FEDERAL COURT OF AUSTRALIA

Haros v Linfox Australia Pty Ltd [2012] FCAFC 42

THE COURT ORDERS THAT:

1.    The appeal be dismissed.

2.    The appellant pay the respondents’ costs of the appeal.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT

The nature and history of the proceeding

1    The appellant, Mr George Haros, appeals from a judgment of a single judge of the Court, who dismissed his application for damages for contraventions of ss 52 and 53B of the Trade Practices Act 1974 (Cth) (“the Trade Practices Act”) and ss 9 and 13 of the Fair Trading Act 1999 (Vic) (“the Fair Trading Act”). See Haros v Linfox [2011] FCA 699. In the proceeding at first instance, Mr Haros contended that the first respondent, Linfox Australia Pty Ltd (“Linfox”), induced him to leave his then secure and long-term employment to accept a position as Linfox’s Business Manager at Avalon Airport (“Avalon”). Mr Haros alleged that Linfox and the second respondent, Linfox’s general manager Mr Timothy Anderson, engaged in conduct that was misleading or deceptive or likely to be misleading or deceptive, or was liable to mislead him about aspects of the employment he was being offered with Linfox.

2    Although Mr Haros did not commence his proceeding until nearly nine months after the termination of his employment, he requested that it be included in the Court’s fast track list. The claim alleged a series of express representations by Mr Anderson and others on behalf of Linfox, from which it was said there was to be implied a representation that Linfox wanted to employ somebody to assist its Managing Director with the management of Avalon’s commercial interests “for at least approximately three years” and that it wanted Mr Haros to perform that role. This was later characterised as “the Security Representation”. It was said to be a representation with respect to future matters and to have been made without reasonable grounds, so that it would be taken to be misleading unless Linfox adduced evidence that it had reasonable grounds for making the representation, by virtue of s 51A of the Trade Practices Act. Mr Haros also alleged that, by not informing Mr Haros that Linfox might resile from the Security Representation in the event that Mr Anderson resigned his employment with Linfox, Linfox and Mr Anderson further engaged in misleading and deceptive conduct or conduct that was likely to mislead or deceive. This omission came to be called “the Longevity Omission”.

3    More than five months after commencing the proceeding, Mr Haros filed an amended statement of claim. The express representations were also alleged to have led to an implicit representation that Linfox did not employ anybody other than Mr Anderson in the management or performance of the activities comprehended by the Business Manager role. This was called “the Exclusivity Representation”. There was also a new allegation that Linfox and Mr Anderson engaged in misleading and deceptive conduct, or conduct that was likely to mislead and/or deceive, by not informing Mr Haros that it already employed people in the management or performance of the commercial activities. This was called “the Exclusivity Omission”.

4    The trial began on 10 May 2010. By the end of the five days allocated for the trial of a case in the fast track list, in accordance with cl 2.3(a) of Practice Note CM 8 Fast Track, it was nowhere near finished. Mr Haros and another witness called on his behalf had given evidence. Mr Anderson had given evidence. The trial therefore continued on a further seven days in August 2010 and concluded on 1 September 2010. The judgment of the learned primary judge was not given until 22 June 2011.

5    Mr Haros’ appeal is primarily on the basis that the primary judge erred in overlooking items of evidence favourable to Mr Haros’ case. Counsel for Mr Haros called in aid in this respect the time lapse between Mr Haros’ oral evidence and the delivery of judgment. They argued that the delay strengthened the case that his Honour had failed to take account of some aspects of Mr Haros’ evidence. In the course of argument on the appeal, a question arose as to whether Mr Haros’ case could have succeeded in any event, because of the absence of evidence of reliance on any of the alleged representations.

The legislation

6    The relevant provisions of the Trade Practices Act were as follows. Section 51A(1) and (2) provided, so far as relevant:

(1)    For the purposes of this Division, where a corporation makes a representation with respect to any future matter (including the doing of, or refusing to do, any act) and the corporation does not have reasonable grounds for making the representation, the representation shall be taken to be misleading.

(2)    For the purposes of the application of subsection (1) in relation to a proceeding concerning a representation made by a corporation with respect to any future matter, the corporation shall, unless it adduces evidence to the contrary, be deemed not to have had reasonable grounds for making the representation.

Section 52(1) provided:

A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

Section 53B provided:

A corporation shall not, in relation to employment that is to be, or may be, offered by the corporation or by another person, engage in conduct that is liable to mislead persons seeking the employment as to the availability, nature, terms or conditions of, or any other matter relating to, the employment.

Each of the foregoing provisions was found in Pt V of the Trade Practices Act. Section 82(1) provided relevantly:

…a person who suffers loss or damage by conduct of another person that was done in contravention of a provision of Part…V…may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention.

7    Sections 4, 9 and 13 of the Fair Trading Act are provisions similar to those found in ss 51A, 52 and 53B of the Trade Practices Act, except that the relevant provisions of the Fair Trading Act were not confined in their operation to the conduct of corporations, but were applicable to persons generally. Section 159(1) of the Fair Trading Act provided:

A person who suffers loss, injury or damage because of a contravention of a provision of this Act may recover the amount of the loss or damage or damages in respect of the injury by proceeding against any person who contravened the provision or was involved in the contravention.

The basic facts

8    Mr Haros is a qualified lawyer, with experience in employment law. From 2005 until he left in 2008 to take up employment with Linfox, Mr Haros was employed in senior roles by the Schiavello group of companies (“Schiavello”). He began employment with Linfox on 24 November 2008, after negotiations that began in June 2008. On 5 March 2009, Linfox terminated his employment.

9    In mid-2008, Linfox engaged the services of a recruitment agency (Mahlab) to assist it to recruit a suitable person to fill the position of Business Manager at Avalon. On 19 June 2008, an advertisement for the position appeared in the press. Mr Haros responded to the advertisement by contacting Mahlab and expressing interest in the position.

10    On 30 June 2008, Mr Haros met with Ms Vivienne Rekas from Mahlab. Ms Rekas told him about the nature and structure of Linfox’s operations at Avalon. She told him that the second respondent, Mr Anderson, was the General Manager. She said that the business was in the process of expanding. She mentioned that there were three operational managers who reported to Mr Anderson and that initially the Business Manager would start at the same level as the operational managers, but later move into a more senior management role.

11     The primary judge found that, either at the 30 June 2008 meeting or shortly before it occurred, Ms Rekas gave Mr Haros a document that described the role of Business Manager as follows:

The role involves working closely with the General Manager to manage and expand all aspects of Avalon Airport’s commercial interests. The role will form part of a team that is to take Avalon Airport into its next exciting growth phase and [sic] become recognised as one of Australia’s top ten airports.…In the medium to long term, the successful candidate will have actively assisted the General Manager in managing Avalon airport, and have secured and implemented business opportunities for Avalon airport.

12    On 10 July 2008, Mr Haros met with Mr Anderson. Mr Anderson discussed Linfox’s expansion plans for Avalon and the role of the Business Manager in that development. A further meeting between the two occurred on 15 July 2008 at Avalon, in which Mr Anderson referred to potential opportunities for commercial expansion.

13    On 3 September 2008, Mr Haros met with Mr David Fox (the Linfox director responsible for its business at Avalon) and Mr Leonard Vary, another director of Linfox. On 8 September 2008, Mr Haros met again with Mr Anderson. By this time, Mr Anderson’s title had changed from General Manager to Managing Director. Mr Haros asked whether the title “Business Manager” could be changed to “General Manager”. In that meeting, Mr Anderson gave Mr Haros a document called “Business Objectives Report”. The report dealt with possible future commercial developments at Avalon.

14    On 16 September 2008, Mr Anderson sent an email to Mr Haros outlining an offer of employment. After referring to “what we discussed last Monday”, the email said:

The title of this position is Business Manager and will remain as such, probably for at least 2 – 3 years or longer. I know you mentioned that the title of General Manager of Avalon Airport would be something of interest to you, but that would not be appropriate at this stage. The General Manager of the airport requires a built up knowledge of the airport and its operations, and would mean that I would have to relinquish some of that direct control, which would not be something that the owners or I as Managing Director would be prepared to consider. So this role will report directly into [sic] myself, along with the other managers. Having said that, I am hopeful this role will rise in importance above the others and that it will definitely be the second in charge.

But your thinking was right – this role will be the stepping stone into that position.

15    On 25 September 2008, Mr Anderson sent an “offer of employment” to Mr Haros. The offer provided for a rate of salary and a three-month probationary period. It also contained what the primary judge described as a “no reliance” clause, as follows:

This letter sets out the entire understanding and agreement between the parties with respect to the terms and conditions of the employment offered with Linfox…All negotiations, representations, warranties or commitments in relation to your employment are superseded by this document and will be of no force or effect whatever.

Mr Haros advised Mr Anderson that he would review the proposed terms that evening “and come back to you with any queries”.

16    On 26 September 2008, Mr Haros spoke with Mr Anderson by telephone. Mr Haros suggested an extension of the period required to give notice of termination of the contract of employment and the provision of a term requiring the payment of three months salary should the Business Manager position became redundant. In a subsequent telephone conversation on 28 September 2008 between the two men, Mr Anderson agreed to the changes suggested by Mr Haros. The new redundancy clause provided:

In the event that your position is made redundant, you will be entitled to a redundancy payment of 3 months [sic] salary plus any amount payable under the incentive package.

17    On 29 September 2008, Mr Haros resigned from Schiavello. On 1 October 2008 he signed the letter of offer from Linfox after incorporating the agreed changes. He agreed with Linfox to commence work on 24 November 2008. In the meantime, on 19 November 2008, Mr Anderson gave Linfox one month’s notice of his resignation. On 20 November 2008, Mr Fox telephoned Mr Haros to advise him of Mr Anderson’s resignation.

18    When Mr Haros commenced employment with Linfox, on 24 November 2008, he met Mr Fox and Mr Justin Giddings. Mr Giddings was appointed acting General Manager of the Avalon business. Mr Giddings had previously spent most of his time at Essendon Airport (which was also operated by Linfox), but was described in various Linfox documents as “Commercial and Operations Manager of Avalon and Essendon aiports”. He estimated that he spent about 20% of his time on commercial projects at Avalon.

19    Later that day Mr Haros met Mr Marc Grant, whose title was “Commercial Manager – Investments” in the Linfox property group, and who was based in St Kilda Road, Melbourne. He handed Mr Haros a business card which described Mr Grant’s role as “Commercial Manager, Avalon Airport”. In the latter part of 2008, Mr Grant was actively involved in pursuing commercial opportunities at Avalon, devoting about half his time to that work. In November 2008, Mr Anderson described Mr Grant as having been “brought…significantly into the [Avalon] business” during the immediately preceding months.

20    Also on the day he began working for Linfox, Mr Haros was introduced to Mr Henry Polk. Mr Polk was an employee of Linfox based at Essendon Airport, who was called on to participate in a number of Avalon-related projects in the latter part of 2008.

21    When Mr Haros commenced work with Linfox, the company was in the process of seeking Commonwealth approval for Avalon to be declared an international airport. A major development plan, which it had submitted to the Government, was rejected as lacking detail. Shortly after Mr Haros commenced, Mr Giddings directed him to prioritise the preparation of a new version of the plan.

22    As well as working on the plan for Avalon to be an international airport, Mr Haros prepared an amended organisational structure for the Linfox business at Avalon. Under this structure, Mr Haros would have been responsible for managing the commercial aspects of the business and Mr Giddings would have been responsible for operational matters. Mr Haros and Mr Giddings would have been on the same level and both would have reported directly to Mr Fox. Mr Haros discussed that suggestion with Mr Fox before raising it with Mr Giddings. Mr Giddings and Mr Fox did not accept it. After consulting with Mr Fox, Mr Giddings proposed an alternative structure, under which Mr Haros would be the Chief Commercial Officer at Avalon, reporting to Mr Giddings. Also under this proposal, Mr Grant and Mr Polk would have reported to Mr Haros.

23    As a consequence of his displeasure with Mr Haros proposing restructuring with Mr Fox without consultation with Mr Giddings, Mr Giddings told Mr Fox towards the end of February 2009 that he would resign if Mr Haros were not dismissed.

24    On 3 March 2009, Mr Giddings informed Mr Haros that he, Mr Giddings, intended to exercise more oversight of the commercial activities of the business at Avalon and intended to appoint a new manager to deal with operational matters.

25    On 5 March 2009, Mr Andrew Nicholls (the senior manager of Linfox’s property division) and Mr Giddings had a meeting with Mr Haros. Mr Nicholls told Mr Haros that his position had been made redundant with immediate effect. Linfox contended before the primary judge that it was untrue that Mr Haros’ position was redundant. It took the view that describing the dismissal in this way was an easier option than termination for unsatisfactory performance.

The adequacy of the primary judge’s reasons

26    Although the notice of appeal did not raise the issue distinctly, counsel for Mr Haros submitted that the primary judge’s reasons for judgment were too brief to disclose a reasoning process. His Honour’s reasons consist of 107 paragraphs, occupying more than 23 pages. They deal with all the issues raised. The submission was made in conjunction with a submission that the length of time for which the judgment was reserved made it impossible to be sure that the primary judge had in mind all of the evidence when he prepared the reasons. Reliance was placed on the judgment of the Full Court in Expectation Pty Ltd v PRD Realty Pty Ltd [2004] FCAFC 189; (2004) 140 FCR 17 at [71] and [72]:

[71]    In the normal course, statements made by a trial judge of a general assertive character can be accepted as encompassing a detailed consideration of the evidence. However, where there is significant delay, such statements should be treated with some reserve. After a significant delay, a more comprehensive statement of the relevant evidence than would normally be required should be provided by the trial judge in order to make manifest, to the parties and the public, that the delay has not affected the decision.

[72]    In cases not affected by delay, an appellate court is entitled to assume that the mere failure to refer to evidence does not mean that it has been overlooked or that other forms of error have occurred. However, where there is significant delay, no favourable assumptions can be made. In such circumstances, it is up to the trial judge to put beyond question any suggestion that he or she has lost an understanding of the issues. Where there is significant delay, it is incumbent upon a trial judge to inform the parties of the reasons why the evidence of a particular witness has been rejected. It is necessary for the trial judge to say why he or she prefers the evidence of one witness over the evidence of other witnesses…

27    Reference was also made to Fox v Australian Industrial Relations Commission [2007] FCAFC 150; (2007) 161 FCR 263, in which the Full Court by majority held that a Commissioner whose reasons for decision were given almost twelve months after the hearing denied the losing party procedural fairness by failing to give specific reasons for preferring the evidence of one witness over that of another. As Marshall and Tracey JJ said at [32], “[t]he lengthy and unexplained delay between the hearing and the delivery of the Commissioner’s decision raised doubts about the capacity of the Commissioner to recall his observations and impressions of [the witnesses] when they gave evidence at the hearing”. Their Honours followed NAIS v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 77; (2005) 228 CLR 470, in which the High Court overturned a decision of the Refugee Review Tribunal to refuse to grant protection visas. That decision depended on the demeanour and credibility of the applicants for those visas, but was not given until several years after the tribunal had heard their oral evidence. The excessive delay denied the tribunal the possibility of considering the applicants’ case properly, which was a denial of procedural fairness. In the course of his reasons for judgment in NAIS, Kirby J at [98] referred to the judgment of the Privy Council in Cobham v Frett [2001] 1 WLR 1775 at 1783, where their Lordships said that 12 months would normally justify the description of excessive delay.

28    This reference prompted counsel for Mr Haros to submit that, because Mr Haros had given his evidence on 10, 11 and 12 May 2010, and judgment had not been delivered until 22 June 2011, more than 12 months had elapsed, there was excessive delay and the primary judge had deprived himself of the chance of giving proper consideration to the evidence. A number of points can be made in respect of this submission. There are dangers in the adoption and mechanical application of a rule such as that a delay in giving judgment of 12 months from the giving of evidence must always be excessive. It is necessary to take account of the circumstances of the particular case. In Fox, the Commissioner’s hearing occupied only two days, so that it was easy to say that a decision based on the credibility of witnesses, given a week short of twelve months after the completion of the hearing, required more than a mere statement of preference for the evidence of one witness over that of another. In the present case, the judgment was delivered less than nine months after the end of the trial. Even though Mr Haros’ evidence was more than a year old by the time the judgment was delivered, it is not to be supposed that the primary judge paid no regard to the detail of the evidence of Mr Haros once Mr Haros left the witness box. His Honour would have been reminded of that detail as the trial proceeded and cross-examination of the respondents’ witnesses about the issues raised by the evidence took place. His Honour also had the benefit of detailed submissions by counsel at the end of the trial, in which the evidence could be canvassed, so far as was necessary.

29    Further, this case is not one in which the primary judgment depends on the judge’s observations of the demeanour of witnesses, or his Honour’s preference for the evidence of one witness over that of another. His Honour’s judgment depended on a refusal to infer from the making of express representations the representations on which Mr Haros relied. The primary judge had available to him the transcript of evidence at the trial and a significant number of documentary exhibits that were tendered, including written statements of the witnesses constituting their evidence in chief. Even though the Privy Council in Cobham enunciated the general proposition that 12 months is excessive delay, it declined to set aside the judgment from which the appeal had been brought because the trial judge had relied on his notes, which were “comprehensive and of a high quality”.

30    There are many reasons for caution in finding that a judge has denied fairness to the losing party in a case by reason of delay. A judge will sometimes make a point of preparing a draft of the facts of a case at the first opportunity after the trial has finished, while the details of the evidence are still fresh in his or her memory. It might be many months before the judgment can be completed, owing to work pressures, poor health, or other reasons, but the quality of the judgment will not suffer by the delay in those circumstances. The evidence in a case might be voluminous, but the issues that arise might turn out to be susceptible of resolution without reference to all of the detail of the evidence. Many cases develop a character as they proceed, which enables the judge to recall all that is necessary to write a judgment, even after a considerable time has elapsed. In many cases, all that is necessary is to return to the case to bring back the memories of the trial. In every case conducted in this Court, transcript will be available to supplement and refresh memory. In determining whether there has been excessive delay, sufficient to deny fairness to a party, much more needs to be examined than simply the length of the delay.

31    The primary judge’s reasons in the present case contain a very clear account of his Honour’s process of reasoning. As appears from the specific examination of the issues below, the reasons contain all necessary findings of fact. It is true that they do not refer to every single item of evidence but, as the Full Court said in Devers v Kindilan Society [2010] FCAFC 72 at [58]:

…a judge’s duty to give reasons is not one which requires him or her to examine in detail every issue raised in the proceedings or to record in minute detail the reasons which led to any particular conclusion. It is enough if the judge outlines the facts found and the process of reasoning which led to the ultimate conclusion…

The reasons of the primary judge satisfy that test without difficulty.

The Security Representation

32    The terms of the Security Representation as pleaded are somewhat unclear. On one reading the terms suggest a representation about the longevity of the position and not the longevity of Mr Haros’ tenure in that position. However it is clear from the way in which the trial was conducted that the Security Representation was pressed as a representation made to Mr Haros as to his own future security in the position and not simply a representation by Linfox that it wanted a person in the role of Business Manager at Avalon for at least three years.

33    It needs to be appreciated that there is a significant difference between a representation that a position on offer is a position that an employer will want filled for a long time and a representation that a prospective employee will be employed in the position offered for a long time. O’Neill v Medical Benefits Fund of Australia Ltd [2002] FCAFC 188; (2002) 122 FCR 455 is an example of a case in which a prospective employee succeeded in relation to the making of a representation as to the longevity of the position offered to him. That was not however the nature of the claim made here. As the primary judge appreciated, the claim here was that Linfox had represented that it wanted Mr Haros employed as its Business Manager at Avalon “for at least approximately three years”.

34    At [75]-[76], the primary judge said that there could be no doubt that, when Linfox engaged Mahlab to manage the recruitment process, it did want to employ a commercial manager to work at Avalon. By the end of the process it did want Mr Haros to fill the position. As his Honour pointed out at [77], there was no evidence that anyone had in mind employment for a fixed term, or for three years or more. Mr Haros was unknown to Linfox. The length of his term of employment would be dependent on his performance. At [78]-[79], his Honour drew attention to the language of the express representations and the context of that language, particularly the frequent use of the words “opportunity” and “potential” and Mr Anderson’s statement of intention that Mr Haros would progress to General Manager level “in time”, without specification of a time, and with the rider that Mr Haros would need to acquire experience. At [80], his Honour said that both the probationary period in the contract and the provision for termination on three months’ notice were inconsistent with an unqualified representation that Linfox wanted to employ Mr Haros for at least approximately three years.

35    Counsel for Mr Haros referred to five specific items of evidence, said to be probative of the making of the Security Representation, which they submitted that the primary judge failed to take into account.

36    The first of these items was the content of the discussion on 30 June 2008 between Mr Haros and Ms Rekas. It is said that Ms Rekas told Mr Haros that Linfox “was seeking a permanent 2IC to maybe take over in the future from him”. As well as making findings about this meeting at [11] of his reasons for judgment, the primary judge referred specifically to it at [78]. His Honour used the meeting as an example of the use of the word “potential”. The second item was a discussion between Mr Haros and Mr Anderson on 10 July 2008, in which Mr Anderson said that Mr Haros’ role “would be the future of the business moving forward” and that Mr Haros “would have the potential to progress into other roles”. The primary judge made specific reference to this discussion at [13] of his reasons for judgment. It is another example of the use of the word “potential”. The third item was Mr Haros’ meeting with Mr Fox and Mr Vary on 3 September 2008. As his Honour found at [16], Mr Fox said that there would be opportunity for a person who had been successful in the Business Manager role to step into the General Manager role. This is an example of the use of the word “opportunity”. It does not necessarily convey a promise of any certainty. The primary judge also referred at [78] to the 3 September 2008 conversation and said there was nothing alleged to have occurred in it which could be construed as an assurance that Linfox wanted to employ the successful candidate for the position “for at least approximately three years”.

37    The fourth item of evidence on which Mr Haros relied was a discussion he had with Mr Anderson on 8 September 2008 in which he said Mr Anderson told him that the person who is appointed to the Business Manager position “needs to carry the airport forward and be the future of the business”. Mr Haros’ own evidence of that conversation was that it was made clear to him that there was an “opportunity” to step into Mr Anderson’s role in the future and an “opportunity” to move into a more senior role. This evidence is another example that supports the primary judge’s proposition that words such as “potential” and “opportunity” were used consistently. His Honour made findings about the meeting of 8 September 2008 at [17]-[18]. They included a finding that the statement about carrying the airport forward and being the future of the business was made. Clearly, his Honour had in mind the tenor of Mr Haros’ evidence about it when he wrote [78] of his reasons for judgment.

38    The fifth item was the email from Mr Anderson dated 16 September 2008, quoted in [14] above and at [19] of the primary judge’s reasons for judgment. Mr Haros relied on the statements that the Business Manager position would remain for “at least 2 – 3 years or longer” and would be the stepping stone into the General Manager’s position. The use of the word “probably” before the first of these statements imports a significant qualification. The email constituted an expression of Mr Anderson’s hopes, rather than any representation. In any event, the primary judge clearly did not ignore the evidence of it.

39    The primary judge did not err in finding that the Security Representation was not made.

The Exclusivity Representation

40    At [83]-[84] of his reasons for judgment, the primary judge drew attention to the difficulty in dealing with the Exclusivity Representation as pleaded. If it were to be inferred from the express representations, which were made over a three month period, that Linfox did not “then” employ anybody other than Mr Anderson in the management or performance of the activities comprehended by the Business Manager role, one difficulty was to fix the time during that three month period at which Linfox did not “then” employ such a person. There was also difficulty in understanding what was meant for this purpose by the reference to the Business Manager role. Mr Anderson and Mr Fox explained to Mr Haros that Linfox was proposing to embark on a significant expansion of its activities at Avalon, and was considering a large number of commercial developments. The Business Manager was needed to ensure that any projects on which senior management determined to proceed would do so successfully. The duties to be performed by the Business Manager could not be determined with precision while negotiations were taking place. Mr Anderson stressed that flexibility would be required.

41    At [86], his Honour described the Exclusivity Representation as one of “implication by omission”. At [87], his Honour said that it was common ground that Mr Haros was not advised about the commercial work being undertaken by Mr Giddings, Mr Grant and Mr Polk at or in relation to Avalon in the latter part of 2008. His Honour identified a number of reasons for this. Mr Haros did not ask any questions that might reasonably have been expected to elicit such information. Mr Anderson was ignorant of much of what Mr Grant and Mr Polk were doing at Avalon and, if asked, would not have given a full account of their activities. Given the ad hoc nature of their work, although they might have been pursuing commercial projects during the recruitment process, information about those projects did not necessarily give any indication of what their activities, if any, might be after Mr Haros took up his duties.

42    At [88], the primary judge said that it could not be reasonably suggested that, by failing to mention that commercial work was ongoing at Avalon during the recruitment period, Linfox implied that it did not then employ anybody other than Mr Anderson to perform such work. Mr Haros knew that Avalon was a busy and developing airport, handling a considerable number of passengers and cargo movements each year, and could not reasonably have expected that Mr Anderson was the only person who undertook commercial work associated with these activities. At [89], his Honour said he did not consider that the Exclusivity Representation was made.

43    Counsel for Mr Haros contended that the primary judge had ignored four items of evidence tending to suggest that the Exclusivity Representation was made. The first item was evidence of a conversation between Mr Anderson, Mr Vary and Ms Rekas, in which it was explained to Ms Rekas that Mr Anderson and three operational managers were involved in management of Linfox listings. This evidence did not involve anything said to Mr Haros. The second item was evidence that Ms Rekas told Mr Haros that the relevant management consisted of Mr Anderson and the three operational managers. The primary judge did not ignore this evidence, but made a specific finding about it at [11] of his reasons for judgment. Ms Rekas was describing the management structure of Linfox in relation to Avalon, not the duties of any person in relation to commercial activity at Avalon.

44    The third item of evidence said to have been disregarded was in the evidence in chief of Mr Haros of his conversation with Mr Anderson on 10 July 2008. Mr Haros said that Mr Anderson “explained that he performed the commercial activities at Avalon and that there were no others performing those roles”. Under cross-examination Mr Haros added that there had been “no specific discussion, one way or the other, about whether there was anybody else around the edges that might be helping me out”. In light of this qualification, the statement from Mr Haros’ evidence in chief was of little, if any, weight as to the making by implication of the Exclusivity Representation. Although his Honour did not mention it, this item would hardly have mattered if he had.

45    The fourth item was in Mr Anderson’s email of 16 September 2008 in which Mr Anderson said, “[e]ven though we are now about the 10th busiest airport in Australia, we only have myself and three operational managers”. Again, this was a statement describing management structure, not as to the duties of any person in relation to commercial activity at Avalon. Although the primary judge did not refer specifically to it, he quoted passages from the same email at [19] of his reasons for judgment. The suggestion that he ignored that particular passage is difficult to sustain.

46    Even if each of these four items of evidence were to be given the prominence for which counsel for Mr Haros contended, it is hard to see how the reasoning of the primary judge on the Exclusivity Representation could be overturned. The absence of any occasion calling for the giving of information as to who was performing what work in relation to commercial activity at Avalon, and the unreasonableness of inferring from the failure to mention the Avalon work of Mr Giddings, Mr Grant and Mr Polk during the recruitment period that there was no-one other than Mr Anderson performing that work, provide a sound basis for his Honour’s conclusion that there was no Exclusivity Representation implied.

The Longevity Omission

47    At [90]-[91] of his reasons for judgment, the primary judge held that, in the absence of any Security Representation, Mr Haros could not succeed in a claim that there was an omission to inform him that, if Mr Anderson resigned from Linfox, Linfox might resile from the Security Representation. The same reasoning leads to the same conclusion in this appeal.

The Exclusivity Omission

48    The Exclusivity Omission was the subject of an alternative claim to the Exclusivity Representation. Although the amended statement of Mr Haros’ claim asserted that Linfox and Mr Anderson engaged in conduct that was misleading or deceptive, or likely to mislead and/or deceive, by not informing Mr Haros that it already employed people in the management or performance of commercial activities, there was no mention of any circumstances that were said to have given rise to the need for such information.

49    At [94] of his reasons for judgment, the primary judge said that it was difficult to see how the failure to inform Mr Haros that there were employees of Linfox engaged in work relating to commercial activity at Avalon had the potential to mislead and/or deceive Mr Haros. The fact that others may have been engaged in such work “was not something which had any obvious bearing” on Mr Haros’ future employment with Linfox. His Honour drew attention to the failure of Mr Haros to make any complaint about having insufficient work to do during his short period of employment with Linfox, despite making numerous complaints about other issues, and despite the fact that others were then engaged in commercial work at Avalon. At [95], his Honour said that from a practical business perspective, the issue of who apart from Mr Anderson was undertaking commercial work at Avalon during the recruitment period could not be regarded as material. The failure to give information about it did not constitute a representation by silence.

50    Having regard to the conclusion that there was no occasion for Linfox or Mr Anderson to give Mr Haros any information about the work of Mr Giddings, Mr Grant and Mr Polk in relation to commercial activities at Avalon during the recruitment period, and to the absence of any assertion of circumstances giving rise to a need to give such information in order to avoid misleading and/or deceiving Mr Haros, it is difficult to see how the primary judge’s rejection of the claim that there was misleading and/or deceptive conduct by reason of the Exclusivity Omission could be overturned. Even if the primary judge could be said to have gone further than he needed to in making his findings about the immateriality of the issue, counsel for Mr Haros was unable to point to any evidence of Mr Haros himself as to the importance to him of the issue. There was no challenge to the finding that Mr Haros had never asked any question relevant to the issue in the course of negotiations, or as to his failure to make this the subject of a complaint. These facts support the conclusion that no occasion arose during the negotiations for Linfox and Mr Anderson to provide any information to Mr Haros about who was working on commercial activities in relation to Avalon. The reference to a statement of Mr Anderson that the role of Business Manager was to be a “blank canvas” carries the matter no further.

The issue of reliance

51    At [96]-[102] of his reasons for judgment, the primary judge discussed the question whether, if the pleaded representations had been made, they were misleading or deceptive. His Honour held that Linfox and Mr Anderson had adduced evidence sufficient to displace the statutory presumption in s 51A(2) of the Trade Practices Act, so that the onus of establishing that a representation as to future matters was made without reasonable grounds remained with Mr Haros. At [100], his Honour summarised the course of negotiations, making a number of points. Mr Haros applied for the position of Business Manager; he did not seek, and was not given, employment for a fixed term; he accepted the position on terms that were negotiated freely; he was under no disability in negotiations, but was an astute lawyer with relevant experience in employment law; he reviewed the draft contract; he did not demur to any of the terms proposed by Linfox; he proposed additional terms, which were accepted; and he signed the contract, thereby representing to Linfox that he approved its content or was willing to take the chance of being bound by those contents. At [101], his Honour said that statements about future prospects for advancement must be understood in the context of the provision in the contract for termination on three months’ notice or payment in lieu of notice and the provision about redundancy. At [102], his Honour pointed out that Mr Haros knew that he would report to Mr Anderson, or to anyone else holding the position of General Manager or Managing Director. His Honour repeated that Mr Haros’ acceptance of the position was not influenced by any concern as to who may or may not have been performing commercial work at Avalon during the negotiations; he did not raise the issue and Linfox did nothing that could reasonably be understood as suggesting that no-one other than Mr Anderson did such work. This was not a material issue and silence about it was not misleading.

52    Implicit in the primary judge’s reasoning about this issue is the proposition that Mr Haros simply did not rely on any representation implicit in any of the express representations about the term of the employment or the absence of anyone other than Mr Anderson doing work in relation to commercial activities at Avalon, or on any representation by omission in relation to those issues. He was not misled or deceived, so that he was not induced by any such representation to accept Linfox’s offer of employment. The question of reliance is raised by Linfox and Mr Anderson in their notice of contention filed in the appeal. In the course of argument on the appeal, it was revealed that Mr Haros gave no express evidence of reliance on any of the representations or omissions in respect of which he claimed. Senior counsel who appeared on the appeal, but not at the trial, said that the absence of express evidence of reliance was the result of a forensic decision. In the course of final addresses, senior counsel who appeared for Mr Haros at the trial made a submission to the effect that express evidence of reliance was unnecessary, referring to Hanave Pty Ltd v LFOT Pty Ltd [1999] FCA 357; (1999) 43 IPR 545.

53    In Hanave at [11], Wilcox J said:

it is ironic that the respondents’ best point is that Mr Burke failed to give the standard self-serving evidence of reliance. However, I do not think this matters. I agree with Kiefel J that causation can sometimes (perhaps best) be resolved by the Court objectively determining the likely effect of the misleading conduct. This is such a case.

At [45], Kiefel J said:

The question of causation can sometimes be resolved not by direct evidence as to what part a misrepresentation played in the process of entry into contract, but by a Court determining what effect must be taken to have resulted. Indeed this course may sometimes be preferable to one which rested solely on evidence later given on the point. In Gould v Vaggelas [(1985) 157 CLR 215 at 236] Wilson J held that if a material representation is calculated (which is to say, objectively likely…) to induce the representee to enter into a contract and the person in fact enters into a contract, a fair inference arises that the representation operated as an inducement, adding that it need not be the only cause…That part of Wilson J’s judgment was not stated to be an exhaustive rule, but is to be seen as a guide to a question of fact which may arise. A conclusion of inducement may then be reached where a combination of factors, including the quality of the representation itself, goes unanswered. In relation to the representation itself it would need to be of a kind likely to provide that inducement and such that

…commonsense would demand the conclusion that the false representations played at least some part in inducing the plaintiff to enter into the contract.

(Wilson J, 238), a statement regarded by the Full Court in [Ricochet Pty Ltd v Equity Trustees Executor & Agency Co Ltd (1993) 41 FCR 229] as providing a practical guide to the drawing of inferences in such cases.

Emmett J dissented.

54    These statements were made in the context of a case in which a vendor of retail premises, in response to an inquiry from a potential purchaser, forwarded to that potential purchaser a property report referring to the premises as having seven “established high quality tenants”, a statement that turned out to be false. In those circumstances, there was little difficulty in the majority reaching the conclusion that the purchaser was induced by the representation to enter into a contract to purchase the premises.

55    The present case is substantially different. Mr Haros pleaded that he resigned his prior employment with Schiavello in reliance upon the purported misrepresentations. As a result of that reliance Mr Haros pleaded that he suffered loss. Even if the representations alleged by Mr Haros were made, whether implicitly or by silence, they were a very small part of negotiations over a period of months. There were many factors that may have made the position of Business Manager of Avalon attractive to Mr Haros and that induced him to resign his previous employment. There may have been factors that made the position less attractive to him, but that he was prepared to regard as outweighed by the favourable factors. There may also have been factors to do with his employment with Schiavello that were of relevance. In such circumstances, it becomes very much more difficult to draw an inference that a particular factor materially influenced a decision to leave one employment in order to take up another. A similar issue about reliance arose in O’Neill and was resolved on the basis of “direct and compelling evidence of reliance” (at [22]-[23]).

56    It is probable that a representation about the security of prospective employment would make that employment attractive to a prospective employee, such as Mr Haros. It is a different matter, however, to draw an inference that such a representation operated as an inducement to a person who had been presented with a detailed draft contract providing for a probation period and termination on three months’ notice, and had read that draft contract carefully and proposed the inclusion in it of a term entitling him to a substantial payment in the event of redundancy (which was then included), to enter into the resulting contract. Those circumstances make it improbable that Haros believed and acted upon the basis that he was being offered a job that would last for about three years, irrespective of business fluctuations, performance issues and satisfactory personal relationships with colleagues. That is particularly the case when the prospective employee is a lawyer, with some experience in employment law. A representation about exclusivity in relation to specific tasks gives rise to even greater difficulty. It cannot be said with any confidence that such a representation is objectively attractive. Some prospective employees might see being plunged into a job involving total responsibility for a particular field of the employer’s business as a negative. Others might regard it as a positive opportunity. Only the prospective employee can disclose how he or she felt about such a representation.

57    The statements of Wilcox J and Kiefel J in Hanave are replete with qualifications. There is no suggestion the Trade Practices Act cast upon a person against whom a claim of misleading and deceptive conduct is made the onus of proving, or advancing evidence tending to prove, that the person making the claim did not rely on the conduct in question. There is no suggestion that there is any kind of presumption to the effect that, once it is established that a misleading and deceptive representation has been made, it is taken to have been relied on unless there is evidence to the contrary. Any such suggestion would be absurd, when all of the information about reliance resides in the mind of the person who claims to be the victim of misleading and deceptive conduct. The person making the claim must prove the causal connection between the misleading and deceptive conduct and the loss or damaged claimed. That is to say, that person must prove that he, she or it suffered loss and damage “by” the conduct (s 82(1) of the Trade Practices Act ) or “because of” it (s 159(1) of the Fair Trading Act). That causal connection is normally proved by establishing inducement by the misleading and deceptive conduct to act in a way that results in detriment to the person so acting. There are some cases in which that inducement can be the subject of an inference drawn by the Court, rather than a finding of fact based on evidence. This is not one of those cases. If he had established that Linfox and Mr Anderson made representations that were misleading and deceptive, Mr Haros would have failed in his claim because he did not establish that he suffered loss and damage “by” or “because of” those representations.

The question of redundancy

58    In the notice of appeal Mr Haros challenged the primary judge’s finding that Mr Haros was not in fact dismissed by reason of redundancy. There was ample evidence to support the proposition that redundancy was a convenient excuse, and that Linfox preferred to keep Mr Giddings rather than to keep Mr Haros. The issue of the actual reason for the termination of employment could only have been relevant if Mr Haros’ claim to have been induced into resigning his former employment by the Security Representation, the Exclusivity Representation, or the Exclusivity Omission had been successful.

conclusion

59    Mr Haros has failed to establish any error on the part of the primary judge that would entitle him to succeed in this appeal. The appeal must be dismissed. In accordance with the usual principle, that costs follow the event, Mr Haros should be ordered to pay the costs of Linfox and Mr Anderson of the appeal.

Associate:

Dated:    22 March 2012