Case: Fencott v Muller [1983] HCA 12 ; (1983) 152 CLR 570
Outcome: cited
Section 82 (damages) and s 87 (other orders) make a corporation, as defined in s 4 , liable in damages and to other orders for a contravention of s 52. Corporations cannot act, of course, except through a human agency, being its directors, servants or agents: Fencott v Muller [1983] HCA 12 ; (1983) 152 CLR 570 at 583 per Gibbs CJ. The effect of s 75B is to apply the provisions of s 82 and s 87 to any person who has been involved in a contravention of those parts of the Trade Practices Act mentioned in s 75B(1) by reason of any of the conduct in paragraphs (a)-(d) of s 75B(1). Those persons may be the corporation's directors, servants or agents. It is not only directors, servants or agents who may be caught by s 75B but, for the purpose of this case, it is enough to consider only that class. 270 In this matter the question is whether s 75B applies to either or both of the second respondent and third respondent so as to allow the Court to make an order for damages against one or both of them as persons involved in a contravention of s 52 of the Trade Practices Act . 271 Section 75B(1) prescribes the particular circumstances where a person who has not himself or herself contravened s 52 can be made the subject of an award of damages or may be made the subject of other orders. In that sense, it is a procedural section which widens the class of persons who may be the subject of orders under the Trade Practices Act . The section instances four separate ways in which a person may be made subject to orders under ss 82 or 87 . In this proceeding the applicants have, in their claims against the second and third respondents, only relied on one of those paragraphs, namely s 75B(1)(c). 279 For the reasons already given, it is my opinion that the second respondent well knew that the brochure contained representations which were, in material respects, false. That having been established, the applicants have established an actual rather than a constructive knowledge of the essential matters that make up the contravention. The applicants have established that there is a close rather than a remote involvement in the contravention: Fencott v Muller [1983] HCA 12 ; (1983) 152 CLR 570 at 584. The second respondent was an intentional participant in the first respondent's contravention. The second respondent constructed the brochure and included the figures which made up the brochure profit and loss statement for the financial statement. She published the brochure to the second and third applicants. She was directly involved in the contravention by the first respondent of s 52 of the Trade Practices Act . 280 It follows, therefore, that the applicants have established that the second respondent was knowingly concerned in or a party to a contravention by the first respondent of s 52 of the Trade Practices Act . 281 In my opinion, the applicants have also established that the second respondent contravened s 10 of the Fair Trading Act . The second respondent's conduct in publishing to the second and third applicants, and thereby the first applicant, the brochure which contained the false representations means that inevitably a finding must be made that she contravened s 10 of the Fair Trading Act . It was her action which caused the company to contravene s 52 of the Trade Practices Act . Necessarily, her action is a contravention of s 10 of the Fair Trading Act .