of the property is shown as 445 feet.

14. It should be noted at this stage that there was evidence, which is accepted, that a copy of the abovementioned brochure had been forwarded by Mr Vince Highland to the applicant by post on the day when the applicant first rang Mr Highland. Mr Highland places that date as early in the week commencing 8 April 1985, that is a week earlier than claimed by the applicant.

15. The applicant's recollection was that at the auction he made but one bid, namely the last bid when the property was knocked down to him. This bid was an increase of $1,000 only after the bidding had apparently ceased at $560,000, bids up to that figure having increased by $10,000 each time. In other words, the final bid was $561,000.

16. Up to that stage the applicant had not met Mr Vince Highland but had noticed a person at the auction who was talking to people during the time when the auctioneer was accepting bids and that in fact this person had spoken to him at or about the time when he made his one and only bid. He had first become aware that this person was Mr Highland when he was escorted by him to a small room off the auditorium after the property had been knocked down to him for the purpose of signing a contract. It was also there that he was first introduced to a Mr Cartwright and a Mrs Bailey whom he understood were representatives of the vendors, the first named respondent.

17. It was also conceded by the applicant that the auctioneer, prior to opening the auction of the subject premises, announced to those gathered that in fact there were then three vacant factories and not the one as shown in the brochure. The auctioneer gave particulars of those two factories. Accordingly when the applicant signed the contract after the selling price of $561,000 had been inserted in ink into the contract, Annexure A, 3rd Schedule to the contract had ink lines drawn through the particulars typed in in respect of factory unit no. 7 and factory unit no. 9 with the word "vacant" inserted in ink immediately after the figure 7 and the figure 9 in the schedule of the nine factories. The schedule already showed factory unit no. 5 as vacant. These alterations were initialled by the applicant and the vendor's representatives.

18. The said contract was the standard 1982 Copyright printed form of Agreement of Sale of Land of the N.S.W. Law Society. Clause 2(e) of the Conditions for Sale set out in the said contract provided that the balance of the purchase price shall be paid as stipulated in the First Schedule which reads:

In cash or by bank cheque on completion which shall take
place within six (6) weeks from the date hereof.

19. The words underlined had already been typed in after the printed words, "In cash or by bank cheque on completion" and had been initialled by the applicant and the vendor's representatives.

20. Having signed the said contract the applicant was asked for the 10% deposit provided for by the contract. As he had apparently come to the auction without his cheque book a blank cheque form was procured for him by Mr Highland which the applicant, having filled in the words and figures of $56,100, signed. Prior to that the applicant had asked that he be permitted to take the contract with its various annexures away before signing in order that his solicitor might read it. This was refused on the basis that it had been announced that morning immediately prior to auction that one of the terms of the auction was that a formal contract would be signed by the successful bidder immediately after the fall of the hammer. The applicant conceded that he had been aware of that condition prior to the commencement of the auction.

21. The applicant states that thereafter on Saturday morning, 20 April, he went out to the subject property at West Botany Street, Rockdale and then saw the premises for the first time. It was then, so he states, that he first became aware that there may not be nine factories but only eight in the complex as he could not find a roller type door with the no. 8 displayed on it as was the position with the other eight factories. Also it appeared to him that two adjoining factories had no dividing wall and appeared to be the one factory. After speaking with a person working in one of the factories, the applicant proceeded to a public telephone and rang Mr Highland at the agents Hurstville office and was informed by a female that Mr Highland was not in attendance that day, Saturday.

22. He says that he rang that office again on the following Monday, 22 April 1985 and was informed that Mr Vince Highland was not in the office and would be away for some time as he had gone on a trip to Tasmania. Accordingly he spoke to a Mr Peter Highland and complained about the fact that there did not appear to be nine factories in the subject complex. Mr Peter Highland informed him that his father, Mr Vince Highland, who was handling that particular business, was away for the week, and that he, Peter Highland, was not aware of the details of the subject premises but that he would let his father know of the applicant's telephone message when he returned.

23. Thereafter the applicant's solicitors wrote to the vendors, the first respondent, indicating that their instructions were that their client had been induced to sign the contract on misleading representations and consequently demanded the return of the deposit of $56,100. This was subsequently refused. Following further correspondence between the solicitors for the vendors and the solicitor for the applicant, the vendor's solicitor, by letter dated 11 June 1985, wrote to the applicant's solicitor as follows:

BAILEY & CARTWRIGHT HOLDINGS PTY. LIMITED SALE TO BOSNICH

We acknowledge receipt of your letter of the 28th May 1985
and note that your client does not intend performing his
obligations pursuant to the agreement dated 19th April 1985.

Accordingly, we hereby give you notice pursuant to the
provisions of Clause 9 of that agreement that the vendor
hereby forfeits the deposit money in the sum of $56,100 held
by Richardson & Wrench Hurstville and terminates the said
agreement dated 19th April 1985.

Our client is taking steps to effect a sale of the property
and reserves the right to bring action against your client
for damages for breach of contract.

24. Clause 9 of the Conditions for Sale set out in the said agreement was in the form as printed in accordance with the 1982 copyright edition of Agreements for Sale of Land of the Law Society of New South Wales.

25. Thereafter on 27 September 1985, the applicant commenced the present action seeking declarations against the first and second respondents consequent upon alleged conduct said to be in contravention of ss.52 and 53A of the Trade Practices Act, and seeking a declaration and order that the agreement for sale of the subject land between the applicant and the first respondent dated 19 April 1985 is null and void and of no effect.

26. Paragraph 9, 10 and 11 of the statement of claim filed herein read:

9. Prior to, at and about the time of the said auction of
the land, the second respondent made representations
that:

a) the income being received from the land at the time
of the auction or thereabouts was $60,696.00 per
annum nett of expenses;

b) the land had upon it buildings the use of which as
factories was permitted;

c) the said buildings on the land at the date of
auction were capable of being leased for $80,000
per annum nett of expenses;

d) that the then rent being received was far below
value;

e) that there were nine individual and distinct
factory units;

f) that the Local Government Authority had approved
development applications in respect of each factory
unit;

g) that owning to the central position of the said
factory building and its proximity to the airport
there was no difficulty in obtaining tenants at
increased rental values.

10. The first respondent was aware of the representations
referred to above at the time or shortly after each was
made and before they were acted upon by the Applicant.

11. Further, the second respondent made the representations
as Agent of the first respondent.

27. Other paragraphs of the statement of claim set out necessary matters supporting such formal claims under the respective sections of the Trade Practices Act.

28. Both respondents denied liability, whilst the first named respondent pleaded a cross-action against the applicant seeking declarations that Mr Bosnich had wrongfully repudiated the subject contract and that the first named respondent was pursuant to Clause 9 thereof entitled to retain the said deposit of $56,100. The applicant in his pleadings denied such repudiation.

29. During the applicant's evidence-in-chief he, from time to time, made reference to the fact that certain particulars of his oral evidence was "set out in his book". "His book" turned out to be a reference to his diary. Prior to the hearing of the matter directions including directions as to discovery had been made by the Court. No diary had been discovered by the applicant. After some apparent hesitation Counsel for the applicant tendered the diary, the tender being objected to by Mr Bruce and Mr Colquhoun. I have used the term "apparent" as it was the Court's impression at the time that both Counsel for the applicant appeared surprised to hear that such a diary existed. After argument the Court accepted the tender.

30. On examination of the diary it was discovered that certain entries which the applicant had stated in his oral evidence were entries which he believed were relevant to his case had been highlighted by a colour highlighter pen. These entries were written in what was stated by the applicant to be partly Croatian and partly mis-spelt English words and were accordingly unintelligible to the Court. Accordingly, the diary was uplifted for the purpose of having certain sections translated by official translators. Translations were subsequently tendered and accepted into evidence.

31. Prior to the tender the applicant had given evidence that each so-called relevant entry had been entered in his diary by himself under circumstances that might be said to make such entries contemporaneous. That is to say, that the entry had been placed in the diary under a particular date either during the evening of the particular day when the entry appears or very shortly thereafter. There is no suggestion that the tender was accepted as a result of suggested recent invention of the evidence given by the applicant, but was accepted under s.14B of the Evidence Act, New South Wales.

32. Despite the evidence of the applicant in this regard and the translations tendered, the Court, looking at the totality of the evidence given in the case, is not satisfied that any relevant entry in the diary was in fact a contemporaneous entry within the meaning of that expression in s.14B of the Evidence Act. The Court is of the view that it is not necessary to elaborate on this finding. As appears later herein there was a conflict of evidence between that given by the applicant and that given by Mr Vincent Highland on certain essential matters. The Court, having had the benefit of observing both witnesses and seeing their demeanour in the witness box, is clearly of the view that the evidence of Mr Highland on all matters where there is such a conflict should be preferred, it being satisfied that the applicant's evidence cannot be readily accepted and should not in all the circumstances be relied upon.

33. In his case, the applicant called a Mr Lloyd, a real estate agent and valuer of some 25 years experience, who gave evidence as to what the rentals of the said factories, both current and future, were and would be. Of course, such figures were based on his opinion. Such opinions were generally in conflict with those of Mr Highland and where such conflict exists then the Court is of the view that the evidence of Mr Highland is to be preferred. In this regard it is noted that where it is possible in fact to objectively test their conflicting views, then Mr Lloyd's opinion is under value by some 50%. As appears in the brochure, No. 5 unit was stated to be vacant at the time of the auction. Mr Lloyd gave evidence that in his opinion the likely rent which might be expected for that unit would be in the vicinity of $3.50 per square foot. In fact a rental of $5.14 per square foot had been obtained for that unit shortly after the auction.

34. The only two other witnesses who gave evidence of events leading up to the signing of the agreement for sale was Mr Cartwright, a director of the first named respondent and Mr Vincent Highland.

35. Mr Cartwright's evidence was not really disputed. He gave evidence that the first named respondent had placed the subject premises in the hands of the second named respondent for sale by auction in about February or March 1985 and that he had prepared a schedule of the lettings in respect of the factories making up the complex together with a list of the then outgoings for use by the agents. That schedule was tendered in evidence. It showed, amongst other things, whether a particular factory had been renovated or not, what the annual rental for each factory let was, the price per square foot calculated from such rent, whether there was a written lease in respect of a particular factory or whether tenants were on weekly or monthly parol leases.

36. As stated, details of the schedule drawn up by Mr Cartwright were not contested by the applicant. It is clear that the schedule formed the basis for the calculations by Mr Vincent Highland of the potential rents which, in the opinion of Mr Highland, might be attainable in the future when leases were able to be re-negotiated. That time could be in the case of the written leases up to three years after the auction, namely October 1988. This matter is discussed later herein.

37. Mr Cartwright also gave evidence that when the abovementioned brochure was prepared by Mr Highland as a draft he noticed that the outgoings did not include an amount for land tax and pointed this out to Mr Highland suggesting that that figure should be inserted. This in fact was done. As to the figures totalling $88,280, which are set out in that brochure, Mr Cartwright stated:

How he (that is Mr Highland) arrived at the $88,280 I am not
quite sure of. I have some idea of how he got to that but
that would be up to Mr Highland to do that. I imagine that
was his estimation of what he thought the property could
achieve.

38. It was also agreed between Mr Cartwright on behalf of the first respondent and Mr Highland representing the second named respondent that there was to be a reserve price set for the auction. In fact that reserve price was more than $561,000, but I accept Mr Highland's evidence that when the biding reached $561,000 he had received instructions from Mr Cartwright and had then announced to those present at the auction that the property "was on the market to be sold out" and that thereafter it was knocked down to Mr Bosnich.

39. Mr Vince Highland gave evidence which is accepted that he was and had been for some 35 years a licensed real estate agent, a licensed auctioneer, a licensed business agent and also a registered valuer. He was employed at relevant times as a salesman by the second named respondent and that the Peter Highland referred to in the name of that company was his son. The said company had been the managing agent for part of the premises at 380 West Botany Street, Rockdale for some period leading up to the auction and that it was he who had had discussions with Mr Cartwright for the sale of the subject property and who arranged for the advertising programme for the sale of the property. He agreed that he had received from Mr Cartwright a schedule of the tenancies and rentals in respect of the subject premises and that he was of the opinion, based on his experience and his knowledge of comparable rentals, that some of the leased units immediately before the auction were grossly under-rented.

40. When assessing the potential rental for those units, it was necessary in his view to estimate what the going rent could be at the time when any particular lease might be re-negotiated, that is, at the expiration of the then current leases. That time of course, in respect of three year leases, could have been as late as March 1988. Taking all relevant matters into consideration such as the duration of the leases, the area, together with comparable rentals being obtained in that area, he had formed the opinion that the potential total rentals amounted to some $88,000. Indeed he stated that he was still of that view at the time when he gave his evidence. Such figures so he stated, were those which could be hoped for when the leases were re-negotiated and the building had been renovated. Such renovations included the driveway being gravelled and a proper car park made in the yard. He stated that the fact that such renovations would be beneficial in assessing future rentals would have been quite apparent to any person who made an inspection of the subject premises at any time before the auction.

41. As regards conversations he had had with Mr Bosnich, his evidence was that he had spoken to Mr Bosnich on the phone twice only before the auction and that both those calls were originated by Mr Bosnich. I accept Mr Highland's evidence in this regard. The first time Mr Bosnich spoke to Mr Highland occurred early in the week commencing Monday, 8 April 1985 whilst the second was on the Thursday before the auction on Friday, 19 April 1985.

42. It is accepted that an advertisement in respect of the subject auction was inserted in the Sydney Morning Herald on at least four occasions before the auction, the last being on Saturday, 13 April 1985.

43. Further, I accept Mr Highland's evidence that at no time did he ever say to Mr Bosnich that the property was capable of immediately returning rentals of $88,000; that he did not speak to Mr Bosnich either personally or on the phone on Friday, 19 April 1985 the day of the auction; that after Mr Bosnich's first phone call during the week commencing 8 April he had caused to be forwarded to him a copy of the brochure set out earlier herein; that at no time did Mr Bosnich request that he be shown the property nor did he ask that a copy of the contract with its annexures be forwarded to him or his solicitor. Accordingly Mr Highland at no time considered Mr Bosnich to be a potential buyer, he being of the view (a view gathered from years of experience as an agent) that if a person showed no interest in inspecting any subject premises then that person should not be classified by him as a potential buyer.

44. As regards the second of the two phone calls stated by Mr Highland to have been made by the applicant, Mr Highland frankly stated that he did not recall the specific words either said by himself or Mr Bosnich but that he had a general recollection of such conversation. The evidence in this regard is, as might be expected, somewhat confused but the Court is of the view that during that particular call after Mr Bosnich had indicated that he was interested in the property, that Mr Highland then said to him, "Well you have not had a look at it", to which Mr Bosnich replied, "I am too busy, I have not had time".

45. Mr Bosnich then asked details of the rentals which Mr Highland gave from the brochure. It was during this conversation that Mr Bosnich informed Mr Highland that he had received the brochure. In addition it was during this conversation that Mr Highland informed Mr Bosnich that the brochure needed updating in so far as two additional factories had very recently become vacant and that one of them, namely no. 9, needed some repair work.

46. Specific questions were put by Mr Colquhoun to Mr Highland regarding certain statements alleged by Mr Bosnich in his evidence to have been made by Mr Highland. His denials of such allegations have been traversed herein. Should there be any such denials which have not been specifically or inferentially referred to then, as indicated earlier herein, any conflict between the evidence of Mr Bosnich and that of Mr Highland, is determined by the Court as being that deposed to by Mr Highland.

47. In this respect it is further accepted by the Court that Mr Highland was in attendance at the office of the second respondent at Hurstville during the week commencing Monday, 22 April 1985 and that it was not until the afternoon of Saturday, 27 April 1985 that Mr Highland left Sydney for Tasmania to attend the Lion's National Convention at Launceston.

48. Mr Highland also gave evidence concerning a telephone call that he received from Mr Bosnich on the Saturday following the auction (ie on 20 April 1985). He states that Mr Bosnich rang him at his home to inform him that he was "withdrawing from the sale" because Mr Highland had mislead him about the size of the land, he claiming that it was not as big as he had been told or as it was advertised. I accept that this call was made and further that Mr Highland then told Mr Bosnich that as he did not have the particular file at home he would not discuss the matter with him at that time and asked him to ring him at the office at Hurstville on the following Monday.

49. I further accept that Mr Highland endeavoured to ring Mr Bosnich on Monday at Mr Bosnich's home but was informed by a female that he was not there; that he was able to speak to Mr Bosnich on the phone on Tuesday, 23 April, when Mr Bosnich informed him that he found that the land size was right but that there were not nine factories in the complex and that he was not going to buy it. These two telephone conversations were the only two conversations that Mr Highland had with Mr Bosnich after the auction. I also accept the evidence of Mr Highland that at no stage prior to auction did Mr Bosnich inform him that he wished to inspect the premises. On the contrary I accept Mr Highland's evidence that he had invited Mr Bosnich to so inspect the property and that he, Mr Bosnich, declined to do so.

50. It is further noted that when Mr Bosnich was making his inspection of the property on 20 April 1985 he spoke to a person in premises abutting onto the subject premises. A business of a private hospital was conducted on those premises. Following that conversation the applicant telephoned the matron of the hospital on the following Monday, 22 April 1985 concerning the possibility of selling the subject premises to the owners of the hospital.

51. During this conversation Mr Bosnich informed the matron that he was prepared to sell the subject premises for the price that he had paid for it. This figures was, so he then claimed, $600,000. The matron, a Mrs A. Nicholson, gave evidence to this effect. She also stated that during that conversation Mr Bosnich had informed her that the income from rents was $70,000 per annum.

52. She then informed Mr Bosnich that the hospital was at that particular time being sold to West Australian interests and that she would pass his offer on. On the following Wednesday, 22 April, Mr Bosnich visited her at the hospital. She then informed him that she was aware that he had bought the subject premises for $561,000 but that she had passed his offer and the fact that she believed that Mr Bosnich had paid only $561,000 on to the future owner of the hospital. She claimed in her evidence that Mr Bosnich had on that occasion indicated to her that he wished to dispose of the factory site because his wife did not then like the particular site. This evidence had been put to Mr Bosnich in cross-examination when he inferentially denied it when he stated that his wife never at any stage of his business life had any say in his business affairs.

53. Mrs Nicholson's evidence, which is accepted, was corroborated by her diary entries for the two relevant days. Copies of those entries were tendered without objection.

54. In his final submission, Counsel for the applicant put his case against the first named respondent as relying only on the provisions of s.75B of the Trade Practices Act. Even if the Court were minded to hold that the second named respondent was in breach of s.52 of the Act, then, accepting as I do the credibility of Mr Cartwright, there is no evidence to support a finding against Mr Cartwright that he aided, abetted, counselled or procured a contravention of s.52 by the second named respondent (see Yorke v. Lucas (1985) 61 ALR 307 ' 317). Accordingly the applicant cannot succeed against the first named respondent.

55. The applicant's case against the second named respondent as put by his Counsel in his final submission, depended, so it was frankly put, and rightly so in my view, on whether the Court accepted Mr Bosnich's evidence as opposed to that of Mr Highland. The Court has already clearly indicated its view in this regard when discussing the evidence of these two gentlemen in respect of the various issues. Without abandoning any of the allegations raised in paragraph 9(a) through to 9(g) of the Particulars of Claim set out earlier herein the applicant's case was finally put by Counsel as an allegation based on particular paragraph 9(c); that is that Mr Bosnich was induced to purchase the subject premises by Mr Highland's alleged representation that the rents could immediately be increased to $88,000 per annum.

56. In this regard I respectfully agree with the observations of Fisher J in Pappas & Anor v. Soulac Pty Limited & Anor (1983) 50 ALR 231 @ 234 where he states:

For the purpose of determining whether any of the respondents
engaged in misleading conduct, statements can not be assessed
in isolation but in the overall context of the negotiations.
I adopt with respect what was said in Parkdale Custom Built
Furniture Pty Ltd v. Puxu Pty Ltd (1982) 42 ALR 1, by Gibbs
C.J. at p 7: "The conduct of a defendant must be viewed as a
whole. It would be wrong to select some words or acts which,
alone, would be likely to mislead if those words or acts,
when viewed in their context were not capable of misleading.
It is obvious that where the conduct complained of consists
of words, it would not be right to select some words only and
to ignore others which provided the context which gave
meaning to the particular words. The same is true of facts".

57. Further, I adopt with respect the dicta of Lockhart J in Bill Acceptance Corporation Ltd v. GWA Ltd (1983) 50 ALR 242 ' 246 where he states:

Misleading or deceptive conduct may be constituted by the
making of statements. They may be statements as to existing
or past facts, statements as to the current holding of a
belief or intention or promises as to future conduct. The
distinction between promises of future conduct on the one
hand and statements as to existing or past facts on the other
is well recognized in cases of fraud or deceit. It may be
necessary for the purposes of s.52, in the case of statements
or representations as to future conduct, to distinguish
between promises on the one hand and predictions on the
other, the former being within the scope of s.52 and the
latter perhaps not: see Thompson v. Mastertouch TV Service
Pty Ltd (1977) ATPR 40-027, per Franki J at 17,364; R. v.
Sunair Holidays Ltd (1973) 1 WLR 1105 and Beckett v. Cohen
(1972) 1 WLR 1593.

58. Here it is accepted that at no time did Mr Highland state to the applicant that rents could be immediately increased to $88,000 per annum. When Mr Highland made an assessment of the rents at $88,000 per annum, he was giving an opinion as to what he believed the rents could be in the future after all the leases had been re-negotiated. That opinion was reflected in the figures set out in the brochure.

59. In my view any statement reflecting Mr Highland's opinion in respect of future rents could not, in all the circumstances of this case, fall within the scope of s.52 or s.53A of the Act.

60. Accordingly the applicant has failed to satisfy the Court on the balance of probabilities that either respondent has breached s.52 or s.53A of the Act. There is to be judgment for the respondents. The applicant is to pay the respondents' costs of the action. Orders accordingly.

61. As stated earlier herein the vendor has claimed that the applicant, as purchaser, wrongfully repudiated the subject contract and accordingly the vendor was entitled, pursuant to Clause 9 of the contract, to forfeit the deposit of $56,100 paid by the applicant pursuant to the contract. Although this was denied in the applicant's pleadings to the cross-action the evidence is clear that the applicant did so repudiate the contract and that the vendor having complied with all necessary procedural steps provided for in Clause 9 is entitled to the declarations and order as asked.

62. Accordingly the Court declares:

a) that the applicant, Mr Bosnich, as purchaser, wrongfully
repudiated the subject contract dated 19 April 1985 made
between him and the first named respondent; and

b) that the first named respondent is entitled to retain the
deposit of $56,100 paid by the applicant pursuant to the
contract.

63. The Court orders that the second named respondent pay to the first named respondent the said sum of $56,100 together with any interest accrued thereon, less any proper and agreed commission due and owing to the second respondent.