Optic Security Australia 2 Pty Limited v YC Investments (NT) Pty Ltd [2023] FCA 495

FEDERAL COURT OF AUSTRALIA

Optic Security Australia 2 Pty Limited v YC Investments (NT) Pty Ltd [2023] FCA 495 File number: NTD 23 of 2020

Judgment of: CHARLESWORTH J

Date of judgment: 19 May 2023

Catchwords: CONTRACTS – agreement providing for the sale of shares in multiple entities following a due diligence process – agreement containing contractual warranties concerning the truth and accuracy of representations made in the due diligence process – whether a claim founded in breach of the warranties is precluded from enforcement by time bar provisions in the agreement – claim barred from enforcement – applicant failing to prove breach to requisite standard in any event CONTRACTS – cross-claim for sum of money payable under a contract – cross-respondent seeking set-off of judgments – cross-respondent not securing any judgment – cross-respondent failed to otherwise put forward a substantive defence to the allegation of non-payment – payment owing by the cross-respondent to be made forthwith CONSUMER LAW – action for damages and other remedies founded on alleged contraventions of s 18 of the Australian Consumer Law – whether representations made by the respondent in a due diligence process culminating in the sale of shares were misleading and deceptive or likely to mislead or deceive – whether representations were with respect to future matters within the meaning of s 4 of the Australian Consumer Law – whether representations deemed to be misleading and deceptive because of the operation of s 4 – applicant founding its case on an allegation that a gross profit margin forecast for a commercial contract was overstated – applicant advancing a positive case that the methodology for calculating the gross profit margin was erroneous – applicant failing to establish the erroneous methodology was employed in fact – applicant otherwise failing to establish that the forecast gross profit margin was inaccurate or otherwise misleading – applicant alleging an alternate transaction would have been entered into had the alleged contraventions not occurred – no evidence the alternate transaction would have been entered into by both the buyer and seller of the shares – insufficient evidence to quantify claims for damages