12 Misleading or Deceptive Conduct © Oxford University Press, All rights reserved.

Misleading or deceptive conduct: section 52 TPA Main objectives: understand parameters of the provision understand the relationship between the statutory provision and the common law of misrepresentation.

Misleading or deceptive conduct cont... Section 52 provides that “a corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.”

Misleading or deceptive conduct cont… Therefore threshold requirements of s 52 are: corporation (or people who fall within extended reach provisions, in particular s 6) in trade or commerce must not engage in conduct that is misleading or deceptive.

Misleading or deceptive conduct cont… Scope of s 52: wide scope given to notion of engaging in conduct – much broader than concept of representation at common law ‘mislead’ and ‘deceive’ also interpreted broadly objective test whether or not particular conduct actually misleads or deceives or is likely to mislead or deceive somebody else.

Misleading or deceptive conduct cont… not fault related: no intent required “likely to mislead or deceive”: added in 1977 “likely to” refers to situations where conduct has potential to mislead or deceive, eg. important in context of false and misleading advertising. Unnecessary to prove that the conduct in question actually mislead or deceived anyone.

Misleading or deceptive conduct cont… however, in context of pre-contractual negotiations, to obtain damages under s 82 (which requires causal connection between deceptive conduct and any loss suffered), you have to show that the conduct actually did mislead you. see generally Brown v Jam Factory.

Misleading or deceptive conduct cont… Circumstances where there may be a s 52 remedy even though there may not be an action at common law: cases of puffing or exaggerated sales talk silence in certain circumstances opinions statements as to the future: statements of intention and false predictions or forecasts.

Misleading or deceptive conduct cont… Note effect of s 51A: s 51A provides that where a corporation makes a representation as to any future matter without a reasonable basis or without reasonable grounds, the representation shall be deemed to be misleading or deceptive for the purposes of s 52.

Misleading or deceptive conduct cont… s 51A reverses the onus of proof: the corporation has to prove that, at time of statement, they had a reasonable basis for it (rather than the plaintiff having to prove that the corporation had no basis for it) impact: s 52 covers statements or predictions as to the future which are made honestly but carelessly.

Misleading or deceptive conduct cont… Remedies: s 80 (injunctions) s 80A (corrective advertising) s 82 (damages) s 87 (orders) note that damages are available under s 82 for innocent misrepresentation which falls within scope of s 52 (compare common law position) s 82 requires ‘a person to have suffered loss or damage by conduct of another person’ - causal connection required.

Misleading or deceptive conduct cont... Reform to remedies: Note introduction of proportionate liability - where loss is caused by more than one defendant, or the plaintiff contributes to their own loss, court must apportion liability to reflect each party’s contribution to the loss.

Misleading or deceptive conduct cont… To summarise: implications of s 52- broad scope and flexibility - thus s 52 often provides a better remedy to a buyer than an action for breach of contract fewer pre-conditions not limited to consumer transactions not fault related superior range of remedies

Misleading or deceptive conduct cont… re remedies: in particular damages available for innocent misrepresentation falling within scope of s 52 bars to rescission do not automatically apply post contractual conduct courts will not generally enforce exclusion clauses in context of s 52 claims.