FEDERAL COURT OF AUSTRALIA

A & D Douglas Pty Ltd ACN 008 404 180 v Lawyers Private Mortgages Pty Ltd ACN 010 556 751 [2004] FCA 1286

A & D DOUGLAS PTY LTD ACN 008 404 180, GRAHAM LESLIE ANDERSEN and HILARY ANDERSEN, YVONNE ELLEN ANDREW, DAVID WILLIAM ARMSTRONG, CHERYL LYNETTE BACKWELL (as executor of the Estate of ELSIE EDITH BACKWELL), HEINRICH BAUER and SABINE BAUER, DONALD BENGSTON, WILLIAM MALCOLM BRYDEN and MARGARET ANNE BRYDEN, FIONA MARY CAMPBELL (as trustee of the F CAMPBELL SUPERANNUATION FUND), FREDRIKA JANE CARSON, ROBERT JOHN CHARLES MCINTYRE (as executor of the Estate of ALAN STANSFIELD CHENEY), JAMES DAVID CLADINGBOEL and MARIAN ELSIE CLADINGBOEL, KENNETH BARRY DUNCAN and JOAN EDITH DUNCAN (as trustees of the DUNCAN FAMILY SUPERANNUATION FUND), LYNETTE KAY HAMATY, KEITH EDWARD HOLMES (as trustee of the MELZTNER TRUST), PATRICK FYSK HOWDEN, JILLIAN ANNE HUGHES, INFOTEC M.S. PTY LTD ACN 003 954 523, JOHN FRASER KENNEDY and VIVIAN JESSICA KENNEDY, MICHAEL COLLIN MELLISH, WADE RICHARD MELLISH, ERIC JAMES MITCHELL and JULIE ANNE MITCHELL (as trustees of the MITCHELL RETIREMENT FUND), RONALD JOHN MOHR and MARGARET STEWART MOHR, ALLAN JOHN MORRISON and PATRICIA JOY MORRISON (as trustees of the A & P MORRISON PENSION FUND), DELIA MURDOCH, BRIAN CHRISTIAN NIELSEN, KAREN ROSE PARKER, PETER JOHN PERRING, KEITH PRINCE, ROBERT RITORZE, NICOLA SCOTT, CHRISTOPHER ROGER SHALLARD and NARELLE VIDA SHALLARD (as trustees of the C & N SHALLARD SUPERANNUATION FUND), IAN ARCHIBALD STEWART and DOROTHY STEWART, WARREN GEORGE TROTMAN and CARMEL MYNETTA TROTMAN (as trustees of the WGCM TROTMAN SUPERANNUATION FUND), W J & A M LUKE PTY LTD ACN 000 884 266, GRAHAM ROBERT WATT and PATRICIA ANNE WATT, ANNIE CATHERINE WEBB, DIETER HOLMAN (in his own right and as Executor of the Estate of MILDRED HOLMAN) AND KEVIN HERBERT TANGEY and ALICE JOY TANGEY v LAWYERS PRIVATE MORTGAGES PTY LTD ACN 010 556 751 AND JONATHON JAMES McCARTHY, BRUCE MICHAEL DURIE, PHILIP ASHLEY RYAN and IAN ALEXANDER NEIL AND ST PAUL INTERNATIONAL INSURANCE COMPANY LTD AND QBE INSURANCE (AUSTRALIA) LIMITED

Q 115 OF 2003

DOWSETT J

20 SEPTEMBER 2004

BRISBANE

REASONS FOR JUDGMENT

1                     The applicants propose to lead evidence as to their understanding of particular statements made to them by, or on behalf of the respondents.  After considerable debate, I have come to the conclusion that the trial should proceed on the following basis.  Having regard to the decision of O’Loughlin J in ACCC v Optell Pty Ltd (1998) ATPR 41-640 and other similar decisions, it is clear that such evidence has been regularly received in this Court in Trade Practices cases.  As the practice is so well-established, it should be followed in the present case.  Indeed, the contrary is not suggested, except by Mr Dunning who argues that cases in which injunctive relief is sought should, for some reason, be treated differently from other cases.  I am not presently able to see any substance in that submission. 

2                     That a person should give evidence as to his or her understanding of a particular statement or term is somewhat unusual.  It is, in my view, little more than opinion evidence which would not normally be permitted.  In none of the cases to which I have been referred was the point addressed directly.  It seems to have been accepted that the Court must make up its own mind as to the meaning of the statement in question, and that evidence from particular persons as to their subjective understandings will be of little assistance.  Nonetheless the evidence was admitted.  Admissibility depends upon relevance and upon there being no other canon of the rules of evidence which dictates exclusion or confers a discretion to exclude.  To what question might such evidence relate?

3                     As I understand it the question which arises under s 52 of the Trade Practices Act 1974 (Cth) and similarly under the legislation presently in issue requires a consideration of the likely effect of the relevant statement upon a reasonable member of the class to which it is directed.  The only basis which I can see for admitting evidence of subjective understanding is that it may assist the Court in forming a view as to the likely qualities and characteristics of members of the class and as to their likely responses to the relevant statement, so that the response of the reasonable member of the class can be identified.  Having regard to the numerous cases to which I have been referred in which such evidence has been received, I am willing to receive it in this case.  However such evidence should not be used for the purpose of advancing some idiosyncratic or personal view as to meaning.  It goes only to the broader issue to which I have referred.  I also do not think that broad statements as to the overall effect of documents, as opposed to evidence about understandings of particular terms or expressions, should be received.

4                     A second matter which arises is the use of such statements in connection with the issue of reliance.  In my view, explanations as to why a person relied upon a particular representation is little more than a prior consistent statement which would generally not be admitted.  In any event, it seems likely that most of the statements to which objection has been taken will be received for the reasons which I have given.  It is probably not necessary to pursue that second matter at this stage.

Associate:

Dated:              6 October 2004