Case: Gould v Vaggelas [1985] HCA 75 ; (1985) 157 CLR 215
Outcome: referred to
The applicant submitted that it may be inferred from the making of false or misleading statements in the four page document and/or the three page document that the making of the statements caused persons to whom the statements were made to approve the 2007 Agreement. In support of this submission reliance was placed upon certain statements of principle enunciated by Wilson J in Gould v Vaggelas [1985] HCA 75 ; (1985) 157 CLR 215 at 236. Gould v Vaggelas was a case of fraud where Gould Holdings Pty Limited purchased the South Molle tourist resort from a number of companies associated with Vaggelas. Mr and Mrs Gould sought damages for deceit in respect of representations made to Mrs Gould that the business was very profitable, the Vaggelases having submitted false figures as to occupancy rates and financial returns. Wilson J summarised the relevant principles applicable to such a case as follows at 236: '1. Notwithstanding that a representation is both false and fraudulent, if the representee does not rely upon it he has no case. 2. If a material representation is made which is calculated to induce the representee to enter into a contract and that person in fact enters into the contract there arises a fair inference of fact that he was induced to do so by the representation. 3. The inference may be rebutted, for example, by showing that the representee, before he entered into the contract, either was possessed of actual knowledge of the true facts and knew them to be true or alternatively made it plain that whether he knew the true facts or not he did not rely on the representation. 4. The representation need not be the sole inducement. It is sufficient so long as it plays some part even if only a minor part in contributing to the formation of the contract.' 95 His Honour proceeded to say at 238: '... Where a plaintiff shows that a defendant has made false statements to him intending thereby to induce him to enter into a contract and those statements are of such a nature as would be likely to provide such inducement and the plaintiff did in fact enter into that contract and thereby suffered damage and nothing more appears, common sense would demand the conclusion that the false representations played at least some part in inducing the plaintiff to enter into the contract.' 96 However, his Honour emphasised that the onus of proof rested on the plaintiff. At 238-239 he said: '... When all the facts are in, the fact-finding tribunal must determine whether or not it is satisfied on the balance of probabilities that the misrepresentations in question contributed to the plaintiff's entry into the contract. The onus to show that they did is a condition precedent to relief and rests at all times on the plaintiff.' 97 In my opinion, absent any evidence that the making of any false or misleading statement to another person or persons caused that other person or persons to vote to approve the 2007 Agreement, a 'fair inference of fact' that the making of the false or misleading statement or statements relied upon caused the person or persons to approve the 2007 Agreement would not be available. It is quite possible that, the causal link between the making of a false or misleading statement to another person or persons and the approval of, in this case, the 2007 Agreement by a majority of those persons who cast a valid vote deciding that they wanted to approve same, is missing because the employees of Karellas who cast valid votes indicating that they wanted to approve the agreement, did not even read the documents containing the false or misleading statements upon which the applicant has relied, let alone pay any regard to them. 98 It follows that the applicant's case for contravention of s 401(1) must fail. 99 Given the contravention of s 341(1) which has been found the Court has power under s 409(a) to declare the 2007 Agreement void, as the applicant would wish the Court to do, provided that a proper case for such an order was made out under s 412(2) of the Act. 100 By virtue of s 412(1) of the Act it is clear that an order declaring the 2007 Agreement 'void' would only take effect from the date of the order or a later date specified in the order. 101 In my opinion, an order declaring that the 2007 Agreement was void would not breathe new life into the 2003 Agreement as a pre-reform certified agreement. By virtue of clause 3(1) of Schedule 7 to the Act, when taken with clause 3(5), the 2003 Agreement ceased to be in operation when the 2007 Agreement was lodged with the Employment Advocate and once it ceased operating, it could not be revived. To use the words of clause 3(5) it could 'never operate again in relation to' Karellas' employees. This may seem a curious outcome. Nevertheless, s 347 of the Act made it clear that the 2007 Agreement came into operation on the day that it was lodged with the Employment Advocate and that it did so notwithstanding that, relevantly, the requirements of s 340(2)(a) had not been met in relation to it. 102 Had s 409(a) empowered the Court to make an order declaring the 2007 Agreement to be void ab initio, it certainly would have been a curious outcome to have the 2003 Agreement permanently displaced. But that is not what the legislature had in mind. Plainly, when one has regard to the terms of s 412(1) of the Act it is apparent that what the legislature intended was that from the date of the relevant order declaring the agreement void or a later date specified in that order, the relevant workplace agreement would cease to have any force and effect.