FEDERAL COURT OF AUSTRALIA
Australian Parking and Revenue Control Pty Ltd v Reino International Pty Ltd [2016] FCA 744
ORDERS
DATE OF ORDER: |
THE COURT ORDERS THAT:
1. The application by the second respondent to strike out parts of the amended statement of claim dated 27 February 2015 (amended statement of claim) is allowed.
2. Pursuant to r 16.21 of the Federal Court Rules 2011 (Cth), the amended statement of claim be struck out save for paragraphs [1]-[3],[6]-[9],[28] and [29], together with paragraphs [49] (a), (b), (d) and (e) insofar as they claim relief as against the first respondent on the basis of the alleged contraventions in paragraphs [28] and [29].
3. The application by the first respondent to strike out parts of the amended statement of claim is otherwise dismissed.
4. On or before 4.00pm on 29 July 2016, the parties are to formulate draft orders to otherwise give effect to this judgment, including timetabling orders for any further amended statement of claim or application for leave to amend.
5. The question of costs is reserved.
THE COURT NOTES THAT:
6. The parties are to confer as to the making of further orders should the applicant wish to have an opportunity to further amend the amended statement of claim, including as to the setting of a timetable, with a view if possible to reaching agreement as to the terms of the proposed further orders.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
PERRY J:
1 The applicant, Australian Parking and Revenue Control Pty Ltd (Australian Parking) seeks relief against the first and second respondents, Reino International Pty Ltd (Reino) and Parking and Traffic Consultants Pty Ltd (PT Consultants) respectively, in relation to a request for tender issued by the Australian Capital Territory Government (ACT) and the National Capital Authority (NCA) (together the RFT Agencies). The request for tender was for the supply, installation and maintenance of pay parking machines and systems. By its amended originating application filed on 4 March 2015, Australian Parking seeks declarations that Reino and PT Consultants each engaged in misleading or deceptive conduct, or conduct likely to mislead and deceive, contrary to s 18 of the Australian Consumer Law in Schedule 2 to the Competition and Consumer Act 2010 (Cth) (ACL), together with compensation for loss and damage allegedly suffered as a consequence. Australian Parking also seeks an order that Reino be restrained in the future from conduct the subject of the declaration.
2 The respondents seek to strike out those pleadings which relate to them under r 16.21 of the Federal Court Rules 2011 (Cth) (FCR) on the grounds relevantly that the pleadings are ambiguous, likely to cause prejudice or embarrassment, and fail to disclose any reasonable cause of action.
3 For the reasons set out below, the statement of claim should be struck out on these grounds save for the discrete pleading against Reino that representations were made on Reino’s website that were misleading and deceptive, together with the claims for declaratory and injunctive relief in relation to those representations and related introductory pleadings. It follows that the entirety of the claim against PT Consultants and the bulk of the claim against Reino as presently formulated should be struck out.
4 Australian Parking and Reino are competitors who supply unattended pay-by-credit-card parking-fee collection machines and associated hardware and software (pay parking machines) to government agencies for use in parking bays and lots to Government and other public agencies who own or control land made available for fee-based public parking (Parking Agencies).
5 PT Consultants provide consulting services to Parking Agencies, including advising and assisting them with:
(1) the preparation of request for tender documentation for the provision of pay parking machines;
(2) the preparation of specifications as to the functionality of pay parking machines to be put to tender;
(3) the assessment of tenders received by Parking Agencies in response to issued requests for tender;
(4) the process of selecting successful tenderers; and
(5) otherwise advising with respect to the procurement, installation, commissioning and deployment of pay parking machines.
1.2 The request for tender and application for preliminary discovery
6 On 23 September 2013, the RFT Agencies issued a request for tender for the installation of pay parking machines on certain lands under their control. Australian Parking and Reino, among others, lodged tenders in response to the request for tender. Reino was selected as the successful tenderer by the RFT Agencies and was awarded the contracts for the supply, installation, commissioning and maintenance of the pay parking machines.
7 On 18 September 2014, Australian Parking commenced proceedings in this Court as a prospective applicant under FCR r 7.23 seeking preliminary discovery of various documents from Reino, including the tender response submitted by Reino to the RFT Agencies (NSD 942/2014). Australian Parking subsequently withdrew that application and on 12 December 2014, the Court made orders dismissing the proceedings and providing that the costs of the proceedings be in the cause in any substantive proceedings commenced by the prospective applicant against the prospective defendant provided that the proceedings were commenced by 31 January 2015.
8 These proceedings were instituted on 30 January 2015. At the heart of its case, Australian Parking alleges that either in failing to advise the RFT Agencies about the MasterCard requirements for contactless credit card or PayPass functionality, or in advising the RFT Agencies about those requirements, PT Consultants made misleading and deceptive representations as a result of which Reino was the successful tenderer and Australian Parking suffered loss of a chance. Australian Parking also contends that Reino engaged in misleading and deceptive conduct in failing to advise the RFT Agencies that its pay parking machines were not compliant with the requirements in the request for tender, being the MasterCard requirements for contactless credit card or PayPass functionality, or in representations allegedly made to the RFT Agencies as to the substance of the MasterCard requirements or the capacity of its pay parking machines to comply with those requirements.
9 It does not appear to be in issue that the pay parking machines have in fact been installed by Reino for the ACT and NCA, and are operating. Neither of the RFT Agencies are parties to these proceedings or have sought to be joined.
10 By its defence filed on 9 April 2015, PT Consultants denies the contraventions alleged against it and that Australian Parking is entitled to the relief claimed. It also pleads that Australian Parking has failed:
(1) to plead the basis on which it alleges that PT Consultants made the implied representations alleged in relation to the amended statement of claim filed on 27 February 2015 (ASOC) at (defence at [11](b) in relation to the ASOC at [11]);
(2) to plead the material facts giving rise to the cause of action in misleading or deceptive conduct under the ACL (defence at [21] and [23] in relation to the ASOC at [21] and [23] respectively); and
(3) to provide particulars of the advice allegedly provided by PT Consultants to the RFT Agencies in paragraph [22] of the ASOC (defence at [22]).
11 No defence has yet been filed by Reino.
1.4 The applications to strike out part of the ASOC
12 On 11 May 2015, PT Consultants applied to strike out paragraphs [10] to [27] inclusive and [48] of the ASOC pursuant to r 16.21 of the Federal Court Rules 2011 (Cth) (FCR), being the paragraphs relevant to the claim against PT Consultants. The strike out application is made on the grounds that the pleadings:
(1) are evasive or ambiguous;
(2) are likely to cause prejudice, embarrassment or delay in the proceeding; and and/or
(3) fail to disclose any reasonable cause of action.
13 PT Consultants did not seek to read the affidavit filed by it in support of the applications.
14 By an amended interlocutory application filed on 19 June 2015, Reino also applies for those parts of the ASOC which relate to the claims alleged against it to be struck out under r 16.21, namely paragraphs [2], [28] to [47] inclusive and [49]. The paragraphs are sought to be struck out on the same grounds as those alleged by PT Consultants and also on the grounds that the pleadings contain frivolous or vexatious material or are otherwise an abuse of the process of the Court. In the alternative, Reino seeks an order that Australian Parking provide further and better particulars of the same paragraphs of the ASOC.
15 The applications to strike out paragraphs of the statement of claim were preceded by correspondence between the parties seeking particulars and raising issues now relied upon to strike out the ASOC. PT Consultants sought further and better particulars of the ASOC by letter dated 16 March 2015. No particulars have been provided in response. Particulars were provided by Australian Parking in response to a request by Reino. However, Reino submits that those responses only serve to highlight the lack of particularity in Australian Parking’s case and do not remedy the deficiencies in the pleadings of which Reino complains.
1.5 Concessions relevant to the strike-out applications
16 I note that there were a number of concessions made at the start of the hearing. It is convenient to set these out. First, Australian Parking clarified that the pleading at [30] of the ASOC that Reino impliedly represented the matters there pleaded, is a pleading of a single implied representation. Secondly, while in answer to the request for particulars Australian Parking referred among other things to a MasterCard Operations Bulletin published in 2014 as establishing the terms of the MasterCard credit card system, counsel for Australian Parking expressly withdrew that particular. Thirdly, PT Consultants accepted the explanation given by Australian Parking as to the construction of paragraph [11] of the ASOC, i.e., that PT Consultants was engaged by Australian Parking as a technical consultant on the basis that they would perform the services with diligence and would give proper and complete advice. However, PT Consultants maintained its objection to the paragraph on other grounds.
17 Rule 16.21(1) of the FCR provides that:
A party may apply to the Court for an order that all or part of a pleading be struck out on the ground that the pleading:
(a) contains scandalous material; or
(b) contains frivolous or vexatious material; or
(c) is evasive or ambiguous; or
(d) is likely to cause prejudice, embarrassment or delay in the proceeding; or
(e) fails to disclose a reasonable cause of action or defence or other case appropriate to the nature of the pleading; or
(f) is otherwise an abuse of the process of the Court.
18 The grounds on which a pleading may be struck out under r 16.21(1) mirror the deficiencies identified in rule 16.02(2) which a pleading must not contain, while r 16.02(1) sets out requirements with which a pleading must positively comply, namely:
(1) A pleading must:
(a) be divided into consecutively numbered paragraphs, each, as far as practicable, dealing with a separate matter; and
(b) be as brief as the nature of the case permits; and
(c) identify the issues that the party wants the Court to resolve; and
(d) state the material facts on which a party relies that are necessary to give the opposing party fair notice of the case to be made against that party at trial, but not the evidence by which the material facts are to be proved; and
(e) state the provisions of any statute relied on; and
(f) state the specific relief sought or claimed.
19 The relevant principles may be summarised as follows.
(1) The requirements of r 16.02(1) and (2) reflect the function of pleadings, namely, to state with sufficient clarity the case that must be met so as to ensure the basic requirement of procedural fairness that a party should have the opportunity of meeting the case against it and incidentally to define the issues for decision: Banque Commerciale SA en Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279 at 286 (Mason CJ and Gaudron J). Equally, in considering a strike out application under r 16.21, the function of pleadings must be borne in mind: Fleet v Royal Society for the Prevention of Cruelty to Animals NSW [2005] NSWSC 926 at [47]-[53].
(2) The power to strike out pleadings is not to be lightly exercised. As the Full Court held in Young Investment Group Pty Ltd v Mann [2012] FCAFC 107; (2012) 293 ALR 537 (Young Investment Group) (at 540 [6]). :
[A]ll of the facts alleged in the relevant pleading are to be accepted as true, and it is to be taken for granted that, on all other points, the pleading is unassailable. Provided that a pleading fulfils its basic function of identifying the issues, disclosing an arguable cause of action and apprising the other party of the case that it has to meet at trial, the pleading should be allowed to stand and the proceeding should be allowed to go to trial.
(3) While a respondent has no absolute right to insist on the applicant pleading every material fact necessary to demonstrate a complete cause of action, all of the material facts necessary to formulate a complete cause of action should in general be pleaded: FCR r 16.02(2); Young Investment Group at 540 [7]. In this regard, a distinction has been drawn between pleadings and particulars even though to some degree they may overlap: McKellar v Container Terminal Management Services Ltd [1999] FCA 1101; (1999) 165 ALR 409 (McKellar) at 417 [21] - 420 [31] (Weinberg J). As Scott J explained in Bruce v Odhams Press Limited [1936] 1 KB 697 at 711-713 (quoted with approval by Goldberg J in Mitanis v Pioneer Concrete (Vic) Pty Ltd (1997) 19 ATPR ¶41-591 at 44,152):
…it is beyond question that there is a radical distinction [between a statement of material facts and particulars] none the less so that in cases near the dividing line there is a penumbra where the two may and often do overlap, just as between night and day there is a zone of doubt which we call dusk…
The cardinal provision in r. 4 is that the statement of claim must state the material facts. The word "material" means necessary for the purpose of formulating a complete cause of action; and if any one "material" fact is omitted, the statement of claim is bad; it is "demurrable" in the old phraseology, and in the new is liable to be "struck out"…
The function of "particulars" under r. 6 is quite different. They are not to be used in order to fill material gaps in a demurrable statement of claim - gaps which ought to have been filled by appropriate statements of the various material facts which together constitute the plaintiff's cause of action. The use of particulars is intended to meet a further and quite separate requirement of pleading, imposed in fairness and justice to the defendant. Their function is to fill in the picture of the plaintiff's cause of action with information sufficiently detailed to put the defendant on [her or] his guard as to the case [she or] he has to meet and to enable [her or] him to prepare for trial. Consequently in strictness particulars cannot cure a bad statement of claim. But in practice it is often difficult to distinguish between a "material fact" and a "particular" piece of information which it is reasonable to give the defendant in order to tell [her or] him the case [she or] he has to meet; hence in the nature of things there is often overlapping.
(4) A pleading which simply pleads a conclusion from unstated facts is embarrassing and is liable to be struck out: Trade Practices Commission v David Jones (Australia) Pty Ltd (1985) 7 FCR 109 at 114-5; Young Investment Group at 540 [7]. A pleading is also embarrassing where it is unintelligible, ambiguous, vague or too general, so as to embarrass the opposite party who does not know what is alleged against her or him: Priest v New South Wales [2006] NSWSC 12 at [34] (Johnson J). Equally, it may be embarrassing where inconsistent allegations are made, alternatives are confusingly intermixed, or the material facts alleged are couched in expressions which leave difficulties or doubts about recognising or piecing together what is referred to (Priest at [35]-[36]. However, as PT Consultants submit, this does not prevent a party from pleading alternative and inconsistent allegations of material facts where those facts are stated separately, and not comingled, so as to show the specific facts on which each alternative cause of action is based: JC Decaux Pty Ltd v Adshel Street Furniture Pty Ltd [2000] FCA 1118; (2000) 178 ALR 339 at 342-343[19].
(5) A party who pleads a condition of mind, including knowledge, must state in the pleading particulars of the facts on which the party relies: FCR r 16.43(1) and (3). Equally, if a party pleads that another party ought to have known something, particulars of the facts and circumstances on the basis of which it is said that that other party ought to have acquired the knowledge must be pleaded: FCR r 16.43(2). For example, it might be pleaded that a party knew or ought to have known a given fact because it received a particular communication: Young Investment Group at 540 [10].
(6) Furthermore, in line with the seriousness of such an allegation, a party who pleads (relevantly) misrepresentation must state in the pleading particulars of the facts on which the party relies: FCR r 16.42. As Foster J held in Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (1998) 42 IPR 1 at 3 with respect to a statement of claim alleging misleading and deceptive conduct in breach of s 52 of the Trade Practices Act 1974 (Cth) (Trade Practices Act) (the predecessor provision to s 18 of the ACL):
In this connection it is important to remember that, as Fox J said in Brown v Jam Factory Pty Ltd (1981) 53 FLR 340 at 348 ; 35 ALR 79 at 86:
Section 52(1) is a comprehensive provision of wide impact, which does not adopt the language of any common law cause of action. It does not purport to create liability at all; rather does it establish a norm of conduct, failure to observe which has consequences provided for elsewhere in the same statute, or under the general law.
It necessarily follows that when the section is sought to be used in litigation as the foundation of a cause of action or claim for some specific form of relief, it is imperative that the factual basis upon which the section is alleged to be brought into play must be stated with appropriate clarity in a statement of claim. This is, of course, a fundamental principle of pleading.
In this regard, Foster J laid particular emphasis upon the need for the questions for decision to be defined from an early stage in order to avoid misdirected, wasteful and unproductive interlocutory procedures such as discovery, observing that “[e]xperience is showing that the court must be astute in the prevention of this type of situation by requiring, in the early stages of litigation, that claims based on s 52 be pleaded with appropriate precision and in a manner that enables the factual issues for trial to emerge with clarity”: see also e.g. McKellar at 419 [25]-[28] (Weinberg J).
2. REINO’S STRIKE OUT APPLICATION
20 The allegations in the ASOC against Reino with respect to the request for tender fall into essentially three categories which, at the risk of oversimplification, can be summarised as follows.
(1) By lodging a tender to provide parking systems to the RFT Agencies, Reino impliedly represented to the RFT Agencies that it was not aware of any matters rendering its pay parking machines non-compliant with the technical requirements of the request for tender regarding (relevantly) contactless functionality for payments to be made by MasterCard issued credit cards by 31 March 2014 in the case of the ACT and 30 May 2014 in the case of the NCA. However, Reino knew or ought to have known of matters alleged to have rendered its pay parking machines non-compliant with those requirements. As a result, in failing to advise the RFT Agencies of those matters, the implied representations by Reino were misleading or deceptive (or likely to mislead and deceive) and the failure by Reino to disclose them was misleading or deceptive conduct (or likely to be so) contrary to s 18 of the ACL (the implied misleading or deceptive representation) (ASOC at [30]-[39]);
(2) Further or in the alternative, in the course of submitting a tender to the RFT Agencies, Reino gave misleading and deceptive advice to the RFT Agencies regarding the requirements for contactless functionality for payments to be made by MasterCard issued credit cards, including that equipment for PayPass Functionality could be retrofitted after 1 April 2014 to machines installed before that date (the misleading or deceptive advice) (ASOC at [40]-[42]);
(3) Further or in the alternative, in the course of tendering in response to the request for tender, Reino misrepresented to the RFT Agencies that it would supply pay parking machines which would be able to receive payments “by way of contactless credit card via use of contactless functionality” and would do so by 31 March 2014 or 30 May 2014 (the parking machines misrepresentation) (ASOC at [42]-[45]).
21 By reason of these implied and alleged misrepresentations, Australian Parking contend that:
(1) the Reino tender submitted in response to the request for tender “was treated as a complying tender and Reino selected as preferred tenderer,” (ASOC at [46]); and
(2) Australian Parking has suffered “loss of an appreciable chance to be selected as preferred tenderer by the RFT Agencies and to be awarded contracts for the supply, installation, commissioning and maintenance of Pay Parking Systems” for which it seeks compensation (ASOC at [47] and [49]).
22 It should be observed that the subject-matter of the implied misleading or deceptive representation, the misleading or deceptive advice and the parking machines misrepresentation is essentially the same: Reino engaged in misleading and deceptive conduct either in failing to advise the RFT Agencies of certain matters or in making positive representations about those matters.
23 Finally, Australian Parking separately alleges that Reino has made misleading and deceptive representations on its website (the website representations) (ASOC at [28]-[29]). The website representations raise issues that are unrelated to the allegations relating to the request for tender.
2.2 The implied misleading or deceptive representation pleadings against Reino (ASOC, [30]-[39])
24 The implied misleading or deceptive representation pleadings are found in paragraphs [30]-[39] of the ASOC which read as follows:
30. Further, and repeating paragraph 6 & 7 above, by the lodgement of a tender to provide Parking Systems to the RFT Agencies, Reino impliedly represented to the RFT Agencies that it was not aware, after having made reasonable enquiries, of any facts, matters and/or circumstances rendering the TX and VX parking machines non-compliant with the technical and operational aspects of Pay Parking Systems referred to in the Request for Tender (Reino Relevant Matter).
31. At the time of lodgement of the Tender by Reino, Reino knew or ought to have known, and it was the fact, that the RFT Agencies:
a. required the parking fee collection machines to have pay-by-credit-card functionality through the use of a Bank and Scheme certified compliant payment solution
b. required parking fee collection machines to have functionality for payment to [be] made by Mastercard issued, contactless enabled credit cards via use of contactless functionality.
c. Required supply, installation and commissioning of the Pay Parking System to be completed and operational by 30 March 2014 in the case of the ACT and 30 May 2014 in the case of the NCA.
Particulars
The requirements were set out in the Request for Tender a document in the possession of Reino at the relevant time.
32. At the time of lodgement of the Tender by Reino, Reino knew or ought to have known, and it was the fact, that supply, installation and commissioning of a Pay Parking System on land was made available by the ACT Government and the CW Government for public parking would result in:
a. the RFT agencies becoming new merchants for the purposes of the Mastercard credit card system; and/or
b. each pay-by-credit-card parking fee collection machine installed in the Pay Parking System becoming a new terminal or in the alternative, a replacement terminal for the purposes of the Mastercard credit card system.
Particulars
By offering a Pay Parking system to the RFT Agencies having regard to the stated wish of the RFT Agencies to have functionality for payment to be made by Mastercard, it was business of Reino to understand the Mastercard system as it applied to Parking Agencies and the necessity of the RFT Agencies joining the Mastercard system as merchants so as to deploy the Pay Parking System, and to understand the necessity for each pay-by-credit-card parking fee collection machine in each Pay Parking System to be a Scheme & Bank-approved and an operational credit card terminal.
33. Each of the matters pleaded in paragraph 32 were Reino Relevant Matters as pleaded in Paragraph 30.
34. At the time of lodgement of the Tender by Reino, Reino knew or ought to have known, and it was the fact that Mastercard required all new MasterCard merchants after 1 January 2013 and all terminals newly installed or terminals replaced after 1 January 2013 for use in the MasterCard system to have Paypass Functionality (MasterCard’s proprietary contactless solution).
Particulars
The particulars to paragraph 32 are repeated and further, it was the business of Reino to understand the requirements of Mastercard as they applied to merchants, such requirements being set out in a MasterCard Operations Bulletin dated 14 March 2011 with the said requirement of Paypass Functionality being at pages 4 and 5 of the MasterCard Operations Bulletin.
35. The matter pleaded in paragraph 34 was a Reino Relevant Matter as described in Paragraph 30.
36. In the premises at the time of lodgement of the Tender by Reino, Reino knew or ought to have known that it was the fact that Mastercard/EMV would not permit terminals located within unattended pay-by-credit-card parking fee collection machines to be installed before 1 April 2014 to be retrofitted with equipment for Paypass Functionality.
Particulars
The particulars to paragraphs 32 and 34 are repeated and by way of further particulars it was the business of Reino to understand the requirements of Mastercard as they applied to merchants.
37. The matter pleaded in paragraph 36 was a Reino Relevant Matter as described in Paragraph 30.
38. At all material times prior to the award to Reino of a contract by the RFT agencies arising out of the Request for Tender, Reino did not advise the RFT Agencies of the Reino Relevant Matters.
39. In the premises, by failing to advise the RFT Agencies of the Reino Relevant Matters the implied representations pleaded at paragraph 30 were misleading or deceptive or likely to mislead and deceive and further and in the alternative, the failure by Reino to disclose the Reino Relevant Matters to the RFT Agencies was conduct on the part of Reino that was misleading or deceptive or likely to mislead and deceive in contravention of the Competition and Consumer Act 2010 (Cth) Sch 2 ACL s 18.
25 In my view, these paragraphs should be struck out for the following reasons.
26 It is convenient first to consider paragraph [31] of the ASOC as that pleading is central to the implied misleading or deceptive representation pleadings against Reino and, if that pleading is struck out, the remainder of the pleadings with respect to this claim cannot stand. Paragraph [31] sets out those matters which the RFT Agencies are said to have required for a compliant tender. The balance of the paragraphs dealing with the implied misleading or deceptive representation pleadings set out the “Reino Relevant Matter[s]” which Reino allegedly knew (or ought to have known) were contrary to the requirements for a compliant tender but which Reino failed to disclose. Paragraph [31](b) in particular sets out the central allegation, being the requirement for the pay parking machines to have contactless functionality for payment to be made to MasterCard contactless credit cards. In this regard, counsel for Australian Parking emphasised in oral submissions:
… PTC was obliged to inform the RFT agencies adequately, and accurately, and correctly with respect to the MasterCard requirements, and we say PTC didn’t do that. And we say that Reino, by reason of its obligations in answer to the RFT, was also obliged to tell the RFT agencies of that matter. In other words, the RFT agencies should not have been left in a state of misunderstanding as to the MasterCard requirements and their import for the purposes of their business conducting these ticketed parking areas, but also from the point of view that it was a relevant distortion of the marketplace for Reino to gain an unfair advantage by reason of the RFT agencies being left in this state of confusion or misapprehension as to the import of the MasterCard requirement.
(emphasis added.)
27 Australian Parking do not suggest that if paragraph [31](b) were struck out, the claim could proceed by reference only to the pleadings in [31](a) and (c).
28 However, not only does paragraph [31] fail in my view to plead the material facts or put Reino adequately on notice as to the case against it. The contradictions within the current pleading and particulars provided by Australian Parking reveal that the claim based on the implied misleading or deceptive representation as presently pleaded has no reasonable chance of success.
29 Paragraph [31] read with its “particulars” pleads in substance that the request for tender had three requirements which were set out in the request for tender document in Reino’s possession. It can be inferred, therefore that the fact that the request for tender was in Reino’s possession at the relevant time is the basis on which Australian Parking says that Reino knew (or ought to have known) of the requirements of contactless functionality for payment to be made by MasterCard contactless enabled credit cards and is the basis on which these requirements are said as a matter of fact to be required by the RFT Agencies.
30 First, however, the so-called “particulars” of knowledge or imputed knowledge should have been pleaded as material facts: see [19](3) and (5) above. Further and in any event, the particulars refer simply and inadequately to the whole request for tender. In this regard, the pleading fails to comply with FCR r 16.04(2) in that it fails to include the words which are material to the pleading. Indeed, it does not even state the relevant effect of the document: FCR r 16.04(1).
31 Secondly, by letter dated 30 March 2015 in response to a request for particulars from Reino, Australian Parking advised that the part of the request for tender relied upon for the pleadings at paragraphs [31](a) and (b) are the sections of that document which appear under the headings “2.5 Credit Card Processing and Clearance” in attachment 1 of Schedule 4 (NCA works) and “2.6 Credit Card Processing and Clearance” in attachment 2 of Schedule 4 (ACT works). While those sections set out 13 minimum requirements, there is no reference to any requirement for “functionality for payment to [be] made by Mastercard issued, contactless enabled credit cards via use of contactless functionality”, as pleaded at [31](b); nor for a requirement in terms pleaded at [31](a). As such, Reino understandably submits that it is unclear from the pleading which of the 13 requirements are relied upon in support of the allegations at paragraphs [31](a) or (b).
32 Thirdly, the requirements identified by Australian Parking in the request for tender include:
CC3 Can process Visa and MasterCard.
…
CC12 The tendered solution must be upgradeable to include contactless payments. Tenderers should submit a cost to upgrade each device to include a contactless reader within the EMV environment. The NCA [ACT, as applicable] will not incur additional costs to replace or retrofit existing hardware or software modules to accommodate the contactless reader system. Additional contactless readers must be compatible with the tendered EMV credit card solution.
CC13 The tendered solution must include a front fascia that can easily accommodate a contactless reader upgrade without the need to replace the service door and fascia or require any machining.
(emphasis added.)
(I note that “EMV” is a reference to the three credit card providers, Europay, MasterCard and Visa.)
33 Thus, as Reino submits, the request for tender refers to contactless functionality upon upgrade only as a minimum requirement. Consistently with this, the request for tender elsewhere identifies “contactless card readers” as an “optional item”. As a result, Reino submits that the pleading at paragraph [31](b) is ambiguous as to whether the reference to “contactless functionality” is a reference to a requirement that the pay parking machines accept contactless payments as at the date of installation or, in the alternative, that machines must be installed which are capable of being upgraded later to accept contactless payments.
34 Australian Parking denies that the reference to “contactless functionality” in paragraph [31(b)] is ambiguous and submits that, read in the context of the pleadings and what is described as the “MasterCard requirements”, the reference can be read as a reference only to contactless functionality as at the time of installation. Thus counsel for Australian Parking submitted that:
…as far as the MasterCard requirements were concerned, what was tendered by Reino could not have been contactlessly functional, because MasterCard in its requirements say that contactless functionality cannot be retrofitted.
…
…"contactless functionality” and its meaning must be clear by the fact that I contemplate within the pleading the MasterCard requirements. No one is suggesting that the RFT [request for tender] said that contactless machines had to be put into the grounds at the relevant dates. What is said is that that the RFT [request for tender] didn’t address the MasterCard requirements, and that occurred by reason of the contravening conduct of PTC and Reino. That’s what the pleading starts with, and that’s what the pleading ends with.
…
So it can’t be said against me, with respect, that “contactless functionality” meant that at the time of installation of the machines, by reason of the contents of the RFT, had to be contactlessly functional. It can’t be said against me because RFT says something completely different…What we say is that the RFT [A]gencies weren’t properly advised as to what the MasterCard requirements were, and the ramifications of that for the RFT.
(emphasis added.)
35 I accept Australian Parking’s explanation of what it intended the phrase “contactless functionality” to mean, i.e. that contactless pay parking machines had to be installed as opposed to machines which were merely capable of being retro-fitted with contactless functionality. However, the submission that Australian Parking does not allege that “the RFT said that contactless machines had to be put into the grounds at the relevant dates” is directly contradicted by the pleading at [31] of the ASOC. The requirements pleaded at [31] are particularised as being “set out in the Request for Tender”. There is no pleading at [31] of any other basis on which Reino is said to know (or ought to have known) of the so called “MasterCard requirements”. That being so, I accept Reino’s submission that, as presently pleaded, the implied misleading or deceptive representation pleading is not reasonably arguable. It is, as Reino submits, not reasonably arguable to allege that it could engage in misleading and deceptive conduct in failing to disclose the alleged requirements of a third party, MasterCard, which are not requirements of the request for tender. It follows that paragraphs [30]-[39] must be struck out as paragraph [31] of the ASOC underpins all of the other pleadings on the implied misleading or deceptive representation claim: see at [26]–[27] above.
36 While given the conclusion I have reached it is unnecessary further to consider those pleadings, there are a number of other serious difficulties with the pleading which reinforce my decision that the whole of this pleading must be struck out.
37 First, I accept Reino’s submission in any event that the ASOC does not plead (or particularise) the material facts that are relied upon for each “Reino Relevant Matter” said to render Reino’s parking machines non-compliant with the “technical and operational aspects of Pay Parking Systems referred to in the Request for Tender” in paragraphs [32] to [37] of the ASOC. Yet those matters are necessary to provide Reino with fair notice of the case put against it: r 16.02(1)(d).
38 In this regard, as noted earlier Australian Parking conceded that the “MasterCard Operations Bulletin No. 2 dated 2 April 2014” given initially as a particular of the pleadings cannot provide a basis for the allegation that Reino knew of the “Reino Relevant Matters” given that Reino lodged the tender in 2013. However, Australian Parking still relied upon the alleged MasterCard requirements set out in the “MasterCard Operations Bulletin No 1 dated March 2011” (the Bulletin) as a particular of paragraphs [34] and [36] of the ASOC. Specifically, it is alleged that it was “the business of Reino to understand the requirements of Mastercard as they applied to merchants, such requirements being set out in [the Bulletin] with the said requirement of Paypass Functionality being at pages 4 and 5 of [the Bulletin].”
39 The relevant passage in the Bulletin relied upon is as follows:
• All Cards Have PayPass Functionality
All cards must have PayPass capabilities, effective with the following dates:
- Release 12.Q4 – all new cards made must have PayPass capability
- Release 14.Q2 - all existing back book of cards must have PayPass capability
…
• Merchant Categories PayPass Functionality
MasterCard requires that all merchants within the card acceptor business codes (MCCs) listed in the table below must support and accept PayPass cards using PayPass functionality, effective with the following dates:
- Release 12.Q4 – all new merchants and replacement terminals PayPass enabled
- Release 14.Q2 - all existing merchants PayPass enabled
The table includes, among other MCCs listed, “Parking Lots”.
40 In oral submissions, Australian Parking submitted that the words “Release 12.Q4” is a reference to the fourth quarter of 2012. On this basis, Australian Parking submits that MasterCard made it clear to stakeholders and merchants that all newly installed terminals by 1 January 2013 had to be PayPass enabled machines. New machine providers would not be able to just upgrade existing machines.
41 However, even if it this construction of the relevant passage in the Bulletin is accepted, it is unclear from the pleading why this passage of a Bulletin is said to impose a “requirement” or even what is meant in this context by a requirement. The fact that the summary to the Bulletin states that “MasterCard will publish the associated rules revisions at a later date” highlights the lack of clarity.
42 Secondly, the implied representation pleaded at [30] from Reino’s conduct in lodging the tender was that Reino “was not aware” of any matters rendering their pay parking machines non-compliant. Yet the pleadings at [32]-[38] of the ASOC assume that that implied representation is rendered misleading and deceptive by Reino failing to disclose information of which it simply ought to have been aware ,i.e., by a failure to disclose imputed knowledge. As currently pleaded, therefore, such a pleading could not succeed.
43 Finally, the pleadings fail to comply with FCR r 16.02(1)(a) in that they plead a range of separate and alternative allegations in a rolled up and unsatisfactory way. For example, paragraph [31] pleads that Reino knew of certain requirements, or ought to have known of them, and those requirements were in fact required by the RFT Agencies. This intermingling rendered the pleadings confused, complex and unclear. It meant, for example, that it was unclear whether a particular was intended as a particular of each alternative allegation or of them all. This highly undesirable form of pleading is repeated throughout the ASOC including in the allegations against PT Consultants. Added to this, the pleading uses inconsistent terms and it is unclear whether the terms are intended to bear the same meaning. For example, at some points the pleading refers to “PayPass functionality” and in other parts it refers to “contactless functionality”. As a further example, at times reference is made to “parking fee collection machines” and other parts to “Pay Parking Systems”.
2.3 The misleading or deceptive advice pleadings against Reino (ASOC, [40]-[41])
44 Paragraphs [40] and [41] of the ASOC provide that:
40. Further and in the alternative, in the course of submitting a tender to the RFT Agencies, in trade and commerce, Reino advised the RFT Agencies that:
a. The unattended pay-by-credit-card parking fee collection machines installed or commissioned in April and May 2014 need not have Paypass Functionality at the time of their installation and/or at the time of their commissioning (such installation and commissioning being required on or before 1 April 2014 (for the ACT machines) and 30 May 2014 (for the NCA machines).
b. Further and in the alternative to subparagraph (a) above, Mastercard did not require unattended pay-by-credit-card parking fee collection machines installed or commissioned in April and May 2014 to have Paypass Functionality at the time of their installation and/or at the time of their commissioning (such installation and commissioning being required on or before 1 April 2014 (for the ACT machines) and 30 May 2014 (for the NCA machines).
c. Equipment for Paypass Functionality could not be retrofitted after 1 April 2014 to terminals located within unattended pay-by-credit-card parking fee collection machines installed before 1 April 2014.
d. Further and in the alternative to subparagraph (b) above, Mastercard/EMV did not proscribe equipment for Paypass Functionality being retrofitted to unattended pay-by-credit-card parking fee collection machines installed or commissioned in April and May 2014 (such installation and commissioning being required on or before 1 April 2014 (for the ACT machines) and 30 May 2014 (for the NCA machines).
Particulars
Such advice was provided to the RFT Agencies in the tender submitted by Reino and by way of representations prior to the award of the contract to Reino by the RFT agencies.
41. The advice pleaded in paragraph 40 was misleading or deceptive or likely to mislead and deceive.
…
Particulars
See paragraphs 31,32, 34, & 36.
45 In my view these pleadings must also be struck out.
46 First, the pleadings fail to plead the material facts necessary to constitute the statutory cause of action including when the representations are alleged to have been made, whether the representations were express or implied, and made in writing or orally, and the identity of the person said to have made the representations. The particulars to paragraph [40] are no more than a bare and opaque statement of an open-ended conclusion.
47 Secondly, the pleading fails to set out the terms of the representations. Yet those words are clearly material in the face of an allegation of misleading and deceptive advice: cf FCR r 16.42. It is fundamental, as counsel for Reino submitted, that:
…when one pleads a representation was made by particular statements, the party needs to know what the statement was. We have construction debates about whether a representation was conveyed by a statement or not, etcetera… So you just cannot understand a case put against you for misleading and deceptive conduct without knowing what the statement is that’s said to have conveyed a representation.
48 Given these matters, it cannot be said that the pleadings give Reino fair notice of the case against them. As the authorities earlier referred to have held, it is imperative that the factual basis upon which the statutory contravention is alleged is stated with appropriate clarity: see above at [19]. Australian Parking sought to explain the lack of particularity on the basis that the “transaction concerned is peculiarly in the knowledge of the respondent” and that Reino has the information available to them. Thus in answer to Reino’s request for particulars of the statements relied upon as constituting the alleged advice, Australian Parking responded that it “will provide the further particulars requested following disclosure. In the meantime, please look to the Tender submitted by your client on or about 20 October 2013.” It is not in issue, as this response suggests, that Australian Parking has no knowledge of Reino’s tender response. The difficulty, however, is that that response reinforces the inference suggested by the lack of particularity in the pleading that the pleading may be speculative and objectionable on that ground: Andrews v Australia and New Zealand Banking Group Ltd [2011] FCA 388; (2011) 281 ALR 113 at 128 [44]-[48] (Gordon J).
49 In so saying, I should emphasise that I do not find that Australian Parking did not have a basis for inferring all that it pleads. The critical point for the purposes of the interlocutory application is that the pleadings manifestly fail to disclose a proper factual basis, including those facts on the basis of which the inferences have been drawn. I accept the submission by Reino that an allegation and, in particular, a distinct and separate claim such as that encapsulated in paragraphs [40]-[41], which lacks a pleaded factual basis, has no place in a statement of claim. Quite apart from other objections, such a claim potentially raises a false controversy with consequential waste in costs and resources, including those of the Court itself: see also above at [19](6). Nor must the seriousness of an allegation of misleading and deceptive conduct and intentional misrepresentation be overlooked. The appropriate mechanism, as Reino also submits, for a party who seeks to investigate whether or not a factual basis exists to plead a case, if that is indeed the case here, is to institute proceedings for preliminary discovery under FCR r 7.23.
50 In this regard, I do not accept the submission by Australian Parking that the provision of a certificate pursuant to FCR r 16.01 provides an answer to the concern as to the apparent absence of a proper factual basis for the pleadings. Rule 16.01(c) of the FCR provides that, if a pleading is prepared by a lawyer, must:
…include a certificate signed by the lawyer that any factual and legal material available to the lawyer provides a proper basis for:
(i) each allegation in the pleading; and
(ii) each denial in the pleading; and
(iii) each non-admission in the pleading.
51 While Reino appropriately disavowed any case that there had been a failure to comply with r 16.01, the fact that such a certificate was provided cannot overcome the failure of a proper factual basis to be pleaded or particularised.
52 Finally, the particulars to paragraph [41] refer the reader to paragraphs [31], [32], [34] and [36] which suffer from the deficiencies which I have earlier identified.
2.1 The parking machines misrepresentation pleadings against Reino (ASOC [42]-[43])
53 The parking machines misrepresentation pleadings are set out at [42]-[43] of the ASOC which read:
42. Further, and in the alternative, Reino in the course of tendering to the ACT and CW Government in response to the RFT represented that by 1 April 2014 or in the alternative by the date required by Mastercard:
a. the VX and TX metered parking machines would be able to receive payments by way [of] contactless credit card via use of contactless functionality.
b. The VX and TX metered parking machines would be Scheme & Bank certified for the contactless enabled credit card acceptance.
Particulars
Tender lodged on or about 20 October 2013.
43. The representation set out in paragraph 42 was a representation or were representations as to a future matter and were misleading or deceptive or likely to mislead or deceive.
54 As Reino correctly submitted, these paragraphs suffer from the same deficiencies as those set out in paragraphs [40]-[41] of the ASOC and therefore must be struck out also: see above at [45]-[51].
2.2 The pleadings in paragraphs [44] - [45], ASOC, against Reino
55 Paragraphs [44] and [45] plead that Reino did not have available to it, and was unable to supply, install and commission, pay parking machines or a pay parking system which would comply with the requirements pleaded at [31] of the ASOC in order to establish that the various alleged representations were misleading and deceptive. It follows that, as paragraphs [30]-[43] have been struck out, paragraphs [44] and [45] must also be struck out.
2.3 The website representations pleadings against Reino (ASOC, [28]-[29])
56 Paragraphs [28] and [29] of the ASOC provide:
28. In trade and commerce, on and from May 2014 Reino has represented that;
a. The VX Parking Pay and Go ticketless metered parking machine is a parking machine able to receive payments by way of use of credit card contactless functionality.
b. The VX Parking Pay and Go ticketless metered parking machine is Scheme & Bank certified for EMV and Contactless credit card acceptance.
c. The TX Parking Pay and Display metered parking machine is a parking machine able to receive payments by way of use of credit card contactless functionality.
d. The TX Parking Pay and Display metered parking machine is Scheme & Bank certified for EMV and Contactless credit card acceptance.
Particulars
Website www.duncansolutions.com.au (copies of web pages attached)
29. The representations at 28 above are misleading or deceptive or likely to mislead and deceive.
Particulars
The VX Parking Pay and Go ticketless metered parking machine is not able to receive payments by way of use of credit card contactless functionality.
The VX Parking Pay and Go ticketless metered parking machine is not Scheme and/or Bank certified for the purpose of contactless enabled credit card transactions.
The TX Parking Pay and Display metered parking machine is not able to receive payments by way of use of credit card contactless functionality.
The TX Parking Pay and Display metered parking machine is not Scheme and/or Bank certified for the purpose of contactless enabled credit card acceptance.
57 Nothing in the pleading suggests that the website representations are said to be connected in any way with the allegations relating to the tender process. Rather they are apparently pleaded as a stand-alone claim. Nonetheless, as Reino submits, no material facts or particulars are given of reliance by any person on those representations so as to cause loss or damage to Australian Parking. As such, there is no reasonable basis on the pleadings as presently framed for any claim for damages by Australian Parking as a result of the website representations. However, I do not consider that the pleadings at [28]-[29] should be struck out because Australian Parking also seek a declaration that s 18 of the ACL has been contravened and related injunctive relief. Taking the facts pleaded on their face, I consider that that claim is reasonably arguable even though the relief sought is not presently framed with sufficient particularity. Accordingly, paragraphs [1]-[3] and [6]-[9] of the ASOC which provide introductory information relevant to this claim should also not be struck out.
58 In reaching the view that these pleadings should not be struck out, I have taken into account that Australian Parking has clarified that the reference to credit card contactless functionality is a reference to functionality of that kind being an existing feature of a pay parking machine, and not a reference to the capacity to retrofit pay parking machines with that functionality. Nor is there any ambiguity introduced in the context of these pleadings by any reference to the request for tender documentation in contrast to the earlier pleadings.
2.4 Causation and damages (ASOC, [46],[47] and [49])
59 With respect to causation and damages, Australian Parking pleads that:
46. By reason of the misleading and deceptive conduct as alleged, the Reino tender submitted in response to the RFT [request for tender] was treated as a complying tender and Reino selected as preferred tenderer.
47. By reason of the misleading and deceptive conduct by Reino as alleged, [Australian Parking] being a competitor to Reino, has suffered loss and damage by way of the loss of an appreciable chance to be selected as preferred tenderer by the RFT Agencies and to be awarded contracts for the supply, installation, commissioning and maintenance of Pay Parking Systems.
…
49. And [Australian Parking] seeks relief against Reino as follows:
a. A declaration that in the events that have occurred Reino has engaged in misleading or deceptive conduct or of conduct likely to mislead and deceive in contravention of Competition and Consumer Act 2010 (Cth) Sch 2 ACL s 18.
ab. An order that Reino pay to [Australian Parking] the amount of loss and damage suffered by [Australian Parking] as a result of the contravention.
b. An order restraining Reino in future from the conduct the subject of the declaration.
c. Interest
d. Costs
e. Interest on costs.
60 As I consider that the paragraphs alleging misleading and deceptive conduct against Reino with respect to the tender process must be struck out as not raising a reasonable cause of action as presently framed, it follows that paragraphs [46] and [47] must also be struck out.
61 However, I note that there is considerable force also in Reino’s submission that the pleading at [46] is, in any event, manifestly deficient. It pleads a conclusion only without exposing any basis on which the RFT Agencies are said to have treated Reino’s tender as being compliant, and Reino’s tender was successful, because of the misleading or deceptive conduct. There is no pleading, for example, that the RFT Agencies relied upon the alleged misrepresentations in reaching their decisions to award the contracts to Reino. Nor does paragraph [47] expose the basis on which it is said that Australian Parking suffered loss of a chance by reason of the misleading and deceptive conduct. It does no more than assert that the contravention resulted in the loss of a chance. Neither paragraphs [46] nor [47] therefore plead any material facts which show a causal link between the alleged loss of a chance and the misleading and deceptive conduct. In this regard, the observations of Weinberg J in McKellar with respect to an action for damages under s 82 of the Trade Practices Act are pertinent:
When a claim is made under s 82 of the Act, the gist of the cause of action being damage, the statement of claim must allege the damage suffered, and that it was suffered by reason of the contravention of the Act. Material facts must be pleaded which show the required causal link between any alleged contravention of the Act, and any damage to the applicant. A deficient pleading, namely one that does not plead relevant material facts, cannot be saved by particulars. It is not sufficient simply to allege loss and damage as a result of alleged contraventions of the Act; it is necessary to identify a causal connection between the impugned conduct and such loss as is said to have been suffered by the applicants…
(citations omitted.)
62 It follows for the reasons earlier given, that I do not consider that as presently framed, the pleadings raise a reasonably arguable case for an award of damages against Reino, as is sought in paragraph [49](ab), and therefore for interest as is claimed in paragraph [49](c). However, I have not struck out any other subparagraph of paragraph [49] as the claims for declaratory and injunctive relief also relate to the separate pleadings with respect to the website representations.
1. PT CONSULTANTS’ STRIKE OUT APPLICATION
63 I have also reached the view that the pleadings against PT Consultants in paragraphs [4], [5], [10] to [27] and [48] (inclusive) of the ASOC must also be struck out.
1.1 Allegations against PT Consultants
64 The allegations in the ASOC against PT Consultants can, again at the risk of oversimplification, be summarised as follows.
(1) Before the issue of the request for tender, the RFT Agencies engaged PT Consultants to assist and advise with respect to the tender process, including advising them on the technical and operational aspects of pay parking systems and preparation of the request for tender documentation (ASOC at [10]). By accepting that engagement, PT Consultants impliedly represented to the RFT Agencies that they would diligently provide those services and inform the RFT Agencies of any matter pertaining to the technical and operational aspects of pay parking systems relevant to the tender (ASOC at [11]). Before the issue of the request for tender, PT Consultants knew or ought to have known (among other things) that:
(a) the RFT Agencies required the pay parking machines to have various features including certified contactless enabled credit card payment solution and functionality for payment to be made by MasterCard, and for installation of the system to be completed by 31 March 2014 (ACT) and 20 May 2014 (NCA);
(b) MasterCard required all new terminals after 1 January 2013 “to have functionality to contactlessly process a credit card payment” (ASOC at [16]-[17]);
(c) MasterCard required PayPass Functionality for all terminals installed before 1 April 2014 to be achieved by installing new terminals rather than retrofitting PayPass devices to existing machines (ASOC at [18]-[19]);
PT Consultants did not advise the RFT Agencies of one of more of these matters as a result of which the implied representations pleaded at [11] were misleading or deceptive (or likely to be so) contrary to s 18 of the ACL (ASOC at [20]-[21]) (the PT Consultants implied misleading or deceptive representation).
(2) Further and in the alternative, in the course of providing the tender services, PT Consultants gave misleading and deceptive advice to the RFT Agencies regarding the requirements for contactless functionality for payments to be made by MasterCard issued credit cards, including that equipment for PayPass Functionality could be retrofitted after 1 April 2014 to pay parking machines installed before that date (the PT Consultants misleading or deceptive advice) (ASOC at [22]-[23]).
65 By reason of these implied and alleged misrepresentations, Australian Parking contend that:
(1) The Reino tender submitted in response to the request for tender “was treated as a complying tender and Reino selected as preferred tenderer.” (ASOC at [26]); and
(2) Australian Parking has suffered “loss of an appreciable chance to be selected as preferred tenderer by the RFT Agencies and to be awarded contracts for the supply, installation, commissioning and maintenance of Pay Parking Systems” for which it seeks compensation (ASOC at [27]).
1.2 The PT Consultants implied misleading or deceptive representation (ASOC, at [11]–[21])
66 The pleadings against PT Consultants suffer from many of the same deficiencies as those as against Reino.
67 First, paragraph [13] sets out a number of matters that Australian Parking asserts PT Consultants “knew or ought to have known” prior to the issue of the RFT, relating to the contactless credit card functionality. While these matters identified are similar, but not identical, to those matters which it is said that Reino knew or ought to have known as alleged in paragraph [31] of the ASOC, Australian Parking’s argument proceeded on the basis that the substantive allegation was the same – that PT Consultants knew or ought to have known that it was a requirement that the pay parking machines would have contactless credit card functionality at the time of installation. The only particulars given are (again) that “[t]he requirements were set out in the RFT” which is alleged to have been drafted, settled and/or issued with PT Consultants’ assistance. Again the pleading impermissibly refers to the whole document, rendering it unclear which parts of the document are relied upon. Moreover, for the reasons earlier given, that document does not set out the requirements pleaded but is inconsistent with those requirements. As such, it is not reasonably arguable that PT Consultants knew or ought to have known of the matters on the basis (based on a generous reading of the pleading) of PT Consultants’ knowledge of and/or involvement in preparation of the request for tender.
68 Secondly, paragraph [14] ASOC sets out further matters that PT Consultants allegedly “knew or ought to have known” relating to the RFT Agencies being merchants for MasterCard credit card system purposes and to the pay parking machines becoming new terminals (or alternatively replacement terminals) for the purposes of the MasterCard credit card system. The particulars (set out in a single lengthy and confusing sentence) said to support this pleading are as follows:
By offering services to Parking Agencies with respect to the preparation of Request for Tender (RFT) documentation for the provision of Pay Parking Systems, the preparation of specifications as to functionality of Pay Parking Systems, the assessment of tenders received, and overall the provision of advice to Parking Agencies as to Pay Parking Systems, and in this case, having regard to the stated wish of the RFT Agencies to have functionality for payment to be made by Mastercard, it was the business of PTC to understand the Mastercard system as it applied to Parking Agencies and the necessity of the RFT Agencies joining the Mastercard system as merchants so as to deploy the Pay Parking System, and to understand the necessity for each pay-by-credit-card parking fee collection machine in each Pay Parking System to be an EMV-approved and an operational credit card terminal.
69 However, quite apart from the fact that the basis for the alleged knowledge or constructive knowledge should be pleaded as material facts and not particulars, the basis on which it is said that PT Consultants knew or ought to have known of the MasterCard requirements is unclear. The conclusion is simply asserted without more that “it was the business of [PT Consultants] to understand …” the matters alleged.
70 Thirdly, similar deficiencies to those in paragraphs [13] and [14] are present in the pleadings in paragraphs [16] and [18] of the ASOC. In addition, the particulars to paragraph [16] effectively mirror those given at [34] of the ASOC in relation to the claim against Reino and suffer from the same deficiencies (see above at [37]-[40]).
71 Fourthly, each of the PT Consultants’ “relevant matters” pleaded in paragraphs [13], [14], [16] and [18] are relied upon as the grounds on which it is said that the implied representations in paragraph [11] are misleading or deceptive: see paragraph [21] of the ASOC. It follows that Australian Parking contends that constructive (“ought to have known”) as opposed to actual knowledge of any of these matters rendered misleading or deceptive the implied representation alleged in paragraph [11](b) that PT Consultants would inform the RFT Agencies of relevant matters pertaining to technical and operational aspects of pay parking systems. However, it is not arguable in my view that such a representation could be misleading or deceptive because of a failure to advise of a matter which the person does not in fact know: see also above at [35].
72 Fifthly, no material facts have been pleaded in support of the allegation that the PT Consultants “relevant matters” rendered a representation by PT Consultants that it would diligently provide its services misleading and deceptive, as pleaded in paragraphs [11](a) and [21].
73 In short, the pleading at paragraph [21] of the ASOC fails to grapple in any meaningful way with the generally expressed implied representations at paragraph [11] so as to sufficiently reveal the basis of the implied misleading or deceptive representation case against PT Consultants. Paragraph [21] states a conclusion without sufficient information about the relevant “conduct” and why it is (or is likely to be) misleading and deceptive so as to give PT Consultants fair notice of the basis of the claim. It is no answer to submit, as does Australian Parking, that these are matters peculiarly within PT Consultants’ knowledge. If the pleading is speculative, it has no place in a statement of claim as I have already said. If the allegations are based upon inferences, then the basis on which the inferences are drawn should be properly pleaded so that PT Consultants is aware of the case which it is asked to meet. A non-disclosure misleading and deceptive conduct claim “requires a clear identification of the conduct said to be misleading and deceptive”: Miller and Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd [2010] HCA 31; (2010) 241 CLR 357 at 364 [5] (French CJ and Kiefel J); see also above at [47].
74 It follows that the pleadings in relation to the PT Consultants implied misleading or deceptive representation at paragraphs [11]-[21] of the ASOC should be struck out.
1.3 The PT Consultants misleading or deceptive advice (ASOC, [22]-[23])
75 Paragraph [22] pleads further and in the alternative that the PT Consultants advised the RFT agencies that:
a. Mastercard did not require unattended pay-by-credit-card parking fee collection machines installed or commissioned in April and May 2014 to have Paypass Functionality at the time of their installation and/or at the time of their commissioning (such installation and commissioning being required on or before 1 April 2014 (for the ACT machines) and 30 May 2014 (for the NCA machines).
b. Mastercard did not require Paypass Functionality for terminals located within unattended pay-by-credit-card parking fee collection machines installed before 1 April 2014 to be achieved by the installation of new terminals as distinct to retrofitting PayPass devices to such machines
Particulars
Such advice was provided to the RFT Agencies on or before the selection of Reino as preferred tendered.
76 Paragraph [23] pleads that the advice referred to in paragraph [22] was misleading or deceptive or likely to mislead or deceive contrary to s 18 of the ACL.
77 These pleadings suffer from the same deficiencies as those already identified at [45]-[48] above and should be struck out for the same reasons.
1.4 Causation and damages (ASOC, [24] - [27])
78 Paragraph [26] of the ASOC alleges that by reason of the misleading and deceptive conduct of PT Consultants, the Reino tender submitted in response to the RFT was treated as a complying tender and Reino was selected as preferred tenderer. Australian Parking pleads at paragraph [27] of the ASOC that, by reason of this misleading and deceptive conduct, it suffered the loss of an “appreciable chance to be selected as preferred tenderer” and to be awarded the contract by the RFT Agencies. The pleadings suffer from the same deficiencies as the equivalent pleadings against Reino: see at [58]-[61] above. The bare facts alleged in paragraphs [24] and [25] that Reino could not supply compliant machines do not suffice to reveal the causal link between the alleged misleading and deceptive conduct and the loss of a chance.
1.1 Remaining pleadings relating to PT Consultants (ASOC, [4],[5] and [48])
79 As the website representations are alleged only against Reino, it follows that no claim for relief as presently framed remains on foot against PT Consultants, and accordingly paragraph [48] of the ASOC (being the claim for relief), together with paragraphs [4] and [5] (being the introductory pleadings relating to PT Consultants) should also be struck out as they no longer serve any purpose.
80 For the reasons set out above, the ASOC must be struck out save for paragraphs [28] and [29], together with paragraphs [49] (a), (b), (d) and (e) insofar as they claim relief as against Reino with respect to the website representations and the introductory pleadings at [1]-[3] and [6]-[9]. Australian Parking should be given an opportunity to replead its case, if so advised. Costs should be reserved in order to afford the parties the opportunity to make submissions on the issue in line with the approach accepted by the parties at the hearing.
I certify that the preceding eighty (80) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perry. |
