Trade Practices - consumer protection - change of tour CATCHWORDS itinerary after publication of brochure - meaning of "accept" - objective determination of terms of contract - agency - whether deposit "payment or other consideration" - whether services "materially different". Trade Practices Act 1974 ss.58(b), 84(2). PETER JAMES DAWSON v WORLD TRAVEL HEADQUARTERS PTY. LTD. Nos. W.A. G21-G26 of 1980. FISHER J. ADELAIDE 28 November 1980. IN THE FEDERAL COURT OF AUSTRALIA ) ) WESTERN AUSTRALIA DISTRICT REGISTRY) No. W.ALG. 21, 22, 23, 24, 25 ) and 26 of 19380 ) GENERAL DIVISION Bil' WE LE N: PETER JAMES DAWSON Prosecutor - and - WORLD TRAVEL HEADQUARTERS PROPRILTARY LIMITED Defendant 28 November 1980 REASONS FOR _JUDGMENT FISHER J.: This matter concerns six alleged contraventions by the defendant of the provisions of s.58(b) of the Trade Practices Act 1974 ("the Act"). As the alleged contruventions arose out of the same transaction, differing only as to the relevant dates, it was convenient for them to be heard together. Section 58(b) 1s in the following terms: "A corporation shall not, 1n trade or commerce, accept payment or other consideration for goods or services where at the time of the acceptance it intends (a) ... (b) to supply goods or services materially different from the goods or services in respect of which the payment or other consideration 18 accepted." The facts which I find indicate that the alleged contraventions arose in the following circumstances, The defendant, which was admitted to be a Corporation engaging in trade or commerce at all relevant times, operates a substantial business in the travel industry. Essentially it arranges tours which it sells to the public. The organisation of all of those aspects of travel and accomodation which go to make up the tours together with the prepar- ation of brochures and other advertising material comprise the "wholesalé side of a travel agency business, whilst the actual selling to the individual members of the public of the tour 1s known as the "retail" business. The defendant operates in both spheres, although it was, for present purposes, essentially the wholesaler of the tour in question, In 1978 and 1979 the defendant employed Michael Henry Schultz ("Mr. Schultz") in Sydney in the position known as "Product Manager, Asia". As such his primary responsibility was to arrange itineraries, accomodation and travel in Asia for what were known as "Swingaway Asia" tours. In 1979 these tours had been operating for some six years. He was assisted by quite a substantial staff 1n Sydney, and by a staff member in both Melbourne and Perth where the defendant also carried on business. In August and September 1978 Mr. Schultz travelled throughout South East Asia arranging Swingaway tours to that continent during the period April 1979 to March 1980. Essentially he was engaged in negotiating accomodation, sight seeing tours, land travel and reception at and travel from airports. Upon his return to Sydney in September he put together the tours which the defendant would be offering to the public in the following year. It was contemplated that such offering would be by way of a Swingaway brochure which would be distributed through travel agents, including the defendant, engaged in the retail side of the travel industry. Whilst Mr. Schultz was overseas his staff had preliminary discussions with airlines concerning flights to and from Asia during 1979. On his return he had discussions with the officer appointed by Qantas to handle the travel requirements of the defendant. A particular aspect under discussion was thut of advance airline schedules for the period commencing 1 April 1979. A document comprising that schedule was delivered t™ Mr. Schultz, and at the same time his attention was drawn to the fact that it disclosed that on the Perth-Singapore sector, the flight out uf Perth was scheduled to leave on a Tuesday. Mr. Schultz was aware of the fact, which was adverted to by the Qantas representative, that at that time flights out of Perth to Singapore departed on Wednesdays. Mi. Schultz was advised that what he was given was a preliminary schedule which was subject to change, but was the best information which Qantas had avallable for Mr. Schultz to work on in planning his tours in Asia. Upon receipt of this schedule Mt. Schultz set about preparing the brochure which advertised Swingaway tours for 1979-40. He stated that he relied entirely upon the Qantas information in preparing relevant portions of the brochure, and that the necessary work imvdved in preparaum, printing and distributicn took approximately three months. By early January 1979 the brochure had been printed and thereafter was distributed, showing as it did Qantas flights departing from Perth on a Tucsday. During January 1979 Mi. Schultz had discussions with the officer of Qantas concerning flights out of Perth, because,although he had relied upon that officer's schedule in preparing his brochure, information coming from the Qantas computer continued to indicate that the Wednesday flights were unchanged, In the last days of January or early February 1979 Mr. Schultz became aware that Qantas did not propose to change its departure dates and that its flights out of Perth would remain on a Wednesday. This state of affairs was confirmed with the Qantas officer who had supplied the original schedule and with whom Mr. Schultz had kept in touch during the intervening months. In so far as the Swingaway brochures represented that tours from Perth to Singapore departed on a Tuesday, they were incorrect in that the departure date was now delayed) by one day. A particular tour which was affected, and which is the tour relevant to these proceedings, was identified in the brochure as "Swingaway Asia Group Holiday G.P.E." and its following special features were highlighted. Its heading was "16 days: To Singapore, Kuala Lumpur, Penang, Hong Kong" and its highlights included: "Three country tour. Duty ree shopping. Four nights at Beach Resort. Overland tour Singapore- Kuala Lumpur-Penang". The tour price was stated to include "Singapore 3 naghts" and to leave Perth on Day 1 (Tuesday) for Singapore where the tourists were to be met and taken to a hotel. Day 2 (Wednesday) auncluded a morning tour and the balance of that day together with Day 3 (Thursday) was scheduled to be spent in Singapore. On the morning of day 4 (Friday) the group was to leave Singapore overland for Kuala Lumpur, At the end of the tour the brochure provided travel from Hong Kong to Perth via Singapore, arriving in Perth on day 16 (Wednesday) in the early hours of the morning. Departure dates for the tour, to the extent relevant to these proceedings, were advertised as June 12, July 10 and August 28, being 1n each instance a Tuesday. When he became aware that Qantas would continue to leave from Perth for Singapore on a Wednesday and that this required an alteration to the arrangements for the tours generally, and tour G.P.E. 1n particular, Mr. Schultz said that he took steps to redesign the tour to provide, as closely as possible, the same itinerary as was advertised in the brochure. In so doing he was restricted, he told us, by certain requirements (T.A.T.A. regulations') which, inter alia, did not permit him to provide a stlop-evet in Singapore on the return trip to Perth which exceeded 2+ hours. Mr. Schultz's opinion was that in the circumstances the best course was to delay the iecturn to Perth and to provide an extra night in Singapore at the end of the tour. However because of the "I.A.T.A. regulations"his passengers would be requircd to depart Singapore for Perth on the flight which left early the following morning and could not spend that day 1n Singapore. He stated that in his view and based on his experience the changes that affectedthis tour were miuntmal and did not warrant any further change in the itinerary. He acknowledged that he could have chanyed the whole itinerary by setting it back one day overall but said that such a change "would become hazardous due to unavailability of accomodation in some key areas throughout the itinerary". In the ultamatc, the changes which he made to tour G.P.E., which thereafter remainea unaltered, were that it would depart on a Wednesday and not a Tuesday, thereby losing a day 1n Singapore, and that thereafter until the last day of the tour the itinerary would be as advertised. At the end of the tour, instead of leaving Singapore on Tuesday evening shortly after arrival from Hong Kong and flying on to Perth, that night would be spent in Singapore and the departure delayed urtil 9.00 a.m. (local time) on the Wednesday morning. Instead of arriving 1n Perth in the early hours of Wednesday morning, the new arrival time was scheduled for early afternoon of that day. The conscqucnec of these aJterations was that the tourists would lose a day 1n Singapore, which day was scheduled as day 3 (a Thursday) in the brochure, but gain a night stay in a hotel in Singapore at the end of the tour. Thus the net loss to the tourists was the daylight hours of one day in Singapore in that they were absent from Australia fo1 approximately half a day less than the brochure offered. Mr. Schultz acknowledged that the provision of two consecutive full days in Singapore at the commencement of the tour was a feature of some significance and an attractive offer to a person interested in buying the tour. When asked 1f it occui1ed to him to send out a memorandum for the use of passengers who might book on the basis of the Swingaway brochure he gave the following significant answer which I set out verbatim: "yes, we had a fail safe system built into the operations, where 1f a tour was changed, nobody could make a reservation without being informed that they were, in fact, purchasing something different from what they read in our brochures." The fail safe system was implemented in this present matter in respect of tour G.P.E. by the sending of telexes to the member of Mr. Schultz's staff in Perth, Mrs. Sue Lynch, who was authorised to pass on the changes. The first telex, rece1ved on 5 February 1979, was explained as conveying in layman's language to Mrs. Lynch as follows: "Swingaway Asia 79/80. Please note amendments to series G.P.E., Departures will be one day latez cutting out a day in Singapore. However an lieu of flying Hong Kong-Singapore- Perth, passengers will fly Singapore Airlines Hong Kong- Singapore leaving 10.45 arriving 15.20 then overnight at Marco Polo before flight Qantas Singapore-Perth leaving 09,00 arriving 14.20. This day flight will bring passengers back to Perth on same day as previous schedule." A further telex received by Mrs. Lynch from Sydney on 19 February 1979 amended the first telex as follows: ""Swingaway Asia 79/80. Re tout G.P.E. series. On telex 5 February stated that passengers would fly Singapore Airlines Hong Kong-Singapore leaving 10.45 arriving 15.20 then overnight Singapore before connecting to Perth at 09.00. Due to Schedule change Singapore Airlines, Hong Kong- Singapore will now be leaving 15.35 arriving 18.30." 7. It 1s to be noted that the first telex specifically stated that the particular tour would be altered to the extent of "cutting out a day in Singapore". It was this anformation which Mrs. Lynch was authorised to pass on and Mr. Schultz expected that it would be passed on in implementation of the fail safe system to ensure in his words that "nobody could make a reservation without being informed that they were, in fact, purchasing something different from what they read in our brochures". However, there was no evidence as to whether Mrs. Lynch passed this information on generally to those businesses to whom the defendant's brochures had been distributed. The only evidence as to any passing on of the alterations relat- ed to an enquiry made by a Mrs. Don of Jetset Tours on 8 May 1979 (to which I will refer again later) in reference to a G.P.E. Tour leaving Perth on 12 June 1979. Mrs. Lynch's evidence which conflicts with that of Mrs. Don was that she replied to the enquiry as follows: "I'm sorry; 1ts not 12 June any more. It is 13 June. It 28 departing a day later and it 1s as per brochure and instead of coming back on Tuesday Hong Kong-Singapore~-Perth on connecting Singapore Airlines flights, they would be flying Hong Kong-Singapore on the Tuesday, overnight at the Marco Polo Hotel in Singapore, and then flying Singapore- Perth on Wednesday with Qantas." The fact that one day would be "cut out" in Singapore was not in so many words passed on by Mrs. Lynch, nor was the time at which the Singapore-Perth flight would leave Singapore for Perth on the Wednesday. There was no evidence that any further information as to the alteration to the G.P.E. tours was passed to Mrs. Don and the latter's evidence was that on 9 and 10 May 1979 the only information she had was that the tour was leaving a day later, When Mrs, Court rang her more than a week later enquiring if the tour had been shortened Mrs. Don could not answer her without again telephoning Mrs. Lynch for further information. The specific transactions which give rise to these proceedings concern bookings with the G.P.E. tour descrtbed in the Swingaway Asia brochure, which bookings were maduw in Perth by a Mrs. and Miss Court who both gave evidence. The evidence given by Miss Court was not wholly satisfactory on all aspects. Th25 was due d& least in part to the fact that she suffers from asthma and was unable to perform well under the stress of giving evidence. In so far as her evidence conflicts with the evidence of others I do not rely upon it as sufficiently reliable to establish a serious ciiminal offence. However 1n the ultimate it 1S my opinion that that part of her evidence which 1s unsatisfactory relates in the main to peripheral matters, and there 1s no crucial conflict between her evidence, the evidence of her mother and that of Mrs. Don, the person at Jetset Tours with whom they made their bookings. My findings on this aspect of the case to the extent I see them as relevant and necessary may be now set out. Miss Court during April 1979 collected from travel agents a number of brochures, ancluding the brochure in question from Jetset Tours. On the last page of the brochure appeared the following words: "Please make your reservations with the Travel Agent whose name appears below." In a block provided below, the name "Jetset Tours" together with an address had been stamped, doubtless by Jetset Tours. Somewhat earlier in the brochure a tear out "Reservation Request" was included but there was no evidence that Mrs. or Miss Court signed such a document. She and her mother selected the Swingaway Tour G.P.E. because they had some association with people in Singapore and Kuala Lumpur, Mrs. Court in particular was attracted to the two days advertised as provided in Singapore, because she had contacts who could assist her in her shopping. She desired to buy in Singapore a barthday present for another daughter. Early in May 1979 Miss Court approached Jetset Tours to make a booking for herself and her mother, and she talked to Mrs. Don. The particular G.P.E. tour 1n which she was interested was the one departing, according to the brochure, on June 12. While Miss Court waited Mrs. Don rang Mrs. Lynch at World Travel Headquarters to enquire about availability of places on that tour. Mrs. Lynch said that she gave Mrs. Don information concerning the tour ain the words which I have already set out. She also told Mrs. Don that she was not able to confirm any reservations on that particular tour, but she had to request reservations from Sydney. She then offered Mrs. Don reservations on the subsequent tour, departing ll July but advertised aun the brochure as departing 10 July, which she would be able to confirm. At this stage, however, Miss Court st11ll wished to go on the 13 June tour, so the reservation was left as a request. Mrs, Don gave the following evidence of what she was told by Mrs. Lynch in that phone conversation, and what she told Miss Court: "On ringing Sue (Lynch) she then... told me that the tour was not leaving on the day specified in the brochure but on the following day. The tour, as I presumed, was still a 15 night tour, and I could not be 100 per cent sure that I told Miss Court specifically at that particular time that it was a 15 night tour but I would definitely not have let her go out of the office thinking that she was going on a day when the tour was not operating, especially when I had to take 1t down on my file." 10. It subsequently turned out that the 13 June tour was fully booked. When she found this, Mrs. Don contacted Miss Court, who now preferred the tour departing on 11 July and who then requested that 2 reservations be made on the latter tour. Mrs. Don then asked for a deposit and was promised that one would be paid immediately. She then rang Mrs. Lynch and confirmed 2 reservations on the tour departing on 1l July 1979. There was no evidence that Mrs. Lynch gave to Mrs. Don any information specifically relating to this tour such as the information she says she gave in respect of the tour departing on 13 June. Mrs. Don said that all she was told in respect of this tour and the earlier tour and all she relayed to Miss Ccurt was that the tour departed a day later. To the extent that there 1s a conflict between the evidence of Mrs. Lynch and Mrs. Don, I accept the evidence of the latter. No additional information in respect of the alterations to the tour departing on 11 July 1979 was given by Mrs. Lynch to Mrs. Don or Mrs Don to the Courts prior to 18 May 197% On 9 May 1979 Miss Court paid $100 to Jetset Tours being part deposit on Tour G.P.E. for herself and her mother. On the following day $60 being the balance of the deposit was paid. Miss Court's evidence was that at the time she paid the deposits she was still under the impression that the tour was leaving on Tuesday 10 Juiy. However I accept Mrs. Don's evidence that at the time Miss Court paid the first instalment of the deposit she had informed Miss Court of the changed date of departure, namely from Tuesday 10 July to Wednesday li July 1979. I also find that at this time no further 1nformation concerning alterations to the brochure was given to Miss Court, and that the only information Mrs. Don had from Mrs, Lynch was that given to her in respect of the tour departing in June. Certainly no further information was given in a letter bearing date 10 May 1979 whach Mrs. Don dictated for Miss Court other than that the tour departed ' 1l. on 11 July 1979. Both Mrs and Miss Court denied having received this letter, and certainly there 1s no satisfactory evidence of it having been posted. A possible explanation fu1 the fact that 1t may not have been sent, is that it requested payment of the balance of the deposit, which balance was in fact paid by Miss Court on the date of the letter. Mrs. Don agreed that this date was the date of typing and that 1f the letter was sent 1t would have been posted subsequent to that date. However as I find that Miss Court was told of the changed date of departure at the time she paid the first instalments of the deposit, I can not see the letter as having significance on any relevant aspect of the matter. These deposit sums totalling $160 were passed by Jetset Tours to the defendant in Perth and are referred to 1n a receipt prepared by Mrs, Lynch on 16 May 1979, Mrs. Lynch acknowledged that tine deposits were probably received by the detendant from Jetset Tours on the preceding day. On 18 May Miss Court paid the sum of $1,000 to Jetset Tours being portion of the balance due in respect. of the bookings of the tour. This sum was not passed on by Jetset Tours to the defendant until about 11 June 1979, by whach time Mrs. Court had (on 31 May) paid the balance on the fares, and both sums, less commission retained by Jetset Tours, were passed on together. At about the time Miss Court paid the instalment on 18 May 1979, her mother obtained some further information as to the alterations. On this date Miss Court was under the impression that although the tour was leaving one day later, two days at the outset would still be provided in Singapore. Her earlier pencil amendment to this effect to the information On the relevant page of her copy of the brochure tends to confarm this as she received no advice of any alteration between 10 May and 18 May 1979. The further information as to the changes which was obtained by Mrs. Court was Lhe result of a telephare le. call she made to Mrs. Don. Mrs. Court said initially in her evidence that this conversation was in the week commencing 18 May 197%, and later that it occurred on about 21 May 1979. Mrs. Don recollects the conversation but can fix the date no more exactly than as being subsequent to 8 May and no later than 31 May 1979. Mrs. Court stated the conversation as follows: "TI asked Mrs. Don, 'could you please tell me, because the tour 18 being changed from 10 to 11 July, would we still be getting the full extent of the 16 day tour'. She said, 'Yes, you will be making up the day on the way back from Hong Kong. When you arrive back from Hong Kong you will havi: that day in Singapore that you did not get on the way up'." Mrs. Don's recollection of the conversation was given as follows: "Later on, e1ther Miss Court or Mrs. Court rang me to ask me whether the tour had in any way been shortened and I said I would go back to World Travel while she hung an, on the other line. I spoke with Sue Lynch and asked her whether they were getting any reduction in the nights away and Sue said 'No'. The night that was to be in Singapore in the first part of their journey had been transposed to the end ef their jJourmey, so they were getting the extra night in Singapore after Hong Kong: and this is what I passed on to Mrs. or Miss Court on the other end of the phone." The significant features of their conversation are that Mrs. Court enquired whether she would still be getting the full length of the tour, which 1s confirmed by Mrs. Don's version that she had enquired if the tour had been shortened, that Mrs. Don had not the information on hand to answer the enquiry and had to refer to Mrs. Lynch and that the two travel agents spoke not of shortening the tour but of the number of nights of the tour. Mrs. Court for her part understood the information she received from Mrs. Don as indicating that the day lost in Singapore in the early part of the tour would be made up at the end. This satisfied 13. her for her particular interest was the nuinbc1 of days in which she could shop. However, to the travel agent, the number of nights involved in the tour was more significant because as Mrs. Don said the hotel expenses were the main cost and "that is what I was interest- ed in". Mrs. Court received on 28 June 197" from Jetset Tours a copy of the itinerary of the tour showing the new arrangements as made by Mr. Schultz. She said that this was the first time that she appreciat- ed that she would be losing the daylight hours of one day 1n Singapore, and that she complained to Jetset Tours sonecrning this loss. The upshot of this evidence 1s that I find that the only alteration to the brochure which was notified by the defendant to Jetset Tours and by Jetset Tours to the Courts prior to the payment by Miss Court on 18 May 1979 was the amended date of departure, There was no evidence that Mrs or Miss Court were aware or should have been aware prior to this date of any consequential changes. Subsequent to this payment by her daughter, Mrs. Court was alerted to further consequential changes. Prior to 31 May 1979 when Mrs. Court made a final payment she was made aware that there were consequential changes to the itinerary disclosed by the brochure, but she misunderstood the true nature of the changes. My finding on this score 1s that the two instalments of the deposits were received by Jetset Tours at a time when the Courts understood the only amendment to the itinerary as disclosed in the brochure was the changed date of departure. I would also find that the position was the same when Miss Court made the payment on 18 May 1979. At the time when Jetset Tours received the final payment on 31 May 197% the Courts were aware or should have been aware that th-re were consequential changes 14. but they did not appreciate the actual nature of the changes. Mrs. Court did not understand the true position until she telephoned Jetset Tours after collecting her tickels in June 1979 and the telephone call confirmed the advice in heir itinerary. I turn to the question whether on these facts I am satisfied, to the requisite degree of certainty, to find that a contravention has occurred in any one or more of the circumstances alleged by the informations. Each of the charges was in the following genc1ral form differing only as to the amount paid and the name of the alleged payer, namely that "...between the ninth day of May 1°79 and the eleventh day of July 1979 inclusive at Perth in the State of Western Australia you being a corporation in trade or commerce did contrary to the provisions of section 79(1)(a) of the Trade Practices Act 1974 contravene section 58(b) of the said Act aun that you did accept payment for services when at the time of such acceptance you did intend to supply services Materially different from the services in respect of which the payment was accepted in that you did accept from Roslyn Denise Court the sum of $50 as a deposit for a 'Swingaway Asia Group Holiday G.P.FE.' tour, the said tour having been represented by you as being of 16 days duration when at was of 15 days duration only." Particulars of the charge were supplied as follows: "1. Between the abovementioned dates you (a) did accept from Roslyn Denise Court, by your agent Jetset Tours (W.A) Pty. Ltd. the sumof $50.90 (b) the said sum of $50.00 was a deposit for a tour advertised and represented by you as 'Swingaway Asia Group Holiday G.P.E. ' departing Perth 10th July 1979 and of 16 days duration. 2. The prosecutor alleges; the said tour was of 15 days' duration only departing Perth on 11 July 1979 and at the time of acceplance of the said payment of $50.00, from the said Roslyn Denise Court, you did intend to supply ocivices materially different from the services 1m respect of which the said payment was accepted in that the said tour was of 15 days' duration only and was to depart Perth on 11 July 1979," Section 58 is not an easy provision to understand or apply, particularly in the complex circumstances of this matter. Sub- section (b) uses the words "services matci1ally different from the... services in respect of which the payment or other consideration 1s accepted". It 15 especially difficult to define and determine the latter services in this case, Counsel fo1 the prosecutor and the defendant each contended for a widely contrasting construction of the words "services in respect of which the payment or other consider- ation s accepted" and the proper construction 1s crucial to the correct decision on the charges before me. Counsel for the defendant submitted that the intention of the provider of the services was crucial not only in defining the services 1t proposed to supply, but in deteimining the services in respect of which the payment was accepted. He contended that in this matter there could be no contravention because, stated simply, on each of the dates upon which it allegedly accepted payments 1¢ intended to supply by way of services that which it did in fact ultimately supply. There was no dispute that such intention was to supply the services as set out in the brochure as altered in January 1979 and advised to Mrs. Lynch by telex on 5 February 1979. Bocause these were the services which the defendant at all relevant times intended to supply and did in fact supply it was contended that they must be the services 1n respect of which the payments were accepted. Counsel drew attention to the fact that under the section the antention of the provider of the services was, he said, the significant feature, and he relied upon the use of the word "accepted" rather than the words "paid" or "received". As the emphasis was throughout on the provider of services and its state of mind, the services in respect of which payment was accepted must be determined, he submitted, by the circumstances in which the payment was received by the provider of services, including in particular its state of mind. There was no basis or justification, he contended, for investigating the services which the consumer thought she was paying for, or what services would obzectively be determined to be provided for by the terms of the contract between the parties. It followed, he said, that the protection of the consumer was not the purpose of the enactment of the section, but rather it was to enact a lew offence of falsely representing an intention to carry out a promise. In the past, because a representation as to future conduct was not regarded as a false statement of an existing fact, such a represent-— ation did not found the crime of false pretences. Section 58 was enacted to remedy this situation and was contravened only if the defendant had accepted payment in respect of a promise which the defendant had no intention of performing. In the present matter the defendant intended at the time of acceptance to perform the services which it believed it was offering to the public and these were the services it did ultimately supply. Thus it was said there could bo no contravention, Counsel for the prosecutor put forward a construction of the words "services 1n respect of which the payment... 1S accepted" diametrically opposed to that of the dlefendant. He contended that these services were the services which at the relevant times Mrs. and Miss Court could reasonably expect to r.celve and in respect of which they made their payments. He also submitted that the offence was complete at the time of acceptance ot the payment and what happened thereafter was of no relevance. 17. In general I accept the prosecutor's construction as the preferred construction though 1n my opinion, where thcre is uncertainty (as in this matter), the services to be provided would be a matter for objective determination by the court. Inu such a case the subjective intention of each of the parties would be of less significance than the inferences to b. drawn from the1r words and conduct. In Smith v Hughes (1871) LR 6 Q.B. 597 Blackburn J. referred to the matters of subjective intention and objective determination, He said at p.607: "I apprehend that 1f one of the parties intends to make a contract on one set of terms, and the other intends to make a contract on another set of terms, or, as 1t 15 some- times expressed,if the parties are not ad idem, there 1s no contract, unless the circumstances are such as to preclude one of the parties from denying that he has agreed to the terms of the other. The rule of law 15 that stated in Freeman v Cooke. If, whatever a man's real intention may be, he so conducts hamself that a reasonable man would believe that he was assenting to the terms proposed by the other party, and that other party upon that belief enters into the contract with him, the man thus conducting himself would be equally bound as if he had intended to agrce to the other party's terms." The author of Chitty on Contracts, 24 ed. at p.136 says on this point: "...- the antention of the parties 1s, as a general rule, to be construed objectively. The language used by one party, whatever his real intention may be, 1s to be construed in the sense in which it would be reasonably understood by the other, or at least in the sense in which a reasonable person would construe it... In most cases the application of the objective test will preclude a party who has entered anto a contract under a mistake from setting up his mistake as a defence to an action against him for breach of contract. If a reasonable man would have understood the contract 1n a certain sense, then, despite his mistake, the court will hold that the mistaken party 1s bound." 18. In Goldsbrough Mort & Co Ltd. v Quinn (1910) 10 C.L.R. 674 at p.695 Isaacs J. expressly approved the observations of Blackburn J. in Smith v Hughes supra. The Master of the Rolls, Lord Denning, would doubtless also approve this as a foreshadowing of the doctrine of promissory estoppel. It falls therefore to the court to decide the terms of the agreement between the parties and in particular the services which at the time it accepted payments the deiendant was obliged to provide. Such decision will be reached upon the bausis of what a reasonable third party would infer from the words and conduct of the parties to the agreement, In different circumstances a court maght conclude that because the parties were not ad idem, it was impossible to anfer the existence of any agreement, but such is not the case here. I have already set out in some detail the relevant facts in this matter. The defendant distributed to the public a brochure wherein 1t set out details of the tours which it offered for sale. Subsequently it altered the itinerary of certain tours but did not amend or withdraw the brochures which remained with retail travel agents. If it wished to ensure that purchasers were aware of the services which 1t proposed to provide in Lieu of those in the brochures, it was obliged clearly and uneyuivocally to draw to their attention the alterations. To the extent that it failed to do so, it was the author of any consequent misunderstandings. In setting up what he called his fail safe system Mr. Schultz acknowlcdged that he accepted the situation that if the defendant failed to inform purchasers of the changes,a customer could be paying fer something a@ifferent from that which his company proposed to supply. That system was implemented in this present matter by the telexes to Mrs, Lynch and her telephone conversations with Mrs. Don. ' 19. On the basis of the Smith v Hughes test supra, it 18 necessary to determine objectively whether, whatever be the state of mind or misunderstanding of the Courts, a reasonable man would conclude that the alterations had been sufficiently brought to thear attention at the relevant times. In other words, would he consider that the Courts should have been aware of the alterations. To the extent to which a reasonable man would conclude that they were aware or should have been aware of the alterations, the services for which the payments were made would comprise the services itemised in the brochure amended to the extent of such conclusions. Applying this test to the evidence concerning the altered date of departure, this evidence 18 not sufficient to satisfy me that there was a failure to notify the Courts of this change to-the brochure. In respect of the loss of time in Singapore I am satisfied that this alteration to the services was not sufficiently brought to their attention at the time of the payments on 10, 11 and 18 May 1979, I make this finding because I am satisfied, to the extent of being without reasonable doubt, that the defendant had not by the lastmentioned date made Mrs. Don of Jetset Tours, and a fortiori the Courts, aware of the loss of time in Singapore. I am satisfied that this asa consequential alteration was effectively conveyed to the defendant's head office in Perth, but that prior to the occasion when Mrs. Court had her telephone conversation with Mrs. Don, the latter was not aware and had not been made aware of this loss of time. It follows that a reasonable man would not conclude that the Courts should have been so aware, and thus the services offered in the brochure were not amended to the extent of this alteration. In respect of the payment received by Jetset Tours on 31 May 1979 I reach a different conclusion. The evidence leaves me in a state of doubt as to whether 1n consequence of the information given 20. to Mrs. Don by Mrs. Lynch and by Mrs. Don to Mrs. Court, the latter was aware or should have been aware of the loss of time in Singapore. Resolving that doubt in favour of the defendant, I am not satisfied that a reasonable man would conclude that the services in respect of which the payment was made on 31 May 1979 were the services as itemised in the brochure and amended only as to the date of departure. He might well conclude that Mrs. Court should have been aware of the likelihood of additional amendments. Counsel for the defendant attached much significance to the presence of the word "accept" and contended that 1ts use precluded me from making the above findings because the defendant was unaware of the Courts state of mind. I would agree that its meaning certainly goes beyond the physical act of receiving payment, and would refer to the discussion of the topic and the differing views as to the appropriate meaning in the particular context in Becker v Corporation of Marion (1974) 9 S.A.S.R. 543, a decision of the Full Court of the Supreme Court of South Australia and on further appeal as reported in {1977] A.C. 271 at pp.285-286. Counsel for the defendant referred to the interpretation placed on the word "accept" in AVA (297 4] 1 All E.R. 755 at pp.762 and 763 and in particular to the following sentence: "Acceptance, in my judgment, involves a deliberate act of recognition of a state of affairs different from the state of affairs which actually exists or may possibly exist and the assumption of obligations depending on the recognised, as opposed to the actual or possible, state of affairs." However "accept" was there interpreted in the context of matrimonial law and the acceptance by a husband of his wife's child as a child of their family. Moreover as Bagnall J. pointed out at p.762, "the concept of acceptance has nothing to do with the law of contract", whereas in my opinion the law of contract 1s very relevant 21. to the meaning of the word "accept" in this matter. Counsel for the defendant contended that there could be no true acceptance if the acceptor was ignorant of the relevant facts, and thus in this matter, the defendant being ignorant of what services the Courts had in mind, there was no acceptance by the defendant. If there was any acceptanca he contended, it was acceptance on the basis of what the defendant had an mind to supply. It was in relation to this argument that counsel conceded that the defendant always intended to supply some- ' thing different from what was in the brochure and he contended that that intention had been communicated to the Courts. He acknowledged early in his submissions that 1f the defendant had fa1led to prove that communication, it was in some difficulty. It may well be that this acknowledgement was ultimately withdrawn but in my view the concession and the acknowledgement correctly stated the position, The acceptance by the defendant of the payments was an acceptance against the background of an invitation to the public in general and Mrs and Miss Court in particular to purchase specified tours on the terms and conditions set out in the brochure. In particular, members of the public were advised of the cost of the tours and directed to make specified payments in the manner therein set out. If the defendant received a payment in respect of any of the tours, in my opinion that payment is accepted for and in the context of the features of the tours specified, except to the extent that any alteration thereof 1s communicated to the payer. It 1s not correct to say, aS was put by counsel for the defendant, that acceptance could be thrust" upon the defendant upon terms of which it was unaware. Rather it 1s to be taken to accept upon terms of which 1t should be aware. In my opinion the use of the word "accept" does not enable the defendant to contend that it received payment for services which were different from those which the consumer was entitled to 22. assume she would receive, such entitlement being objectively determined 1n accordance with the test 1n Smith v Hughes supra. It was also submitted that Jetset Tours in receiving the payments from Mrs and Miss Court were acting as their agent and not as agent for the defendant. If this be the case, the defendant did not "accept" payments, 1t was said, until such time as the various amounts were received by 1t, 1.e. some days subsequent to receipt by Jetset Tours. Jetset Tours received payments on account of the deposit on 9 and 10 May 1979 respectively and the defendant received these payments at the latest on 15 May 1979. Miss Court paid to Jetset Tours an amount on account of the fares on 18 May 1979, prior to the date upon which she or her mother became aware, in my findings, of those changes to the itinerary other than the amended date of departure. Mrs. Court paid the balance on 31 May 1979, subsequent to ascertaining some details of alterations from Mrs. Don, and both amounts less commission were paid to the defendant on 6 June 1979, As each of the charges alleges that the contraventions occurred on the day upon which the relevant payment was received by Jetset Tours, it is only necessary to determine whether, as alleged in each charge, Jetset Tours, in accordance with the partaculars, accepted the payment as agent for the defendant. In other words I must decide whether receipt by Jetset Tours amounted in the circumstances to receipt by the defendant. Such will in my opinion be the case if Jetset Tours received the payment in question with the authority, express or implied, of the defendant and because, as Lord Herschell said, "no word 1s more commonly and constantly abused than the word 'agent'" (See International Harvester Co of Australia Pty. Ltd. v Carrigan's Hazeldene Pastoral Co (1958) 100 C.L.R. 644 @ 23. p.652), I prefer to consider this as a matter of authority rather than agency. Counsel for the defendant referred to that portion of the judgment of the court in Peterson v Maloney (1951) 84 C.L.R. 91 at 95, namely: "But it must, we think, be regarded as scttled law that an agent employed to find a purchase: has no implied authority to receive the purchase money in the sense that a receipt by him 1s a receipt by his principal and will therefore discharge the purchase? ." It can not be said that this 1s authority for the general proposition that an agent has no implied authority. Rather it relates to a more limited authority, namely to give a receipt in discharge of the payer. In addition to drawing attention to the nature of the implied authority which was referred to in that dicta, I would refer to the short reasons of Sankey J. 1n Butwick v Grant f1924} 2 K.B. 483 at 489, He said: "I found my judgment upon that of Lush J. in Drakeford v Piercy. He there said: 'that an agent authorised to sell has as a necessary legal consequence authority to receive payment is a proposition utterly untenable and contrary to authority'. In an action by the seller of goods against the buyer for the price it would be open to the buyer who had paid the seller's agent to show, and in the absence of any reason to the contrary he would be entitled to succeed on showing, either that the agent had actual authority to receive payment, or that he had ostensible authority to receive payment, or that he had a customary authority by reason of the fact that the payment was made to him in the ordinary course of the business of agencies of the kind in question. In the present case the county court judge has found that no authority of any of these descriptions was shown to have been possessed by the agent." In this present matter the prosecutor contended that it was open to it to show authority of any of the above descriptions, and also pointed to s.84(2) of the Act, which yocs beyond those forms of 24, authority and 1s in the following terms: "Any conduct engaged in on behalf of a body corporate by a director, agent or servant of the body corporate or hy any other person at the direction or with the consent or agreement (whether express or implied) of a director, agent or servant of the body corporate shall be deemed, for the purpose of this Act, to have been engaged in also by the body corporate." However, in my opinion, without calling tn aid s.84(2) I consider there 1s sufficient evidence upon which I can act to find implied authority in Jetset Tours to accept payments from prospective tourists, particularly in that there was no evidence tendered by the defendant to the contrary. Mr. Pateman, a director of Jetset Tours, gave evidence of the arrangements between his company and the defendant. He also deposed to the business practices in the 2ndustry, which practices support my view of Jetset Tours' authority. Support 1s also to be found in the defendant's document wherein was calculated the balance of the fares. This document contemplated that such balance would be paid to the travel agent, and the agent was authorised to deduct its commission prior to paying the defendant. Moreover the document was directed by the defendant not to the Courts but to Jetset Tours, and there 1s nowhere any suggestion that the amount of the balance fare should be paid by the Courts direct to the defendant. Furthermore, I attach considerable significance to the invitation on the back of the brochure which I have already mentioned and which can only be seen as a request by the defendant to the public not to deal directly with the defendant but to deal through a specified retail agent. It 1s an the following terms: "Please make your reservations with the Travel Agent whose name appears below", 25. and 18 accompanied by a large white block 1n which the name and address of Jetset Tours was stamped. That this amounts to a holding out by the defendant of Jetset Tours as a body authorised to collect payments and make bookings for the defendant's tours is 1n my view confirmed also by the Reservation Request, a form of which 1s also included in the brochure. Once again the defendant has requested the prospective purchaser to deal with a retail agent and to make payment to such agent for ultimate disbursement to the defendant. Additionally in that document, which names the retail agent and not the defendant, the purchaser "agrees to accept the conditions which are the basis of the contract". It follows that, in my opinion, Jetset Tours was authorised by the defendant to accept money on its behalf, and for this limited purpose at least was the agent of the defendant. A further submission of counsel for the defendant was the contention that the amounts paid by way of deposit did not in law amount in the circumstances of this case to "payment or other consideration" for services. He presented this argument on the basis that a deposit 1s in truth merely an carnest for performance, and not a payment for services. Reference was made to Brien v Dwyer (1978) 53 A.L.J.R. 123 especially per Gibbs J. at 127-8, Soper v Arnold (1889) 14 App. Cas 429 at p.435 and Howe v Smith (1884) 27 Ch.D 89. In the first mentioned case Gibbs J. at p.127 said: "The nature of a deposit 18 well understood. In Soper v Arnold (1889) 14 App Cas. 429 at p.435, Lord Macnaghten Said: 'The deposit serves two purposes - 1f the purchase 1s carried out 1t goes against the purchase money - but its primary purpose is this, it 1S a guarantee that the purchaser means business..." 26. In the present matter not only was the purchase "carried out" so that the deposit went in fact against the purchase price of the Services, but that this was to be the case was expressly provided by condition 8 of the defendant's conditions of service. In my opinion, each of the payments made to Jetset Tours on behalf of the defendant was a payment for serviccs. The final question 1s whether the services 1n respect of which Jetset Tours accepted on behalf of the defendant the Courts' payments were materially different from those which the defendant intended on the relevant dates to supply and did in fact supply. This is a question of degree, in that there was without doubt some difference. On my findings of fact the Courts reasonably expected on 9, 10 & 18 May 1979 to receive two full days in Singapore at the commencement of their tour, They received, as the defendant at all relevant tames intended they should receive, one full day at that time and the night hours of an additional day at the end of the tour. In my opinion, considered objectively, such a difference was a material difference, and was certainly seen as such by Mrs. Court. Likewise Mr. Schultz saw two consecutive full days in Singapore as a significant feature of the tour and as an attractive offer to a prospective purchaser. It was thus an offer likely to influence the decision of a reasonable person. I find the alteration was Material and that it entarled the supply of materially different services. My findings stated in general terms are that the defendant by its agent Jetset Tours accepted payments on 10, 11 and 18 May 1979 in consideration for services which it intended to supply, which services differed materially from the seivices for which a reasonable 27. man would conclude it had accepted the payments. It follows that in respect of these findings there have been contraventions of s.58 (b) of the Act. The prosecutor laid five charges in relation to these contraventions, two in respect of each of the two earlier days ana one in respect of 18 May 1979. I can not accept that two contraven- tions of the section occurred on each of the earlier days. The occasion of a contravention is the acceptance of payment, and in my opinion because on each day there was an acceptance of payment on one occasion only, there was only one offence. Admittedly, each time money was paid, it was paid in respect of services to be supplied to two persons. However such is nothing to the point, so long as there was only one acceptance of payment. It can not be that there are as many contraventions as there are persons in respect of whom the services are to be supplied when one payment only 1s accepted an respect of the services. There was nothing in the evidence to suggest that on each day there were two separate acceptances of payment. As there was only one acceptance each day, I do not consider it appropriate that the defendant should be found to have committed on each occasion more than one offence. I will in due course enter a conviction in respect of the two earlier dates on charges numbered respectively G21 of 1980 and G23 of 1980. As to charge numbered G25 of 1980 I will enter a conviction and I will dismiss charge numbered G26 of 1980. I will hear counsel on the fate of charges G22 and G24 respectively of 1980 and also on the two matters of fines and costs. I draw the parties! attention to the provisions of Order 49 rule 5 of the Rules of Court and adjourn the ' proceedings to a date to be fixed. 28. I do not propose to enter any formal judgments at this stage but to stand the actions over to enable the aforesaid matters to be determined. The time for appeal will therefore not run until I enter formal judgment on each of the charges. = | certify that this and the <2 / preceding pages are a true Copy of the Reasons for Judgment of Mr Justice Fisher Cpa P| sian Dated ZB Mevemhur (RD v