Case: Hurley v McDonalds Australia Ltd [1999] FCA 1728
Outcome: referred to
Section 51AC of the TP Act proscribes unconscionable conduct in trade or commerce on the part of a corporation. In this context the word "unconscionable", bears a wider meaning than that recognised by the common law of Australia. In Hurley v McDonalds Australia Ltd [1999] FCA 1728 Heerey, Drummond and Emmett JJ said that: " For conduct to be regarded as unconscionable, serious misconduct or something clearly unfair or unreasonable, must be demonstrated Cameron v Qantas Airways Ltd (1994) 55 FCR 147 at 179. Whatever 'unconscionable' means in s 51AC , the term carries the meaning given by the shorter Oxford English Dictionary, namely, action showing no regard for conscience, or that are irreconcilable with what is right or reasonable Qantas Airways Ltd v Cameron (1996) 66 FCR 246 at 262. The various synonyms used in relation to the term 'unconscionable' import a pejorative moral judgment Qantas Airways Ltd v Cameron (1996) 66 FCR 246 at 283-4 and 298 ... Before s 51AC will be applicable, there must be some circumstance other than the mere terms of the contract itself that would render reliance on the terms of the contract 'unfair' or 'unreasonable' or 'immoral' or 'wrong'." 74 In the present case, it may be assumed in the applicant's favour that the respondent was aware of the applicant's mistaken belief that the foyer would need to be reinstated at the end of the lease. There is, however, no evidence that this knowledge in any way motivated the decision to proceed with the renovation of the foyer in July and August 1997. As will emerge later in these reasons, it is my view that the principal imperative which informed Tabcorp's conduct at this time was its desire to have all renovation works concluded by 31 August 1997 when it was due to move to 5 Bowen Crescent. 75 Moreover, Tabcorp cannot be said to have acted unconscionably in either of the senses used in ss 51AA and 51AC of the TP Act . The applicant laboured under no special disadvantage in its relationship with Tabcorp. It had been engaged in the construction and letting of commercial premises for over 30 years. It had access to advice from experienced solicitors. Those solicitors negotiated with solicitors for Tabcorp in order to settle agreed terms for the lease. This process continued over many weeks and was ultimately successful. The applicant continued to have the benefit of its solicitors' advice after the lease had been executed and Tabcorp's tenancy had commenced. There is nothing in Tabcorp's conduct at any stage during this process that attracts any moral opprobrium. 76 Even if it be assumed that the applicant had a cause of action based on ss 51AA or 51AC of the TP Act , Tabcorp contends that such a cause of action is statute barred. I agree. Section 82(2) of the TP Act requires that any proceeding be commenced within six years of the cause of action accruing. What I have already said in relation to the applicant's claim in waste being statute barred applies also to its claims under ss 51AA and 51AC . 77 The applicant's case, insofar as it alleges a breach of the lease, is straight forward. It starts with the uncontroversial proposition that the work undertaken by Tabcorp in July and August 1997 whereby the foyer was stripped back and renovated constituted a substantial alteration to the building. It says that it never gave written consent for the work to be undertaken and that, as a result, a breach of Clause 2.13 of the lease occurred. It seeks damages in the sum of $1,350,000 which is the estimated cost, in 2007 dollars, of restoring the foyer to its former condition.