Badger v John Kagelaris Pty Ltd [2019] NSWSC 1792

Supreme Court New South Wales

Medium Neutral Citation: Badger v John Kagelaris Pty Ltd [2019] NSWSC 1792 Hearing dates: 13, 14 and 15 May 2019 Date of orders: 13 December 2019 Decision date: 13 December 2019 Jurisdiction: Equity Before: Henry J Decision: (1) Pursuant to Competition and Consumer Act 2010 (Cth), Sch 2 – Australian Consumer Law, s 243, declare the whole of the Business Sale Agreement between the plaintiff and the first and second defendants dated 14 January 2017 to be void. (2) Pursuant to Competition and Consumer Act 2010 (Cth), Sch 2 – Australian Consumer Law, s 237, order the second and third defendants to pay to the plaintiff the sum of $114,991.48. (3) Order the second and third defendants to pay the plaintiff's costs of the proceedings. (4) The plaintiff to file and serve any application for a special costs order by 14 January 2020. (5) The second and third defendants to pay the plaintiff interest of $17,999.06 pursuant to Civil Procedure Act 2005 (NSW), s 100. Catchwords: CONTRACTS – misleading conduct under statute – misleading or deceptive conduct – representations – inducement to enter into contract for purchase of business – false information provided about customer base and profitability of business – whether third defendant a mere conduit of first and second defendants – whether third defendant acting solely on behalf of corporation or personally liable – alternative claim of accessorial liability – whether contract affirmed – contract declared void Legislation Cited: Civil Procedure Act 2005 (NSW), s 100 Competition and Consumer Act 2010 (Cth), ss 139B, 139C, Sch 2 – Australian Consumer Law, ss 18, 236, 237, 243 Corporations Act 2001 (Cth), s 601AD(1) Uniform Civil Procedure Rules 2005 (NSW), r 36.17 Cases Cited: Alati v Kruger (1955) 94 CLR 216 Arktos Pty Ltd v Idyllic Nominees Pty Ltd [2004] FCAFC 119 Australian Competition and Consumer Commission v Birubi Art Pty Ltd [2018] FCA 1595 Awad v Twin Creeks Properties Pty Limited [2012] NSWCA 200 Borzi Smythe Pty Limited v Campbell Holdings (NSW) Pty Limited [2008] NSWCA 233 Butcher v Lachlan Elder Realty Pty Limited (2014) 214 CLR 592; [2004] HCA 60 CH Real Estate Pty Ltd v Jainran Pty Ltd; Boyana Pty Ltd v Jainran Pty Ltd [2010] NSWCA 37 Google Inc v ACCC (2013) 249 CLR 435; [2013] HCA 1 Havyn Pty Ltd v Webster [2005] NSWCA 182 Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (No 1) (1988) 39 FCR 546; (1988) 79 ALR 83 Henville v Walker (2001) 206 CLR 459; [2001] HCA 52 Houghton v Arms (2006) 225 CLR 553; [2006] HCA 59 I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109; [2002] HCA 41 Khoury v GIO of NSW (1984) 165 CLR 622 Munchies Management v Belperio (1988) 58 FCR 274; (1988) 84 ALR 700 Myers v Transpacific Pastoral Co Pty Limited (1986) ATPR 40-673 Rafferty v Madgwicks; Time 2000 Systems (Aust) Pty Ltd v Rafferty (2012) 203 FCR 1; [2012] FCAFC 37 Sykes v Reserve Bank of Australia (1998) 88 FCR 511 Yorke v Lucas (1985) 158 CLR 661 Category: Principal judgment Parties: Stephen Badger (plaintiff)