Mensie Services Pty Ltd v Newserv Pty Ltd [2023] NSWSC 65

Supreme Court New South Wales

Medium Neutral Citation: Mensie Services Pty Ltd v Newserv Pty Ltd [2023] NSWSC 65 Hearing dates: 11-15 July 2022 Date of orders: 10 February 2023 Decision date: 10 February 2023 Jurisdiction: Equity Before: Richmond J Decision: Cross-claimant is entitled to an order under ss 237 and 242 of the ACL that the "Purchase Price" in the Sale Agreement be reduced from $3 million to $2.1 million, with the effect that the "Advance" owing under the Loan Agreement will be reduced from $1.5 million to $600,000. Plaintiff is entitled to judgment in the sum of $600,000 plus interest at the rate of 8% per annum from completion date less amounts of interest already paid. Catchwords: CONTRACTS — breach of contract — where defendant ceased payments under agreement for the sale of a business — plaintiff entitled to amount owing under that contract CONTRACTS — breach of contract — breach of contractual warranty — where cross-defendant warranted that accounts were materially accurate, do not overstate the profitability or net financial position of the business and are not affected by unusual or non-recurring items — whether entitlement to damages — whether breach was causative of cross-claimant's loss — quantum of damages CONSUMER LAW — misleading or deceptive conduct — causation or reliance — whether misstatement of subcontractor expense was causative of cross-claimant and defendant's loss CONSUMER LAW — enforcement and remedies — action for damages — measure of damages — whether an order should be made pursuant to s 237 to compensate for the cross-claimant and defendant's loss by reducing the contract price Legislation Cited: Competition and Consumer Act 2010 (Cth), Sch 2 (Australian Consumer Law) ss 18, 236, 237, 242 Income Tax Assessment Act 1936 (Cth) s 262A Cases Cited: Blatch v Archer (1774) 1 Cowp 63 Britannia Pty Ltd v Parkline Constructions Pty Ltd (2006) 67 NSWLR 9; [2006] NSWCA 238 Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304; [2009] HCA 25 Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64; [1991] HCA 54 Eastgate Group Ltd v Lindsey Morgan Group Inc [2002] 1 WLR 642 EW Blanch Pty Ltd v Cooper [2005] NSWCA 217 Henville v Walker (2001) 206 CLR 459; [2001] HCA 52 HWT Valuers (Central Qld) Pty Ltd v Aston Land Pty Ltd (2004) 217 CLR 640; [2004] HCA 54 Karim v Wemyss [2019] EWCA Civ 27 Leadenhall Australia Ltd v Peptech Ltd [2001] NSWCA 272; 39 ACSR 265 Merck Sharp & Dohme (Aust) Pty Ltd v Peterson (2011) 196 FCR 145; [2011] FCAFC 128 O'Brien v Bank of Western Australia Ltd [2013] NSWCA 71 Zong v Wang [2022] NSWCA 80; 401 ALR 698 Category: Principal judgment Parties: Mensie Services Pty Ltd (Plaintiff/First Cross-Defendant) Mr Mensie Menashie (Second Cross-Defendant), Ms Julyana Dankha (Third Cross-Defendant) Menashie Services Pty Limited (Fourth Cross-Defendant) Newserv Pty Ltd (First Defendant/First Cross-Claimant) Mr Simon Bartter (Second Defendant/Second Cross-Claimant) Representation: Counsel: Mr R Gration (Plaintiff/Cross-Defendants) Mr A Di Francesco (Defendants/Cross-Claimants)