MYOZEXP PTY LTD -v- CHUNYAN CHEN as Trustee for TABG TRUST [2026] WADC 64

[2026] WADC 64 [2026] WADC 64 [JM] Page 1 JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA IN CIVIL LOCATION : PERTH CITATION : MYOZEXP PTY LTD -v- CHUNYAN CHEN as Trustee for TABG TRUST [2026] WADC 64 CORAM : SEFTON DCJ HEARD : 20-25 MAY 2024 & FURTHER SUBMISSIONS 16 MAY 2025, 30 MAY 2025 & 13 JUNE 2025 DELIVERED : 3 JULY 2026 FILE NO/S : CIV 4478 of 2020 BETWEEN : MYOZEXP PTY LTD Plaintiff AND CHUNYAN CHEN as Trustee for TABG TRUST First Defendant PERTH AU PTY LTD Second Defendant Catchwords: Lease - Misleading and deceptive conduct - Misrepresentation - Future representation - Reasonable grounds - Quiet enjoyment -- 1 of 119 -- [2026] WADC 64 [2026] WADC 64 [JM] Page 2 Legislation: Australian Consumer Law, s 4, s 18 Competition and Consumer Act 2010 (Cth), sch 2, s 131, s 139B(2) Planning and Development Act 2005 (WA), s 146 Town Planning and Development Act 1928 (WA) (repealed), s 20(2) Result: Judgment for the plaintiff against the second defendant Representation: Counsel: Plaintiff : Mr K A Dundo & Ms F Lai First Defendant : Mr A P Hershowitz Second Defendant : Mr A P Hershowitz Solicitors: Plaintiff : KD Legal First Defendant : Robertson Hayles Lawyers Second Defendant : Robertson Hayles Lawyers Case(s) referred to in decision(s): Aldi Stores (A Limited Partnership) v EFTPOS Payments Australia Ltd [2011] FCA 1114 Armada Balnaves Pte Ltd v Woodside Energy Julimar Pty Ltd [2022] WASCA 69 Aussie Traveller Pty Ltd v Marklea Pty Ltd [1998] 1 Qd R 1 Australian Competition and Consumer Commission v ACM Group Ltd (No 2) [2018] FCA 1115 Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2013] HCA 54; (2013) 250 CLR 640 Australian Competition and Consumer Commission v Woolworths Group Ltd [2020] FCAFC 162 Bagata Pty Ltd v Sunstorm Pty Ltd [2024] QCA 17 Binningup Nominees Pty Ltd v Mirvac (WA) Pty Ltd [2021] WASCA 130 -- 2 of 119 -- [2026] WADC 64 [2026] WADC 64 [JM] Page 3 Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336 Browne v Flower [1911] 1 Ch 219 Butcher v Lachlan Elder Realty Pty Limited [2004] HCA 60; (2004) 218 CLR 592 Byrnes v Jokona Pty Ltd [2002] FCA 41 Campbell v Backoffice Investments Pty Ltd [2009] HCA 25; (2009) 238 CLR 304 Canon Kabushiki Kaisha v Green Cartridge Co (Hong Kong) Ltd [1997] AC 728 Concrete Constructions (NSW) Pty Ltd v Nelson [1990] HCA 17; (1990) 169 CLR 594 Cummings v Lewis (1993) 41 FCR 559 Effem Foods Pty Ltd (t/as Incle Ben's of Australia) v Lake Cumbeline Pty Ltd [1999] HCA 15; (1999) 161 ALR 599 Electricity Generation Corporation t/as Verve Energy v Woodside Energy Ltd [2014] HCA 7 [35]; (2014) 251 CLR 640 Esso Petroleum Co Ltd v Mardon [1976] 1 QB 801 Flogineering Pty Ltd v Blu Logistics SA Pty Ltd (No 3) [2019] FCA 1258; (2019) 138 ACSR 172 Gan v Xie [2023] NSWCA 163; (2023) 378 FLR 418 Gates v The City Mutual Life Assurance Society Ltd (1986) 160 CLR 1 Glasshouse Investments Pty Ltd v MPJ Holdings Pty Ltd [2005] NSWSC 456 Global Sportsman Pty Ltd v Mirror Newspapers Pty Ltd (1984) 2 FCR 82 Goldsworthy Mining Ltd v The Commissioner of Taxation of the Commonwealth of Australia (1973) 128 CLR 199 Gould v Vaggelas [1985] HCA 75; (1985) 157 CLR 215 Great Union Pty Ltd v Sportsgirl Pty Ltd [2021] VSCA 299 Grosvenor Hotel Company v Hamilton [1894] 2 QB 836 Harrison, Ainslie & Co v Lord Muncaster [1891] 2 QB 680 Havyn Pty Ltd v Webster [2005] NSWCA 182 Hawkesbury Nominees Pty Ltd v Battik Pty Ltd [2000] FCA 185 Henville v Walker (2001) 206 CLR 459 Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216 Hyder v McGrath Sales Pty Ltd [2017] NSWSC 1647 Italform Pty Ltd v Sangain Pty Ltd [2009] NSWCA 427 Jewelsnloo Pty Ltd v Sengos (No 2) [2016] NSWSC 61 Jewelsnloo Pty Ltd v Sengos [2016] NSWCA 309 JKAM Investments Pty Ltd CAN 159 084 018 v Damien [2021] NSWSC 70 Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCAFC 151 Kane's Hire Pty Ltd v Anderson Aviation Australia Pty Ltd [2023] FCA 381 -- 3 of 119 -- [2026] WADC 64 [2026] WADC 64 [JM] Page 4 Karaggianis v Malltown Pty Ltd [1979] 21 SASR 381 Kelly v Rogers [1892] 1 QB 910 Line v Stephenson (1838) 132 ER 950; (1838) 4 Bing NC 678 Marks v GIO Australia Holdings [1998] HCA 69; (1998) 196 CLR 494 Mostyn v The West Mostyn Coal and Iron Company Ltd (1876) 1 CPD 145; (1876) 45 LJQB 401 Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37 O'Keefe v Williams (1910) 11 CLR 171 Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191 Peter Williams Pty Ltd v Capitol Motors Ltd (1982) 41 ALR 613 Sharp v Ramage (1995) 12 WAR 325 Sutton v A J Thompson Pty Ltd (in liq) [1987] FCA 167; (1987) 73 ALR 233 Sykes v Reserve Bank of Australia (1999) 88 FCR 511 Todburn Pty Ltd v Taormina International Pty Ltd (1990) 5 BPR 11,173 Ventouris Enterprises Pty Ltd v Dib Group Pty Ltd [2010] NSWSC 963 Warwick Entertainment Centre Pty Ltd v Alpine Holdings Pty Ltd [2005] WASCA 174 Watson v Foxman (1995) 49 NSWLR 315 Wheeldon v Burrows (1879) 12 Ch D 31 Wilcox v Richardson (1997) 43 NSWLR 4 Willett v Thomas [2012] NSWCA 97 -- 4 of 119 -- [2026] WADC 64 [2026] WADC 64 [JM] Page 5 Table of Contents Introduction ................................................................................................................................ 8 Background ................................................................................................................................. 9 Parties ..................................................................................................................................... 9 Purchase of Lot 2 by the second defendant .......................................................................... 10 Head lease ............................................................................................................................. 11 Communications prior to the Lot 2 sublease being executed ............................................... 11 'R.O.W.' and encroachment dispute...................................................................................... 13 Initial attempts to resolve dispute ......................................................................................... 16 Legal status of right of way .................................................................................................. 17 Resolution of the dispute ...................................................................................................... 20 Plaintiff's case ........................................................................................................................... 21 Issues to be determined............................................................................................................. 22 Standard of proof and general considerations .......................................................................... 23 Mr Tassi ................................................................................................................................ 25 Mr Lai ................................................................................................................................... 26 Ms Chen................................................................................................................................ 27 Mr Yoon ............................................................................................................................... 27 Mr Harrison .......................................................................................................................... 27 The Australian Consumer Law claim/misleading and deceptive conduct case........................ 28 Issue 1: Did the defendants make the alleged oral representations? ....................................... 28 The first meeting - 10 November 2018 ................................................................................ 29 Evidence of Mr Tassi ........................................................................................................ 29 Analysis and findings ....................................................................................................... 37 Subsequent meetings until 21 November 2018 .................................................................... 42 Diagram 11454 and 'R.O.W.' discussion .......................................................................... 45 Licensed car bays.................................................................................................................. 52 Other discussions during the 21 November 2018 meeting ................................................... 52 Issue 2: Did the second defendant engage in misleading and deceptive conduct constituting a breach of the Australian Consumer Law s 18? ......................................................................... 53 Legal principles .................................................................................................................... 53 Misleading and deceptive conduct ................................................................................... 53 Representation as to a future matter ................................................................................. 54 Issue 2(a): Did the defendant have reasonable grounds for making the representations as to future matters? .......................................................................................................................... 56 Contentions as to characterisations of oral representations .................................................. 56 -- 5 of 119 -- [2026] WADC 64 [2026] WADC 64 [JM] Page 6 Findings as to oral representations made and their characterisation .................................... 56 Issue 2(b): Did the defendant have reasonable grounds for making the representations as to future matters? .......................................................................................................................... 58 Knowledge of previous owner of Lot 2 ................................................................................ 59 What facts and circumstances were known by Mr Lai prior to sublease being signed? ...... 60 Site inspections and discussion with Mr Harrison and Mr Yoon ..................................... 60 Information memorandum in relation to sale of Lot 2 ..................................................... 67 Did Mr Lai and/or Ms Chen become aware of an issue in relation to the status of the 'R.O.W.' prior to the sublease being signed? .................................................................... 67 Did Mr Lai and/or Ms Chen become aware of any issue being raised by the owner or operator of Lot 1 about the garage encroachment? .......................................................... 74 Reasonable grounds - analysis and determination ................................................................ 75 Laneway representation .................................................................................................... 79 Garage representation ....................................................................................................... 81 Rear area representation ................................................................................................... 82 Issue 3: Causation - reliance and loss ...................................................................................... 83 Legal principles .................................................................................................................... 83 Issues in relation to causation ............................................................................................... 84 Issue 3(a): Did the plaintiff rely on the alleged representation/s in entering the sublease? .... 85 Analysis and findings as to reliance ..................................................................................... 86 Disclaimer......................................................................................................................... 91 Agency .................................................................................................................................. 94 Analysis and determination .............................................................................................. 97 Issue 3(b): If the defendants were in breach, did their conduct cause the plaintiff any alleged loss and damage? ...................................................................................................................... 98 Agreed quantum of damages ................................................................................................ 99 Did the plaintiff suffer loss due to not being able to access and use the laneway? ............ 100 Analysis and determination ............................................................................................ 101 Nature of damages claim .................................................................................................... 105 Breach of contract case ........................................................................................................... 107 Issue 1: What is the proper construction of cl 5.1(e)? ........................................................... 109 What are the premises? ....................................................................................................... 109 Legal Principles - quiet enjoyment ..................................................................................... 110 Proper construction of cl 5.1(e) .......................................................................................... 113 Issue 2: Did the first defendant breach cl 5.1(e)? .................................................................. 116 Erection of metal post and concrete bollard ................................................................... 116 Denial of access to and use of the garage ....................................................................... 117 -- 6 of 119 -- [2026] WADC 64 [2026] WADC 64 [JM] Page 7 Inability to use garage..................................................................................................... 118 Issue 3: Loss and damage ...................................................................................................... 118 Orders ................................................................................................................................. 118 -- 7 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 8 SEFTON DCJ: Introduction 1 This action concerns a claim by the plaintiff against the first defendant and the second defendant for damages. The damages are said to have arisen by reason of alleged false and misleading representations said to comprise misleading and deceptive conduct in breach of s 18 of the Australian Consumer Law1 and an alleged breach of cl 5.1(e) of a sublease between the parties. 2 Central to the proceedings is a property located at 79 Aberdeen Street, Northbridge (Lot 2), an adjacent property located at 75 Aberdeen Street, Northbridge (Lot 1), and a laneway between the main building on each property that traverses both properties.2 3 A garage was located at the end of the laneway. It was partly constructed on Lot 2 and partly encroached onto part of the laneway that was within Lot 1. At the rear of Lot 1, adjacent to the garage, was an open rear area that was licensed for non-residential car parking for up to five vehicles. 4 Part of the laneway was within Lot 2. The remainder of the width of the laneway was within Lot 1 and noted on survey diagram 11454, held by Landgate, as being 'R.O.W.', an abbreviation for right of way.3 5 The only way to access the garage and backyard area by car was via the laneway between the main buildings on Lots 1 and 2. 6 Shortly after the sublease was entered into, on 21 November 2018, a dispute emerged in relation to access to and use of the laneway and the garage, with the operator of the hostel on Lot 1. The operator first erected a collapsible metal post, and then a concrete bollard in the laneway on Lot 2 within the area denoted as 'R.O.W.'. This prevented vehicles being driven down the laneway and the plaintiff being able to use the garage or the backyard area to park vehicles. 1 Australian Consumer Law (sch 2) Competition and Consumer Act 2010 (Cth) (ACL) s 131. 2 The street numbers of Lot 2 and Lot 1 are also described as being 79 - 81 and 75 - 77 Aberdeen Street, respectively. 3 Exhibit 3, page 7, diagram 11454. -- 8 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 9 7 It emerged that in fact the area denoted on survey diagram 11454 as 'R.O.W.' had not legally taken effect as a private right of way. No separate certificate of title had been obtained for that area of land and a five-year limitation period for that to be done expired in 2011. 8 In addition, at one point, the plaintiff was told he could not use the garage by Mr Kelvin Lai (the sole director and secretary of the second defendant). That was because part of it encroached on Lot 1/the 'R.O.W.' area and continued use and potential demolition of the garage was subject to the dispute that emerged with the neighbouring tenant and owner of Lot 1. 9 The second defendant eventually resolved the dispute with the owner of Lot 1 after lawyers became involved. However, it took nearly three years before it was resolved. 10 The plaintiff claims that during discussions at a site inspection and subsequent meetings prior to the sublease being signed, the second defendant orally misrepresented to it that the laneway, garage and rear area could be accessed and used by it. It also claims that the first defendant breached cl 5.1(e) of the sublease under which it agreed that the sublessee may occupy the premises without interruption by the sublessor. 11 It is also in dispute whether any alleged breach of s 18 of the ACL or breach of contract, if established, caused the plaintiff any loss as alleged. In the event that the court were to find that the plaintiff suffered any such loss as a result of an alleged breach, it has been agreed that the quantum of damages as at 1 June 2022 is $166,000. Background 12 Many of the background circumstances to the claim have been agreed between the parties. The following findings are based on agreed facts4 or other facts which I find, and which were not particularly controversial. Parties 13 The plaintiff is and was at all material times a duly incorporated company controlled by Mr Marco Tassi, its sole director, secretary and shareholder. 4 The court was provided with an Agreed Statement of Facts dated 22 February 2024. -- 9 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 10 14 The first defendant, Ms Ivy Chen, is and was at all material times the trustee for the TABG Trust. 15 The second defendant, Perth Au Pty Ltd, is and was at all material times an incorporated company and trustee for the Aber Trust. Mr Lai is and was at all material times the sole director and secretary of the second defendant. 16 Ms Chen and Mr Lai are and were at all material times married. Purchase of Lot 2 by the second defendant 17 The second defendant is the current registered proprietor of Lot 2. It acquired Lot 2 by contract dated 20 June 2018. That contract was a replacement contract for an earlier contract dated 7 March 2018 that was purportedly entered into by Ms Chen, on behalf of the second defendant, following an auction of Lot 2. Settlement occurred in October 2018.5 By agreement between the previous owners and the second defendant the original contract was treated as void ab initio. 18 The special conditions specified in the initial contract included a special condition that:6 2. The Buyer/s acknowledge the following: a) The eastern boundary of the subject property is approximately located midway between the structure occupying 79 Aberdeen Street and the structure occupying 77 Aberdeen Street (the neighboring (sic) lot), the land immediately to the east being R.O.W. (see attached Diagram 11435 and 10880); b) The Buyer is aware that the garage at the south/eastern corner of the property encroaches on the R.O.W. 19 Although the copy of the initial contract received in evidence did not include diagrams 11454 and 10880 as attachments, as explained later in these reasons, I am satisfied that they were attached to the contract at the time. 20 The replacement contract contained no equivalent provisions. 5 The property is more specifically described as Lot 2 on diagram 10880 contained in certificate of titles vol 1894 folio 67 and vol 2130 folio 269. See Exhibit 4, pages 10 - 11; Exhibits 12, pages 91 and 92; ts 413. 6 Exhibit 91, page 803. -- 10 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 11 21 In addition to the replacement contract, various other agreements were entered into by the sellers and the second defendant and related steps were taken. These included a lease dated 28 May 2018 between the sellers and Sunvalley Holdings Pty Ltd (Sunvalley Holdings), a company which they controlled, which operated a backpacker accommodation business from the property. A deed of novation was also entered into between those entities and the first defendant in relation to the novation of the rights and obligations under that lease. Prior to settlement occurring, a private taxation ruling was also obtained by the sellers in relation to the GST-free status of the sale of the property under the replacement contract. 22 The circumstances surrounding the negotiation of these agreements and steps are the subject of some contention. In particular, the plaintiff advanced a case theory that the defendants and sellers had become aware of an issue in relation to the legal effectiveness of the 'R.O.W.'. It is suggested that the sellers therefore agreed to the new arrangements, which were financially beneficial to the second defendant. This is considered later in these reasons. Head lease 23 Prior to the replacement contract being entered into, an agreement to enter into a lease dated 29 May 2018 was entered into between the first defendant, as lessee, and the second defendant, as lessor, in relation to Lot 2. The lease term ultimately commenced in October 2018 on settlement of the sale of Lot 2 under the replacement contract.7 This is the headlease, from which the sublease was derived. Communications prior to the Lot 2 sublease being executed 24 The plaintiff operated a backpacker/hostel business in Palmerston Street, Northbridge (the Palmerston Lodge) and operated various other rental spaces. The Palmerston Lodge included car parking that was used by guests of the business. 25 Mr Tassi was interested in other opportunities to expand his business interests in the area. He drove past Lot 2 and saw a 'for lease' sign. He called a number on the sign and spoke to Ms Chen.8 Mr Tassi arranged an inspection of Lot 2. 7 Exhibit 9. 8 Exhibit 11. -- 11 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 12 26 On Saturday, 10 November 2018, Mr Tassi inspected the property with Mr Lai. When conducting the inspection Mr Lai was acting on behalf of the second defendant, which itself was acting as the agent of the first defendant.9 I return to the significance of that agency relationship below. 27 Mr Tassi and Mr Lai gave evidence about what occurred during the inspection. 28 Their evidence was broadly consistent in relation to many aspects of what occurred. The main area of dispute concerned what, if anything, was discussed in relation to the laneway. To a lesser extent they differed in recollection as to what was said in relation to the ability to park cars in the garage and rear area. The resolution of those disputes is central to the determination of the plaintiff's claim for alleged breach of s 18 of the ACL. 29 After their meeting at the property, Mr Tassi exchanged various texts with Mr Lai that day for the purpose of providing his contact email address and obtaining various documents. He requested documents for all outgoings, lodge approval and building plans. Mr Lai emailed a summary of outgoings and a copy of an evacuation plan and confirmed that the approval was for 41 beds. Mr Tassi indicated an intention to check everything and give his 'offer' at the beginning of the next week.10 30 Various discussions, electronic communications and meetings then occurred between Mr Tassi and Mr Lai, or Mr Tassi and both Mr Lai and Ms Chen, in the lead up to the sublease and a final version of the commercial lease proposal being signed on 21 November 2018.11 A dispute arises as to the timing of certain meetings, whether Ms Chen was present, and what was said and done during the meetings, particularly in relation to the laneway. This is considered later in these reasons. 9 Amended Substituted Defence of First and Second Defendants filed on 18 August 2023 (and further amended at trial on 25 May 2024), par 8 (Defence); Amended Substituted Reply filed 31 August 2023, par 3(a) (Reply). 10 Exhibit 16A, pages 90 - 92. 11 See for example: Exhibits 15, 16A and 17 - 20. -- 12 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 13 'R.O.W.' and encroachment dispute 31 The plaintiff took possession of Lot 2 and the whole of the garage on or about 21 November 2018.12 The plaintiff commenced renovating Lot 2 and the garage prior to commencing to operate a backpacker accommodation business at the property in February 2019.13 32 The plaintiff had use of, and access to, the laneway, rear area and the garage from then until about 5 December 2018.14 During that period the plaintiff was able to use the backyard area and garage to park cars. 33 However, a dispute emerged almost immediately. The dispute related to the boundary between Lot 1 and Lot 2 and the use of the portion of the laneway that was located within Lot 1 and marked as 'R.O.W.' on diagram 11454. The dispute also concerned the encroachment of the garage onto Lot 1, the use of the garage and whether it should be demolished. 34 There is a difference on the pleaded cases of the parties as to whom the dispute was between. I am satisfied that in a general sense the dispute that developed was between the plaintiff and the defendants on the one hand, and the operator of the hostel at Lot 1 and owner of Lot 1 on the other hand. The principal parties who engaged in discussions and entered into agreements resolving the dispute were the second defendant and the owner of Lot 1. 35 An aspect of the dispute, relating to use of the laneway and keeping it clear, became apparent almost immediately after the sublease was signed on 21 November 2018. 36 On the morning of 20 November 2018, Mr Tassi messaged Mr Lai requesting that he ask next door (ie Lot 1) to place the bins in a way that 'we can drive in the driveway and [be] able to park the car at the back'. Mr Lai responded indicating that he would 'nicely discuss with next door for do not park the car on drive way! And waste bin at the back yard'.15 12 Exhibit 16A, pages 101 - 109. The plaintiff was given early access to facilitate steps like measurements being taken prior to renovations commencing. 13 ts 144 - ts 145. 14 Defence, par 25.1; Reply, par 10. 15 Exhibit 16A, pages 102 - 104; Exhibit 99. -- 13 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 14 37 On 22 November 2018, Mr Lai messaged Mr Tassi and confirmed having emailed the owner of Lot 1, on the night of 21 November 2018, advising that the new operator (the plaintiff) would start renovation on 26 November 2018 and noting the need to keep the driveway clear all the time. 38 In his message Mr Lai also said that 'I think u r right As well, as u r the tenant you should able to park ur car at back yard car park'. He also messaged shortly afterwards that '[W]e' are going to ring the council and get advice as soon as possible. Shortly afterwards, he messaged requesting Mr Tassi also ask council about the issue when he went to council to apply for the floor plan and site plan.16 39 It is not entirely clear to what extent the operator or owner of Lot 1 had at that point asserted its rights over the 'R.O.W.' area to the plaintiff or the defendants and disputed its use by them. Neither Mr Tassi nor Mr Lai were specifically asked about those messages during their evidence. 40 In any event, by 27 November, it was clear to the defendants and the plaintiff that the operator of Lot 1 was disputing any entitlement of the plaintiff or the defendants to use that portion of the laneway. Mr Tassi had by then received, and emailed to Mr Lai, a copy of a boundary identification survey for Lot 1 prepared by Jurovich Surveying (2015 Jurovich Survey Plan) in August 2015. I infer that he obtained it from the operator or owner of Lot 1. A meeting was arranged on-site on 28 November and an informal arrangement reached relating to not parking in the laneway while the dispute was being discussed.17 41 It is not clear precisely when the aspect of the dispute about the use of the garage and its encroachment onto Lot 1/the 'R.O.W.' area was first raised by the operator or owner of Lot 2 with the plaintiff or the defendants. However, by 2 December, both the defendants and the plaintiff were aware of the issue.18 42 Shortly afterwards, the Lot 1 operator complained to Mr Lai about the plaintiff parking vehicles on the laneway and that they could not put their bins away. The operator indicated that he was intending to arrange for a post to be erected in the middle of the driveway.19 16 Exhibit 16A, pages 107 - 108. 17 Exhibit 16A, pages 110 - 112, 120; Exhibit 2. 18 Exhibit 28. 19 Exhibit 16A, pages 117 - 120. -- 14 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 15 43 The operator of Lot 1 then caused a collapsible metal post (also sometimes called a metal bollard) to be installed towards the top of the laneway near the middle of its width on 4 December 2018. The metal post was able to be unlocked by key and placed horizontally on the ground so as to facilitate access to the laneway. The key was held by the operator of Lot 1. 44 The operator of Lot 1 messaged Mr Lai that day and asserted that the plaintiff had 'broken the rules and disrespected our agreement', apparently being a reference to the informal arrangement by which the laneway would not be blocked while the dispute was being discussed. He said that he had instructed Mr Tassi to see one of the Lot 1 office staff when he needed to remove his car and she would open the bollard. The operator said that he would now 'control who goes down my land'. He also indicated that a key would not be provided to Mr Lai until he had made a decision on the options he had apparently given to Mr Lai the previous day. He requested a decision on those options, threatening to have contractors put up a fence. Consistent with that communication, for a short period an arrangement operated by which Mr Tassi could request that the bollard be unlocked if he wished to obtain vehicular access to the laneway.20 45 Over the next week issues continued to escalate. At one point a moveable temporary fence was erected by the plaintiff's contractors in a way that impeded access to the rear of Lot 1. After a concern was raised by the Lot 1 operator, it was moved. Further issues were raised about workmen engaged by the plaintiff parking in the lane at times.21 An issue also arose about Mr Tassi entering the office of Lot 1 and going behind the desk, as well as running into the metal bollard, as was apparently captured on closed-circuit television footage.22 46 On 10 December 2018, Mr Lai explained to the operator of Lot 1 that he was obtaining legal, professional and council advice. 47 On 11 December, the operator indicated he was going to get the laneway blocked off on the Lot 1 side. Mr Lai maintained that it was illegal for anyone to block the common driveway. The operator of Lot 1 responded that it was not a common driveway and that his lawyer had instructed him to do this in the interest of his business. He also threatened to have concrete delivered for a wall at the front.23 20 Exhibit 16A, pages 120 - 122; ts 207. 21 Exhibit 16A, pages 132 - 138. 22 Exhibit 16A, pages 137 - 138; ts 209. 23 Exhibit 16A, pages 142 - 144. -- 15 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 16 48 On about 11 December, the operator of Lot 1 caused to be installed a heavy concrete bollard approximately midway across the laneway, in addition to the metal post. It could only be moved with equipment such as a bobcat.24 49 On at least two occasions, in late January and early February 2019, to facilitate the completion of renovations, when Mr Tassi sought permission to temporarily move the concrete bollard, the operator of Lot 1 reluctantly granted it. This occurred when Mr Tassi's workers needed to remove accumulated rubbish associated with the renovation from the rear portion of Lot 2.25 While it was suggested to Mr Tassi in cross-examination that it was not impossible to get access as the concrete bollard could be moved, I find that the willingness of the operator of Lot 1 to the bollard being moved was limited to the period up until the renovation was completed in early February 2019.26 Initial attempts to resolve dispute 50 Mr Tassi engaged with Mr Lai and Ms Chen. Mr Lai, in particular, became involved in trying to reach a resolution of the dispute with the owner and operator of Lot 1. This included making enquiries of the council to try to confirm the common rights and any previous agreement in relation to use of the laneway. 51 Mr Tassi paid a lawyer to prepare a letter, which Mr Lai in turn signed and sent on behalf of the second defendant, to Mr Summers, the lawyer for the operator of Lot 1, on or about 12 December 2018. In that letter it was asserted that legal advice had been obtained and that the operator of Lot 2 had no authority to install or maintain posts or bollards in the 'R.O.W.'. The letter demanded the removal of the post and bollard by 14 December 2018.27 52 On 13 December 2018, Mr Summers replied for the operator of the business on Lot 1. Ms Chen forwarded the response to Mr Tassi.28 Mr Summers, amongst other things: refuted the assertions; asserted that his client held a leasehold interest over Lot 1; confirmed that his client installed a metal post in the laneway and later a concrete bollard; asserted they were located on land belonging to the proprietor of Lot 1; refuted that the laneway was a right of way; and noted he 24 Exhibit 16A, page 139; ts 207. 25 Exhibit 16A, pages 176 - 186, 191 - 202; Exhibits 46 and 47; ts 214. 26 ts 214, ts 216 - ts 217. 27 Exhibit 16A, pages 158 - 160; Exhibit 30. 28 Exhibit 35. -- 16 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 17 (Mr Summers) had previously provided the owner of Lot 2 with a survey plan prepared by Jurovich Surveying which identified the portion of its client's proprietary interest as being approximately 1.87 m of the 2.87 m wide laneway. Mr Summers also recited an email his firm received dated 27 November 2018 from the Assistant Registrar of Titles at Landgate in which the Assistant Registrar asserted, amongst other things, that: 1. Diagram 11454 had the sole purpose of creating a right of way out of Lot 1 on diagram 10880. 2. No action was ever taken to create a title for the right of way and excise it from Lot 1. 3. As of 14 November 2011, diagram 11454 had a legal status of 'Expired' and could not be acted on. 4. If the owner of the land ever wanted to subdivide Lot 1, they would need to make arrangements with Landgate to cancel diagram 11454. 5. The right of way did not exist and it remained within Lot 1. 53 Various other assertions were also made by the lawyer for the operator of Lot 1. They included reiterating an earlier notice that was said to have been given to the proprietor of Lot 2 that it was responsible for a garage structure which encroached substantially on his client's property, as identified in the 2015 Jurovich Survey Diagram mentioned in previous correspondence. That letter was not tendered. It is therefore unclear when the notice referred to was issued and received by either defendant. Mr Summers also asserted that his client's intention was to demolish the encroaching portion of the garage and fence the entire laneway along the boundary of Lot 1. He said that his client's assertion of his rights was within the knowledge and approval of the registered proprietor of Lot 1. Legal status of right of way 54 It is not in dispute that the area denoted as 'R.O.W.' on diagram 11454 had no legal effect as a private right of way. An expert report was tendered by consent from Mr Incerti of Jurovich Surveying -- 17 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 18 confirming that position.29 It is also accepted by the parties for the purposes of the proceedings that no equivalent rights arose in the absence of the issue of a certificate of title.30 55 In his expert report, Mr Incerti explained, and I accept, that diagram 11454 was a survey completed in 1939 to create a right of way between Lot 1 and Lot 2 with land to be taken entirely from Lot 1. The diagram was lodged at the titles office and approved by the Town Planning Board and Inspector of Plans and Surveys on 12 October 1939. However, it was never dealt with or acted on after it was approved. For that to occur a new certificate of title needed to be issued in relation to the plan of survey. This neither occurred, nor was requested. 56 Following the introduction of the Planning and Development Act 2005 (WA), a time limit was imposed within which the Registrar of Titles could create or register a certificate of title under the Transfer of Land Act 1893 (WA) in respect of land the subject of a plan of subdivision. Where a diagram or plan of survey of the subdivision of that land had been endorsed with the approval but a certificate of title had not been created or registered, the time period to lodge an application was five years.31 57 Mr Jurovich explained, and I accept, that in the period from 2005 - 2011, Landgate attempted to contact owners of land in respect of which there was a plan (or, I infer, diagram) of survey that had not been dealt with to notify them of the new requirements. He did not suggest, nor was there any evidence to suggest, that Landgate also notified adjacent landholders where, as in this case, their interests may also have been affected.32 58 After 2011, plans of survey that had still not been dealt with were placed in a status of 'Expired'. As a result, new titles could not be issued for these plans unless a new survey approved by the Western Australia Planning Commission was lodged. 59 I am satisfied that the owner of Lot 1 was likely aware of an issue in relation to the legal effectiveness of the designation on diagram 11454 of the area denoted as 'R.O.W.' for many years prior to the 29 Exhibit 94. 30 ts 98. 31 Section 146 of the Planning and Development Act. See Exhibit 94. Compare s 20(2) of the now repealed Town Planning and Development Act 1928 (WA). 32 Exhibit 94. -- 18 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 19 second defendant purchasing Lot 2. I also find that it was aware that the garage encroached into the 'R.O.W.' area within Lot 1 from at least August 2015 when Mr Incerti was engaged to perform a boundary re-establishment survey in relation to Lot 1. 60 On the 2015 Jurovich Survey Diagram he recorded the boundaries of Lot 1 and Lot 2. The boundary passed along the laneway, recording that a slightly wider portion of the laneway falling within Lot 1 than Lot 2. The boundary line transected the constructed garage, a portion of it encroaching on the portion of the laneway located within Lot 2.33 61 After the dispute was resolved, Mr Incerti performed an updated survey on 31 January 2022, shown below. While there are some minor differences as compared to the 2015 survey, they are immaterial to the issues in these proceedings. The 2022 survey identifies that the garage encroached into Lot 1 by 1.99 m. 33 Exhibit 2. -- 19 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 20 62 After the dispute emerged, the owner of Lot 1, on whose land the 'R.O.W.' was denoted, applied to cancel diagram 11454. It was cancelled on 12 July 2019. Resolution of the dispute 63 The dispute and attempts to resolve it became protracted. 64 Initially the relations between Mr Tassi, Mr Lai and Ms Chen remained positive. They worked cooperatively to try and resolve the dispute with the operator and owner of Lot 1. Absent any resolution of the dispute, and access to the garage and parking area at the rear of Lot 2 by vehicle being prevented, their relations deteriorated. Mr Tassi's frustrations grew. While at times various discussions occurred directed to resolving the dispute and as to outcomes that would satisfy Mr Tassi, they ultimately came to nothing. The dispute and its resolution was put in the hands of lawyers by the second defendant. 65 The dispute was not resolved until December 2021, more than three years after the dispute arose.34 It was resolved on terms reflected in a deed of extinguishment and release dated 22 December 2021 between the second defendant and the owner of Lot 1. Those parties agreed to extinguish any rights of easement that may have accrued to the second defendant on terms set out in the deed. The deed also made provision for demolition of the garage, installation of a boundary fence on the property boundary previously occupied by the garage, and removal and collapse of the metal collapsible bollard. It was also agreed to extinguish any adverse possession claims.35 66 A deed of licence was also entered into by those parties at the same time. Under that deed, each granted to the other a reciprocal licence which was agreed to be registered as an easement over the portion of the laneway on their respective lot. The licences had a termination date in 2033 or various other dates depending on whether and when either party did or did not commence redevelopment, unless the parties otherwise agreed in writing.36 34 Exhibits 72 and 73. 35 Exhibit 72. 36 Exhibit 73. -- 20 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 21 67 The concrete bollard was removed in January 2022.37 The metal bollard was unlocked and collapsed on or about 13 January 2022. This was communicated by letter dated 20 January 2022 from legal representatives of the defendants to the legal representatives of the plaintiff. They also advised that the registered proprietor of Lot 1 had indicated that it would arrange complete removal of the bollard in the next two weeks or so. The letter also notified the plaintiff that the Lot 1 registered proprietor or its contractors would commence demolition works in about two weeks, including of the garage.38 68 From about 25 March 2022, the plaintiff did not have use of the garage, which was demolished on 1 April 2022.39 A new garage was later erected at the rear of Lot 1 and its installation was completed in August 2023.40 69 I am satisfied that for at least some portion of the period between mid-January 2022 and 1 June 2022, the plaintiff could again access the laneway by vehicle and park vehicles at the rear of the premises. However, for at least some of that period it could not be utilised in that manner. This was due to works associated with the demolition of the garage and a red fence (that had been erected as an interim measure to separate the garage and rear of Lot 2 from Lot 1) and erection of a new fence aligned with the boundary where the garage had been located (as provided for under the deed of extinguishment and release). 70 The precise period during which access and use of the laneway by vehicle and of the garage and rear area to park vehicles does not need to be determined.41 That is because the parties have agreed the quantum of damages if breach and some loss is established. The quantum covers the period until 1 June 2022, with an agreed rate of pre-judgment interest from that date until judgment.42 Plaintiff's case 71 The plaintiff's case has two essential limbs. First, a claim based on alleged oral misrepresentations said to give rise to a cause of action for breach of s 18 of the ACL and, secondly, a claim based on an alleged breach of cl 5.1(e) of the sublease. 37 Defence, par 17.3; Reply, par 8. 38 Exhibit 75. See also Exhibits 74, 77 and 79. 39 Further Amended Statement of Claim dated 31 May 2024, pars 25A and 25B (Statement of Claim); Defence, pars 27A and 27B; ts 151, ts 274. 40 Defence, par 27; Reply, par 15; Exhibit 83; ts 202, ts 276 - ts 277. 41 Statement of Claim, par 19A; Defence, par 21A. 42 Exhibit 84; ts 151. -- 21 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 22 Issues to be determined 72 The primary issues for determination in the misrepresentation case are: 1. Did the defendants make the alleged oral representations pleaded in par 8 of the Statement of Claim? If so: 2. Did the defendants engage in misleading and deceptive conduct constituting a breach of s 18 of the ACL? Sub-issues include: (a) if any alleged representations were made, were they representations as to future matters? (b) if so, did the defendants have reasonable grounds for making any representations as to future matters for the purposes of s 4 of the ACL? 3. If the first and/or second defendant was in breach of s 18 of the ACL: (a) did the plaintiff rely on any representation/s alleged to have been made? (b) did it cause the plaintiff to suffer any alleged loss and damage? 73 The primary issues for determination in the breach of contract case are: 1. On the proper construction of the sublease, what is the scope of cl 5.1(e) relating to quiet enjoyment and the plaintiff's right to occupy the premises without interruption by the first defendant? Does it extend to the laneway, garage and car parking bays on the premises? 2. Did the first and/or second defendant breach cl 5.1(e) of the sublease? 3. If so, did that breach cause the plaintiff to suffer any alleged loss or damage? -- 22 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 23 Standard of proof and general considerations 74 The standard of proof that applies in this case is satisfaction that the case has been proved on the balance of probabilities.43 The court, in deciding whether it is so satisfied, is required to take into account the nature of the cause of action or defence, the nature of the subject matter of the proceeding, and the gravity of the matters alleged.44 While the gravity of the issues in this case is serious, in my view, it is not of the same gravity of other types of cases of alleged breach of provisions of the ACL (or its precursors) where a finding of a breach could, in appropriate proceedings, be visited with significant civil contravention penalties.45 75 In assessing the evidence, I have borne in mind the significant period that has elapsed since the critical events the subject of the proceedings. The period between witnesses giving evidence at trial and the alleged oral representations was in the region of five and a half to six years. Bearing in mind that the representation case is based on alleged oral conversations, that delay is important to bear in mind, particularly as any discussions and representations were not contemporaneously documented. 76 In such circumstances an orthodox approach, which I have adopted, is to place primary emphasis on the objective factual surrounding material and the inherent commercial probabilities, together with tendered documentation.46 77 I have also taken special care in the context of spoken words, which must be established with a sufficient degree of precision to enable the court to be reasonably satisfied that they were misleading in the established circumstances. As McCelland J observed in Watson v Foxman:47 … In many cases (but not all) the question whether spoken words were misleading may depend upon what, if examined at the time, may have been seen to be relatively subtle nuances flowing from the use of one word, phrase or grammatical construction rather than another, or the 43 Evidence Act 1995 (Cth) s 140(1). 44 Evidence Act 1995 (Cth) s 140(2). See also Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336. 45 See, for example, Peter Williams Pty Ltd v Capitol Motors Ltd (1982) 41 ALR 613, 619 - 620 (Franki J) and decisions referred to therein. 46 Effem Foods Pty Ltd (t/as Incle Ben's of Australia) v Lake Cumbeline Pty Ltd [1999] HCA 15; (1999) 161 ALR 599 [16], [32] (Gleeson CJ, Gaudron, Kirby & Hayne JJ) (Effem). 47 Watson v Foxman (1995) 49 NSWLR 315, 318 - 319 (McLelland CJ). -- 23 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 24 presence or absence of some qualifying word or phrase, or condition. 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. … 78 Further, as the Full Court of the Federal Court observed in Julstar Pty Ltd v Hart Trading Pty Ltd, after citing the above passage:48 That caution is also reflected in s 140 of the Evidence Act 1995 (Cth) and in what Dixon J said in Briginshaw v Briginshaw (1938) 60 CLR 336 at 361 - 363 about the standard of proof. Dixon J emphasised that, when the law requires proof of any fact, the Court must feel an actual persuasion of its occurrence or existence before it can be found. He said that a mere mechanical comparison of probabilities, independent of any belief in its reality, cannot justify a finding of fact: see too Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission (2007) 162 FCR 466 at 479 - 482 [29] - [38] per Weinberg, Bennett and Rares JJ. As Dixon J said (60 CLR at 362): 'In such matters 'reasonable satisfaction' should not be produced by inexact proofs, indefinite testimony, or indirect inferences'. But, the nature of the fact to be proved necessarily affects the sufficiency of the evidence by which it can be established. 79 However, that is not a demand for unattainable perfection. Ultimately, whether the evidence is sufficiently precise to enable the court to be reasonably satisfied that the words spoken were misleading is a question of degree.49 80 Further, the inability of a witness to recall the precise words used, and the specific occasion on which they were used, does not mean that a person's memory of the substance or 'gist' of what was said must be rejected.50 48 Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCAFC 151 [73], [74]. 49 Kane's Hire Pty Ltd v Anderson Aviation Australia Pty Ltd [2023] FCA 381 [125] (Jackman J) (Kane's Hire) approved in Gan v Xie [2023] NSWCA 163; (2023) 378 FLR 418 [125] (White JA, Simpson AJA & Basten AJA agreeing) (Gan v Xie). 50 Gan v Xie [119] - [120] (White JA, Simpson AJA and Basten AJA agreeing) agreeing with Kane's Hire [21] - [129] (Jackman J). -- 24 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 25 81 I have also taken into account that English is not the primary language of Mr Tassi, Mr Lai or Ms Chen. While each of Mr Tassi, Mr Lai and Ms Chen could speak and comprehend English, this was subject to some limitation. This was apparent at times when Mr Tassi and Mr Lai, and to a lesser extent Ms Chen, were giving evidence. It was reflected in the phrasing of some of their answers and, at times, difficulty understanding aspects of certain questions asked. That was particularly so when prolix and compound questions were asked by counsel. 82 Given the passage of time, unsurprisingly, each witness had difficulties recalling aspects of events, and, at times, was inaccurate in aspects of their recollection. I nevertheless considered that each witness appeared to be honestly giving evidence. Mr Tassi 83 In my view, Mr Tassi generally presented as having a reasonably clear and detailed recollection of what occurred and the substance of what was said during the initial site inspection with Mr Lai. I consider his evidence was generally accurate and reliable regarding those matters. 84 I consider that Mr Tassi's recall of the timing of certain events after the meeting was not always reliable, although his recollection of what was said and done was still reasonably reliable. For example, Mr Tassi initially confidently gave evidence about a meeting on 12 November 2018 that he recalled attending at Morley with Mr Lai and Ms Chen. He later, however, conceded that his recollection may be wrong, as I have found below. He also erroneously recalled when the concrete bollard was ultimately removed during 2022, and initially, there were lines for car bays in the back yard. 85 In relation to the central issue of what, if any, representations were made, I generally found Mr Tassi's evidence to be reliable. 86 Mr Tassi's answers were, at times, discursive. He also was at times argumentative. In part at least that appeared to be associated with difficulties understanding and seeking to fully respond to compound and sometimes unclear questions. I have taken this into account in assessing the weight to be given to his evidence. -- 25 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 26 87 While other challenges were made to Mr Tassi's credit and consistency of conduct, I did not consider that they materially undermined his credibility in relation to the central facts in issue. For example, his evidence was sought to be challenged by reference to the contents of a letter dated 11 January 2019 that he sent to Mr Lai and Ms Chen by email on 15 January 2019.51 As explained later in these reasons, I do not consider that his assertions in the letter were materially inconsistent with his evidence at trial. Further, the letter should not be viewed in isolation. Mr Tassi elaborated on his position soon afterwards in an email dated 7 February 2019, which was consistent with his evidence at trial. Mr Lai 88 Mr Lai had significant difficulty recalling many aspects of relevant events. His evidence was marked by significant periods of lengthy pauses before answering many questions, both during evidence-in-chief and cross-examination. The pauses generally appeared to be consistent with the limitations of his recollection and a concern to properly understand the precise question being asked and to accurately answer the question. I do not consider that the pauses generally reflected equivocation or adversely affected his credibility. 89 One area where I generally found Mr Lai's evidence to be unconvincing concerned any communications with Mr Tassi regarding the use of the laneway. That evidence was in contrast to his evidence in relation to many other aspects of his interactions with Mr Tassi, where he was prepared to accept or did not deny matters, acknowledging significant limitations on his recollection. However, even when he had difficulty recalling associated aspects of what occurred, he appeared quick to deny any communication relating to the laneway. He repeatedly denied any such discussion, using a similar phrase on several occasions, often when unprompted. 90 Whether consciously or subconsciously, in my view, Mr Lai's answers were affected by his appreciation of the potential significance of any discussions about access to and use of the laneway. It was also likely affected by elements of reconstruction. 91 I generally prefer the evidence of Mr Tassi, in relation to the discussions when Lot 2 was inspected and during the lead up to the sublease being signed, to the extent of any inconsistency with the evidence of Mr Lai. 51 Exhibit 42. -- 26 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 27 Ms Chen 92 Ms Chen was generally clear and direct in her answers. Her recollection was limited in certain respects. To the extent she could recall matters I considered her evidence to have been generally reliable. However, in relation to matters that she denied having occurred, I found her evidence to be less reliable. 93 At times Ms Chen appeared quick to dismiss or dispute matters, particularly in relation to when she first saw a copy of diagram 11454, whether she provided a copy to Mr Tassi at a meeting in Morley before the sublease was signed, and whether there was any discussion about a 'R.O.W.' or the laneway. I was not satisfied that these aspects of her evidence were reliable. In my view, as with Mr Lai, Ms Chen's evidence about the laneway was likely affected by her recollection of having been provided with a copy of diagrams 10880 and 11454 by Mr Stephen Harrison, the selling agent, after the sublease was signed and dispute with the operator of Lot 1 emerged. However, as I find later in these reasons, I am satisfied that she first received a copy of them at the time of the auction. Mr Yoon52 94 Mr Yoon's evidence was fairly general in nature. He had limited recollection of discussions with Mr Lai and Ms Chen. To the extent that he could recall matters I am satisfied that his evidence was generally reliable. Mr Harrison 95 Mr Harrison was a confident witness. He acknowledged limitations on aspects of his recollection. In my view, it was apparent that aspects of his recollection were reconstructed after referring to his file and at times based on his usual practice which he believed he had followed rather than a specific recollection of events. I am satisfied, however, that his recollection in relation to explaining the approximate location of the boundary between Lot 1 and Lot 2, that there was no agreement in place in relation to the use of the right of way, and as to the encroachment of the garage, is reliable. 52 See [231]. The registered proprietors of Lot 2 for many years had been Mr Kwok Leong Yoon and Ms Margaret Lily Yoon (jointly as to one undivided half share) and Mr Kim Hong Tan and Ms Peck Yoong Tan (jointly as to one undivided half share), as joint tenants. -- 27 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 28 The Australian Consumer Law claim/misleading and deceptive conduct case 96 The parties substantially agree as to the applicable legal principles in relation to the ACL claim. Their real dispute concerns the facts of the claim and application of the principles to those facts. 97 Section 18 of the ACL provides that a person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. 98 It is not contended by the defendants that, if the alleged conduct relied on is established, the conduct was not engaged in, in trade or commerce. Plainly, it was. I find that the alleged conduct occurred in the course of discussions and meetings relating to the potential subleasing of Lot 2. The first defendant was the lessee and second defendant the registered proprietor and lessor of Lot 2. The alleged conduct occurred in the course of business activities which, of their nature, bore a commercial character.53 Issue 1: Did the defendants make the alleged oral representations? 99 The plaintiff's pleaded case is that various representations were made by the defendants to the plaintiff prior to the plaintiff executing the sublease.54 100 In closing oral submissions, counsel for the plaintiff clarified however that the case ultimately advanced by the plaintiff was based solely on three alleged oral representations said to have been made by Mr Lai to Mr Tassi, the sole director and secretary of the plaintiff, during negotiations for the sublease. 101 The three alleged oral representations relied on are that under the sublease, the plaintiff would have access to and use of: (a) the laneway shared with the neighbouring property, Lot 1; (b) the garage; and (c) the five car parking bays located at the rear of the premises and accessible by vehicles using the laneway.55 53 Section 2 of the ACL; Concrete Constructions (NSW) Pty Ltd v Nelson [1990] HCA 17; (1990) 169 CLR 594 [7] - [8] (Mason CJ, Deane, Dawson & Gaudron JJ). 54 Statement of Claim, pars 8 - 13. 55 Statement of Claim, par 8. -- 28 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 29 102 The plaintiff ultimately did not rely on an alleged oral representation by Ms Chen on behalf of the first defendant, that the premises accommodated up to five car parking bays at the rear of the premises. Subject to a difference in the evidence as to when it occurred, Ms Chen in substance accepted making a statement to that effect to Mr Tassi. However, that occurred in circumstances in which the evidence established that a licence had been issued by the Department of Transport to the second defendant on 22 October 2018 for the use of five non-residential car parking bays without charge by the Department. As such, any representation made as to that fact was true and not misleading or deceptive, in any event.56 103 To the extent that the plaintiff's pleading or evidence adduced referred to any other alleged statements or conduct of either defendant, other than that in par 8 of the Statement of Claim, the conduct is not independently relied on as comprising actionable representations. Rather, they are said to be contextual matters which, if found to have occurred, are relevant to, and supportive of, the court making findings in support of the making of the alleged oral representations identified in par 8.57 I have proceeded accordingly. 104 It is necessary to make findings about relevant aspects of what was said and done by Mr Lai, Ms Chen and Mr Tassi in the period from 10 November until 21 November 2018 when the sublease was signed. The first meeting - 10 November 2018 Evidence of Mr Tassi 105 It is not in dispute, and I find, that on 10 November 2018 Mr Lai met Mr Tassi at Lot 2 and conducted an inspection. Mr Lai was acting on behalf of the second defendant which was, in turn, acting as agent of the first defendant in relation to the inspection. 106 Mr Tassi appeared to have a reasonably detailed recollection of the first meeting with Mr Lai on 10 November 2018. In my view, Mr Tassi's recollection was more complete and reliable than Mr Lai's recollection. 56 Statement of Claim, par 11; Exhibit 10; ts 562 - ts 567. 57 Statement of Claim, pars 9 - 12; ts 562 - ts 567. -- 29 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 30 107 In relation to those and other discussions after the site inspection, Mr Tassi did not purport to recount the exact words used. Rather, he explained that he recalled what was said, the meaning and type of conversation and what had been discussed, but not the exact words.58 108 As to the first meeting, Mr Tassi gave evidence that he met Mr Lai and was taken through the premises. Mr Tassi described, in some detail, the layout of the premises and where he and Mr Lai went inside and outside the premises during the initial inspection. He recalled that Mr Lai explained there were still some people living in some bedrooms and asked if they could go through only the one that was relatively empty. To similar effect, Mr Lai confirmed meeting Mr Tassi at Lot 2 for him to inspect the property and that he showed Mr Tassi inside the house and some of the rooms.59 Backyard and garage 109 Mr Tassi explained that he and Mr Lai exited the main building by some steps leading into the laneway and went to the rear where there was an outdoor area with gravel next to a garage. He saw some signs on the buildings that indicated there was a car park. Mr Tassi explained that he and Mr Lai discussed that rear area then, as well as when they were inside the premises. Mr Tassi said that they discussed the layout of the rooms and, in relation to the outside area, 'that it was an area that I could use to park vehicles'.60 110 Mr Tassi gave evidence that he and Mr Lai entered into the garage. He said that one side was full of tools and equipment and things left there from previous tenants. On the left side was an empty space. Mr Tassi said that Mr Lai mentioned that this was the space used by the previous owner who was running the hostel to park his vehicle.61 Mr Tassi explained that he and Mr Lai stepped outside the garage. As it was a sunny day, they moved to a shaded section of the laneway between the garage and the steps, and continued talking in more detail.62 111 Mr Tassi recalled Mr Lai saying that Mr Tassi could park vehicles in the premises at the back and he could also park inside the garage. In his answer he also referred to there being space in the back 58 ts 163. 59 ts 117 - ts 118 (Mr Tassi), ts 399 - ts 400 (Mr Lai). 60 Exhibits 31 (front sign) and 59 (rear signs); ts 118, ts 169 - ts 170. 61 ts 118. 62 ts 119 - ts 120. -- 30 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 31 in the open area that could locate five to six car bays. It was unclear whether the reference to the number of car bays was something he recalled Mr Lai saying or whether it was based on his own observation. Mr Tassi gave evidence that Mr Lai said that at the time parking could only be on one half of the garage, but if all the other leftover equipment or tools were removed Mr Tassi could also use the other half.63 112 Mr Tassi later gave evidence that Mr Lai said that the garage was part of the building that Mr Tassi would lease and that he could have exclusive use of it 'to use it as a garage or anything I were thinking to do that - that I can use it for'. Mr Tassi said that he was also told by Mr Lai that he would have to take out building insurance on the garage and the main building.64 113 During cross-examination, Mr Tassi agreed that Mr Lai said something to the effect that the garage area was where the owner sometimes parked his car when he came in to manage the premises. Mr Tassi maintained, however, that he also asked about removing the items in the garage and whether he could use the garage to park two vehicles, and Mr Lai agreed.65 114 In relation to the backyard area, Mr Tassi gave evidence that he asked Mr Lai who was allowed to park there. Mr Tassi considered that it was 'kind of self-explanatory' due to two parking signs he saw on the garage indicating that only guests of the Aberdeen Lodge (located on Lot 2) could park in that area. Mr Tassi also saw a sign near the beginning of the laneway that referred to vehicles found on the premises being clamped.66 115 Mr Tassi explained that he checked on his phone and opened Google Maps on the aerial view and saw there were three cars parked in the back of the premises on the photos. He said he and Mr Lai looked at Mr Tassi's phone on Google Maps and 'we confirm[ed] that there was the car parks … at the back'.67 116 Under cross-examination, Mr Tassi confirmed that Mr Lai told him that guests could park vehicles on the rear outdoor area. He agreed that Mr Lai said something along the lines that 'This area can be used where cars can come in there and they can stay there'. Mr Tassi said that in the backyard he and Mr Lai talked about whether it could be 63 ts 123 - ts 124. 64 ts 123. 65 ts 164. 66 Exhibits 31 and 59; ts 121. 67 ts 122. -- 31 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 32 used to park vehicles and Mr Lai said 'yes' and they confirmed this by looking at the aerial map. He said that he pulled up the map on the phone and he and Mr Lai both looked at it and the cars there on Google Maps. Mr Tassi said that he asked for confirmation if he could use the backyard to park there and Mr Lai confirmed that cars could be parked there. Mr Lai satisfied himself from the map that at some point vehicles were parked there.68 117 Mr Lai's evidence about discussions in relation to the garage and backyard area was similar to Mr Lai's, with a few minor differences. 118 Mr Lai confirmed going out through the back door into the back area and that he opened the garage with a key and showed Mr Tassi inside the garage. He said that he told Mr Tassi that the garage had equipment and items stored on one half and the other side was kept empty. He confirmed that Mr Tassi said that he was going to clean up the garage for an office or storeroom or something like that. He recalled saying that whatever Mr Tassi did, he needed to get council approval and not to demolish the garage or property.69 119 Under cross-examination, Mr Lai broadly maintained that evidence. He confirmed that he showed Mr Tassi the garage and that he said to Mr Tassi that he could use and access the garage and backyard.70 Mr Lai also confirmed that they went inside the garage and he told Mr Tassi that half of the garage had a lot of tools, equipment and other items left, and that the other side was kept empty (by the previous owner/landlord) and would allow one car bay or space there, and that was where the previous landlord had a car. Mr Lai confirmed that Mr Tassi discussed working at the garage and trying to make it into an office or storeroom.71 He could not remember what was said at the time when asked about an aspect of the initial defence he filed to the claim on behalf of the second defendant in relation to the garage and its previous use.72 120 Mr Lai was cross-examined by reference to certain assertions contained in the defence he initially filed on behalf of the second defendant in the Magistrates Court and whether he said something to 68 ts 164 - ts 167. See also Statement of Claim, par 12(a); Defence, par 12.2; Reply, par 4. 69 ts 399 - ts 400, ts 459 - ts 460. 70 ts 429, ts 459. 71 ts 429 - ts 430. See also ts 459 - ts 460. 72 Exhibit 96; ts 459. -- 32 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 33 Mr Tassi about the garage being used since the property was purchased. He could not remember what he said at the time.73 121 During cross-examination, Mr Lai maintained that he did not say anything to Mr Tassi about use or access to the laneway but said that he did say that Mr Tassi was able to use the garage and the backyard.74 He confirmed that he said to Mr Tassi that he could use the garage and there was a space empty from the previous landlord and 'It's allowed for one car - - - … Car there'. He also confirmed Mr Tassi discussed using the garage for a storeroom or office, or something like that.75 122 During his evidence-in-chief, Mr Lai said he could not remember saying anything to Mr Tassi about car parking that day.76 He recalled Mr Tassi showing him the backyard area on Google Maps and thought he showed Mr Lai that the area had a car parked in it.77 Under cross-examination, Mr Lai initially said that he could not recall having a discussion about the area in the back where cars were parked on the map, later clarifying that he could not remember what he said.78 Parking signs 123 In relation to parking signs, there was no real dispute, and I find that there was a sign in relation to parking on the wall on the side of the laneway.79 There were also two other parking signs, one on the right side of the front wall of the garage, and the other on the side wall of the garage facing the car parking area.80 124 While it is pleaded that Mr Lai showed three parking signs to Mr Tassi during the inspection, that is denied.81 Mr Tassi did not suggest in his evidence that Mr Lai showed the signs to him in the sense of pointing them out to him. Mr Lai could not recall whether he showed or pointed out any parking signs on the property to Mr Tassi.82 Mr Lai later asserted that he did not say anything about the parking sign at the front on the day of the inspection.83 In relation to a sign/s at the 73 ts 459. 74 ts 459. 75 ts 460. 76 ts 401. 77 ts 400. 78 ts 430 - ts 431. 79 Exhibit 16A, pages 124 and 128; Exhibit 31. 80 Exhibit 59, pages 383 and 383A; ts 125 - ts 126, ts 167, ts 433 - ts 434. 81 Statement of Claim, par 12(b); Defence, par 12.3. 82 ts 401. 83 Exhibit 31; ts 435. -- 33 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 34 rear, he could not remember if Mr Tassi or he said anything about the sign/s, saying he did not pay attention to that.84 125 I am satisfied that the signs were not erected by either defendant, but were in position when they purchased the property. I find that Mr Tassi saw the sign on the wall in the laneway and the two signs at the back of the property during the inspection. 126 The sign on the wall was headed 'PARKING FACILITY MANAGEMENT' followed by an ABN number and a heading in bold 'CONDITIONS OF ENTRY, PARKING ENFORCEMENT and LIMITATION OF LIABILITY' making reference to entering and using the carpark at one's own risk and setting out various terms and conditions. 127 The signs at the rear stated as follows: NOTICE THE CLOTHES LINES AND PARKING FACILITIES ON THIS PROPERTY ARE STRICTLY FOR THE USE OF ABERDEEN LODGE RESIDENTS ONLY PLEASE DO NOT USE THESE FACILITIES UNLESS YOU ARE RESIDING IN ABERDEEN LODGE Laneway 128 The main dispute between Mr Tassi and Mr Lai was whether there was any discussion at the initial inspection meeting in relation to the laneway, particularly as to accessing and using it. 129 Mr Tassi gave evidence that he and Mr Lai also talked about the use of the laneway, and that it could be used to drive cars to reach the back area.85 When later asked specifically about his recollection of what, if anything, Mr Lai said about the laneway, Mr Tassi gave 84 Exhibit 59; ts 435 - ts 436. See also ts 169 - ts 170 (Mr Tassi). 85 ts 119. -- 34 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 35 evidence to the effect that he spoke to Mr Lai about the laneway and was told that it was a laneway shared between the two buildings (that is, the next door hostel and the premises he was looking to rent). He said that he was told by Mr Lai that 'everyone' could use the laneway including to drive down it, and it could be used to access the backyard and garage.86 130 Mr Tassi also recounted asking if, during the renovation that he was intending to do, he could remove the steps in the laneway to make it easier for car access and guests to go to the back with vehicles. The steps were located part way down the laneway and led to a door in the main building on Lot 2. Mr Tassi gave evidence that Mr Lai said that he did not know if Mr Tassi could remove the steps and that Mr Tassi would have to ask the council if it was an option.87 131 During cross-examination, Mr Tassi confirmed that there were some discussions about using the laneway. When asked what words Mr Lai used in relation to using the laneway, Mr Tassi said 'That tenants of both premises could use the laneway'. When asked if that was all that was said, he then said, 'And the car can go'.88 While not expressed as completely as some of his earlier evidence, it was, in my view, still consistent with the substance of his earlier description of what was said. Mr Tassi's answer also appeared to be a response to the specific question directed to use of the laneway rather than any discussion relating to the laneway. 132 In relation to that meeting, Mr Lai gave the following evidence-in-chief in relation to the laneway:89 Okay. Thank you. At the meeting, did you discuss with him the laneway at all?---I did not mention any use or access to the laneway. So at - at - on that date, on the 10th - - -?---No. - - - you didn't mention the laneway to him at all? No. 133 Under cross-examination, Mr Lai maintained that he did not say anything to Mr Tassi prior to the sublease being signed 'about use or access [to] the laneway' and maintained that he said the garage and backyard were able to be used.90 When then questioned as to whether 86 ts 120. 87 Exhibit 8; ts 119 - ts 120. 88 ts 171. 89 ts 401. 90 ts 459. -- 35 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 36 he had never said to Mr Tassi that the laneway could be used, Mr Lai maintained that he had not said to Mr Tassi 'any use of and access to the laneway. I haven't mentioned it'.91 He further said 'I didn't say anything about it, use of or access to the laneway. I said use of access to garage and back yard'.92 134 When further questioned about any discussion about the laneway the following exchange occurred:93 Right. Okay. Now, coming back to the laneway, if you had - you're saying that you never said to him he could use the laneway, is that what you're saying?---I said I did not mention to Marco Tassi use of and access to the laneway. It's clear. I said he able to use, access to the garage. But yeah. How is he going to do that with motor vehicles if he can't - if he couldn't use the laneway? How - - -?---I don't know. Did you drive - when you went for the inspection on 12 November - sorry, 10 November 2018, where did you park your car?---I drive through the car to the - yes. Where? You drove down the laneway?---Yeah. Drive it down the laneway. Yes. And did you park in the parking area to the right?---Yes. Yes. So if Mr Tassi was to be - if this was Mr Tassi who was going to have use to car parking area and garage, he's got to have use of the laneway, isn't he? I mean, I - you're not telling me that you - he - you didn't tell him he could use the laneway?---I said he could use. But I - I don't know how he used. (Indistinct) licence - - - Okay?--- (Indistinct) licence, the five - the - the five car bays licence from - - - Yes?--- - - - from - from Transport Department, right? Yes?---Then they (indistinct) allow you to use it, but how you use, who knows? 135 The reference towards the end of the above passage to 'I said he could use. But I - I don't know how he used. (Indistinct) licence' was somewhat unclear. While it initially appeared to be an acknowledgement that Mr Lai said Mr Tassi could use the laneway, in my view, in context of the remainder of his answer, it was more likely a reference to using the backyard rather than the laneway. 91 ts 460. 92 ts 460. 93 ts 461. -- 36 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 37 Analysis and findings 136 I have taken special care in assessing the evidence in relation to the alleged oral representations, including having regard to the matters referenced earlier, and the evident issues that both Mr Tassi and Mr Lai demonstrated at times in the imprecision of language they used given that English is not the first language of either. 137 I have placed primary emphasis on the objective factual surrounding material and the inherent commercial probabilities, together with the documentation tendered in evidence.94 138 I have made due allowance for such matters, and that their evidence did not purport to describe the exact words used, but rather their substance. I have also taken into account my general conclusions about the reliability of the evidence of the witnesses. 139 The defendants contend that Mr Tassi described a general conversation about the use and sharing of the laneway and that his evidence was in vague and general terms.95 They contend that care should be taken to distinguish between whether representations pleaded were made or just general statements about things that could be said to be similar to the representations pleaded.96 140 In my view, the essence of what was allegedly said was however, clear and not complicated. I am satisfied that what was said by Mr Lai during the initial site inspection has been established with a sufficient degree of precision to enable me to be reasonably satisfied as to the nature of the representations made and, in turn, whether they were misleading in the established circumstances. 141 I find that Mr Lai made oral statements to Mr Tassi, during their initial inspection of Lot 2 on 10 December 2018 in relation to use and access to the garage, the area at the rear of the Lot 2 laneway and the garage. I find that during the discussions, in substance and effect: 1. Mr Lai said that Mr Tassi and his guests could access and use the garage and backyard. 2. Mr Lai said that the garage was part of the building that Mr Tassi (the plaintiff) would lease, and Mr Tassi could have exclusive access to and use of the garage. He said that Mr Tassi could park a vehicle on the left-hand side of the garage that was empty and had been used by the previous owner to park a car. 94 Effem [16]. 95 ts 118 - ts 120, ts 495. 96 ts 494 - ts 495. -- 37 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 38 3. Mr Tassi discussed removing items from the right-hand side of the garage and suggested that he would then be able to park two vehicles. While I am satisfied that Mr Lai did not disagree with that suggestion, I am not satisfied that he specifically confirmed that Mr Tassi could then park two vehicles. 4. Mr Tassi also discussed potentially renovating the garage for uses such as an office or storeroom. Mr Lai said that whatever Mr Tassi did he needed to get council approval and must not demolish the garage or property. 5. Mr Lai also said that the laneway was shared between the neighbouring premises (ie Lot 1 and Lot 2) and that the tenants of both premises could use the laneway. He said that the laneway could be used to drive down and access the backyard and garage area by car. 6. Mr Tassi asked if he could remove the steps on the laneway to make it easier for cars to get to the backyard area. Mr Lai said that he did not know if Mr Tassi could remove the steps and suggested that Mr Tassi approach the council. 7. Mr Lai said that Mr Tassi and guests of Lot 2 could use the rear area of Lot 2 to park vehicles. He confirmed that by showing Mr Tassi on Google Maps, which Mr Tassi brought up on his phone, an image showing at least one car parked in the backyard area. That was consistent with what the signs on the garage stated that were observed by Mr Tassi. 142 I am satisfied that the references to Mr Tassi were, in context, a reference to Mr Tassi and the plaintiff. 143 I have reached those findings for the following reasons. 144 First, there was no substantial dispute between Mr Tassi and Mr Lai that during the inspection there was a discussion about access to and use of the rear area, and access to and use of the garage to park at least one car and for other potential uses. 145 Secondly, in order to access and use the garage and rear area to park cars it was necessary to use the laneway. That was obvious. It was not, however, obvious as to the nature and extent of any ability or entitlement of the occupant of Lot 1 or Lot 2 to use the laneway or the garage. -- 38 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 39 146 Thirdly, I have taken into account that the discussions were not the subject of any contemporaneous record and the associated reasons for caution when relying on recollection of oral discussions in those circumstances. 147 Fourthly, I am, however, satisfied that it is objectively unlikely, in the context of the discussions which occurred, and the objective significance of being able to use the laneway, that there was no discussion about the use of the laneway, as Mr Lai maintained. I am satisfied that the commercial context and probabilities support the conclusion, and that the laneway was also discussed, as Mr Tassi consistently maintained. 148 As was known to the defendants, Mr Tassi was proposing to operate a backpacker accommodation business from Lot 2. He was already operating a nearby backpacker business which had parking. I am satisfied that he asked questions and discussed the use of the garage and backyard to park cars to verify whether he would be able to access and use them. It is most unlikely in that context that he simply assumed that the plaintiff would be able to access and use the laneway to drive vehicles, as was apparently contended by the defendants, and that no discussion about the laneway occurred. 149 My conclusion as to the objective significance of the ability to access and use the laneway by car is also consistent with my later findings that Mr Lai and Ms Chen themselves earlier discussed the use of the laneway with Mr Harrison, the selling agent, and Mr Yoon, one of the previous owners, prior to the second defendant purchasing Lot 2. 150 Fifthly, I accept that the ability to use the rear area to offer parking to guests for remuneration was of particular significance to Mr Tassi. I am satisfied that Mr Tassi considered the ability to use the rear area to park cars for a fee was valuable to the backpacker accommodation business he contemplated opening if he secured a sublease and the rent that he was willing to pay. 151 Sixthly, to the extent of any inconsistency between Mr Tassi's and Mr Lai's evidence about what was said during the first inspection, I generally prefer the evidence of Mr Tassi. His recollection was generally more complete and detailed. While there was some variation in the words he used to describe what was said by Mr Lai, I am satisfied that the substance of what he recalled being said was -- 39 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 40 consistent. Mr Lai had a poorer recollection of certain aspects of the conversations. Further, while Mr Lai accepted that there were aspects of the discussions that he could not recall, that was in contrast to him resolutely maintaining that he did not say anything about access to or use of the laneway. He repeated words to that effect during his answers on many occasions, even when they were not expressly used during the question asked of him. In my view, his answers were likely influenced by his appreciation of the significance of the issue as to use and access to the laneway. His denials of any such discussions were unpersuasive. 152 Seventhly, counsel for the defendants challenged the credit of Mr Tassi by reference to his communication with Mr Lai and Ms Chen shortly after the dispute arose, in a letter dated 11 January 2019, emailed on 15 January. However, in my view, the content of that letter is not materially inconsistent with the evidence of Mr Tassi and the findings I have made. Mr Tassi refers to when 'we first negotiated the lease, we both understand that the use of the garage and the space in the backyard to park cars was included as well as the laneway…'. He also said that he signed the lease with the figure agreed, 'expecting to have access to the back of the property to use it for car parking'. He said this had not been possible and it 'was not what I agreed to'.97 153 While Mr Tassi did not specifically identify any oral representations by Mr Lai in that communication, he elaborated in his email of 7 February 2019, which he was not taken to in cross-examination.98 The email was addressed to Mr Mezzatesta, a friend of Mr Lai's who was assisting him in trying to resolve the dispute. It was also copied to the email addresses of the defendants. In that email Mr Tassi specifically asserted that before signing the lease Mr Lai told him that: he could use the driveway; he could park cars in the garage as the previous owner did or use it for a different use; and he could park five cars in the backyard which he verified with the Department of Transport. Mr Tassi also asserted that Mr Lai showed him maps/drawings and a Google Maps photo and other documents as proof of what he stated. The assertions were generally consistent with his evidence at trial. 154 Finally, counsel for the plaintiff cross-examined both Ms Chen and Mr Lai by reference to the defences each filed to the proceedings when they were initially commenced in the Magistrates Court. 97 Exhibit 40. 98 Exhibit 49. -- 40 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 41 155 The general procedure claim filed by the plaintiff in substance identified a claim for breach of contract, and alleged misrepresentations with respect to access and use of part of the premises under the sublease. The claim for damages extended to: loss with respect to business operations as a backpacker accommodation from loss of use of the garage on the premises; loss of use of the laneway that provides vehicle access to the rear area of the premises; and loss of guest occupancy due to guest parking being unavailable. In the statements of defence filed by each defendant at the time, various bases were put forward by way of defence to the claim including that:99 1) The defendants (Sub lessor & Head Lessor), were telling the claimant (sub lessee) whatever they had been told by the property agent and the previous owner and the defendants believed that was true and correct, including sharing the laneway with the neighbor [sic] 2) The garage was used since the property was purchased and even the tenants who stayed in the backpacker's accommodation at that time could use the garage store their luggages [sic] and belongings when they required to flight to mining site for work but come back in two weeks time. 3) The defendants able to use the laneway for the vehicles drive in and out of the backyard and the tenants of the neighbor [sic] could use the laneway as well, even the workers such as roof fix, or other property fix required labor [sic] were all able to use the laneway and the backyard 4) 5 car parking bays permit license was issued by the department of transport 5) The defendants were in harmony good relationship with the neighbor [sic] business owner and the manager, even though we both operated a backpacker accommodation, sometimes, the manager of the neighbor [sic] business helped us put the rubbish bin out for rubbish collection … 156 Mr Lai confirmed he prepared the statement of defence of the second defendant in his capacity as sole director of the second defendant but could not remember the response to the general procedure claim. Under cross-examination, he did not recall whether 99 Exhibits 95 and 96. -- 41 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 42 he had said certain things asserted in the response, accepted he said certain other things in the response and, in particular, maintained his denial of having said anything about the laneway.100 157 Ms Chen accepted that she personally lodged the similar response on behalf of the first defendant in May 2020. Under cross-examination, she suggested that what was asserted in the defence related to things told to Mr Tassi before and after he signed the sublease, and was not separated.101 158 The plaintiff sought to rely on the contents of the initial statements of defence in support of its case that the oral representations alleged were made. It is not necessary to determine whether the statements may be relied on in that way. Even if they could, in my view, they were of limited significance in circumstances in which the general procedure claim did not identify the nature or timing of the alleged misrepresentations. Nor did the plaintiff tender any subsequent documents that may have been filed by the plaintiff, prior to the statements of defence being filed, elaborating on those aspects of its claim.102 159 I accordingly have not relied on the content of those statements of defence in reaching the above findings as to the oral statements that were made. I am satisfied that they were irrespective of the content of the statements of defence. Subsequent meetings until 21 November 2018 160 A number of differences emerged in the evidence of Mr Tassi, Ms Chen and Mr Lai in relation to any meetings held at Morley between 12 and 21 November and aspects of what was said at any meetings. Ultimately, it is not necessary to resolve all of these differences in the evidence. 161 The principal issue requiring resolution is whether a copy of diagrams 10880 and 11454 was shown to Mr Tassi at any such meeting and whether the term 'R.O.W.' appearing in diagram 11454 was discussed. 100 ts 412, ts 459 - ts 461 (Mr Lai). 101 ts 315 - ts 319, ts 352, ts 357 - ts 361 (Ms Chen). 102 Exhibit 100. -- 42 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 43 162 The plaintiff's pleaded case is that Mr Lai, on behalf of the second defendant, provided various documents to Mr Tassi including diagrams 10880 and 11454 at a meeting in Morley on 12 November 2018.103 As already observed, at trial, it was made clear that the plaintiff did not independently rely on this as a representation but rather as support for whether the oral representations asserted were made. The plaintiff contended that although on the evidence of Mr Tassi the documents were handed to Mr Tassi by Ms Chen, they were shown to him by Mr Lai in the sense that Mr Lai was present and then responded to a question from Mr Tassi about the meaning of 'R.O.W.'.104 163 While Mr Tassi initially gave evidence that at a meeting in Morley on 12 November 2018 Ms Chen was present, he eventually accepted that he may be incorrect about the date.105 I am satisfied that he was. The meeting Mr Tassi recalled occurred during working hours.106 However, the relevant contemporaneous messages between Mr Tassi and Mr Lai objectively establish that the meeting on 12 November 2018 did not occur until about 7.30 pm.107 While Mr Lai had limited recollection of the details of the meeting on 12 November, he recalled that Ms Chen was not present. He also explained that if he was at work in the evening, Ms Chen would generally be at home looking after their two children.108 Ms Chen also denied being present at that meeting, or at any other meeting with Mr Lai and Mr Tassi other than the meeting on 21 November 2018.109 164 I find that Mr Tassi met with Mr Lai on the evening of 12 November 2018 and presented an initial written commercial proposal to him in relation to the proposed sublease. I find that Ms Chen was not present at that meeting and that Mr Lai did not provide a copy of diagrams 10880 or 11454 to Mr Tassi at that meeting. 165 Mr Tassi maintained, however, that he attended two meetings at which both Mr Lai and Ms Chen were present. He gave evidence that at the first meeting the proposal was discussed, he sought confirmation of various matters, and he was shown various documents including 103 Statement of Claim, pars 9 and 10. 104 ts 423 - ts 424. 105 ts 138, ts 173 - ts 176, ts 186, ts 261. 106 ts 177 - ts 178. 107 Exhibit 99. The times recorded on Exhibit 99 were the Perth time. The times recorded in the version of the messages comprising Exhibit 16A were three hours ahead of Perth time. See also ts 176 - ts 177. 108 ts 403, ts 426 - ts 428, ts 463 - ts 464. 109 ts 311, ts 354. -- 43 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 44 diagrams 10880 and 11454. Mr Tassi suggested the meeting went for at least an hour and a half to go through all the documentation.110 166 In respect of the meeting on 21 November 2018,111 Mr Tassi recalled discussions about a range of issues relating to the final commercial lease proposal document that was signed at the same time. Mr Tassi could not recall then being shown any documents other than the sublease document. 167 In contrast, Ms Chen gave evidence that the only meeting all three attended was the meeting on 21 November 2018. When asked if she maintained her evidence that she did not meet Mr Tassi twice, she responded 'As far as I remember, no'. She then said that she could not meet him (Mr Tassi), apparently by reference to the meeting that occurred on 12 November.112 Mr Lai also only recalled one meeting at Morley where all three were present.113 168 I am satisfied that it is more likely than not that there was only one meeting at which all three attended, on 21 November 2018, and that there was a second, earlier meeting at which all three attended after 12 November. There is no independent record of an earlier meeting during that period. 169 I am satisfied that what Mr Tassi recalled occurring at an earlier meeting at which all three were present, most likely occurred at the meeting on 21 November 2018. Whether there were one or two meetings, there was considerable overlap between what Mr Tassi recalled happening at the first of the two meetings he recalled and what Ms Chen recalled happening on the meeting on 21 November 2018. I am satisfied that the aspect of a meeting where both Mr Tassi and Ms Chen recalled Ms Chen passing various papers to Mr Lai in relation to outgoings, and at which Mr Tassi recalled also being shown diagrams 10880 and 11454, was the same meeting. 170 I am satisfied that at that meeting in Morley, at which all three were present, Ms Chen was handling all the papers, placed them on the table and showed Mr Tassi them by passing them over to him. That is consistent with the evidence of Mr Tassi, Ms Chen and Mr Lai.114 110 ts 182 - ts 186, ts 261. 111 ts 154. 112 ts 354 - ts 355. 113 ts 425. 114 ts 130, ts 134 (Mr Tassi), ts 355 (Ms Chen), ts 404 - ts 405, ts 439 (Mr Lai). -- 44 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 45 171 I find that the documents that were provided to Mr Tassi to view by Ms Chen included documents evidencing outgoings. They included documents such as council, tax and water rates and an outgoings summary prepared by Lex Legal, who prepared the sublease on instructions from Ms Chen. That is supported by the evidence of both Mr Tassi and Ms Chen.115 172 For the reasons explained below, I also find, contrary to the evidence of Ms Chen and Mr Lai, that at that meeting, in addition to those documents, Ms Chen passed a copy of diagrams 10880 and 11454 to Mr Tassi. A short exchange then occurred between Mr Tassi and Mr Lai in relation to the term 'R.O.W.' denoted on diagram 11454 and Mr Tassi did a Google search in relation to its meaning. Diagram 11454 and 'R.O.W.' discussion 173 Mr Tassi recalled that the documents he was shown included a Ray White document and some plans of the premises and lot. In particular, he recalled being shown a copy of diagram 10880 and diagram 11454. Diagram 11454 had 'R.O.W.' denoted on it.116 A copy of the diagrams is set out below: 115 ts 130, ts 134, ts 186 - ts 188 (Mr Tassi), ts 313, ts 338 - ts 339 (Ms Chen). 116 Exhibit 3, pages 6 - 7; Exhibit 29, page 313; ts 131 - ts 132, ts 134. -- 45 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 46 -- 46 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 47 174 Mr Tassi gave evidence that he asked what 'R.O.W.' meant because he did not know the meaning of the word. He said that Mr Lai answered that there was a laneway that was shared between the two buildings and that that could be used for the premises that he (Mr Tassi) was looking to lease and buy the other business. Mr Tassi said that after the explanation, in the presence of Mr Lai and Ms Chen, he googled it and brought up a Landgate page which explained that 'R.O.W.' is a 'right of way'.117 175 During cross-examination, Mr Tassi maintained what he had said. He explained that after he asked Mr Lai and Ms Chen for an explanation, he verified what Landgate was saying by a Google search at the meeting to 'make sure that we were all on the same page'. 117 ts 132, ts 187 - ts 188. -- 47 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 48 Mr Tassi said that he entered 'R.O.W.' in Google and it came up with 'right of way' and something similar to what 'they' advised him, and then he was 'kind of satisfied'. 176 When asked, Mr Tassi appeared to accept that 'they' showed him a sketch where he saw an 'R.O.W.' and said that he asked them what it was. He said that they explained to him what it was. Mr Tassi did not draw a distinction between being told what it was and what 'R.O.W.' meant. He then took his own steps to confirm what 'R.O.W.' meant (by the Google search).118 177 While Mr Tassi referred to 'they' at points in his answers, his earlier evidence, which I accept, is that it was Ms Chen who passed over documents to him, in the presence of Mr Lai, and that it was Mr Lai who responded to his question about what 'R.O.W.' meant. 178 Ms Chen's recollection of any other documents being shown by her to Mr Tassi appeared limited.119 She denied, however, that diagrams 10880 or 11454 were laid out or that there was any discussion with Mr Tassi about what 'R.O.W.' referred to.120 Ms Chen stated that she had seen in the information memorandum a copy of diagram 10880.121 179 Ms Chen said that the first time she saw diagram 11454, which denoted that area as 'R.O.W.', was after the dispute (with the operator and owner of Lot 1) emerged post the sublease being entered into. She said she contacted Mr Harrison for help and said that he told her that they had rights to use the laneway because this was their right of way. Ms Chen said that was when she knew there was something called a 'right of way'. Mr Harrison then emailed her diagram 11454 (and diagram 10880) on 5 December 2018.122 180 Mr Harrison could not recall Ms Chen asking him to provide a copy of diagram 11454 in December 2018.123 118 ts 188. 119 Exhibit 4, page 15; Exhibit 15, page 89; ts 313, ts 327, ts 338 - ts 339, ts 355. 120 ts 338 - ts 339, ts 360. 121 Exhibit 3, page 6; Exhibit 8, page 43; Exhibit 29, page 313; ts 321 - ts 323. Diagram 10880 does not include any reference to 'R.O.W.'. Rather it refers to an area, which is denoted on diagram 11454 as 'R.O.W.', by reference to 'Dia (F.B. 11435) 11454'. 122 Exhibit 3, page 7; Exhibit 97; ts 324, ts 356 - ts 357. 123 ts 390. -- 48 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 49 181 Mr Lai had a very limited recollection of anything that occurred at any meeting at which he, Ms Chen and Mr Lai were present. He could not recall Ms Chen telling Mr Tassi about there being five licensed car bays, although she accepted that she did on 21 November 2018.124 In relation to that meeting, Mr Lai could not recall what documents were put on the table, including whether annexures to the Ray White information memorandum were put on the table, given how long ago it occurred. He also explained that he could not remember what Mr Tassi and Ms Chen did and that 'I just … be here to help'. He said that he was just there to help. He knew that they 'close[d] out a lot of items'.125 182 At one point during cross-examination, when asked if he recalled showing diagrams 10880 and 11454 to Mr Tassi at a meeting in Morley, Mr Lai said 'No'.126 At a later point, he indicated that he could not recall what documents were put on the table during the meeting on 21 November 2018, including whether diagram 10880 or other annexures to the information memorandum were placed on the table. However, in contrast to his generally poor recollection, as to diagram 11454 he said it was 'definitely not'.127 Mr Lai also maintained that the first time he saw diagram 11454 was in December 2018 when Ms Chen showed him the plan which Mr Harrison provided to her after Ms Chen sought his help.128 Mr Lai could not recall when he first saw diagram 10880.129 He had roughly read the Ray White information memorandum.130 183 When asked if he knew what 'R.O.W.' stood for in diagram 11454 he responded, somewhat hesitantly, 'Is it right to - right of way?'.131 He gave no evidence as to when he first became aware of the meaning of 'R.O.W.' or 'right of way'. Findings 184 Despite issues with his recollection about when meetings occurred and whether there were one or two meetings at which Ms Chen and Mr Lai were both present, I generally prefer the evidence 124 ts 461. 125 Exhibit 4, pages 10 - 15; Exhibit 6; ts 439 - ts 443. 126 Exhibit 3, pages 6 and 7; ts 423 - ts 425. 127 ts 443. 128 Exhibit 3, page 7; ts 424. 129 Exhibit 3, page 6; ts 424. 130 ts 418. 131 ts 424; Exhibit 3, page 7. -- 49 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 50 of Mr Tassi to that of Ms Chen and Mr Lai as to whether he was shown diagrams 10880 and 11454 and had a discussion about the meaning of 'R.O.W.' at a meeting in Morley at which all three were present. 185 First, despite limitations on their recollection of which documents were shown to Mr Tassi at the meeting where Ms Chen passed over various documents to Mr Lai relating to outgoings (particularly in the case of Mr Lai), both Mr Lai and Ms Chen were quick to deny the documents included a copy of diagram 11454. 186 Secondly, while both Mr Lai and Ms Chen denied having seen diagram 11454 prior to December 2018 when Mr Harrison emailed a copy of it to Ms Chen after speaking to her, I am satisfied that they were mistaken. 187 I find that Ray White staff obtained a copy of both diagram 10880 and diagram 11454 from Landgate prior to the auction and retained them on its file. As reflected in the dates at the bottom of each diagram, I find that diagram 10880 was a copy made by Landgate on 15 December 2017. Diagram 11454 was a copy made by Landgate on 1 March 2018.132 188 While a copy of diagram 10880 was included as an annexure to the information memorandum, a copy of diagram 11454 was not. I infer that this was most likely because it was not obtained by Ray White until 1 March 2018, shortly prior to the auction on 7 March 2018, and most likely after the information memorandum had been finalised. 189 It is not entirely clear whether a copy of diagram 11454 was provided to Ms Chen or Mr Lai prior to the auction.133 I am, however, satisfied that it was on display and available to inspect at the auction, consistent with standard practice.134 190 Further, special condition 2(b) of the original contract signed by Ms Chen on behalf of the second defendant referred to diagrams 11435 (this is an error, should be 11454) and 10880 as being attached. While a copy of the diagrams was not included with the version of the contract included in the trial bundle and received in evidence, I find that they were attached to, or at least accompanied, the original contract when signed by Ms Chen. It is highly unlikely that they were not given 132 Exhibit 3, pages 6 - 7; ts 389. 133 ts 388 - ts 390. 134 ts 383, ts 390. -- 50 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 51 they were referenced in the contract and had been obtained by Ray White. I also infer that Ms Chen, who attended the auction on behalf of the second defendant, was provided a copy of the signed contract and attachments to it and more likely than not retained them on behalf of the second defendant. 191 Thirdly, I am satisfied that Ms Chen and Mr Lai's mistaken recollection about when diagram 11454 was first received and seen by them likely impacted their evidence as to whether the document was shown to Mr Tassi and if there was any discussion about the term 'R.O.W.' appearing in the diagram. They likely had forgotten that occurred. 192 I find that at a meeting at which Mr Tassi, Mr Lai and Ms Chen were present in Morley, more likely than not on 21 November, diagrams 10880 and 11454 were provided by Ms Chen, in the presence of Mr Lai, to Mr Tassi to review. I am not satisfied that Mr Lai personally showed the document to Mr Tassi. While the timing of the meeting is inconsistent with the pleaded case, I am satisfied Mr Tassi was confused as to the timing of the meeting at which this occurred. Also, it was not ultimately relied on as itself being an actionable representation, but rather as context relevant to whether the oral representations alleged were made.135 193 I find that Mr Tassi observed the notation 'R.O.W.' on diagram 11454 and asked what it meant. I find that Mr Lai responded. He did not directly explain what 'R.O.W.' meant. Rather, by reference to the area marked as 'R.O.W.', he explained, in substance, that the laneway was shared between and could be used by the occupants of both premises (ie Lot 1 and Lot 2). The answer I find Mr Lai gave is consistent with the statements I have found he made during the site meeting he had with Mr Tassi on 10 December 2018. 194 I also find, as explained by Mr Lai, that he then did a Google search for the term 'R.O.W.' and it came up with 'right of way' and an associated explanation of that term. 195 The above findings are not necessarily inconsistent with Ms Chen's evidence that she was not familiar with the term 'right of way' prior to her conversation with Mr Harrison in December 2018. That may be the case. Mr Tassi did not say that he communicated the result of his Google search to Mr Lai or Ms Chen. Further, 135 Statement of Claim, par 8. -- 51 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 52 while the term 'R.O.W.' is used in the original sale contract, the term 'right of way' is not used in that document or the information memorandum. Licensed car bays 196 It was not in issue, and I find, that Ms Chen received a letter from the Department of Transport dated 22 October 2018 addressed to the second defendant indicating the second defendant was licensed to permit non-residential parking on the premises in relation to five licensed car bays at the property.136 I accept Ms Chen's evidence and find that she told Mr Tassi that she had received a letter from the Department of Transport indicating that there were five non-residential parking bays available for the property.137 I accept Mr Tassi's evidence, and find, that before executing the sublease he also called the Department of Transport to verify if he could park vehicles in the premises and was told he could park up to five vehicles.138 Other discussions during the 21 November 2018 meeting 197 It is not in issue, and I find, that at the meeting on 21 November 2018 the sublease and final commercial lease proposal document were signed after any proposed insertions or deletions were agreed and recorded.139 198 Mr Tassi also explained that 'we', being an apparent reference to Mr Tassi, Mr Lai and Ms Chen, discussed about the premises Mr Tassi was going to lease, that he was able to use the premises for backpacker accommodation and that he could park vehicles in the backyard and in the garage. He also said that they discussed that he was looking to do some renovation and how the rent could change over the years. He said that it was also discussed that he had to have insurance over the building and the garage/shed before starting any renovations.140 199 Mr Tassi spoke in general terms and did not indicate what was said by whom during that discussion. While I am satisfied that there was some general discussion about most, if not all, of those matters, I am not satisfied as to what, if anything, was said by Mr Lai and/or 136 Exhibit 13. 137 ts 313, ts 318 - ts 319, ts 360 - ts 361 (Ms Chen), ts 138, ts 261 (Mr Tassi), ts 461 (Mr Lai). 138 ts 143 - ts 144. 139 Exhibit 24 (The pages of the commercial lease proposal appear in reverse order in the trial bundle ie the first page of the proposal is page 299 of the trial bundle and the final page of the proposal is page 296); ts 140 - ts 141 (Mr Tassi), ts 312, ts 371 (Ms Chen). 140 ts 140 - ts 142. -- 52 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 53 Ms Chen in relation to those matters. In particular, other than what Ms Chen accepted she said in relation to the parking licence (see above) I am not satisfied as to whether Ms Chen and/or Mr Lai otherwise said at that meeting that Mr Tassi could park vehicles in the backyard or the garage. 200 In any event, if and to the extent these things recalled by Mr Tassi were said by Mr Lai and/or Ms Chen at the meeting on 21 November, they are generally consistent with the findings I have made about what Mr Lai said to Mr Tassi during the initial site inspection on 10 November 2018. Nothing said at that meeting qualified or altered the nature or character of the oral representations made on the earlier date. Issue 2: Did the second defendant engage in misleading and deceptive conduct constituting a breach of the Australian Consumer Law s 18? Legal principles 201 There was no real dispute as to the applicable legal principles in relation to determining whether the alleged representations, if made, comprise misleading and deceptive conduct. Misleading and deceptive conduct 202 In assessing whether conduct is misleading or deceptive or is likely to mislead or deceive, the words are to be given their plain and natural meaning.141 When considering whether conduct is misleading or deceptive, it is necessary to consider that conduct from the perspective of a reasonable person in the position of the plaintiff. An objective approach is required. It is not necessary to establish that a defendant intended to mislead or deceive.142 203 Whether conduct is misleading and deceptive is a question of fact to be determined in the context of the evidence as to the alleged conduct and the relevant surrounding facts and circumstances.143 141 Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191, 198 (Gibbs CJ) (Parkdale). 142 Butcher v Lachlan Elder Realty Pty Limited [2004] HCA 60; (2004) 218 CLR 592, 625 - 626 [109], [112] (Butcher); Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216, 228, 232 (Stephen J, Jacobs J agreeing), 234 (Murphy J). 143 Campbell v Backoffice Investments Pty Ltd [2009] HCA 25; (2009) 238 CLR 304, 341 - 342 [102] (Campbell); Parkdale [199]. -- 53 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 54 204 Conduct is misleading or deceptive if it induces or is capable of inducing error. Conduct that objectively leads one into error is misleading.144 Conduct is likely to mislead or deceive if there is a real and not remote chance or possibility that a person is likely to be misled or deceived. That is so even though the possibility of that occurring is less than 50%.145 205 An honest but incorrect statement in relation to private rights may amount to a false statement of fact within the scope of s 18 of the ACL.146 Representation as to a future matter 206 If the court finds any of the alleged oral representations were made by Mr Lai to Mr Tassi, it is in dispute whether the representations comprise future representations and, if so, whether the second defendant had reasonable grounds for making the representations. 207 Where a person makes a representation with respect to a future matter, and the person does not have reasonable grounds for making the representation, the representation is taken, for the purposes of the ACL, to be misleading.147 A party is taken not to have had reasonable grounds for making a representation with respect to a future matter, unless evidence is adduced to the contrary.148 208 A representation will only be with respect to a future matter if it is in the nature of a promise, prediction, forecast or other like statement which is directed to the circumstances or events which may or may not happen in the future but which cannot be proven to be true or false at the time when they are made.149 209 The proper characterisation of a representation/s actually conveyed, will turn on the content of the representation/s in question, judged objectively in the particular context.150 It may be possible to make a double-barrelled representation or more than one representation in more or less the same breath.151 144 Butcher [111] (McHugh J). 145 Butcher [112], citing Global Sportsman Pty Ltd v Mirror Newspapers Pty Ltd (1984) 2 FCR 82, 87 (judgment of the court) (Global) with approval. 146 See, for example, Hyder v McGrath Sales Pty Ltd [2017] NSWSC 1647 [87] - [91] (Parker J). 147 Section 4(1) of the ACL. 148 Section 4(2) of the ACL. 149 Australian Competition and Consumer Commission v Woolworths Group Ltd [2020] FCAFC 162 [121], [132] (ACCC v Woolworths). 150 ACCC v Woolworths [132]. 151 ACCC v Woolworths [134]. -- 54 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 55 210 If there was a representation as to a future matter, the representor is required to adduce evidence of: some facts or circumstances; existing at the time of the representation; on which the representor in fact relied; which are objectively reasonable; and which support the representation made.152 211 The relevant legal position is conveniently summarised by Griffiths J in Australian Competition and Consumer Commission v ACM Group:153 In the case of representations as to future matters, it is necessary to determine whether ACM had reasonable grounds for making such representations. The effect of s 4(1) of the ACL is that if a person makes a representation with respect to any future matter and the person does not have reasonable grounds for making the representation, the representation is taken to be misleading. Furthermore, the effect of s 4(2) of the ACL is that, for the purposes of applying s 4(1), the person is taken not to have had reasonable grounds for making the representation unless evidence is adduced to the contrary. Whether or not there are reasonable grounds for making a representation is a question of fact to be determined as at the date of the making of the representation (see Sykes v Reserve Bank of Australia (1999) 88 FCR 511). It is insufficient that the person making the representation had a genuinely held view that the representation was not misleading or deceptive (see Cummings v Lewis (1993) 41 FCR 559). There will not be reasonable grounds for making a representation if, at the time it was made, the person who made it did not have facts sufficient to induce in the mind of a reasonable person a basis for making the representation, which is to be assessed objectively and not by reference to the maker's subjective state of mind (see ACCC v Jones (No 5) [2011] FCA 49 at [32] per Logan J, applying George v Rockett (1990) 170 CLR 104). 212 The failure of the predicted event to occur does not of itself establish that the person making the future representation 'did not believe it would eventuate or that the belief lacked any, or any adequate foundation'.154 213 Knowledge of contradictory information is relevant to an assessment as to whether a future representation was made on reasonable grounds.155 152 Sykes v Reserve Bank of Australia (1999) 88 FCR 511, 513 (Heerey J). 153 Australian Competition and Consumer Commission v ACM Group Ltd (No 2) [2018] FCA 1115 [173] (ACCC v ACM Group). 154 Global (88) (judgment of the court). 155 Aldi Stores (A Limited Partnership) v EFTPOS Payments Australia Ltd [2011] FCA 1114 [83], [92], [100], [103]. -- 55 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 56 Issue 2(a): Did the defendant have reasonable grounds for making the representations as to future matters? Contentions as to characterisations of oral representations 214 The plaintiff contends that the oral representations, properly characterised, relate to the existing nature and character of the premises and are not future representations.156 215 The defendants contend that if, which is disputed, any of the alleged oral representations were made, they were representations as to future matters. That is said to be apparent from the nature of the representations alleged, that the plaintiff 'would have access to and use of' certain things.157 Further, the defendants contended they had reasonable grounds for making any representations that may be found to have been made. 216 If, contrary to its primary position, any representation/s are found to be representations as to future matters, the plaintiff disputes that the defendants had reasonable grounds for making the representation/s and should have conducted their own enquiries in relation to the status of the 'R.O.W.' prior to making the representation/s.158 217 The plaintiff also contends that even if it is found that the defendants had a reasonable basis for any future representation, that is irrelevant. It contends that the defendants were under a duty to take reasonable care to see that the representation was correct and reliable.159 In my view, that contention is misconceived in the context of the application of s 4 of the ACL. Further, no tortious claim for negligent misrepresentation was pleaded, or materially advanced at trial. Findings as to oral representations made and their characterisation 218 The findings I made earlier as to what was said by Mr Lai, on behalf of the second defendant, to Mr Tassi, on behalf or the plaintiff, occurred in the context of discussions about the plaintiff potentially entering into a sublease of Lot 2. 156 See ACCC v Woolworths [132] (judgment of the court). 157 First and Second Defendants' Outline of Submissions for Trial dated 29 April 2024 (Defendants' Opening Submissions), par 43; ts 501. 158 Reply, par 5(b); Defendants' Opening Submissions, par 33. 159 Defendants' Opening Submissions, par 34, citing Esso Petroleum Co Ltd v Mardon [1976] 1 QB 801, 820 (Lord Denning), a passage concerning the tort of negligent misrepresentation. -- 56 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 57 219 I am satisfied that, in context, Mr Lai, on behalf of the second defendant, in substance and effect made representations to the plaintiff, that if the plaintiff entered into the sublease: 1. The plaintiff could access and use the laneway, including by car to drive down it to the garage and rear area of Lot 2. 2. The plaintiff could access and use the garage, on an exclusive basis, for uses including to park cars or other uses contemplated by the plaintiff, such as an office or storeroom. 3. The plaintiff could access and use the backyard area at the rear of the main building on Lot 2 to park cars. 220 Mr Lai also made representations that the use of the laneway was shared between Lot 1 and Lot 2 and their tenants. 221 Any difference between my findings as to the representations made and the representations alleged is immaterial.160 222 In my view, properly characterised, each of the first three representations was a representation as to a future matter. They related to whether the plaintiff could access and use the laneway, garage and back yard area in the future if the plaintiff entered into a sublease in relation to Lot 2. 223 I find that the representation that the use of the laneway was shared between Lot 1 and Lot 2 and their tenants was not a future representation. I find that it was a representation of historical and then current fact as to the nature of the use of the laneway by the owners and occupants of Lot 1 and Lot 2. In my view, properly characterised in context, the representation did not expressly or impliedly represent, as the plaintiff appears to contend,161 that the shared use was pursuant to a shared legal right of usage. 224 I also find, consistent with the evidence of Mr Lai and Mr Yoon, that, as a matter of fact, prior to and as at the time of the representation, and up until the sublease was entered into, the use of the laneway had been shared between Lot 1 and Lot 2.162 Therefore, I am satisfied that this representation was in substance true, and not misleading or deceptive. 160 See Statement of Claim, par 8. 161 Statement of Claim, par 29(a). 162 ts 234. -- 57 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 58 225 I consider below the question as to whether the three future representations were misleading or deceptive. Issue 2(b): Did the defendant have reasonable grounds for making the representations as to future matters? 226 While the defendants deny having made any alleged representations, they contend that, if it is found that they did, at the time of making the representations they had reasonable grounds for making them. 227 The reasonable grounds are particularised as follows:163 a. Prior to the purchase of the Premises in or about March 2018, the second defendant's Mr Kelvin Lai and [Mr Harrison of] Ray White, the selling agent for the previous registered proprietors, both inspected the Premises. b. On that occasion Mr Kelvin Lai was informed by [Mr Harrison of] Ray White that the then registered proprietors of the Premises had the use of, and access to, the Laneway, the Garage and the parking space at the back of the Premises, and that such use and access had continued since 1991 and 1998 respectively when they separately bought 2 parts of the Premises comprising in two certificates of title. c. In or about March 2018, the property information on the Premises provided by Ray White for the auction sale of the Premises contained Landgate records of titles of the Premises which annexed a diagram 10880. The diagram depicted the Premises (Lot 2), the neighbouring Lot 1 and the Laneway. d. The Laneway in the Landgate diagram 10880 referred to another old Landgate diagram 11454. That old diagram depicted the Premises (Lot 2), the neighbouring Lot 1 and the Laneway, with Laneway marked as 'R.O.W.' ie, right of way. 228 At trial the defence case was advanced, without objection, on a slightly broader basis. The defendants also relied on evidence of: what Mr Yoon told Mr Lai; an aerial photograph in the information memorandum that showed cars parked in the backyard area; the terms of the initial contract of sale; and Mr Lai's own observations during inspections and attendances at the property, including when looking at Google Maps.164 163 Defence, par 14. See also Defendants' Opening Submissions, par 48. 164 ts 501 - ts 502. -- 58 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 59 229 It is accordingly necessary to make factual findings in relation to those and related matters relevant to whether the defendants had reasonable grounds for making the representations. 230 Prior to doing so, it is convenient to deal with certain other contextual historical matters. Knowledge of previous owner of Lot 2 231 The registered proprietors of Lot 2 were, for many years, Mr Kwok Leong Yoon and Ms Margaret Lily Yoon (jointly as to one undivided half share) and Mr Kim Hong Tan and Ms Peck Yoong Tan (jointly as to one undivided half share), as joint tenants. They purchased Lot 2 by contract dated 11 September 1990.165 In a subsequent letter dated 25 September 1990, the preceding registered proprietors, Mr and Mrs Kerr, stated:166 We warrant that the access way between 75 - 77 Aberdeen Street and 79 - 81 Aberdeen Street, Perth is a Right of Way, and we confirm that we have been using this access way as a Right of Way ever since we acquired the subject property on 21st August, 1969. We have also been using the outbuilding situated at the rear as a store for storing our equipment since our acquisition of the subject property. The sale of the subject property shall include the outbuilding situated at the rear, together with the right to the benefit of the above mentioned Right of Way. 232 I find that this reflected what Mr Yoon was told during pre-contractual negotiations.167 233 I find, as Mr Yoon explained in his evidence, that after the purchase, a lease was entered into between the owners of Lot 2 and Sunvalley Holdings, a related company over which the owners had control.168 234 I also find that from 1991 until 2018 Mr Yoon was involved, nearly fulltime, running a backpacker business at the property. Further, I find that throughout that period guests of the business had 165 Exhibit 1; Exhibit 4, pages 10 - 11; ts 232. The Certificates of Title record the registration of Mr and Ms Yoon as registered proprietors of a half undivided share on 18 February 1991, and of Mr and Ms Tan of a half undivided share on 7 April 1998. The reason for the timing difference was not explained and is immaterial to this matter. 166 Exhibit 1. 167 ts 233. It is not suggested that this letter was provided to either defendant prior to the sublease being signed. 168 ts 244. -- 59 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 60 access down the laneway. I accept that problems were not experienced. While sometimes people would park in the laneway, after being asked to remove their vehicle, they would remove it. Mr Yoon explained that the laneway was shared with the neighbour (Lot 1), whose guests obtained access to the backdoor of that property from the laneway.169 Putting to one side any question of legal entitlement to use the laneway, I find that, as a matter of fact, access and use of the laneway, was shared during that period. Mr Yoon's understanding throughout that period was that the lane was 'supposed to be a clearway', that could be used by both properties and their tenants, without hindrance.170 What facts and circumstances were known by Mr Lai prior to sublease being signed? Site inspections and discussion with Mr Harrison and Mr Yoon 235 In assessing whether Mr Lai had reasonable grounds for the future representations I have found he made, it is necessary to make findings in relation to what was communicated to him by Mr Harrison and Mr Yoon during site inspections he attended in connection with the purchase of Lot 2 by the second defendant. 236 Mr Lai, Ms Chen, Mr Yoon, and Mr Harrison gave evidence about their attendance at the site and discussions that occurred either prior to or in the weeks following the auction on 7 March 2018. 237 Unsurprisingly, there were a number of differences in their recollections as to what was said, when, and who was present. Mr Lai 238 Mr Lai recalled that he and Ms Chen went to the property by themselves a few times. Mr Lai said that he inspected the property more than once from the outside from the street and inside only a few times. Mr Lai gave evidence that he and Ms Chen first went there before March 2018. He described how an appointment was made and he met Mr Harrison with Ms Chen at the property. He also said that he did not meet with Mr Harrison on his own, only with Ms Chen. Mr Lai recalled one meeting where the three of them met at the property. Mr Lai accepted that Mr Yoon may have been there too but could not remember.171 169 ts 234. 170 ts 234. 171 ts 394, ts 396 - ts 397. -- 60 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 61 239 Mr Lai recalled that, at the meeting, Mr Harrison gave him his business card and a copy of the information memorandum.172 240 Mr Lai recalled walking through the house and going out the back through the side door (that opens onto the laneway). He described Mr Harrison showing him the garage, that one vehicle was parked at the beginning of the laneway and there were cars parked in the backyard as well. Mr Lai saw the two buildings on Lot 1 and Lot 2 and the brick garage that sat on the laneway at the end. Mr Lai recalled Mr Harrison telling him and Ms Chen that they were 'able to use of and access the laneway to the … garage and backyard parking'. When asked if Mr Harrison said anything about the boundary of the property, Mr Lai said that Mr Harrison mentioned that the use of the common laneway was shared between Lot 1 and Lot 2. I did not understand his answer to suggest that Mr Harrison used the term 'common laneway'. Rather, 'common drive way' or 'common laneway' were terms that Mr Lai used at times to describe the laneway.173 Mr Lai said that Ms Chen was present when those things were said.174 241 Mr Lai said that at the meeting Mr Harrison showed him the garage at the back, and he thought Mr Harrison opened it. Mr Lai could observe a lot of tools, equipment and other things stored.175 He recalled that the left-hand side was empty, allowing a car to park there.176 242 Mr Lai also recalled that before the second defendant bought the property he met Mr Yoon, but he could not remember the day. Mr Lai said that they met at the property, near the garage and discussed the property. The following exchange about their discussion occurred:177 Did he say anything to you about the laneway, that you can remember? ---Yes. He - he told me the laneway, I able to use it, access for the laneway. And since he purchased the property, 1990, long time ago, he could use the laneway. And he parked the car - - - Yes?--- - - - inside the garage and on the laneway. So he told you that?---Yes. 172 Exhibit 8; ts 394. 173 Exhibit 16A, page 118; Exhibit 28; ts 364 - ts 365, ts 405. 174 ts 395. 175 ts 395. 176 ts 396. 177 ts 396. -- 61 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 62 Did he say anything to you about parking bays that you can remember? Or cars being able to park at the back?---He did mention we can park the car at the back. Ms Chen 243 Ms Chen's evidence was broadly consistent with that of Mr Lai. She said that she and Mr Lai attended an inspection at the property, in early 2018. During the inspection Ms Chen said that Mr Harrison let her and Mr Lai into the main property, the rooms, kitchens, then backyard and garage. Mr Lai was present with her.178 244 Ms Chen saw an old garage at the back of the laneway. Next to it was an empty space and a clothes hanger. She also thought there were cars in the backyard. She saw the garage at the back of the laneway and observed that it was 'not (indistinct) inside this land and' was 'a little bit on this side as well'.179 245 In contrast to Mr Lai's recollection that there was an empty space on the left of the garage, Ms Chen recalled that the garage had a car in it. She recalled that Mr Harrison said in the presence of her and Mr Lai that 'we can actually use of and access of the laneway to drive the cars inside the garage, and also the parking area at the back of the property'. She recalled that Mr Harrison said the laneway was 'Shared between the other property … Between the neighbour, lot one. 75'. Ms Chen said that Mr Harrison 'just mentioned that we can use the laneway - the laneway to the garage, the backyard, and that he also mentioned that the owner of the 79 property had used it since they are becoming the owner of this property'.180 246 Ms Chen also recalled that Mr Yoon was present during this inspection. She said that she only had general, social conversation with Mr Yoon on that occasion. Ms Chen recalled that she and Mr Lai went back to the property on a second occasion and on that occasion spoke to Mr Yoon. She was not sure if Mr Harrison was present on that occasion. She recalled going back inside the main building and that Mr Yoon showed her and Mr Lai the laneway, garage and back of the property. She said that Mr Yoon also mentioned that he had used the laneway, garage and backyard since becoming the owner of the 178 ts 305 - ts 307. 179 ts 307. 180 ts 307. -- 62 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 63 property.181 In response to a leading question, Ms Chen confirmed that Mr Harrison said that the owner had confirmed that he had access and used the laneway all the time.182 Mr Yoon 247 When asked if he had ever met Mr Lai or Ms Chen at the property, Mr Yoon said 'Maybe just a fleeting glance but we have not much discussion because I deal mostly through our friend, Stephen Harrison, not directly with them'. 248 It was then suggested to Mr Yoon that Mr Lai and Ms Chen both said he told them he had had uninterrupted use of the laneway during his period (as owner). When asked if he remembered that, Mr Yoon explained that he could not recall whether he did or not, but accepted that he might or could have.183 Mr Harrison 249 Mr Harrison recalled Ms Chen contacting him and that he attended an inspection in 2018 with Ms Chen.184 His recollection as to whether Mr Lai was present on that occasion appeared limited, and partly informed by email correspondence to refresh his memory, but which was not tendered. 250 Mr Harrison initially explained, and later confirmed, that his memory was 'a bit patchy'. He thought Mr Lai may have been overseas at the time he inspected the property with Ms Chen before the auction, but that Mr Lai did come through later in March, based on email correspondence. Mr Harrison had an email saying Ms Chen and Mr Lai would like to come through and he had memories of taking them through. He suggested that, according to correspondence he had subsequently reviewed, Mr Lai was overseas on the first occasion. The correspondence was not requested to be produced or tendered. When further questioned, Mr Harrison explained, however that, he was unsure whether Mr Lai was present during the initial inspection with Ms Chen.185 181 ts 308. 182 ts 307. 183 ts 235. 184 ts 377. 185 ts 377. -- 63 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 64 251 Mr Harrison assumed there was one prior to the auction and remembered there was definitely one after the auction (that was held on 7 March 2018) as well.186 Mr Harrison could not recall how many times he showed Ms Chen and Mr Lai through before the auction. He thought one, but could not remember. When asked if he showed Mr Lai through one time before the auction, he indicated that he did not recall that. However, when it was then indicated that Mr Lai would give evidence that he was there (at the inspection before the auction), and Mr Harrison showed him through, Mr Harrison confirmed that he had no reason to doubt that.187 252 In relation to the inspection prior to the auction, at which Mr Harrison recalled that at least Ms Chen was present, Mr Harrison explained that he would have shown whoever was with him through the premises, the lodging rooms, the kitchen and they accompanied him during the inspection. Mr Harrison recalled that they went through to the backyard area and the area where the laneway was. In contrast to the evidence of Ms Chen and Mr Lai, Mr Harrison said that he did not think they opened the garage as it was generally locked and used for storage. Mr Harrison said that they (that is, he and whoever else was present) went to the laneway and 'we were' careful to explain the laneway. He said he understood that the boundary of the property sat midway between the laneway, and he told Ms Chen that on that day.188 He further explained:189 And did you say anything about the use of the laneway that you can recall?---Yeah, I sort of said 'Look, there's no formal access agreement. The boundary sits here. The - the garage that you can see actually encroaches' - - - Yes?--- - - - 'past that boundary', and - yeah. Basically it's the - all the information that was in the auction contract. 253 When further questioned, Mr Harrison confirmed that he was aware that the garage encroached past the boundary. He could not specifically recall whether he said anything about the garage on that occasion.190 186 ts 379 - ts 380. 187 ts 380. 188 ts 377 - ts 378. 189 ts 378. 190 ts 378. -- 64 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 65 254 During cross-examination, Mr Harrison confirmed taking Mr Lai for an inspection on about 20 March 2018, after the auction. That was consistent with his earlier evidence about an email saying Ms Chen and Mr Lai would like to come through and his memory of taking them through. He could not recall specifically what occurred during the inspection but said 'It would have been the standard showing people around … indicating the driveway, probably talking about the number of beds, that kind of thing'.191 He assumed they walked in the backyard. When asked if he could recall a discussion about the garage not being on the full title he said 'There would have been'. And that it was just 'standard spiel' he was providing to anyone that inspected.192 When then referred to his earlier evidence that he told Ms Chen (and, I infer, whoever else was then present) during an inspection prior to the auction that there was no formal access agreement and asked if he had the same conversation with Mr Lai, he said that he did not have a direct memory but, if asked, he would assume as much.193 255 In contrast to the tenor of the evidence of both Ms Chen and Mr Lai, Mr Harrison was clear that he had no discussion about car parking at the back with Ms Chen or Mr Lai during any inspection. He could not recall if either asked him any questions about the laneway.194 Analysis and findings 256 A question arises as to whether the discussions Mr Harrison recalled having with Ms Chen during an inspection of Lot 2, prior to the auction, occurred on an occasion when Mr Lai was also present. Ms Chen and Mr Lai both recalled being present at an inspection with Mr Harrison, prior to the auction, and that they did not separately attend inspections with Mr Harrison. Mr Harrison's evidence as to who attended inspections was less clear. He indicated that his memory in that respect was 'patchy'. He could not recall Mr Lai being present, at one point referencing correspondence that he suggested supported this. However, under further questioning, he accepted that Ms Chen and Mr Lai may have both been present. 257 Given the uncertainty of Mr Harrison's recollection and the contrary evidence of Ms Chen and Mr Lai as to their attendance, and that they only attended inspections with Mr Harrison together, 191 ts 391. 192 ts 391. 193 ts 391. 194 ts 379, ts 387. -- 65 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 66 I am satisfied to the requisite standard that they were both present at the discussion Mr Harrison recalled having with Ms Chen and Ms Chen and Mr Lai recalled having with him. 258 I find that the use of the laneway was discussed. I am not satisfied that Mr Harrison's comments were expressed in an unqualified manner, as the evidence of both of Ms Chen and Mr Lai appeared to suggest. They made no mention of any words of qualification. I am not satisfied that Mr Harrison said that Mr Lai and Ms Chen could use the laneway. Rather, I am satisfied that he was conservative in his approach and careful to explain matters he considered important to disclose. I am satisfied, consistent with the evidence of Ms Chen and Mr Lai, that Mr Harrison explained that the then owner of Lot 2 had used the laneway since becoming the owner of the property and that its use had been shared with Lot 1. I find, however, that Mr Harrison expressly qualified his comments by explaining that there was no formal access agreement in relation to the use of the laneway. I also find that Mr Harrison specifically drew to the attention of Ms Chen and Mr Lai the approximate location of the boundary of Lot 2 (as he understood it), being part way across the laneway. 259 I accept Mr Harrison's evidence, in respect of which he was also clear in his recollection, that he did not have any discussion about car parking with Ms Chen or Mr Lai during any inspection. 260 I also find that Mr Harrison explained that the garage encroached across that boundary during an inspection of Lot 2 at which Mr Lai was present. That is consistent with the standard comments he made to persons inspecting the property. It is also consistent with the special conditions of the auction contract that Ray White prepared. 261 I find that a short discussion occurred between Mr Yoon, Mr Lai and Ms Chen at Lot 2 during which Mr Yoon, in substance, told Mr Lai and Ms Chen that he had used the laneway, garage and backyard since becoming an owner (in 1990), and had used the garage to park his car. While Mr Yoon could not recall any discussion in which he suggested he had uninterrupted use of the laneway during his ownership, he accepted it may have occurred. That is consistent with Mr Yoon's own shared use of the laneway as I found earlier. 262 While Mr Lai suggested that Mr Yoon also said that Mr Lai could use the laneway, and the backyard, to park cars, Ms Chen did not suggest this. Given the differences in recollection, I am not satisfied -- 66 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 67 that Mr Yoon specifically said that Mr Lai could use those areas, although I accept that Mr Lai inferred this from what Mr Yoon said above. Information memorandum in relation to sale of Lot 2 263 An information memorandum in relation to the sale of Lot 2 was prepared by Ray White, in part based on information provided by Mr Yoon, as well as observations and inquiries with relevant authorities by Mr Harrison and other staff.195 The information memorandum included various annexures. They included, amongst other annexures: a copy of the certificate of title for Lot 2; a sketch of Lot 1; a copy of diagram 10880 and a certificate of registration of a lodging house in respect of the premises. 264 The sketch of Lot 1 was itself contained on the front page of a certificate of title for Lot 1 that was expressly noted as being superseded and included for the sketch only.196 265 The information memorandum included a copy of an overhead aerial photograph of Lot 2 and the surrounding area, obtained from RP Data.197 The approximate boundary of Lot 2 was marked by a red outline. The line passed through the rear garage. Most of the laneway is outside the area bounded by the red lines. Visible at the rear of the main building on Lot 2 is an open area where three cars were parked. Mr Lai was provided with a copy of the information memorandum by Mr Harrison during an inspection he attended. He 'roughly read it'.198 Did Mr Lai and/or Ms Chen become aware of an issue in relation to the status of the 'R.O.W.' prior to the sublease being signed? 266 During cross-examination, counsel for the plaintiff explored in detail with witnesses for the defendants the circumstances surrounding the entry into a replacement contract for the auction contract and related agreements. The case theory he sought to explore appeared to involve a number of elements. In particular, it appeared to involve the suggestion that the parties and their representatives, including Mr Lai and Mr Yoon, became aware of an issue in relation to the registration of the 195 Exhibit 8; ts 375 - ts 376 (Mr Harrison). See also ts 237 - ts 239 (Mr Yoon). 196 Exhibit 8, Annexures A - D, pages 40 - 45. The superseded certificate of title also itself contained a statement within it that it was superseded by 'digital register'. The back page, which is where any encumbrances were noted as being recorded, was not included. 197 Exhibit 8, page 33; ts 375 - ts 376. 198 ts 394, ts 417 - ts 418. -- 67 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 68 'R.O.W.' prior to the first contract settling, as well as a GST issue which Mr Lai/the second defendant wished to resolve to ensure that no GST liability arose. 267 Counsel explored whether, in return for the new contract being entered into, Mr Yoon was 'let off' what was said to be a representation in the auction material that the laneway was available to be used. Presumably that was the reference to the existence of the 'R.O.W.' in special condition 2. It was suggested that, in addition, interest was not charged for the delay between when settlement was due under the original contract and when settlement ultimately occurred under the replacement contract. It was suggested that this resulted in a benefit of about $240,000 to the first defendant from avoiding $192,000 of GST and about $50,000 of interest. 268 It was also explored whether Mr Lai was aware of the problem in relation to registration of the 'R.O.W.' and did not disclose it to Mr Tassi because his intention was to redevelop the property, the laneway was not an issue for him long term, and he thought he could deal with the issue with his neighbour.199 269 The defendants contend that any case that the defendants knew the 'R.O.W.' had been terminated or extinguished and they concealed it was not pleaded in reply and, in any event, there was no evidentiary foundation in support of such a proposition.200 I agree. 270 Although little was ultimately pressed by counsel for the plaintiff about this theory in closing, and it was not raised on the pleadings, for completeness it is nevertheless appropriate that I consider it. For the following reasons, I reject it. In particular, I am not satisfied that it has been established that Mr Lai or Ms Chen were aware of any issue in relation to the registration of the 'R.O.W.', prior to the sublease being entered into, or that there was any form of trade-off as contended on behalf of the plaintiff. 271 First, in relation to the entry into a replacement contract, the evidence of Ms Chen, Mr Yoon and Mr Harrison was broadly consistent, and I generally accept it. It was also objectively supported by the terms of the various agreements entered into, and the basis on which a private binding taxation ruling was obtained in August 2018. 199 ts 240 - ts 242. 200 ts 503; Reply, par 5(b); Response to Request for Further and Better Particulars filed 9 December 2022 (response to request 11). -- 68 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 69 272 I find that the principal reasons that the replacement contract and related agreements were entered into related to concerns relating to ensuring that the sale was GST-free, as well as an issue as to whether the first contract had been properly authorised on behalf of the second defendant. 273 I find that following the fall of the hammer, some debate occurred before the contract was signed. The second defendant wished to purchase the land on a going concern GST-free basis. A standard Real Estate Institute of Western Australia going-concern GST clause was annexed and formed part of the contract.201 The sellers agreed to the proposed GST clause that formed part of the contract.202 274 Under the terms of the GST clause, the parties agreed that the sale of the property was the supply of a going-concern and GST-free. The seller agreed to continue to conduct the 'enterprise' as a going-concern until settlement. It also agreed to supply at settlement all things required for the continued operation of the enterprise as a going-concern. It was agreed that the purchase price was exclusive of GST. Further, it was agreed that if the Commissioner of Taxation did not accept that the transaction was GST-free, for the supply of a going-concern, the buyer (the second defendant) was required to pay to the seller the amount of GST on the sale, after the liability of the seller was confirmed by the Commissioner of Taxation.203 275 Ms Chen recalled, and I accept, that the second contract was negotiated in circumstances where it was intended to buy the property as a going-concern such that the transaction would be GST-free, and that this would have to be established to the satisfaction of the Australian Taxation Office.204 276 I find that Lot 2 was offered for sale by auction with vacant possession. Consistent with that position, nil leases were specified in cl 4 of the auction particulars and conditions of sale.205 As referred to earlier, Mr Yoon explained, and I accept, that a lease was entered into in about 1991 between the owners and Sunvalley Holdings, a company over which the then owners had control and under which the property had been operated as a backpacker accommodation. The lease was not 201 ts 384. 202 ts 250 (Mr Yoon), ts 341 (Ms Chen), ts 384 (Mr Harrison). 203 Exhibit 91, page 805. See also ts 381 - ts 382, ts 384 (Mr Harrison), ts 339 - ts 341 (Ms Chen). 204 ts 341. 205 Exhibit 8, page 32; Exhibit 91, cl 4, page 801; ts 138, ts 379. -- 69 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 70 referred to in the auction sale terms and conditions because the owners could cause the lease to be terminated by mutual agreement so that the sale could proceed on the basis that it was not subject to the existence of the lease.206 277 Mr Harrison recalled, and I accept, that after the initial contract was entered into considerable correspondence was engaged in about the GST and going-concern issue. Ultimately it was resolved to appoint a tax specialist lawyer who recommended that a private binding ruling be sought from the Commissioner of Taxation, which was agreed between the lawyers for the parties.207 Mr Yoon explained, and I accept, that in addition to the GST issue that arose, the sellers' lawyer also identified an issue with the execution clause and did not consider it was legally appropriate as it was signed on behalf of the second defendant by a representative (Ms Chen). The initial contract was therefore cancelled and settlement was not proceeded with.208 278 I find that as part of the negotiated arrangements entered into: 1. A new lease was entered into between the then owners of Lot 2 and Sunvalley Holdings dated 28 May 2018, with a commencement date of 15 May 2018 and termination date of 14 May 2019. It was entered into to formalise the existing lease arrangement. 2. A replacement contract of sale was entered into between the owners and the second defendant dated 20 June 2018. In that contract the parties acknowledged that the original contract of 7 March 2018 was void ab initio. The sale price remained the same. The property was sold subject to the above property lease and conditional upon the novation of the lease. Under the terms, consistently with the original contract, it was agreed that the sale was GST exclusive and that the enterprise was sold as a going-concern and was 'GST-free'. It was also agreed that the seller would apply for a private binding ruling. If a ruling was issued that the supply was a taxable supply or otherwise declined to issue a private binding ruling, at settlement the second defendant was required to pay to the seller GST on 206 ts 244 - ts 245. It is noted in the private binding ruling subsequently issued that the original lease was for a three-year term and that Sunvalley Holdings had continued to hold over a monthly period tenancy, although there was a question as to whether it had converted to a tenancy at will. 207 ts 384. 208 ts 250. -- 70 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 71 the purchase price. Settlement was due within 20 business days of a private binding ruling or the Commissioner of Taxation refusing to issue a ruling.209 3. A deed of novation was entered into between the owners, Sunvalley Holdings (as outgoing lessor) and the first defendant (as incoming lessor) under which the rights and obligations of Sunvalley Holdings under the lease dated 28 May 2018 were novated to the first defendant with effect from the date the second defendant became the registered proprietor of the property.210 279 A private binding ruling was issued on 31 August 2018, ruling that the sale of the property, subject to the ongoing lease, would constitute the supply of a GST-free going-concern.211 280 The second defendant became the registered proprietor of Lot 2 on 4 October 2018. This followed execution of a transfer of land by the then owners of the fee simple dated 1 October 2018.212 281 Secondly, although not referred to in the private binding ruling, as I have already found, an agreement to lease (the headlease) was also entered into between the second defendant as lessor and first defendant as lessee, on 29 May 2018, the day after the lease was entered into between the then owners and Sunvalley Holdings. A 60-month lease term was specified. The lease term was specified as commencing on settlement. A date in July 2018 was then recorded immediately thereafter and an end date of 14 July 2023, apparently in anticipation that by that point settlement would have occurred.213 282 Upon the second defendant becoming the registered proprietor of Lot 2, there were therefore potentially two leases in existence in relation to Lot 2. The first was the novated lease dated 28 May 2018 under which the first defendant was the lessee. The second was the 209 Exhibit 92. 210 Exhibit 93. Although the replacement contract specified in condition 1.1(6) of Annexure A that the 'Property Lease' was 'the lease annexed to this contract', a copy of the lease was not annexed to the copy of that contract that was tendered. It is apparent however from the remaining conditions that the lease dated 28 May 2018 was subject to the deed of novation. 211 Exhibit 98. 212 Exhibits 7, 12 and 92; ts 385 - ts 386. The transaction date on the endorsement of transfer of land was the replacement contract date of 20 June 2018. 213 Exhibit 9. As the copy of the signed lease that was tendered was partly illegible, a clean copy of the pro forma terms of that lease was also tendered and incorporated into Exhibit 9. The specific date in July on the version received by the court was illegible. -- 71 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 72 lease that took effect in October 2018, upon the second defendant becoming the registered proprietor of Lot 2, pursuant to the agreement to lease entered into on 29 May 2018 between the second defendant (as lessor) and first defendant (as lessee). 283 No evidence was adduced as to whether the rights under the leases differed, or whether the headlease entered into was intended to replace the novated lease and any rights or obligations arising under it. Whilst the novated lease was produced to the plaintiff at a later stage of the proceedings, after a call for its production, it was not tendered by either party. 284 In those circumstances, to the extent the plaintiff sought to point to it as a factor supporting its case theory, in my view, the fact that the first defendant paid no rent under the novated lease does not advance the theory.214 285 Thirdly, counsel for the plaintiff also pointed to certain other matters that he contended supported the case theory. 286 The special conditions of sale specified in the initial contract in relation to the location of the approximate boundary between Lot 1 and Lot 2, the location of 'R.O.W.', and that the garage encroached into the 'R.O.W.' were not included in the replacement contract. Rather, under the replacement contract the special conditions included that:215 1.7 The Property is sold 'as is', 'where is' and 'with all faults' without any representation or warranty from the Seller or any person acting on the Seller's behalf including, without limitation, any representation or warranty as to condition, fitness for any particular purpose or compliance with laws and regulations. 1.8 The Buyer has undertaken its own due diligence investigations and made all enquiries as the Buyer saw fit with respect to the Property, has satisfied itself as to the results of such investigations and enquiries and enters into the contract in reliance solely upon its own investigations, enquiries, inspections and examination of the property. 214 ts 343. 215 Exhibit 92, page 809. -- 72 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 73 287 I accept Ms Chen's evidence that she did not know why the special conditions of auction in the first contract were not mentioned in the second contract.216 She was not the signatory of the second contract, Mr Lai was. Mr Lai was not cross-examined as to why the clauses were inserted. 288 The replacement special conditions are also not, in my view, an unusual type of condition in a contract of sale or commercial contract. 289 I am satisfied that the final sale and related agreements entered into were likely financially less beneficial to the sellers as settlement remained at the same price but occurred later than was required under the initial contract. It also gave greater certainty to the second defendant that the sale would be GST-free and it would therefore not be liable to reimburse the seller in respect of any GST liability. However, as I have found, issues had arisen in relation to GST liability and whether the initial agreement was void ab initio. That provides a direct explanation for why the sellers were prepared to renegotiate various matters to facilitate the sale of Lot 2. 290 After the initial contract and correspondence about it occurred, both the sellers and the second defendant were represented by lawyers.217 I accept Ms Chen's evidence that she did not instruct Lex Legal, but rather, Mr Lai instructed them, in relation to the settlement of the purchase of the property. Ms Chen instructed Lex Legal in relation to the subsequent preparation of the sublease.218 291 While it is possible that lawyers acting for the second defendant or sellers may have identified and taken into consideration other issues, the evidence does not support an inference being drawn that they became aware of an issue in relation to the validity or effectiveness of the 'R.O.W.' area. 292 Fourthly, no direct evidence was adduced that the issue was raised with Mr Yoon or the then owners prior to the sale by auction of Lot 2, or either defendant prior to the sublease being entered into. Neither party called any representative of the owner or operator of the lodge at Lot 1. 216 Exhibit 91, page 803; ts 343. 217 Exhibit 12, pages 79 and 81. James Chong Lawyers acted for the sellers and Lex Legal for the second defendant. 218 ts 318 - ts 320 (Ms Chen). -- 73 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 74 293 Fifthly, subject to the qualification regarding my finding as to what Mr Harrison communicated about the boundary between Lot 1 and Lot 2, and the absence of any formal agreement in relation to laneway access, I accept the evidence of Mr Lai that he did not know that there was no 'R.O.W.' or right of access down the laneway before the letter was received from Summers Legal in December 2018.219 I also accept that Ms Chen did not know anything about the 'R.O.W.' having expired or not having been registered properly on the title between the dates of signing the first contract in March 2018 and the settlement date of 6 June 2018.220 That is consistent with Mr Yoon's denial that he became aware of any issue in relation to the 'R.O.W.' between the first contract and the replacement contract being signed, and that it was not raised with him by Mr Lai, Ms Chen or any solicitor acting for him or the second defendant.221 Did Mr Lai and/or Ms Chen become aware of any issue being raised by the owner or operator of Lot 1 about the garage encroachment? 294 It is unclear on the evidence when any issue was first raised by the owner or operator of the business at Lot 1 with either defendant about the use of the laneway or the garage encroachment. 295 As earlier indicated, by letter of 13 December 2018, Mr Summers, the legal representative of the operator of the business on Lot 1, refuted that the laneway was a right of way. He, amongst other things, asserted that he had previously provided the owner of Lot 2 with the 2015 Jurovich Survey Diagram which identified the portion of its client's proprietary interest in the laneway.222 The letter from Summers Legal also reiterated an earlier notice that was said to have been given to the proprietor of Lot 2 that it was responsible for the garage structure which encroached substantially on his client's property, as identified in the 2015 Jurovich Survey Diagram mentioned in previous correspondence. That notice and any associated correspondence was not tendered, nor were their dates identified. 219 Exhibit 35; ts 409. 220 ts 344. 221 ts 247 - ts 248. 222 Exhibit 35. -- 74 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 75 296 Mr Lai gave evidence that he did not (directly) receive the survey plan but thought Ms Chen may have received the survey plan.223 He was not asked when it was received. Nor was Ms Chen. Mr Harrison gave evidence, and I find, that he had not seen the 1995 survey plan before giving evidence.224 297 It is therefore unclear precisely when either the first defendant or second defendant received or became aware of the 1995 Jurovich Survey Plan, and any assertion by the lawyers for the operator of Lot 1 about the garage encroachment or its interest in the laneway. The evidence is not sufficient to establish that it occurred prior to the sublease being entered into on 21 November 2018. Reasonable grounds - analysis and determination 298 The requirement that a defendant have a positive belief and reasonable grounds for a future representation presents practical difficulties for a defendant who denies making a representation but whose evidence in that respect is not accepted, including where the representor is mistaken. The representor is left without direct evidence as to what the representor relied on to make the representation.225 Further, as observed by Basten JA in Willett v Thomas,226 at least in a case where the representor gives an unequivocal denial of making a relevant representation, which is rejected, the difficulty may constitute an insurmountable obstacle. 299 The second defendant faces such practical difficulties in this case, particularly in relation to his future representation about whether the plaintiff could access and use the laneway. 300 First, Mr Lai denied having made any representation about the laneway or access to and use of it, including by car. However, contrary to his evidence, I have found that he did make such a representation. 301 Secondly, although Mr Lai denied making that and other future representations, it was open to him to give direct evidence as to what, if any, belief he had at the time about the matters it was alleged he made representations about, and the grounds on which he held any such a belief. Mr Lai did not give direct evidence as to his belief about such matters at the time or the basis of it. 223 Exhibits 2, pages 34 and 35; ts 448. 224 ts 388. 225 Cummings v Lewis (1993) 41 FCR 559, 565 - 566 (Shepherd & Neaves JJ); Ventouris Enterprises Pty Ltd v Dib Group Pty Ltd [2010] NSWSC 963 [35] (Allsopp P, Macfarlan & Handley JJA agreeing). 226 Willett v Thomas [2012] NSWCA 97 [41] - [44]. -- 75 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 76 302 Thirdly, absent such evidence, it is necessary for the second defendant to rely on inferences. 303 I do, however, infer, in all the circumstances of the case, that Mr Lai genuinely believed the three future representations I have found he made on behalf of the second defendant. 304 The difficulty that remains for the second defendant is pointing to evidence that it may be inferred Mr Lai actually relied upon in making the representations at the time he made them on behalf of the second defendant. 305 It is not sufficient for the second defendant to point to facts or circumstances which, had they been relied upon, would have amounted to reasonable grounds. They must actually have been relied upon in making the future representation. 306 In summary, in relation to relevant facts and circumstances of which Mr Lai was aware at the time of making the future representations, I find that: 1. In about March 2018, Mr Lai received and roughly read the information memorandum. He noticed there were vehicles parked in the rear area of the property shown in an aerial photograph of the property contained in the information memorandum.227 2. In about March 2018, during an inspection of Lot 2, Mr Lai saw inside the garage, including items stored there and an empty space on the left side where there was space sufficient for a car to be parked. That was similar to what he saw during the inspection with Mr Tassi on 10 November 2018. Mr Lai also saw a car parked near the beginning of the laneway and in the backyard area of Lot 2.228 3. In about March 2018, at a site inspection of Lot 2, Mr Harrison explained to Ms Chen and Mr Lai that the owner of Lot 2 had used the laneway since becoming the owner of the property and that its use had been shared with Lot 1. He expressly qualified his comments by explaining that there was no formal access agreement in relation to the use of the laneway. Mr Harrison also specifically drew to the attention of Ms Chen and Mr Lai 227 Exhibit 8, page 33; ts 398. See also ts 305 (Ms Chen). 228 ts 395 - ts 396. -- 76 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 77 the approximate location of the boundary of Lot 2 (as he understood it), being part way across the laneway. Mr Harrison did not discuss car parking with Ms Chen or Mr Lai during any inspection. 4. In about March 2018, Mr Yoon told Mr Lai and Ms Chen that he had used the laneway, garage and backyard during the period of his ownership since 1990. He also said that he had used the garage to park his car. 5. Between settlement in early October 2018 and the sublease being entered into on 21 November 2018, Mr Lai generally attended the property each week to empty the bins, and drove down the laneway to the rear area and parked there. He did not experience any problems or issues with access.229 6. Mr Lai was aware when he purchased Lot 2 that the garage was partly built on Lot 1 land.230 Mr Harrison also explained that to him and Ms Chen at an inspection of Lot 2 at which Mr Lai was present. 7. Mr Lai was not asked whether he reviewed the original contract signed by Ms Chen on behalf of the second defendant after the auction due to his absence overseas, or was aware of its special conditions. I am satisfied that is likely that Mr Lai saw that contract, given he was the sole director of the second defendant, the dispute that developed about ensuring the transaction was GST-free and whether the contract was properly authorised, and that he, rather than Ms Chen, instructed lawyers in relation to the matter.231 In the absence of any direct evidence and for reasons further elaborated below, I am not prepared to infer that Mr Lai read or paid any particular attention to the special conditions, or diagrams 10880 and 11454, that I have found were attached to the contract, or relied on that information in making the future representation about access to and use of the laneway. 8. As I earlier found, and contrary to the evidence of Ms Chen and Mr Lai, at a meeting in Morley, on 21 November 2018, Ms Chen passed a copy of diagrams 10880 and 11454 to 229 ts 413. 230 ts 422. 231 ts 319 - ts 320 (Ms Chen). -- 77 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 78 Mr Tassi in the presence of Mr Lai. In response to a question from Mr Tassi as to what 'R.O.W.' meant, Mr Lai responded by reference to the area denoted as 'R.O.W.' and said that the laneway was an area that was shared between and could be used by the occupants of Lot 1 and Lot 2. Given Mr Lai's denial that he had seen diagram 11454 prior to December 2018, which I reject, it is difficult to infer with any confidence whether Mr Lai had examined diagram 11454 before the above meeting, or prior to making the representations on 10 November 2018. Mr Lai was also uncertain when he first saw diagram 10880. He did not give direct evidence of noticing or attaching any significance to it in forming any view about any right or ability to access and use the laneway. It is therefore unclear what, if any, reliance Mr Lai placed on those diagrams in making the representations. It is also unclear whether, at the time of making the representations, he understood what 'R.O.W.' meant. His response when asked during his evidence whether he knew what 'R.O.W.' meant, while correct, was very hesitant. By then he was of course aware of, and had been extensively involved in the dispute about the right of way. In those circumstances, I am not prepared to infer that Mr Lai placed any reliance on diagram 10880 or 11454 when he made the representations. 9. The information memorandum included a section entitled 'Legal information'. It specified that information contained within it or any other verbal or written information provided given in respect of the property was provided to the recipient on various conditions. They included a condition to the effect that the recipient should satisfy themselves as to the accuracy and completeness of the information through its own inspections, surveys, enquiries and searches by its own independent consultants. It also recommended the recipient obtain independent legal, financial and taxation advice.232 Given that Mr Lai only roughly read the information memorandum, and could not recollect that condition, I am not satisfied that he was aware of the condition. However, the condition is still relevant to the assessment of the 232 Exhibit 8, page 39. -- 78 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 79 reasonableness of any grounds the second defendant relied on in making the future representation in relation to the laneway and garage. 10. Mr Lai was taken to that clause during his cross-examination. When asked whether he instructed a lawyer or anyone to do searches to show title deeds, plans, diagrams or anything like that, he said that he did not do so (conduct searches) himself and was not sure if the settlement agent did. He had not asked the settlement agent to do so.233 I accept that evidence. 307 During his cross-examination, Mr Lai was referred to that condition. He was asked:234 My friend asked you questions about number 4, that you should satisfy yourself as to the accuracy of the information, and he asked you questions, Mr Tassi, about that. Your answer was, you relied on Stephen Harrison?---Yes. 308 That question misstated the evidence. Mr Lai had not provided such an answer. Mr Lai was then asked:235 Did Stephen Harrison - was there any reason for you to think something was wrong with the information that Stephen Harrison gave you? Was there any reason for you to doubt the information that Stephen Harrison had provided you?---No. 309 This is the closest Mr Lai's evidence came to directly identifying any ground for making the representations I have found he made. Laneway representation 310 As noted earlier, I am satisfied that it is appropriate to draw an inference, and find, that Mr Lai believed the three future representations I have found he made. Although Mr Lai gave no direct evidence of this, I also draw an inference, and am satisfied to the requisite standard and find, that in making the representations he relied principally on what he had been told by Mr Harrison and Mr Yoon, together with his own observations and experience in relation to the laneway, garage and area at the rear of Lot 2. 233 ts 418 - ts 419. 234 ts 462. 235 ts 462. -- 79 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 80 311 The second defendant contends that those facts and circumstances amount to reasonable grounds for making the representations, including in the absence of Mr Lai making further inquiries or taking further steps to verify the nature of any right or entitlement to use the laneway. It in substance contends that it was not on notice of any need to make further inquiry. It contends that what Mr Lai was told by the selling agent, Mr Harrison, and previous owner, Mr Yoon was significant and provided a reasonable ground for making the representations. That is said to be reinforced by Mr Lai's own experience.236 312 I accept that aspects of those facts and circumstances tend to support the representation Mr Lai made relating to whether the plaintiff could use and access the laneway. However, I am not satisfied that they were sufficient to induce in the mind of a reasonable person a basis for making that representation to the plaintiff in all the circumstances of the case. 313 First, Mr Lai was the owner of the property and made the representations on behalf of the second defendant in a commercial context where it was objectively likely they would have financial implications for the plaintiff if it acted in reliance upon them and the represented matters did not eventuate, ie if the plaintiff could not access and use the laneway, garage and rear area to park cars during the sublease. 314 Secondly, the second defendant had purchased the property and had engaged legal representation associated with the negotiation of the replacement contract and related agreements. It was therefore in a position of greater relative knowledge in relation to the property than the plaintiff, as would have been apparent to Mr Lai, particularly when he made the representations during the first inspection of the property by Mr Tassi. 315 Thirdly, Mr Harrison expressed significant words of qualification in relation to the potential use of the laneway when he advised Ms Chen and Mr Lai, who were present, that there was no formal access agreement in place in relation to the laneway. He also specifically identified the approximate boundary of Lot 2. In my view, in those circumstances, it was not reasonable for a person in the position of the second defendant to rely on the other matters said by Mr Harrison or Mr Yoon in relation to the laneway when making the unqualified 236 ts 503 - ts 506. -- 80 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 81 representation to Mr Tassi about access to and use of the laneway. That conclusion is reinforced by the absence of any independent inquiry by the second defendant to confirm the nature and extent of any right or entitlement to use the laneway. 316 Fourthly, and in any event, given condition 4 of the information memorandum, I am satisfied that it was not reasonable for a person in the position of the second defendant to rely on what Mr Harrison and Mr Yoon said about access to the laneway in making that future representation, without first having made independent inquiries about such matters, which did not occur. While Mr Lai was not a lawyer or expert in land matters, he did not, for example, obtain or instruct his lawyer or any other person to conduct searches of title deeds, plans, diagrams or other like materials. 317 Fifthly, Mr Lai's own observations and experience of using the laneway and backyard to park his car was over a limited period and number of occasions. Settlement of the purchase of Lot 2 only occurred about a month before the inspection Mr Lai conducted with Mr Tassi. Those facts and circumstances did not, of themselves, provide a reasonable ground for making that representation. Nor did they, in combination with the other facts and circumstances then known to Mr Lai, for the reasons explained above. 318 I find that the second defendant did not have reasonable grounds for making the future representation that the plaintiff could access and use the laneway, including by car to drive down it to the garage and rear area of Lot 2. The representation is therefore taken to be misleading. Garage representation 319 The second defendant contends that Mr Lai's knowledge and understanding about the prior use of the garage by Mr Yoon amounted to a reasonable ground for making the future representation to Mr Tassi that the plaintiff could access and use the garage on an exclusive basis. It contends that a layperson such as Mr Lai, even if knowing there was an encroachment, might not appreciate the consequence of encroachment. It contends that this does not render the ground for making the representation unreasonable.237 237 ts 504 - ts 506. -- 81 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 82 320 I do not accept that contention. I am satisfied that Mr Lai's knowledge and understanding of the prior use of the garage by Mr Yoon to park his car and store items, did not amount to an objectively reasonable basis for making an unqualified representation that the plaintiff could access and use the garage, in those circumstances. 321 It was known to Mr Lai when the second defendant purchased Lot 2 that the garage was partly built on Lot 1. The encroachment was specifically drawn to his attention by Mr Harrison during a site inspection. It was also recorded in the special conditions of the sale contract and is relevant to reasonableness, even if not seen by him. 322 Mr Lai was not a lawyer or person with particular expertise in relation to land matters. Nevertheless, knowledge of prior use of the garage did not amount to a reasonable ground for making his unqualified future representations about access to and use of the garage in the absence of having made any inquiry to ascertain the potential effect of the encroachment on any rights or entitlements to use the garage. Objectively, even to a layperson, the fact that the garage encroached onto Lot 1 and that it was specifically brought to his attention, ought to have raised a question as to the effect of the encroachment on any rights or entitlements to use the garage. 323 While I am satisfied that Mr Lai believed that the plaintiff would be able to access and use the garage, I find that the second defendant's making of the future representation about access to and use of the garage was not based on reasonable grounds. Rear area representation 324 I am satisfied that the second defendant had reasonable grounds for making the future representation that the plaintiff could access and use the rear area at the back of the main building on Lot 2 to park cars. In this context, access and use related to accessing and using the area itself, rather than the ability to gain access to that area by car from the laneway. 325 I infer that Mr Lai, in making the representation, did so in reliance on his observations and experience, and based on what he had been told by Mr Yoon, in particular. I am satisfied that it would have been apparent to Mr Lai from his inspections at the premises that the rear area was within Lot 2 itself (unlike the garage) and large enough for at least five vehicles to be parked in it. I am also satisfied that he -- 82 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 83 had used the area to park his car and had seen cars parked in that area both in the aerial photograph in the information memorandum and on the Google Maps image he saw at the time of making the representation. He had also been told by Mr Yoon that he had used the area during his ownership of Lot 2. Given the absence of any contrary information, in all the circumstances, I am satisfied that Mr Lai made the future representation about access to and use of the rear area to park cars based on reasonable grounds. 326 A finding that a person made a future representation on reasonable grounds does not of itself preclude a finding that the representation was misleading. Nothing is pointed to by the plaintiff to suggest such a finding ought to be made if I were to find the representation was made on reasonable grounds. I find that this representation was not misleading. Issue 3: Causation - reliance and loss Legal principles 327 Ordinarily causation will be established where the plaintiff incurs a loss acting in reliance on a belief induced by a defendant's misleading and deceptive conduct. In order to show that loss was caused 'by' the contravention this will be shown by proving that the conduct was relied on in the taking of some action, often, by the entry into a contract.238 Section 236 of the ACL is not in the same terms as s 82(1) of the former Trade Practices Act 1974 (Cth) because it uses the phrase 'because of the conduct' rather than 'by conduct'. That does not materially change the relevant established principles in relation to causation.239 328 Whether a plaintiff relied on certain conduct is a subjective question.240 329 In a case where the allegedly misleading conduct consists of a representation directed specifically towards a particular person, with a view to making a single specific sale (here transaction) the principles restated by Wilson J241 in Gould v Vaggelas are applicable:242 238 Italform Pty Ltd v Sangain Pty Ltd [2009] NSWCA 427 [42] (Italform). 239 Flogineering Pty Ltd v Blu Logistics SA Pty Ltd (No 3) [2019] FCA 1258; (2019) 138 ACSR 172 [27]. 240 Italform [40]. 241 Sutton v A J Thompson Pty Ltd (in liq) [1987] FCA 167; (1987) 73 ALR 233 [29] - [31] (judgment of the court) (Sutton v A J Thompson). See also Sharp v Ramage (1995) 12 WAR 325, 329 - 330 (Ipp J), 326, 336 (Rowland & Anderson JJ agreeing) (Sharp v Ramage). As to drawing inferences as to reliance, see also -- 83 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 84 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. 330 In this formulation:243 … the possibility that a foolish person might be misled by some representation which no normal person would take seriously, is covered by the exclusion of representations which are not 'calculated to induce' entry into the contract - the test is objective, but must take into account the respective positions of the parties, including such matters as their knowledge of each other through previous dealings and their respective familiarity with the subject-matter of the contract. 331 It is not necessary for the plaintiff to establish that 'but for' the alleged impugned conduct it would not have acted upon it. What is required is proof that the impugned conduct materially contributed to a decision taken by the plaintiff to act in a particular manner and any loss or injury suffered.244 Issues in relation to causation 332 An issue arose at the start of the trial as to whether the plaintiff was required to establish reliance on a misleading oral representation and that it suffered some resulting loss. The plaintiff initially appeared to contend that it did not, by reason of the agreement in relation to quantum.245 The defendants maintained, however, that even if the Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2013] HCA 54; (2013) 250 CLR 640 [55]. 242 Gould v Vaggelas [1985] HCA 75; (1985) 157 CLR 215, 236. 243 Sutton v A J Thompson [30] (judgment of the court). 244 Henville v Walker (2001) 206 CLR 459, 480 [61] (Gaudron J) (Henville). 245 Plaintiff's Opening Submissions, pars 3, 4 and 43; ts 6 - ts 14. -- 84 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 85 plaintiff established a breach of s 8 of the ACL (or of cl 5.1(e) of the sublease), it was also necessary for it to establish that any such breach caused or materially contributed to the plaintiff suffering at least some loss by acting on the representation. The defendants accepted that, if it does so, the quantum of the loss is the quantum agreed.246 333 Eventually, that position was accepted by the plaintiff.247 The trial proceeded accordingly. 334 It is therefore convenient to first consider whether the plaintiff acted in reliance on either the future lane representation and/or the future garage representation. I then consider whether, if there was any such reliance, this resulted in any loss being suffered by the plaintiff of the nature alleged. 335 The defendants contend that the plaintiff has not established that it relied on any oral representation that may, contrary to its primary position, be found to have been made. Further, it contends that the plaintiff has not established that it suffered any loss of the nature alleged. It is only if both things are established that the agreed quantum is payable. Issue 3(a): Did the plaintiff rely on the alleged representation/s in entering the sublease? 336 The plaintiff claims that it relied on the representations at the time of entering into the sublease.248 Its pleaded case is that had it known that the right of way did not exist and that it would not have full use and access to the laneway (implicitly on a shared basis), the rear area that could accommodate parking and the garage it would not have agreed to the annual rent under the sublease. Rather, it says that it would have sought to negotiate a lower annual rent or considered alternative premises to lease for the purpose of conducting a backpacker accommodation business.249 337 The plaintiff also claims that acting on the representations it removed the contents of the garage and attended to replacement of the door and windows of the garage and insured the garage for its replacement value.250 No claim for damages was however 246 Defendants' Opening Submissions, pars 62; ts 105 - ts 111; s 236 of the ACL. 247 ts 108, ts 113. 248 Statement of Claim, par 9. 249 Statement of Claim, par 31. 250 Statement of Claim, par 28. -- 85 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 86 particularised or advanced at trial based on any such reliance. To the extent such reliance may have occurred, it may support the primary claim of reliance. Analysis and findings as to reliance 338 For the following reasons, I find that in entering the sublease, at the rental agreed, Mr Tassi relied on the future oral representations in relation to the plaintiff's ability to access and use the laneway and the garage. 339 First, Mr Tassi gave credible, direct evidence of his reliance, which I accept.251 I am satisfied that Mr Tassi was seeking to lease backpacker premises similar to the Palmerston Street premises operated by the plaintiff, which also offered onsite car parking facilities. Mr Tassi intended to offer car parking to guests for a fee. I accept his evidence that in performing calculations about income and profitability and the rental he was prepared to pay, he took into account the potential profit from offering car bays to paying customers.252 That is consistent with his communication to the defendants in January 2019, after he had entered the sublease, in which he sought to renegotiate a lower rental figure once it became apparent that he could not use the laneway and car bays and garage.253 340 The defendants question Mr Tassi's evidence that he would not have entered into the lease if the representations had not been made. They contend that he was not suggesting that he would have negotiated a lesser price.254 In my view the evidence, properly understood, in context of the entirety of his evidence, was a reference to entering into the lease on the terms on which the lease was entered into. 341 I also accept that the ability to use the garage to park vehicles or for other potential uses, was considered by Mr Lai to be of value. That is consistent with the agreed insertion in the final commercial proposal that was signed (at the same time as the sublease agreement) a special clause requiring that the insurance be paid by the plaintiff including for all buildings including the garage and provide a copy of a valid insurance policy to the sub/head lessor.255 It is also consistent with his proposal to and actions to renovate the garage and potentially change its use. 251 ts 201 - ts 203. 252 ts 119. 253 Exhibit 40; ts 214. 254 ts 201, ts 507. 255 Exhibit 24, pages 296 and 298. -- 86 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 87 342 Secondly, I find that, for similar reasons, the representations concerned matters that were objectively commercially significant in the context of the operation of a backpacker business from the premises. I am satisfied that the representations made were material and calculated to induce the plaintiff to enter into a sublease. A fair inference arises from the plaintiff's entry into the sublease in those circumstances that it was induced to do so by the future representations. 343 Thirdly, I accept that Mr Tassi made his own observations during the inspection, that were relevant to the conclusions he reached about the ability to access and use the laneway, garage, and rear area of Lot 2. These included observations of the laneway, the garage and the backyard area. Mr Tassi also saw space for a car in the garage, and that the laneway was wide enough for a vehicle. He also saw and read the vehicle parking signs and cars in the backyard area on the Google Maps image he brought up on his phone. Mr Tassi saw that the garage extended over the laneway and that it was necessary to use the laneway to get to the garage and the backyard area.256 344 Contrary to the contention of the defendants, I am satisfied that Mr Tassi did not simply assume that the plaintiff could use the laneway and park vehicles in the backyard area, or use the garage. Rather, I accept his evidence, that he asked for confirmation of what he saw himself. 345 While some of the matters Mr Tassi saw tended to support the prospect that the plaintiff, as sublessor, would be able to use the laneway, garage and backyard area to park vehicles, it did not follow from those observations that the plaintiff would necessarily be able to use them. I find that Mr Tassi sought, and was given, confirmation by Mr Lai about being able to access and use the laneway, the garage and the rear area to park vehicles.257 I am satisfied that although Mr Tassi also took into account other matters, such as his own observations, that the future representations in relation to the laneway and garage materially contributed to his decision, on behalf of the plaintiff, to enter the lease on the terms in which it was entered into, including as to rent. 256 ts 195, ts 201. 257 ts 172, ts 195. -- 87 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 88 346 Fourthly, I accept, as contended by the defendants, and in substance accepted by Mr Tassi, that he was keen to enter into a sublease from the outset. However, his keenness did not mean he would have entered the lease in any event. 347 Mr Tassi first inspected the premises on 10 November 2018. The future representations were made to him by Mr Lai on that occasion. 348 Mr Tassi was familiar with the area and operated a nearby backpacker accommodation on Palmerston Street. He wanted to operate another similar business in the area and considered this one to be suitable from the first inspection.258 He became aware that other persons had submitted offers. 349 I am satisfied, however, that despite Mr Tassi's enthusiasm to enter into a sublease, he was materially influenced in entering the sublease at the rent agreed by the future representations about the laneway and garage. In my view, Mr Lai's keenness to proceed tends to explain, in part, why the plaintiff did rely on the representations and made only limited further enquiries. Other than confirming with the Department of Transport that he could park up to five vehicles at the premises, Mr Tassi did not make enquiries of any other government agencies. He did not seek legal advice. He noticed that the garage extended over the laneway but did not investigate that.259 He did not request to see a copy of the headlease.260 350 Mr Tassi prepared an initial written proposal, as requested by Mr Lai, on 11 November 2018. I am satisfied that he delivered that proposal on 12 November and on 15 November emailed a revised proposal to Mr Lai, which was then amended with certain suggested changes highlighted by Mr Lai and Ms Chen. 351 Mr Lai met Mr Tassi on 16 November 2018 for a dinner meeting in Northbridge and they both attended and inspected the Palmerston Lodge that was also run by the plaintiff. At the time he took him to various rooms that he had renovated, as well as the dining area, which was an open space area that faced the backyard where there was a car park that was working with cars parked in it.261 258 ts 191. 259 ts 143, ts 190. 260 ts 201. 261 ts 124. -- 88 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 89 352 Mr Tassi indicated that if Mr Lai wanted he would bring cash for the deposit at the inspection proposed for the following day. He explained that he was happy to pay the deposit before the lease was signed as they (Mr Lai and Ms Chen) wanted the money first. It was after it was deposited into their account they met to finalise the agreement. The deposit was paid on the evening of 16 November 2018.262 While this supports Mr Tassi's keenness to finalise an agreement, this was six days after the initial site inspection where the future representations were made to him. 353 I accept Mr Tassi's evidence that by 11 November 2018 he had decided he wanted to go ahead with the lease if he could negotiate the correct rental terms. While he was keen from the first inspection to enter into an arrangement for the backpacker accommodation, he explained, and I accept, that this was if he could use the premises with the bed numbers and car parking.263 354 That is consistent with the continued negotiations up until and after 16 November 2018. 355 Negotiations occurred on 16 November before the evening meeting in relation to matters relating to proposed renovations, including to the garage to become an office and rental re-evaluations to take into account added value to rent from any renovations. A further version of the lease proposal was exchanged that afternoon.264 Some form of oral agreement in principle was reached by 16 November 2018, and Mr Tassi paid a deposit. Even following the agreement in principle, the terms of the lease were subject to ongoing negotiation up until the lease was signed. This included changes to the terms of the final lease proposal and special clauses, and amendments made to the sublease on 21 November 2018.265 356 Fifthly, in relation to the garage, I find that at the time the plaintiff entered into the contract Mr Tassi was contemplating renovating the garage and changing its use to an office. He communicated this to Mr Lai and it was reflected in the terms of the final proposal. I accept that whilst that was what he contemplated, it was an option he was seeking to have and, if he required an office, 262 Exhibit 16A, page 98; Exhibit 17; Exhibit 19; ts 196 - ts 197. 263 ts 190 - ts 191. 264 Exhibit 18, page 214. 265 Exhibits 18 and 24; ts 139, ts 141, ts 192. Changes were made between the version of the commercial lease proposal emailed back by Mr Lai with amendments on the afternoon on 16 November 2018 and the final version signed on 21 November 2018. -- 89 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 90 he would do that.266 It did not follow that the ability to park cars in the garage was irrelevant to Mr Tassi's decision, although I accept it was not his primary concern. Rather, I am satisfied that it was the ability to use the garage for a variety of potential uses that was critical. 357 Sixthly, the defendants also contend that Mr Tassi did not rely on the alleged five car parking bay representation by Ms Chen because of his evidence that he needed to satisfy himself and before he signed the lease agreement had phoned up the Department of Transport to verify if he could park vehicles at the premises.267 When it was suggested that Mr Tassi relied on the advice of the Department of Transport about whether he could park five cars, he responded 'Also'.268 I accept that he had not seen the licence prior to signing the sublease.269 Given that the plaintiff did not maintain reliance on this alleged representation, it is not necessary to decide whether Mr Tassi materially relied on that representation. 358 Seventhly, prior to signing the sublease, Mr Tassi was shown diagrams 10880 and 11454 and noticed the area endorsed as 'R.O.W.'. He also did a Google search which came up with the meaning of as being 'right of way' and some related information. Mr Lai gave an explanation about the use of the laneway that was consistent with the information Mr Tassi located online. As Mr Tassi said, he was then 'kind of satisfied'.270 While I find that the diagram and online information were taken into account by Mr Tassi in forming a view that the plaintiff would be able to access and use the laneway, I find that its effect was to reinforce what he had already been told by Mr Lai, which Mr Lai then, in substance, repeated at the time. I am satisfied that the future laneway representation made by Mr Lai was material to the decision of Mr Tassi to enter into the sublease. 359 Eighthly, I have taken into account the terms of the disclaimer contained in the sublease agreement. However, as explained below, I am satisfied, despite cl 14.7 of that agreement, that the plaintiff did rely on the future representations in entering into the agreement. 266 Exhibit 18; ts 193. 267 Exhibit 10; ts 143, ts 205, ts 264, ts 506 - ts 507. 268 ts 205. 269 ts 301. 270 ts 188. -- 90 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 91 Disclaimer 360 The defendants rely on cl 14.7 of the sublease in support of a contention that, even if a representation was made, it was not relied on by the plaintiff. Clause 14.7 provides that:271 (a) The provisions of this sub-lease, and any consents given under it, contain the entire agreement as concluded between the parties and no oral or collateral agreements are of any effect. (b) No representation by the sub-lessor regarding the premises will form an implied or other term of this sub-lease. The sub-lessee acknowledges that it has not been induced into this sub-lease by any representation, made by the sub-lessor or its agent, that is not included in this sub-lease. 361 While accepting that such provisions do not always preclude a conclusion of reliance, they contend that the evidence of Mr Tassi about the clause was unsatisfactory.272 They contend that in this case there is no evidence or foundation for finding Mr Tassi (and therefore the plaintiff) was misled by the representation in the face of such a clause.273 362 A contractual disclaimer of reliance will in many cases:274 not 'be taken to evidence a break in the causal link between misleading or deceptive conduct or loss'. Despite such a provision the representee may 'nevertheless be found to have been actuated by the misrepresentations into entering into the contract. The question is not one of law, but of fact'. 363 The relevant question in a case such as this remains one of reliance or inducement. 364 As the Court of Appeal observed in Warwick Entertainment Centre Pty Ltd v Alpine Holdings Pty Ltd:275 … If, as a result of misleading conduct, a person is induced to enter into a contract and suffers loss, the right to a remedy will subsist whatever the parties may provide in their agreement: Clark Equipment Australia Ltd v Covcat Pty Ltd (1987) 71 ALR 367 at 371, per Sheppard J with whom Fox J and, relevantly, Jackson J were in agreement; 271 Exhibit 24, page 284. 272 ts 199 - ts 203 (Mr Tassi), ts 500 (closing). 273 ts 508 - ts 509. 274 Italform [41] citing Campbell [31] (French CJ). 275 Warwick Entertainment Centre Pty Ltd v Alpine Holdings Pty Ltd [2005] WASCA 174 [59] (Steytler P, McLure & Pullin JJA agreeing) (Warwick Entertainment Centre). -- 91 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 92 Petera Pty Ltd v EAJ Pty Ltd (1985) 7 FCR 375 at 378, per Wilcox J; and Oraka Pty Ltd v Leda Holdings Ltd (1997) ATPR 41-558 at 43,717. Exclusion clauses in a contract will only preclude a remedy under the Act when those clauses demonstrate that the party in question did not, in fact, rely on the conduct or where the conduct could not, as a whole, have been seen to be misleading: Lezam Pty Ltd v Seabridge Australia Pty Ltd (1992) 35 FCR 535 at 557; Kewside Pty Ltd v Warman International Ltd (1990) ATPR 41-012. 365 In Jewelsnloo Pty Ltd v Sengos (No 2)276 Robb J was not satisfied that a purchaser had relied on a representation in all the circumstances including where the terms of the contract included provisions that the purchaser had made its own enquiries regarding any financial return or income that may be derived from the business and that it did not rely on any representation made by the vendor in respect of the subject matter of the agreement other than those expressly contained in it. Justice Robb acknowledged that such acknowledgments may not always be absolutely effective to prevent a purchaser relying on a false representation that has induced it to enter into a contract of sale. His Honour observed however that:277 … in my view it would be wrong for the court lightly to ignore the effect of such provisions in arm's length commercial transactions in which the parties are professionally represented. Terms of this nature should not be treated as mere verbiage. If a potential purchaser does not want its rights to be governed by such terms, it may insist upon a variation to the agreement, or decline to proceed with it. … (underlining added) 366 While the defendants rely on that passage, the comments were directed, in particular, to circumstances unlike the present case, where the parties were all professionally represented. While I accept that a provision in a contract such as cl 14.7 should not be lightly ignored, the provision is a circumstance to be taken into account in determining as a matter of fact whether a plaintiff did rely on a representation. 367 In Jewelsnloo Pty Ltd v Sengos,278 the NSW Court of Appeal considered that his Honour had treated the no reliance clause not as an absolute bar, but as forming part of the overall circumstances for assessing the claim, consistent with authority such as Butcher.279 276 Jewelsnloo Pty Ltd v Sengos (No 2) [2016] NSWSC 61 (Jewelsnloo). 277 Jewelsnloo [146]. See Defendants' Opening Submissions, par 61. 278 Jewelsnloo Pty Ltd v Sengos [2016] NSWCA 309. 279 Butcher [150] - [153] (McHugh J). -- 92 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 93 368 Turning to Mr Tassi's evidence, Mr Tassi accepted that he was sent a copy of the proposed sublease on 19 November 2018 and requested to 'have a good read' prior to the parties meeting to sign the sublease and his proposal.280 I accept Mr Tassi's evidence that he did not have significant experience signing legal documents or as a businessman, but that he was quite careful and prudent when buying a business or entering into a new agreement and would read and consider a legal document.281 Mr Tassi agreed that he read the lease carefully and, by the time it was signed on 21 November 2018, he was happy with everything in the sublease.282 369 While the sublease did not refer to car parking bays or that he could use the backyard area for that purpose, Mr Tassi maintained, and I find, that it was important for him because he knew how important it was to have car bays in a hostel or accommodation close to the city.283 370 Mr Tassi agreed that he would have read cl 14.7 at the time.284 Despite cl 14.7, Mr Tassi maintained that he did rely on what he was told by Mr Lai and Ms Chen in entering into the sublease. When asked why he would sign a document (saying that he was not induced by any representations to enter into the sublease) Mr Tassi sought to explain, saying 'Maybe I was not an experienced businessman'.285 He maintained that what Mr Lai (and Ms Chen) told him contributed to him going ahead with the lease.286 Mr Lai also explained elsewhere in his evidence that the word 'representation' was a technical word that he came to know 'after six year'.287 371 While Mr Tassi did not provide a particularly clear answer as to why he signed the agreement containing cl 14.7, I am satisfied that he did so without fully considering or appreciating the meaning and significance of cl 14.7 prior to signing the sublease, or necessarily understanding at the time the meaning of 'representation'. He also did not appreciate that he had been misled. In my assessment, Mr Tassi adopted a fairly pragmatic, robust and not finely focused approach to his business dealings. That was reflected in the relative informality of 280 Exhibit 20, page 221; ts 198. 281 ts 159. 282 ts 198 - ts 199. 283 ts 200. 284 ts 201 - ts 202. 285 ts 202 - ts 203. 286 ts 203. 287 ts 264. -- 93 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 94 the terms of the final commercial lease proposal, which all the parties signed. I do not consider that the absence of reference to car parking or laneway access in that document meant those matters were insignificant to the plaintiff. 372 After considering all relevant circumstances of this case I am satisfied, despite Mr Tassi having signed the sublease agreement, that he was materially influenced to, and did, enter into the sublease relying upon the future representations made to him by Mr Lai on behalf of the second defendant. Agency 373 In the course of trial neither counsel for the plaintiff nor the defendants raised, during opening or closing, examination or cross-examination of witnesses, or at any other stage, any matters relating to agency and whether the first defendant may be found liable for an alleged representation that might be found to have been made by Mr Lai on behalf of the second defendant. 374 However, the issue of agency was raised, to a limited extent, in the defence and reply. 375 The plaintiff alleges in the Statement of Claim,288 that in or about early November 2018, prior to entering into the sublease, Mr Lai on behalf of the second defendant represented to Mr Tassi that the plaintiff would have access to and use of the laneway, the garage and the five car parking bays at the rear of Lot 2. 376 In response,289 the second defendant raises the issue of agency. In particular, it asserts that on or about 10 November 2018, Mr Lai acting for the second defendant, and in its capacity as agent of the first defendant did or said certain things: met Mr Tassi at the premises;290 inspected the premises and the garage together with Mr Tassi291 and said to Mr Tassi words to the effect that the garage was full of tools, equipment and other items that the previous proprietors had left behind and that one side of the garage was empty which would allow space for one car to park there.292 The second defendant otherwise denies the allegations. 288 Statement of Claim, par 8. 289 Defence, par 8. 290 Defence, par 8.1. 291 Defence, par 8.2. 292 Defence, par 8.3. -- 94 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 95 377 In reply, the plaintiff admits,293 and makes an additional assertion in relation what Mr Lai said about the previous landlord parking his car on one side of the garage.294 378 The plaintiff also alleges,295 that in or about early November 2018, Mr Tassi attended the premises to meet Mr Lai and inspect the premises. It is said that at the time of the inspection Mr Lai showed to Mr Tassi an aerial photograph of the premises using Google Maps using Mr Tassi's phone, for the purpose of showing to Mr Tassi that there were cars parked at the rear of the premises. 379 In response,296 the second defendant admits that Mr Lai in his capacity as agent of the first defendant showed Mr Tassi an aerial photograph of the premises using Google Maps. In reply, the plaintiff admits that allegation.297 380 No other allegations of agency are raised on the pleaded cases of the parties. 381 The defendants also raise a plea that if, which is denied, any of the pleaded representations298 were made by the defendants to the plaintiff, that at the time they were made, the defendants had reasonable grounds to make the representations.299 In reply, the plaintiff asserts that the representations were not representations as to future matters and that if, which is denied, the second defendant made representations as to future matters, the second defendant had no reasonable grounds for making such representations. 382 In light of those pleas, the court subsequently made programming orders for the parties to file submissions in relation to certain questions which it appeared to the court might arise due to those limited pleas of agency. 293 Defence, par 8.1. 294 Defence, par 3(a). 295 Statement of Claim, par 12. 296 Defence, par 12. 297 Reply, par 4. 298 Being those alleged in pars 8 - 12, including an allegation that Ms Chen at a meeting at the defendants' offices in Morley informed Mr Tassi that the premises accommodated up to five car parking bays at the rear of the premises. 299 Defence, par 14. -- 95 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 96 383 The parties were invited to address issues as to: 1. Whether, if the court finds that Mr Lai, on behalf of the second defendant, made an oral representation to Mr Tassi, it is open and appropriate for the court to infer that the conduct was carried out by the second defendant as agent for the first defendant, and within the scope of the second defendant's actual or apparent authority. 2. If the above is established, whether the court can and should the liability of the first defendant for a contravention of s 18 of the ACL, in addition to the second defendant. 3. If the first defendant's liability is in issue: (a) whether s 110(2) of the Fair Trading Act 2010 (WA) (FTA) deems the conduct to be that of the first defendant;300 or (b) if the oral representation involves a statement about a future matter, whether there are any remaining issues concerning whether the first defendant had reasonable grounds for making that representation. 384 The primary contention of the defendants is to the effect that the pleadings and conduct of the trial proceeded on the basis of clearly defined allegations and legal contentions and the plaintiff did not advance any case premised on agency principles or attribution of conduct under s 110(2) of the FTA. It also contends that no opportunity was afforded to the defendants to adduce evidence at trial specifically directed to those new issues. In those circumstances it contends that the court should not entertain any case against the first defendant based on principles of agency or attribution of conduct.301 385 The defendants contend that the plea by the second defendant was a plea of express agency and authority, was narrow, and extended only to authority to meet the plaintiff's Mr Tassi and inspect the premises with him and show him an aerial photograph.302 The plea was, however, slightly broader. It included a plea that Mr Lai on behalf 300 Given the claim is made under the ACL rather than the equivalent Australian Consumer Law (WA) (ACL (WA)), the correct provision that is potentially applicable is s 139B(2) of the Competition and Consumer Act 2010 (Cth). Section s 110(2) of the Fair Trading Act 2010 (WA) is the equivalent section applicable to conduct to which the ACL (WA) applies. 301 First and Second Defendants' Submissions dated 30 May 2025, pars 3 and 4. 302 First and Second Defendants' Submissions dated 30 May 2025, referring to Defence, pars 8 and 12.2. -- 96 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 97 of the second defendant, and in its capacity as agent, said certain words to Mr Tassi in relation to the garage during the site inspection on 10 November 2018.303 The plea also did not in its terms identify that it was a plea of express agency or authority. 386 The defendants also made submissions as to why they contend, if the court were to entertain the issue, no finding of agency should be made in relation to the alleged representations leading to a finding of liability of the first defendant. 387 As to the defendants' objection that the plaintiff's pleaded case and case at trial did not advance any issue of agency and liability of the first defendant for the representations allegedly made by Mr Lai on behalf of the second defendant, the plaintiff contends that based on the aspects of the pleadings where agency was raised and admitted that 'the case was clearly advanced on agency principles'.304 It contends that the defendants by their plea accepted that Mr Lai acted as agent for the first defendant and that by implication Mr Lai had implied or ostensible authority. It says that the defendants did not plead any limitation on the scope of that agency.305 388 The plaintiff also addresses in detail in its submissions why it contends the evidence at trial supports a finding that in making the alleged representations Mr Lai, on behalf of the second defendant, was acting as agent of the first defendant within the scope of the second defendant's implied or ostensible authority.306 While the plaintiff in its initial submissions sought to rely on s 110(2) of the FTA and arguments as to ratification,307 it did not maintain those arguments in its later submissions.308 Analysis and determination 389 I am satisfied that to the extent that the second defendant raised any issue in its defence about agency it was limited to Mr Lai, on behalf of the second defendant, in its capacity as agent for the first defendant, doing the specific acts identified. The plea of agency did not identify the nature and extent of the agency relationship. The second defendant 303 Defence, par 8.3. 304 Plaintiff's Submissions dated 13 June 2025. 305 Plaintiff's Submissions dated 16 May 2025. 306 Plaintiff's Submissions dated 16 May 2025; Plaintiff's Submissions dated 13 June 2025. 307 Plaintiff's Submissions dated 16 May 2025, pars 11 - 12. 308 Plaintiff's Submissions dated 13 May 2025. -- 97 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 98 did not assert that Mr Lai, on behalf of the second defendant, in its capacity as agent for the first defendant, did any other acts, or was authorised to do any other acts on 10 November 2018 or subsequently. 390 In its Statement of Claim the plaintiff did not assert the first defendant was liable for any breach of s 18 of the ACL as a result of any representations made by Mr Lai, on behalf of the second defendant, whether based on any agency relationship or otherwise. In its reply, it admitted certain allegations as to certain acts being done by Mr Lai on behalf of the second defendant, in its capacity as agent for the first defendant. It did not, however, allege that any of the representations alleged in par 8 of the Statement of Claim that I have found were made by Mr Lai, were made on behalf of the second defendant, in its capacity as agent of the first defendant, or that the first defendant was liable under s 18 of the ACL or otherwise for any such acts. 391 In the course of trial, no such case was advanced by the plaintiff. Further, I accept that had the plaintiff sought and been permitted to do so, the defendants may have adduced evidence about the question of agency and the question of reasonable steps by the first defendant, had that issue been raised, and may have cross-examined Mr Tassi to the extent it may have been relevant to such issues. 392 In those circumstances, I uphold the submission of the plaintiff that it would not be open and appropriate for the court to entertain and make any determination in relation to the question of agency and any associated liability of the first defendant in respect of the representations I have found were made by Mr Lai, on behalf of the second defendant. 393 I find that any such case extends beyond the issues raised in the pleadings and at trial. Issue 3(b): If the defendants were in breach, did their conduct cause the plaintiff any alleged loss and damage? 394 The final issue in relation to the claim under s 18 of the ACL is whether the plaintiff has established that it suffered some loss related to entering into the sublease in reliance on the future representations, that relates to it being able to access and use the laneway and the garage to park cars for a fee or to attract custom. -- 98 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 99 Agreed quantum of damages 395 An agreement was reached between the parties in relation to the quantum of damages to be awarded in the event that liability was established. That agreement provides that regarding the plaintiff's loss of profit, and interest to be applied from 1 June 2022 until the date of judgment, the quantum is agreed in the sum of $166,000 and the rate of pre-judgment interest is to be 6% per annum. The agreement was made without admission of liability and on the basis that the quantum is for all alleged loss and damage arising from or in connection with all of the plaintiff's claims.309 396 As already noted, the plaintiff initially disputed, but ultimately accepted, that it is required to establish that it has at least suffered some loss as a result of the breach of s 18 of the ACL. 397 A related question concerns whether establishment of a loss of any type will suffice. That too was the subject of some debate between the parties. It ultimately was a matter of common ground. 398 Consistent with the basis of the joint instructions to experts, it is accepted by the plaintiff that the loss must be a loss in some way relating to the plaintiff not being able to utilise and charge a fee for use of car parking bays, or in respect of guests who would have chosen to stay at the hostel had it offered on-site parking.310 To similar effect, the defendants' position is, in effect, that the plaintiff must establish, but the evidence is not sufficient to establish, it suffered at least some financial loss relating to either or both of those matters. It accepts (even though it is not pleaded in that way) that the loss could be the loss of a valuable opportunity.311 399 It follows that it is not sufficient for the plaintiff to establish some loss resulted from a breach of s 18 of the ACL, such as by reason of the inability to use the garage for a purpose other than car parking312 or wasted expenditure on renovating the garage. 309 Exhibit 84. 310 Joint Memorandum Following Expert Conferral dated 16 August 2023 (Joint Expert Memorandum), pars 2 and 3; ts 534 (counsel for the plaintiff). See also Exhibit 86, cl 2.1, page 504; Statement of Claim, pars 36 - 38. 311 ts 8 - ts 9, ts 104 - ts 105, ts 509 - ts 511 (counsel for the defendants). See also, ts 291 - ts 292 (Mr Tassi). 312 ts 104 - ts 105. -- 99 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 100 400 Further, the agreed quantum of damages relates to the period up until 1 June 2022. After that interest on that amount is agreed to be paid at 6%. Given that agreement, in my view it is not open to the plaintiff to point to a loss suffered by the plaintiff relating to the use of the garage after 31 May 2022. 401 I understand it to be common ground that the plaintiff will satisfy the causation requirement if, consistent with the claims for loss and damage, it can establish that it was unable to access and use the laneway and/or the garage for a period or periods and this resulted in some financial loss relating to the use of the garage or rear area of Lot 2 for paid parking by guests. 402 A possible issue arises however as to the basis on which such loss might have been caused or materially contributed to by reliance on the misrepresentations in entering into the sublease. I return to that question below. I first consider whether the plaintiff has established that it was unable to use the laneway and the garage for any period and whether that caused any loss. Did the plaintiff suffer loss due to not being able to access and use the laneway? 403 As I found earlier, the plaintiff was unable to use and access the laneway by car for a significant period from February 2019 until sometime between mid-January and June 2022. The precise period is immaterial. 404 The plaintiff also asserts that it was prohibited from using the garage for a period of about six months in 2019 as a consequence of the boundary dispute. That is denied. It is common ground that from about 25 March 2022 (shortly before the demolition of the garage), the plaintiff has not had the use of the garage but has had the use of a garage since a new garage was erected on 7 August 2023. 405 The defendants contend that there is no evidence that had there been access to car parking bays the plaintiff would have been able to lease out car parking bays. They contend that even if the other hostel operated by the plaintiff might offer parking, or people may want to use parking, that is not of itself enough. They point to the absence of evidence that in the period when access was restored the plaintiff leased out car bays; or of any historical figures or comparative evidence of what was earned in the industry.313 313 ts 510 - ts 511. -- 100 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 101 406 The defendants further contend that any loss suffered was caused by factors unrelated to access to the parking bays and laneway. They point to evidence in relation to the impact of events such as COVID-19 and anti-social behaviour issues.314 Analysis and determination 407 It was surprising that the plaintiff did not give or adduce any direct evidence as to parking bays being made available for a fee, or as to any net income that may have been earned by the plaintiff from such provision of car parking to guests for a fee, at Lot 2 or the Palmerston Lodge that the plaintiff also operated. It could readily have done so. 408 Nevertheless, for the following reasons, I am satisfied having regard to the evidence that was adduced that the plaintiff has established that it would have taken up the opportunity to offer parking bays to guests for a fee during the period the laneway was not able to be accessed and used by car. 409 As broadly accepted by Mr Tassi during cross-examination, I find that the Aberdeen Lodge operated by the plaintiff from Lot 2 was budget accommodation. It was at the lower end of the market in terms of amenity, with shared facilities and no air conditioning. In 2018 - 2019, customers paid about $18 - $20 per night, and up to $25 per night, depending on the room.315 410 I find that the plaintiff, as it intended when it entered into the sublease, would have offered car parking to guests for a fee had the car parking bays at the rear of the premises been available to it. I am satisfied that it commenced doing so from about 1 June 2022. 411 Mr Tassi gave evidence, and I accept, that he was offering to backpackers at Lot 2 car parking spaces at the back.316 While the available evidence does not directly indicate that a fee was charged, given the intention of the plaintiff to charge fees, and evidence that parked bays were being utilised by guests, I infer that the plaintiff did make parking bays available to guests for a fee, and that some utilised it. 314 Defendants' Opening Submissions, pars 63; ts 8 - ts 9. 315 ts 160 - ts 161. 316 ts 114 - ts 115, ts 151. -- 101 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 102 412 Further, I am satisfied that parking spaces were available on-site in the backyard at the Palmerston Lodge and utilised by guests.317 The plaintiff had been operating that lodge for one or two years prior to 2018 and it was not far from the Aberdeen Lodge.318 Given that Mr Tassi was looking to replicate the business he operated there, and he intended to charge fees to guests at Lot 2 for using the parking bays, I also infer that he made available car parking bays at the Palmerston Lodge for a fee. 413 I find that there was demand by some potential guests of Lot 2 for car parking bays for which they would pay a fee, despite it being budget accommodation. That is consistent with the above findings. Further and, in any event, it is supported by the evidence of Mr Tassi, which I accept, that some international backpackers do have cars in a variety of circumstances. Some are present for work, some for travel and others for both.319 414 Given Mr Tassi's experience in operating share accommodation, the Aberdeen Lodge and the Palmerston Lodge, and renting campervans to backpackers, he was well placed to give evidence about car use by backpackers and potential demand for parking spaces. 415 The inner city location of the hostel, the need to be able to park a vehicle, and the convenience of being able to park on-site are all factors which I am satisfied would have contributed to demand for paid parking at Lot 2. 416 I find that while the majority (over 50%) of comparable properties Mr Tassi identified, and most city hostels, did not offer car parking, a reasonable proportion did. During the COVID-19 pandemic 8 out of 26 hostels around the City of Perth closed. Seven of the remaining eighteen hostels in the City of Perth area offered parking.320 This tends to support a finding that there is a demand in this market for car parking. 417 I find that the ability to access and use the rear parking area was commercially valuable. It is not necessary to ascertain the value, only that it had a material value in relation to the chance of making revenue from the use of the car bays. 317 ts 124. 318 ts 157. 319 ts 162. 320 Exhibit 86, par 3.2, page 537; ts 161 - ts 162. -- 102 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 103 418 As I earlier found, the premises were licensed under the Perth Parking Management Act 1999 (WA) for five parking bays, and this incurred no fee. 419 Further, although no evidence was adduced in relation to any costs that might arise, I infer that the costs associated with offering car park bays to guests for a fee would likely have been minimal, and certainly less than any fee revenue that could have been earned. 420 I am satisfied to the requisite standard, and find, that due to being unable to access and use the laneway by vehicle for a significant period after opening its backpacker business in February 2019, the plaintiff lost the valuable opportunity to charge fees to guests for parking at the rear of the premises. It would have exploited that opportunity and earned additional profit from that activity. 421 I am satisfied that the availability of car parking bays would likely have attracted additional guests to stay at Lot 2. Further, I find that at least in the period from February 2019 to July 2021 there were generally surplus beds available at the hostel such that additional guests could have been accommodated.321 Given the conclusion that loss was suffered in relation to charging fees for car bays, it is, however, unnecessary to also determine whether the plaintiff's loss of the chance of securing increased custom from customers who otherwise would not have stayed at Lot 2 in the absence of availability of car parking was valuable. Other causes of loss of turnover 422 The defendants contended, in substance, that the cause of any diminution of turnover and ultimate loss of profit was a range of other matters including the effect of the COVID-19 pandemic and issues that had arisen with the type of clientele attending at the Aberdeen Lodge and the neighbouring hostel.322 Mr Tassi rejected that suggestion in cross-examination and expressed the opinion that the availability of car bays would have expanded the clientele and that some backpackers and clientele of this type of accommodation did have a need for and willingness to pay for car parking. 423 Mr Tassi accepted that during the COVID-19 pandemic there was a substantial decline and international tourists dramatically reduced. However, he gave evidence, which I accept, that Western Australia had a 321 Exhibit 86, page 595. 322 ts 511. See also Defendant's Opening of Submissions, pars 63, 89 - 97. -- 103 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 104 particular attraction for some travellers still in Australia, and that while travellers generally did not have a need for a car when they initially arrived, they often did at other times, including where they had jobs or were travelling around. I am satisfied that during that period the plaintiff retained an ability to earn additional net profit from charging guests for the use of car bays. 424 Further, in my view, this contention seemingly conflates different questions. Insofar as a decline in trade is concerned, even if a decline was suffered during the COVID-19 period, or due to other issues such as anti-social behaviour, that is a different issue to whether the unavailability of car bays resulted in financial loss in relation to loss of revenue from charging guests for use of car bays and increase in custom from having car bays available (or the chance of making profit from engaging in those activities). When the business commenced in February 2019 it was unable to offer car bays to its guests for a fee. That continued until at least some time in 2021. 425 By reason of that finding and my earlier findings as to breach, I am satisfied and find that the plaintiff suffered loss in relation to not being able to access the laneway and rear area at the back of Lot 2. In accordance with the agreement of the parties, the agreed quantum is payable, liability and some loss of the nature identified having been established. 426 I turn now to the inability of the plaintiff to access and use the garage to park cars, over a similarly lengthy period. I am not satisfied that the plaintiff suffered any additional loss in relation to any inability to access and use the garage to park cars for a fee, to that of not being able to park cars in the backyard area for a fee. First, it is unclear whether the parking licence extended beyond the rear open area and included the garage. No evidence was adduced about that question. Secondly, even if it did, the licence was for up to five car bays, and the rear area could accommodate at least that many bays. Thirdly, as noted on the licence, it is issued free for parking by up to five guests. There is no evidence as to any fees that might have been charged if that number were to have been increased. -- 104 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 105 Nature of damages claim 427 In Gates v The City Mutual Life Assurance Society Ltd Mason, Deane and Dawson JJ said:323 However, there is much to be said for the view that the measure of damages in tort is appropriate in most, if not all, Pt V cases, especially those involving misleading or deceptive conduct and the making of false statements. Such conduct is similar both in character and effect to tortious conduct, particularly fraudulent misrepresentation and negligent misstatement. 428 Their Honours further observed:324 … Neither the fact that the representation induces entry into a contract nor the fact that it is a statement of the benefits to which the plaintiff will be entitled under that contract is enough to justify compensation for expectation loss. … 429 The High Court subsequently said that the scope of compensatory remedies under s 236 of the ACL is not confined by analogies with actions in contract or tort.325 430 In the context of a claim for loss suffered by reason of reliance on a misrepresentation resulting in the entry into a contract, the measure of loss will not generally be determined by loss of an expectation or of profits that the plaintiff would have received if the representation had been true. An example where such damages might be awarded is where it is established that reliance has deprived the plaintiff of the opportunity to enter into a different contract in respect of which she would have made a profit.326 431 In my view, it is difficult to identify any basis on which the plaintiff's claim for loss profits or expectation loss in relation to profits from the ability to park vehicles and attract additional custom, is maintainable. That is because it involves considering the position it would have been in if the representations had eventuated to be correct and access and use had been available. 323 Gates v The City Mutual Life Assurance Society Ltd (1986) 160 CLR 1, 14 (Gates). 324 Gates (15). 325 Marks v GIO Australia Holdings [1998] HCA 69; (1998) 196 CLR 494 [14], [17] (Gaudron J), see also [38] (McHugh, Hayne & Callinan JJ), [102] (Gummow J), [148] (Kirby J). 326 Henville, (502) [132] (McHugh J, Gummow J agreeing), (509) [162] (Hayne J); Havyn Pty Ltd v Webster [2005] NSWCA 182 [117] (Santow JA, Tobias JA & Brownie AJA agreeing); Warwick Entertainment Centre [90] - [104] (Steytler P, McLure & Pullin JJA agreeing), see also [143] - [148] (Pullin JA). -- 105 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 106 432 However, even if the claim is not maintainable on that basis, as I understood the parties to accept, the purpose of determining if the agreed quantum was payable, the plaintiff alleges that had it known that the right of way did not exist and that it would not have full use and access to the laneway (implicitly on a shared basis), the car parking area and the garage it would not have agreed to the annual rent under the sublease and would have sought to negotiate a lower annual rent or considered alternative premises to lease for the purpose of conducting a backpacker accommodation business.327 433 I am satisfied on the whole of the evidence, that if the second defendant had not made the misleading representations to the plaintiff about its ability to access and use the garage and the laneway, the plaintiff, through Mr Tassi, would not have been willing to enter into the sublease on the same terms as to rent and would have sought to negotiate a lower rent. That is consistent with, and supported by, my earlier findings that the rent the plaintiff was willing to pay took into account anticipated profits from being able to offer guests the ability to park at the premises for a fee and potential attraction of additional custom. I am also satisfied, and find, that, in those circumstances, the second defendant would have acted reasonably and either have taken steps to ensure there was in place a clear right of access and use over the laneway and garage, or reduced the rental to reflect the risk that the plaintiff might not have access and use of them during the term of the sublease. 434 I am satisfied that the plaintiff thereby suffered an expectation loss due to the second defendants' misrepresentation and its reliance on it in entering into the sublease. I am also satisfied that this loss related to the future ability of the plaintiff to access and use the rear area of Lot 2 to park vehicles for a fee. 435 In those circumstances I am satisfied, in any event, that the plaintiff has established that it suffered the loss of a valuable opportunity to seek to renegotiate the rent of the lease due to its reliance on the misrepresentations in entering into the sublease at the agreed rental. As that loss relates to the plaintiff's future ability to use the rear area of Lot 2 to park vehicles for a fee, and resulting attraction of custom, I am satisfied that the second defendant is liable to pay the agreed quantum and pre-judgment interest to the plaintiff as a result of its breach of s 18 of the ACL, in any event. 327 Statement of Claim, par 31. -- 106 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 107 Breach of contract case 436 The plaintiff's breach of contract case is based solely on an alleged breach of cl 5.1(e) of the sublease, which provides that: Subject to the sub-lessor's rights under this sub-lease, the sub-lessee may occupy the premises during the term without interruption by the sub-lessor. 437 Its claim is solely a claim against the first defendant. In essence, it alleges that the first defendant breached that term by failing to ensure the plaintiff's occupation of the premises during the term was without interruption.328 438 The interruption the plaintiff relies on has three aspects. First, the alleged interruption to the use of the laneway, preventing vehicular access to the rear of the premises from about February 2019 until 1 June 2022 as a result of the erection of the metal post and then concrete bollard by the operator of Lot 1.329 439 Secondly, the plaintiff relies on an alleged interruption to its use of the garage for a period of about six months in 2019 as a result of the dispute that emerged at about that time. The plaintiff alleges that in or around March 2019 Mr Lai on behalf of the second defendant informed the plaintiff that it could not use the garage at all until the resolution of the dispute.330 440 Thirdly, the plaintiff relies on the alleged interruption in the form of an inability to use the garage since about 25 March 2022, shortly before the garage was demolished, until a new garage was erected in August 2023.331 441 In its opening written submissions the plaintiff used a number of different expressions to convey the nature of the alleged obligation on the first defendant under cl 5.1(e) and how it breached that obligation.332 In his oral opening counsel for the plaintiff confirmed, however, that its case was that the obligation arising under cl 5.1(e) was an obligation 'to ensure' there was no interruption to the use and 328 Statement of Claim, pars 32, 33 and 36(b). 329 Statement of Claim, pars 14 and 15. 330 Statement of Claim, pars 24 and 25; Reply, par 18(a)(i); Response to request for further and better particulars filed 9 December 2022, response to request 4, par 2; ts 551 - ts 552. 331 Statement of Claim, pars 24, 25 and 25A; Reply, par 18(a)(i); Response to request for further and better particulars filed 9 December 2022, response to request 4, par 2. 332 Plaintiff's Outline of Submissions for Trial dated 8 April 2024, pars 10, 12 and 13. -- 107 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 108 enjoyment of the premises by the plaintiff and that the first defendant breached that obligation by not ensuring there was no interruption.333 The hearing proceeded accordingly. 442 In closing, however, the plaintiff contended that cl 5.1(e) should be interpreted in substance such that the first defendant, as sublessor, would be liable for breaching cl 5.1(e) if it failed to take steps to eliminate or prevent the problem occurring, and that the plaintiff at least had to take all reasonable steps. The steps it identified included formalising an agreement in relation to access the laneway.334 The defendants object to the plaintiff relying on this on the ground it is outside its case as pleaded and opened.335 443 The defendants' position is that, on the proper construction of the sublease, the express covenant for quiet enjoyment does not extend to interference by acts of third parties who are not authorised by the first defendant and the obligation on the first defendant is not to interrupt the occupation by the plaintiff of the premises (or enjoyment of the premises and any rights appurtenant thereto).336 The defendants say that the protection extends to acts of the landlord, including acts authorised by the landlord, or persons claiming through or under the landlord but that it is not an absolute covenant protecting the tenant against interference by anybody.337 444 The defendants contend that they did not by any act or omission cause any substantial disruption to the plaintiff's quiet enjoyment of the premises. Rather, it was caused by the acts of the operator of Lot 1 installing a metal post and concrete bollard. Those acts are said not to have been authorised or acquiesced in by the defendants and that they were not a matter within their control. Further, the defendants say that during the dispute that emerged they took steps to engage with the Lot 1 owner in respect of the installation of the bollard, the dispute ultimately being resolved by deed in December 2021.338 333 ts 20, ts 23. 334 ts 546 - ts 551. 335 ts 490 - ts 491, ts 568 - ts 569. 336 Defendant's Opening Submissions, par 34; see also Defence, par 35. 337 Glasshouse Investments Pty Ltd v MPJ Holdings Pty Ltd [2005] NSWSC 456 [14] (Glasshouse); Bagata Pty Ltd v Sunstorm Pty Ltd [2024] QCA 17 [54] (Bagata). Defendants' Opening Submissions, pars 3, 34, 67, 68 and 70; ts 482. 338 Defendants' Opening Submissions, pars 71 - 73. -- 108 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 109 Issue 1: What is the proper construction of cl 5.1(e)? What are the premises? 445 Initially it appeared that there was a dispute as to what comprised 'premises' in cl 5(e) of the sublease. 446 In closing, however, it was common ground that the 'premises' in cl 5.1(e) was the area comprising Lot 2, including any fixtures on that land. Two possible qualifications concern the garage and any rights in relation to use of the laneway.339 447 As a starting point, cl 1.1 of the sublease relevantly provides that: In this sub-lease, the following terms have the following meanings unless the context otherwise requires: land means the land described in Schedule 1 of the lease. premises means the land and any of the sub-lessor's fixtures sub-lessor's fixtures includes all appurtenances, equipment, fittings, fixtures and furnishings of whatever nature supplied from time to time at the premises by the sub-lessor. (original emphasis) 448 Schedule 1 of the lease in turn specifies at item 3: 3 Address of premises Premises known as 79-81 Aberdeen Street, Northbridge in the State of Western Australia more particularly described in the head lease. 449 Under the headlease, the premises to be leased (including any fixtures, fittings and accessories) are described as 79 Aberdeen Street, Northbridge WA 6000.340 The land is identified as Lot 2.341 450 A question arises as to whether the 'premises' includes all the garage and land on which it is situated, in circumstances where it encroached outside the boundary of Lot 2 onto Lot 1. Ultimately it is not necessary to finally determine that question. 339 ts 471 - ts 472 (defendants' closing), ts 537 - ts 539 (plaintiff's closing); see also ts 83. 340 Exhibit 9, sch cl 1. 341 Exhibit 9, sch cl 2. Lot 2 on Diagram 10880 and being the whole/part of the land on Certificate of Title vol 1894 and vol 2130 folio 67 and folio 269. -- 109 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 110 451 There are certainly indicators within the lease and the attached commercial lease proposal that tend to support a broader construction of 'premises' so as to include all the garage and land on which it is situated. The special conditions specified at item 14 to sch 1 are: (a) The sub-lessee shall not destroy, demolish the building structure of the Premises including but not limited to the garage and shed. (b) The sub-less [sic] shall maintain the Premises in good condition. (c) The sub-lessee shall remove all rubbish and junk in the shed and behind the shed. 452 Further, the attached signed commercial lease proposal that was signed by the parties when they signed the sublease, included certain special clauses that: *myOZexp PtyLtd/Marco Tassi must take out and maintain the proper insurance to cover the building (79-81 Aberdeen St Northbridge and the Garage/shed) and business insurance required by law. *The lessee/myOZexp Pty Ltd/Marco Tassi shall NOT destroy, demolish the building structure of the premises including but not limited to the garage/shed; who also must use professional builder/architecture to ensure there will not damage/destroy/demolish the building /structure and have to write to the lessor for consent and get council approval. Legal Principles - quiet enjoyment 453 Absent an express clause in a lease, such as cl 5.1(e), a covenant for quiet enjoyment will generally be implied from the circumstance of the letting and/or to give business efficacy to the contract.342 That is because in its absence a landlord would be allowed to annul its own deed by interfering with the possession that it had conferred on the tenant. The covenant has two functions. The first is a limited undertaking as to title. The second is a covenant that the tenant be permitted to 'peaceably hold and enjoy the demised premises without interruption by the lessor or persons claiming through or under [the lessor]'.343 342 Goldsworthy Mining Ltd v The Commissioner of Taxation of the Commonwealth of Australia (1973) 128 CLR 199, 214 (Goldsworthy Mining); Aussie Traveller Pty Ltd v Marklea Pty Ltd [1998] 1 Qd R 1, 8 (McPherson JA, Thomas J agreeing) (Aussie Traveller) citing O'Keefe v Williams (1910) 11 CLR 171, 191 - 192 (Griffiths CJ), 199 - 200 (Barton J) and 211 (Isaacs J). 343 Goldsworthy Mining (214); Aussie Traveller (6) (Fitzgerald P), (8) (McPherson JA) citing O'Keefe v Williams (191) - (192) (Griffiths CJ), (199) - (200) (Barton J) and (211) (Isaacs J). -- 110 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 111 454 A qualified covenant of this nature is to be contrasted with an absolute covenant protecting title paramount.344 While qualified covenants vary in their phraseology, any action such as entry, eviction, ejectment or other interruption by the real owner, or party entitled to possession, or by any person who does not claim 'by, from or under' the lessor, would not be a breach of such a qualified covenant.345 The words only protect against the acts of persons who are successors in title to the landlord or who actually have the authority from the landlord to do the acts in question. Such a qualified covenant does not generally extend to acts of a stranger, as a lessee in those circumstances is left to the tenant's rights in trespass against the stranger.346 455 Under a covenant for quiet enjoyment the tenant's entitlement extends beyond possession of the leased premises. It extends to the enjoyment of the premises and any rights appurtenant thereto.347 Whether a breach has occurred requires that the possession or enjoyment of the premises and any rights appurtenant thereto be substantially interfered with, as a result of an act of omission or commission by the landlord (or those claiming under him).348 456 While the plaintiff has not advanced a case based on any implied obligation not to derogate, it is nevertheless relevant to observe that a lessor's implied obligation not to derogate from the grant is not excluded by an express covenant of quiet enjoyment. Commonly it involves the lessor letting or using adjoining land in a way that interferes with the conduct of the principal demise.349 457 Both types of covenant are instances of the general rule in contract that neither party shall do anything to destroy the efficiency of the bargain which the party has made.350 As a further illustration of the application of the general principle that a grantor shall not derogate from his grant, in certain circumstances, such as where leased premises 344 JKAM Investments Pty Ltd CAN 159 084 018 v Damien [2021] NSWSC 70 [355] (Slattery J) (JKAM Investments) citing Mostyn v The West Mostyn Coal and Iron Company Ltd (1876) 1 CPD 145; (1876) 45 LJQB 401 and Harrison, Ainslie & Co v Lord Muncaster [1891] 2 QB 680, 684 (Lord Esher). 345 JKAM Investments [356] - [357] citing Line v Stephenson (1838) 132 ER 950; (1838) 4 Bing NC 678; 7 Scott 69. See also Kelly v Rogers [1892] 1 QB 910. 346 JKAM Investments [358] - [359]. 347 Todburn Pty Ltd v Taormina International Pty Ltd (1990) 5 BPR 11,173, 11,177 (Powell J) cited with approval in Byrnes v Jokona Pty Ltd [2002] FCA 41 [66] (Allsop J) (Byrnes v Jokona); Glasshouse Investments [14] (Young CJ). 348 Hawkesbury Nominees Pty Ltd v Battik Pty Ltd [2000] FCA 185 [37] - [38] (Hawkesbury Nominees); JKAM Investments [358] - [359]. 349 JKAM Investments [366]; see, further Browne v Flower [1911] 1 Ch 219; Grosvenor Hotel Company v Hamilton [1894] 2 QB 836; Karaggianis v Malltown Pty Ltd [1979] 21 SASR 381, 393 - 394 (Wells J). 350 Hawkesbury Nominees [36]. -- 111 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 112 are part of a larger landholding of a lessor, rights in the nature of a quasi-easement might be implied where needed or required for the reasonable enjoyment of the property granted.351 458 In Aussie Traveller, McPherson JA referred to a distinction sometimes drawn between the agreement for quiet possession being 'directed primarily to acts of the lessor done on the leased premises, whereas the obligation not to derogate from the grant is directed to acts done off the premises on other land retained by the lessor', noting it was doubtful whether the distinction had much practical significance.352 459 His Honour observed that some older authorities suggest that where the acts of another tenant of the landlord causes substantial interference to the tenant's quiet enjoyment, the lessor is not liable for breach of a covenant of quiet enjoyment unless the lessor authorised or actively participated in the acts or the acts that gave rise to the disturbance, or at least were reasonably foreseeable. McPherson JA observed, however, that the law had moved some way and considered a series of cases in which a person was found liable for acts done on that person's land creating a nuisance, even though they were done by the trespasser or resulted from natural causes, if the person failed to take steps to eliminate or prevent them. His Honour observed that even though a lessor generally loses control over premises once they are let to a tenant, he may 'remain legally responsible for tortious acts done on the land by a tenant at least if at the time he agreed to part with possession and control, it was reasonably foreseeable that the tenant was likely to do those acts'.353 460 In Aussie Traveller a finding at trial of breach of an implied obligation not to derogate from the grant of a lease to a tenant where disturbance was caused by a neighbouring tenant was upheld on appeal.354 Relevant matters included that there was a provision in the other lease by which it was possible for the landlord to control the nuisance-making activities of the other tenant, of which it knew or became aware, yet it did not do so. In that context, although not 351 Wilcox v Richardson (1997) 43 NSWLR 4, 13 - 14 (Handley JA), see also (8) (Meagher JA), (19) (Powell JA); Wheeldon v Burrows (1879) 12 Ch D 31, 49 (Thesiger LJ); Canon Kabushiki Kaisha v Green Cartridge Co (Hong Kong) Ltd [1997] AC 728, 736 - 738 (Lord Hoffman). 352 Aussie Traveller (8). 353 Aussie Traveller (12) (McPherson JA, Thomas J agreeing). 354 Compare Aussie Traveller (5) - (6). President Fitzgerald was satisfied that it was warranted to imply a term as a matter of fact to give business efficacy to the contract that the tenant's permitted uses of the premises would not be unreasonably disturbed by the landlord or another of its tenants. -- 112 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 113 authorised or encouraged by the landlord the nuisance 'was capable of being corrected or terminated by active intervention on its part'.355 461 In Byrnes v Jokona Allsop J observed:356 Where the acts are not those of the lessor, the lessor is nevertheless liable for them if it fails to take steps to eliminate or prevent them. Older authorities suggest authorisation is required, or at least that the acts were reasonably foreseeable. See generally the discussion by McPherson JA in Aussie Traveller v Marklea Pty Ltd, supra at p12. I do not think any differences between these formulations matter here. The respondent had control over and could be said to have authorised most of the matters complained of. 462 In my view, his Honour's observation that where the acts are not those of the lessor, the lessor is nevertheless liable for them if it fails to take steps to eliminate or prevent them should be understood in context, where it concerned a lessor that had leased other premises from which the disturbance of the tenant's quiet enjoyment emanated and in respect of which it had an ability to control under the terms of the other lease. In my view it is not to be understood as stating a principle of general application that a covenant not to derogate from the grant of a lease (or a qualified covenant of quiet enjoyment) extends to a failure to take steps to eliminate or prevent acts of another person whose acts cause substantial interference with a tenant's quiet enjoyment. There must be at least an ability to control, such as under an agreement with another tenant, or a positive act that created the risk of interruption. Proper construction of cl 5.1(e) 463 A sublease is to be construed in accordance with the accepted principles of contractual construction. They include determining the meaning of the words of a contract by reference to its text, context and purpose. Ascertaining the meaning of terms used requires a determination of what a reasonable person would have understood those terms to mean. That requires consideration of the language used in the contract, the circumstances addressed by the contract, and the commercial purpose or objects to be secured by the contract. The instrument must be read as a whole.357 355 Aussie Traveller (12) (McPherson JA, Thomas J agreeing). 356 Byrnes v Jokona [66]. 357 Binningup Nominees Pty Ltd v Mirvac (WA) Pty Ltd [2021] WASCA 130 [399] - [400]; Armada Balnaves Pte Ltd v Woodside Energy Julimar Pty Ltd [2022] WASCA 69 [426]. -- 113 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 114 464 Absent a contrary intention, the court approaches commercial contracts, including commercial leases, on the basis that they should be given a business-like interpretation and that the parties intended to produce a result that makes commercial sense, so that provisions have a sensible commercial operation. This requires that the construction placed on the term or terms in question be consistent with the commercial purpose or object of the agreement.358 This however 'does not constitute a licence to alter the meaning of a term to achieve a result the court may think to be reasonable'.359 465 The sublease specifies that the permitted use of the premises is the business of backpacker accommodation.360 It does not expressly refer to or require that car bays or access to the whole laneway be provided. 466 It was known to both the sublessor and sublessee that a licence had been issued authorising the provision of up to five car parking bays for use and that Mr Tassi wished to be able to use the parking bays as part of the operation of the backpacker business. 467 It was also objectively apparent, and known to the parties, that access by car to the rear area and garage required access to and use of the laneway. 468 In this case, the obligation in relation to quiet enjoyment is express. Clause 5.1(e) provides that: Subject to the sub-lessor's rights under this sub-lease, the sub-lessee may occupy the premises during the term without interruption by the sub-lessor. 469 In my view neither the text, context nor purpose of the provision support construing cl 5.1(e) in the expansive manner contended for by the plaintiff. Such a construction is contrary to the ordinary grammatical meaning of the text, which is qualified and limited in its terms to 'interruption by the sub-lessor'. 358 Electricity Generation Corporation t/as Verve Energy v Woodside Energy Ltd [2014] HCA 7 [35]; (2014) 251 CLR 640, 656 - 657 (French CJ, Hayne Crennan & Kiefel JJ); Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37 [51] (French CJ, Nettle & Gordon JJ); (2015) 256 CLR 104, 117; Bagata [51]. 359 Great Union Pty Ltd v Sportsgirl Pty Ltd [2021] VSCA 299 [32] (judgment of the court). 360 Exhibit 24, cl 5.1(a) and sch 1 cl 10. -- 114 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 115 470 The principal construction advanced by the plaintiff, that the first defendant must ensure that access is provided to the premises (including the laneway, garage and rear area), in effect requires those qualifying words be put to one side and the obligation construed as being an absolute covenant as to title or positive covenant to ensure an outcome, where that extends to property that is not part of the premises. The sublease contains no express term to that effect, nor was it contended or sought to be established that any such term arose by implication. In my view it certainly did not arise on the proper construction of cl 5.1(e). 471 I am satisfied that cl 5.1(e), properly construed, does not extend to an absolute covenant as to title or a qualified covenant as to possession without interruption by any person other than the sublessor, at least where there is no right to control that person's actions and prevent them from interfering with quiet possession. To the extent there has been recognition in some circumstances of qualified covenants extending to a failure to prevent another person interfering with a tenant's possession, they are far removed from this case. 472 The above construction of cl 5.1(e) is consistent with cl 8.2(a), which obliges the sub-lessee during the term to permit any person having any interest in the premises superior to or concurrent with the sub-lessor to exercise the sub-lessor's and that person's lawful rights. 473 The language used does not include words such as 'or persons claiming through or under the lessor' or 'by, from or under' the lessor. Nevertheless, in my view, having regard to the underlying object of the clause, and clauses of this nature, being to protect the tenant from having quiet possession interrupted by the sublessor or persons claiming by, through or under them, and construing the lease in a commercial manner, the obligation properly construed extends to interruption by the sublessor or persons claiming by, from, through or under the sublessor. 474 Further, although the language refers to possession, in my view, consistent with the usual scope of such covenants when implied, it extends by implication to possession of the premises and enjoyment of the premises and any rights appurtenant thereto. That would, for example, extend to enjoyment of any rights that attach to the land within Lot 2, such as any easements that might exist for the benefit of Lot 2. -- 115 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 116 475 In other words, on its proper construction, cl 5.1(e) provides similar protection to that of a qualified covenant of quiet enjoyment that would otherwise generally be implied in relation to a commercial lease. 476 In my view nothing in the text of cl 5.1(e), or its context, or purpose, warrants the obligation on the sublessor being construed as an obligation to ensure (or to take reasonable steps to ensure) that quiet possession and enjoyment of the premises and rights appurtenant thereto are not substantially interrupted by another person, in this case the owner or lessee of the neighbouring Lot 1. 477 Finally, while the obligation refers to 'without interruption', consistent with the authorities in relation to the operation of such covenants, that obligation will only be breached if the interference is substantial. Issue 2: Did the first defendant breach cl 5.1(e)? 478 For the following reasons I am satisfied that the first defendant did not breach cl 5.1(e) of the sublease. Erection of metal post and concrete bollard 479 The acts of erecting and maintaining the metal post and concrete bollard amounted to a substantial interference with the plaintiff's possession of the premises and enjoyment of the premises and rights appurtenant thereto. They prevented the plaintiff being able to access the garage and rear portion of Lot 2 by motor vehicle for a significant period. 480 However, those acts were not the acts of the first defendant. Nor were they under the first defendant's control. It was also not alleged that the acts were authorised by or acquiesced in by the first defendant. Nor does the evidence support such a finding. 481 Having regard to the proper construction of cl 5.1(e) the first defendant therefore did not breach that clause. 482 In closing, for the first time, the plaintiff advanced an argument that the first defendant was liable for breaching cl 5.1(e) by not taking reasonable steps to ensure that the plaintiff could access and use the right of way. -- 116 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 117 483 In my view such a claim ought be rejected. First, it was not pleaded and is inconsistent with the way in which the case was outlined in opening. As such it was not open to the plaintiff to advance the case on that basis. Secondly, on its proper construction, the obligation did not extend to requiring that the first defendant take any steps alleged. Thirdly, the actions of the neighbouring Lot 1 operator and/or tenant were not under the control of the first defendant. Fourthly, I am not satisfied that it has been established that the first defendant failed to take any reasonable steps. Rather, the defendants and the plaintiff initially cooperated in trying to achieve an outcome under which laneway access was restored before lawyers became involved. The dispute clearly involved complex issues and the operator of Lot 1 was very assertive in relation to his rights. The complexities of some of the issues is apparent from the details of the ultimate settlement of the dispute as reflected in the deeds and licence agreements that were entered into. There were also other obstacles to a prompt resolution including the impact of COVID-19 and legal involvement. Denial of access to and use of the garage 484 In relation to the alleged denial of access to the garage for a period of about six months, the act relied on is an alleged act of Mr Lai on behalf of the second defendant in prohibiting it from using the garage.361 485 I am satisfied that in about March 2019 Mr Lai, on behalf of the second defendant told the plaintiff he could not use the garage in the context of the ongoing dispute that had arisen with the owner of Lot 1.362 486 That too resulted in a substantial interruption to the possession and enjoyment of the garage by the plaintiff, for a period of about six months prior to the plaintiff, with the consent of the second defendant, erecting temporarily a red fence to separate the garage and back yard area of Lot 2 from the laneway. 487 However, having regard to the proper construction of cl 5.1(e) I am not satisfied that the first defendant breached the obligation. She was not required to ensure or take reasonable steps to ensure it did not occur. Further, no case was advanced identifying any reasonable steps it was contended she ought to have taken to prevent this occurring. 361 Statement of Claim, pars 25 and 25A; Reply, par 18(a)(i). 362 ts 219 - ts 221, ts 225 - ts 227. -- 117 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 118 Inability to use garage 488 Similarly, the inability to use the garage from shortly prior to its demolition arose due to the agreement between the second defendant and owner of Lot 1 to resolve the dispute on terms that involved the garage being demolished and a fresh garage being constructed on Lot 1. 489 That too resulted in a substantial interruption to the possession and enjoyment of the garage by the plaintiff, for a period of about 16 months prior to a new garage being erected. 490 Again, having regard to the proper construction of cl 5.1(e), I am not satisfied that the first defendant breached the obligation. The first defendant did not engage in the act causing the interruption. She was not required to ensure or to take reasonable steps to ensure it did not occur. Further, no case was advanced identifying any reasonable steps it was contended she could and ought to have taken. 491 Further, I am not satisfied that it has been established the plaintiff suffered any resulting loss from this alleged breach in relation to allowing vehicles to park for a fee including because the absence of the garage would not, of itself, have prevented vehicles being parked. Issue 3: Loss and damage 492 If I am wrong in relation to the above conclusion and, contrary to my findings, the first defendant were liable for breaching cl 5.1(e) I am satisfied that the substantial interruption to the plaintiff's ability to use the laneway and therefore the backyard to park vehicles, was causative of at least some loss of profit or chance of earning profit from the plaintiff providing car parking bays to guests for a fee. As such, I would have been satisfied that the first defendant would have been liable to pay the agreed quantum. 493 For reasons already given I am not satisfied any additional loss was suffered by the inability to use the garage during that period alleged relating to the ability to offer parking for a fee or attract custom. Orders 494 Judgment will be entered in favour of the plaintiff against the second defendant in the amount of $166,000 in addition to pre-judgment interest at 6% per annum from 1 June 2022 until judgment. 495 I will hear the parties as to costs and any consequential orders. -- 118 of 119 -- [2026] WADC 64 SEFTON DCJ [2026] WADC 64 [JM] Page 119 I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia. CJ Associate to his Honour Judge Sefton 3 JULY 2026 -- 119 of 119 --