Burke v LFOT Pty Ltd [2000] FCA 1155

FEDERAL COURT OF AUSTRALIA

Burke v LFOT Pty Ltd [2000] FCA 1155 CONTRACT – whether the first appellant, in scrutinising a draft contract for the sale of a tenanted property by the first respondent to the second appellant and effectuating exchange, was acting in his capacity as a director of the second appellant or as a solicitor pursuant to a retainer – if there was such a retainer, whether it was a retainer to act generally in the purchase or whether it was a limited retainer to execute the conveyancing aspects of the purchase – whether the retainer included an implied duty of care which the first appellant breached by failing to advise the second appellant as to the desirability of making inquiries concerning the financial situation of the tenants – whether the second appellant, if it had made inquiries concerning the financial situation of the tenants, would have discovered the truth – whether, in circumstances in which the first respondent's contravention of s 52 of the Trade Practices Act 1974 (Cth) (TPA) was found to have been an operative cause of the second appellant's decision to purchase the property and the loss thereby sustained, it was open to the primary Judge to find that the first appellant's failure to advise the second appellant to make inquiries, by which the falsity of the first respondent's misrepresentation would have been discovered, was also a cause of the loss DAMAGES – measure of damages in respect of loss caused by the first appellant's breach of his retainer – measure of damages under s 82 TPA in respect of loss caused by the first respondent's contravention of s 52 – relevance of the second appellant's allegedly incompetent management of the property after settlement – method of calculation of the true value of the property at the time of sale CONTRIBUTION - right to contribution at common law and in equity - whether the first respondent (having been held liable to pay damages to the second appellant under s 82 TPA in respect of its contravention of s 52) and the second respondent (having been held liable to pay damages to the second appellant under s 82 in respect of his involvement, within the meaning of s 75B, in the first respondent's contravention of s 52) were entitled to claim contribution against the first appellant (who had been held liable to pay damages to the second appellant in respect of a breach of his contract of retainer) - whether contribution may only be claimed by one party from another if the first party has fully discharged, or has been adjudged liable fully to discharge, a common obligation to a third party, or whether the first party may cross-claim for contribution against the second party in the proceeding in which the first party's liability to the third party is to be determined - whether the loss caused by the breach of contract was the same loss as that resulting from the conduct infringing s 52 - whether the measure of damages payable in respect of the breach of contract is the same as that payable in respect of the contravention of s 52 - whether a claim for contribution is to be refused or adjusted by reference to the perceived degree of culpability of each of the wrongdoers - whether contribution would be required if it were established that one wrongdoer was obliged to indemnify the other, and whether a right to indemnity had been established in this case – apportionment of contribution Trade Practices Act 1974 (Cth), ss 52 and 82 Fair Trading Act 1985 (Vic) Law Reform (Miscellaneous Provisions) Act 1946 (NSW), s 5 Merryweather v Nixan (1799) 8 TR 186; 101 ER 1337, referred to Craythorne v Swinburne (1807) 14 Ves Jun 160; 33 ER 482, referred to Lingard v Bromley (1812) 1 V & B 114; 35 ER 45, referred to Holmes v Williamson (1817) 6 M & S 158, referred to Boulter v Peplow (1850) 9 CB 493, referred to Spottiswoode's Case (1855) 6 De GM & G 345, referred to Marsack v Webber (1860) 6 H & N 1, referred to Lowe v Dixon (1885) 16 QBD 455, referred to Re Denton's Estate, Licenses Insurance Corporation and Guarantee Fund Ltd v Denton [1904] 2 Ch 178, referred to Spicer v Spicer (1931) 47 CLR 151, referred to McLean v Discount and Finance Limited (1939) 64 CLR 312, referred to Eyre v NZ Press Association Limited [1968] NZLR 736, referred to Albion Insurance Co Ltd v Government Insurance Office (NSW) (1969) 121 CLR 342, referred to Neilsen v Hempston Holdings Pty Ltd (1986) 65 ALR 302, referred to Scholefield Goodman & Sons Ltd v Zyngier [1986] AC 562, referred to Sutton v Thompson Pty Ltd (1987) 73 ALR 233, referred to B P Petroleum Development Ltd v Esso Petroleum Co [1987] SLT 345, referred to Johnson v Perez (1988) 166 CLR 351, followed Nikolaou v Papasavas, Phillips & Co (1989) 166 CLR 394, followed Spika Trading Pty Ltd v Harrison (1990) 19 NSWLR 211, referred to Argy v Blunts & Lane Cove Real Estate Pty Limited (1990) 26 FCR 112, referred to Re La Rosa; ex parte Norgard v Rodpat Nominees Pty Ltd (1991) 31 FCR 83, referred to Trade Practices Commission v Manfal Pty Ltd (No 3) (in liq) (1991) 33 FCR 382, referred to March v E & M H Stramare Pty Ltd (1991) 171 CLR 500, referred to Mahoney v McManus (1991) 180 CLR 370, referred to Wardley Ltd v Western Australia (1992) 175 CLR 514, referred to Deanplan Ltd v Mahmoud [1992] 3 All ER 945, referred to Capita Financial Group Ltd v Rothwells Ltd (1993) 30 NSWLR 619, referred to Cummings v Lewis (1993) 41 FCR 559, distinguished Dorrough v Bank of Melbourne Ltd (1995) ATPR (Digest) 46‑152, referred to Street & Halls v Retravision (NSW) Pty Ltd (1995) 56 FCR 588, referred to Henderson v Amadio (No 1) (1995) 62 FCR 1, followed Kizbeau Pty Ltd v W G & B Pty Ltd (1995) 184 CLR 281, followed Jones v Mortgage Acceptance Nominees Ltd (1996) 63 FCR 418, referred to Austotel Management Pty Ltd v Jamieson (1996) ATPR 41‑454, referred to Yenald Nominees Pty Ltd v Como Investments Pty Ltd (1996) 18 ATPR 42,349, referred to Trumble Szanto Braham (a firm) v Soultanides (Victorian Court of Appeal, unreported, 9 May 1996), followed ABCOS v Jones (1997) 150 ALR 488, referred to Como Investments Pty Ltd (in Liq) v Yenald Nominees Pty Ltd (1997) 19 ATPR 43,617, referred to Henderson v Amadio (No 1) (1998) 81 FCR 149, followed Bialkower v Acohs Pty Ltd (1998) 83 FCR 1, referred to James Hardie & Co Pty Ltd v Seltsam Pty Ltd (1998) 196 CLR 53, referred to Allison v Uatar Management Services Limited NZCA, 17 December 1999 CA146/98, referred to Bowler v Hilda Pty Ltd [2000] FCA 899, referred to Austral Pacific Group Pty Ltd v Airservices Australia [2000] HCA 39, referred to GIO Finance Ltd v Cockburn [2000] NSWSC 362, referred to Meagher, Gummow and Lehane, Equity – Doctrines and Remedies (3rd ed, 1992), referred to Goff and Jones, The Law of Restitution (4th ed, 1993), referred to Mason and Carter, Restitution Law in Australia (1995), referred to Goff and Jones, The Law of Restitution (5th ed, 1998), referred to Fleming, The Law of Torts (9th ed, 1998), referred to WILLIAM ROBERT BURKE AND HANAVE PTY LIMITED v LFOT PTY LIMITED AND PAUL EWEN MITCHELL TRESSIDER AND JOSEPH RAYMOND GLEW N 1394 OF 1999 LEE, HEEREY AND LEHANE JJ 18 AUGUST 2000 SYDNEY