Case: Watson v Foxman (1995) 49 NSWLR 315
Outcome: followed
each of the applicants who gave evidence and Messrs Chappell and Hung were giving an account of events that happened years before and about which they had not given much, if any, thought until recently for the purpose of this litigation. I agree with the caution expressed by McLelland CJ in Eq in Watson v Foxman (1995) 49 NSWLR 315 at 319 concerning evidence of this kind. He said: "Furthermore, human memory of what was said in a conversation is fallible for a variety of reasons, and ordinarily the degree of fallibility increases with the passage of time, particularly where disputes or litigation intervene, and the processes of memory are overlaid, often subconsciously, by perceptions or self-interest as well as conscious consideration of what should have been said or could have been said. All too often what is actually remembered is little more than an impression from which plausible details are then, again often subconsciously, constructed. All this is a matter of ordinary human experience." Austcorp argued that, to varying degrees, the applicants' oral evidence of their continuing reliance on the representations complained of at the time they executed or completed the contracts and leases should be discounted or rejected. It claimed that the important nature of the transactions and the fact that a solicitor could be expected to explain the contractual documents accurately, so as to dispel any misapprehension or misrepresentation, weighed against a finding that the representations complained of were relied on at all by the time of execution or completion. And, Austcorp argued that the failure of the applicants, other than Ms Tan Bounkeua (who had no solicitor), to call the solicitor acting for them was a powerful factor undermining the reliability of their evidence. Here, however, there is the objective evidence of the contents of the brochure and other promotional material (including the unchallenged, and inherently likely evidence of Mr Walker's repetition and reinforcement of its messages in his discussions with each applicant). There is no doubt that these conveyed the powerful messages of assurance and success of the investment contained in the representations. In general, these factors lend force to the applicants' claims that the representations were relied on by them at the time they entered into their contracts, completed them and executed their leases. I will, of course, consider each applicant's individual circumstances separately below. But, as a matter of ordinary human experience, powerful marketing messages tend to have a sustained effect. Although the representator did not remove the effect of the misrepresentations, I am satisfied that Mr and Mrs Di Giulio and Mr Luciani turned their mind to these questions and considered the advice from each of Mr Dunn and Mr Fullerton carefully before taking a considered but deliberate risk to proceed with the investment based on their own confidence in the outcome. This is a particularly apposite instance of the need for the exercise of caution, expressed by McLelland CJ in Eq in Watson v Foxman 49 NSWLR at 318-319, in accepting evidence of persons claiming many years later to have been misled by representations in entering into a contract. Mrs Di Giulio was emphatic that she was not aware that the guarantee by Pacific International Hotels was limited to 12 months worth of rent as opposed to 10 years. She said: "Well, there's a big difference from 10 years to 12 months. This was suppose to be a solid future investment, not something that was suppose to be for 12 months and we weren't told that at the time . It wasn't said here in the brochures or the leaflet, it wasn't told by Warren Walker and, you know, our solicitors reassured us everything would be okay . When you say solicitors reassured you that everything would be OK, what are you referring to? --- That it would be a solid future investment to, you know, to carry on with that ." (emphasis added) She denied that she was aware of the 12 months limitation and said: "It wouldn't be logical to go into something that' s 12 months when you're thinking of a future investment."