TITLE OF COURT: SUPREME COURT OF TASMANIA (FULL COURT)

Limitation of Actions - Contracts, torts and personal actions - When time begins to run - Particular causes of action - Negligence - Date on which cause of action accrues - Negligent misrepresentations leading over six years prior to issue of writ to entry into equitable lease, payment of deposit and borrowing of money at interest - Whether any of those events established that cause of action had accrued.

Limitation Act 1974 (Tas), s4(1)(a).

Wardley Australia Ltd v Western Australia [1992] HCA 55; (1992) 175 CLR 514, distinguished.

Karedis Enterprises Pty Ltd v Antoniou [1995] FCA 1356; (1995) 59 FCR 35; Marks v GIO Australia Holdings Ltd [1998] HCA 69; (1998) 196 CLR 494; Wardman v Hatfield [2003] NSWCA 283; HTW Valuers (Central Qld) v Astonland Pty Ltd [2004] HCA 54; (2004) 79 ALJR 190; Murphy v Overton Investments Pty Ltd [2004] HCA 3; (2004) 216 CLR 388, considered.

Interest - Recoverability of interest - Award of interest as damages - In Tasmania - Action for damages for negligent misrepresentations - Damages awarded for monies paid out in the reliance on misrepresentations - Lost opportunity to invest money - Intervening bankruptcy - Whether money would have been applied to creditors and not to an investment.

Hungerfords v Walker [1989] HCA 8; (1989) 171 CLR 125, distinguished.

First and Second Respondents: G L Sealy, R A Browne

First and Second Respondents: Fitzgerald and Browne

Judgment Number: [2008] TASSC 12

ANDREW HAROLD EDWARDS and DAVID GEORGE ELLWOOD v

ANDREW HAROLD EDWARDS and DAVID GEORGE ELLWOOD v

1 The first and second respondents, Mr and Mrs Stocks, to whom I will refer as "the respondents", sued the third respondent, the Retirement Benefits Fund Board ("RBF") for damages for negligent misrepresentations that led them to agree to lease premises at the Northgate Shopping Centre ("Northgate") at Glenorchy and there open a shop, which subsequently failed. Their case was that the misrepresentations, upon which they relied, were made by RBF's agents, the two appellants. RBF was the developer of Northgate. One of the managing agents for RBF was a real estate firm, Edwards & Windsor. RBF appointed that firm as its agent for the purpose of leasing out the shops at Northgate. The first appellant, Mr Edwards, was a principal of Edwards & Windsor and the second appellant, Mr Ellwood, was an employee.

2 RBF took third party proceedings against the appellants and against Douglas Parker Fitzgerald. He was employed by Edwards & Windsor as the manger of the shopping centre in about July 1986. Judgment was given in his favour and the appeal does not concern him.

3 Following a trial, the respondents were successful in their action against RBF and obtained a judgment against it for $71,124.17. RBF was successful in its third party proceedings against the appellants and obtained an order that they indemnify it with respect to the judgment sum it was liable to pay the respondents. The appeal has been brought by the appellants and not by RBF.

4 The learned trial judge found that the following representations were made to Mr Stocks by Mr Edwards and/or Mr Ellwood at a meeting at about the end of January 1986:

1 That Coles was committed to being the major tenant at Northgate and would operate a super store there. The words conveyed the impression that the Coles store would be very large and would comprise a supermarket with a substantial area devoted to the sale of variety goods.

2 That the estimated pedestrian traffic flow for the shopping centre was approximately 50,000 people a week.

3 That a Tattslotto agency would be established at a kiosk in the centre of the specialty shops area.

4 That nearly all the shops were let and there were only three shops left available for lease.

5 The learned trial judge made the following findings of fact, which he regarded as establishing that those representations were misrepresentations:

1 Coles had indicated that it intended to lease just under 5000m2 and operate a supermarket with a section devoted to variety goods, but no lease had been drawn up. When Coles opened at Northgate in November 1986, it consisted of a very large supermarket, but it did not have a substantial area devoted to the sale of variety goods.

2 The representation that the estimated pedestrian traffic flow for the shopping centre was approximately 50,000 people a week was based on Mr Edwards' unsubstantiated guess that the weekly traffic flow through Northgate would be twice the number that a competitor told him went through his centre each week. The competitor was Mr Rudi Sypkes, the owner of the nearby Glenorchy Central Shopping Centre. He had told Mr Edwards that 25,000 went through his centre each week. In fact less than half of 50,000 people went through Northgate each week following its opening.

3 The only basis for making the representation that there would be a Tattslotto agency established at a kiosk in the centre of the specialty shops area was Mr Edwards' understanding that it was something that the promoters wished to achieve. Negotiations to fulfil that wish did not commence until after the representation was made. In fact there was never a Tattslotto kiosk at Northgate.

4 With respect to specialty shops, which were the majority of the shops and the subject of the respondents' interest, applications had been received for about half the total, which exceeded 50, and no deposits had been paid or leases drawn up. Although the number of shops available in the area appropriate for the business proposed to be carried on by the respondents may have been limited, in the sense that there were only a limited number that were not then the subject of discussion with other prospective tenants, the representation that nearly all the shops were let and that there were only three shops left was untrue.

6 The respondents also pleaded that it was represented that Venture had been confirmed as a major retailer for Northgate, but the learned judge omitted to make specific findings concerning that matter. For reasons explained by Blow J, it appears that the learned judge was satisfied that the representation in question was made and that it was a misrepresentation, for Venture had not been a prospective tenant for seven months, although at a meeting on 20 January 1986 Mr Edwards agreed to make a fresh approach to Venture to see if it would reconsider its position.

7 It was found by the learned judge that the misrepresentations were made negligently and that the respondents acted in reliance on and were induced by them to agree to take a lease of shop 31 at Northgate.

8 The respondents did not sign a lease for shop 31. However, it was common ground that by a letter from Mr Stocks to Mr Ellwood dated 14 May 1986 accepting an offer of a tenancy of shop 31 upon the terms of a letter dated 2 May 1986, an equitable lease was entered into.

9 The respondents had no capital to put into their Northgate business and relied upon two loans from Mrs Stocks' father totalling $105,000 together with a joint personal loan from the Westpac Bank. Mrs Stocks' father was the guarantor of that loan. In due course the respondents received shop fit-out plans. They did not gain access to Northgate until about a week before the opening in November 1986 to enable them to fit-out the shop and be ready to commence trading. The fit-out consisted of bringing power and water into the shop, installing a ceiling and walls, laying carpet and tiles, building a front, installing shelves and the like. Approximately $75,000 worth of stock was purchased by them.

10 It soon became clear to the respondents that Venture was not going into Northgate and that there was no Tattslotto kiosk. There were a number of acrimonious discussions between the respondents and other tenants, on the one side, and RBF's representative, on the other side, about the absence of Venture, the absence of the kiosk, the size and nature of Coles store and the low number of people coming to Northgate. The respondents' shop was not making a profit. On several occasions in late January or early February 1987 they asked Mr Edwards if the rent could be reduced due to poor trading figures. They were not alone in doing so. On 4 February 1987, RBF resolved that a tough stand be taken with tenants seeking rental relief and that in the event of non-payment of rental, tenants were to be issued with a notice to quit possession. On 13 February 1987, such a notice was issued to the respondents. They packed up their stock and such fittings as they could remove and vacated Northgate on or about 14 March 1987. They had paid rent to 13 March.

11 The respondents did not claim damages for their loss of profits from trading at Northgate once they had opened. Their case was that they would not have entered into the equitable lease, incurred certain expenses and carried out certain work but for the making of the misrepresentations. On that basis their claim for damages was limited to the cost, thrown away, of fitting-out the shop, their labour in the shop from the time of fitting it out in November 1986 until 13 March 1987, the rent for the period from November to March that was paid by them, their solicitor's costs and out of pockets associated with drawing up a lease, general damages for vexation and distress and interest in accordance with the principles established in Hungerfords v Walker [1989] HCA 8; (1988) 171 CLR 125. The damages that were awarded included all of those items.

12 There are eight grounds of appeal. I agree with Blow J, for the reasons he has stated, that grounds 2 - 7 fail. My reasons are confined to grounds 1 and 8.

13 The writ was issued on 7 September 1992. The defence pleaded that the respondents' cause of action accrued more than six years before the action was commenced and accordingly, that the action was barred by the Limitation Act 1974, s4(1)(a). The learned judge rejected the defence. The first ground of appeal attacks that rejection.

14 Section 4(1)(a) provided then, as it does now, that an action of the present kind "shall not be brought after the expiration of 6 years from the date on which the cause of action accrued". It was the defence case that notwithstanding that Northgate did not open until November 1986 and the respondents did not obtain possession and become liable to pay rent until that month, they first suffered damage prior to 7 September 1986, and thus they were barred from bringing the proceedings because their cause of action arose upon them suffering damage. As a matter of general principle, where an action is for economic loss caused by negligence, the cause of action accrues and time begins to run when damage is suffered. I will return to the law later, but will first explain the facts upon which the appellants relied to base the defence.

15 Following negotiations and dealings between Mr Stocks and the representatives of RBF, Edwards & Windsor sent a letter to him on 2 May 1986. It was signed by Mr Ellwood. It offered shop 31 for lease on terms that included an annual base rental of $47,300, a fixed lease period of five years and annual rent increases of 8 percent, with a rent review to market levels every two years. Relevantly, the letter contained the following statement: "It would be appreciated if you would sign the attached copy of this letter to indicate your agreement to the above terms and conditions. Would you also forward a deposit of $3,942.00 being one month's rental. As soon as we receive your deposit and agreement to the above we will forward to you a lease and Agreement for Lease for your consideration. Your prompt attention to the above matters would be appreciated as we are anxious to commence shop fitout discussions with you." On 14 May 1986 Mr Stocks responded by a letter in which he stated that he accepted the terms and that the deposit of $3,942 would be sent by 30 May 1986. The deposit was in fact paid to Edwards & Windsor on 31 May 1986. As stated earlier, it was common ground at the trial that by Mr Stocks sending that letter an equitable lease was entered into. The learned judge found that the deposit was paid by Edwards & Windsor into its trust account and remained there until 2 December 1986. No finding was made concerning what happened then, but a property card kept by Edwards & Windsor reveals that by a journal transfer on 2 December 1986 the deposit was applied to rent. The respondents' liability to pay rent had commenced with the opening of the centre on 17 November 1986.

16 It was the appellants' case at the trial that by entering into the equitable lease and by paying the deposit of $3,942 on 31 May 1986, the respondents suffered damage and that accordingly, the cause of action accrued in May 1986, and as that was over six years prior to the date of the writ, the action was barred by the Limitation Act. On the other hand, it was the respondents' case at the trial concerning the payment of the deposit, that rent was not payable until the centre opened on 17 November 1986, which was inside the relevant period of six years, and that RBF had no entitlement to any part of the deposit until the liability to pay rent arose on 17 November. It was also the respondents' case that Edwards & Windsor was not entitled to deal with the deposited funds until the respondents became liable for the rent on 17 November, at which time the term of the lease commenced. Counsel for the respondents submitted to the learned judge that the money was held by Edwards & Windsor on trust and was not applied to any purpose until after the limitation period commenced.

17 The learned judge accepted the respondents' argument. His Honour found, as the evidence obliged him to do, that the deposit of $3,942 was paid prior to the commencement of the limitation period on 7 September 1986 as a result of the misrepresentations. The learned judge continued:

"However, this was not a payment of rent, but payment of a sum of money to be held by Edwards Windsor as trustee upon trust for both the plaintiffs and the defendant. The basic term of the trust was that should Northgate open for trading, the money was to be paid to the defendant being one month's rent, but should Northgate not open, the money was to be repaid to the plaintiffs. Accordingly, the sum paid was held by Edwards Windsor in its trust account until after the centre opened.

Thus, this is a contingency situation as was the case in Wardley Australia Ltd v Western Australia [1992] HCA 55; (1992) 175 CLR 514 in which it was held that where a plaintiff enters into a contract that gives rise to a contingent loss, no loss is suffered until the contingency is fulfilled and the loss becomes actual. In Murphy v Overton Investments Pty Ltd [2004] HCA 3; (2004) 216 CLR 388 the judgment of the court described the effect of Wardley in these terms at 408:

'In that case, the mere entry into obligations which might, but need not, have had detrimental consequences in the future was held not to have occasioned loss or damage to the party making the contract.'

Accordingly, I am not persuaded to the requisite degree that that the plaintiffs suffered any actual loss until after 7 September 1986, and the bringing of this action is not barred by reason of the provisions of the Limitation Act, s4."

1">18 I will return to the effect of Wardley's case later. At this point I state my respectful disagreement with what the learned judge said about the deposited funds being held by Edwards & Windsor on trust for both RBF and the respondents. Edwards & Windsor was the agent of RBF but not of the respondents. There was no evidence to support a conclusion that once paid, Edwards & Windsor held the funds as trustee upon trust for both RBF and the respondents. The firm may have held the funds as trustee for RBF but not also as trustee for the respondents. That was not a basis upon which the respondents paid the deposit, nor a basis upon which Edwards & Windsor received it.

19 Almost 100 years ago in Campbell v Rogers (1909) 5 TLR 30 at 36, Nicholls J reviewed a number of authorities and concluded that in the usual case, where there is a contract for sale between a vendor and purchaser and the purchaser pays a deposit to the vendor's real estate agent, the latter is not a stakeholder at all but merely the agent of the vendor. The payment to the vendor's agent amounts to payment to the vendor. Further, the agent does not become a stakeholder by continuing to hold the deposit. In the usual case, where a binding contract has come into existence, the agent has an implied authority to receive payment of the deposit in the sense that the payment is deemed to be a payment to the principal. Wells v Birtchnell [1893] VicLawRp 79; (1893) 19 VLR 473 at 481; Whinfield v Lovell [1926] VicLawRp 26; [1926] VLR 185 at 187; Smith v Woodcock [1950] VicLawRp 21; [1950] VLR 114 at 118; Fischer v Parry & Beveridge Pty Ltd [1963] VicRp 14; [1963] VR 97 at 99. There are exceptions to the general rule. They include where the agent is an auctioneer, where it is agreed at the time of payment that the agent will receive the money as stakeholder and where the deposit is paid to the agent at a time when no binding contract has come into existence. As to that last exception see Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353 at 364 - 366; Sorell v Finch [1977] AC 728; Wells v Birtchnell (supra); Fischer v Parry & Beveridge Pty Ltd (supra); Whinfield v Lovell (supra); Henning v Ramsay [1964] NSWR 1165; Harris v Fuseoak Pty Ltd (1995) 7 BPR 14,511. Another exception is where the contract expressly provides that the agent shall hold the deposit as stakeholder. Most contracts for the sale of land in this State contain such a provision. It was a standard provision of the form of contract recommended by the Law Society of Tasmania many years ago, which remained in use for a long time and very possibly still is today.

20 While all of the cases to which I have referred concerned deposits paid to estate agents on a sale or a proposed sale, there is no reason why the same principles should not apply to a deposit paid to an estate agent acting as agent for a landlord for the purpose of making a binding agreement for lease with a prospective tenant. The payment of the deposit by the respondents on 31 May 1986 should be treated as a payment to RBF and, subject to a consideration of Wardley's case, was a loss suffered by the respondents outside the limitation period as a result of the negligent misrepresentations of RBF's agent.

21 I agree with the learned judge that the deposit was not a payment of rent at the time it was paid, notwithstanding that it was equal to a month's rent. The respondents and Edwards & Windsor described it as a deposit. Therefore, it was paid as a deposit in the normal sense and had the usual functions of a deposit. It was paid as a guarantee that the equitable lease, that is to say the agreement for lease, would be performed by the respondents, an "earnest to bind the bargain" (Howe v Smith (1884) 27 Ch D 89 at 101), a guarantee that the respondents meant business (Soper v Arnold (1889) 14 App Cas 429 at 435). If the lease did not proceed by reason of the default of RBF, the respondents would have been entitled to its repayment. If the respondents defaulted, it would have been liable to be forfeited to RBF. The payment also represented a part-payment of what the respondents would have been liable to pay under the lease. In that regard, it was likely that it would be taken as payment of the first month's rent when it became payable. That was in fact what happened to it.

22 It was also the appellants' case at the trial that the respondents suffered damage outside the six year limitation period when they borrowed $60,000 from the Westpac Bank and incurred a liability to pay interest on the borrowed money. The evidence of Mr Stocks was that it was a personal loan, and not an overdraft facility, and that it was guaranteed by Mrs Stocks' parents. They also had an overdraft facility with the Commonwealth Bank. The money they borrowed, including the personal loan, was expended on fitting out and acquiring stock for the new shop at Northgate, with some of the money being left over as a "cash buffer". In cross-examination, Mr Stocks was unable to remember the date upon which they received the funds from Westpac, and counsel for the appellants advised that it was a matter that was being sorted out by counsel. Subsequently, counsel for RBF advised the learned judge that it was an agreed fact that "on or about 1 September 1986 [the respondents] borrowed the sum of $60,000 from the Westpac Bank at a rate of 18.75 per cent interest". It was the appellants' case that it was probable that the $60,000 was received by the respondents, and their liability to pay interest, commenced over six years before the writ was issued on 7 September 1992, and that accordingly, they had suffered loss and damage as a result of the negligent misrepresentations over six years before and for that reason also the action was barred.

23 The onus of proof lies upon a defendant who pleads a limitation defence. Pullen v Gutteridge Haskins & Davey Pty Ltd [1993] VicRp 4; [1993] 1 VR 27 at 76; Cigna Insurance Asia Pacific Ltd v Packer [2000] WASCA 415; (2000) 23 WAR 159 at par52; Segal v Fleming [2002] NSWCA 262 at par27; re Monger; ex parte Cross [2004] WASCA 176 at par69. Having observed that, his Honour rejected the appellants' limitation defence, so far as it was based on the loan from Westpac, for the following reasons:

"With respect to the bank loan, the transcript records the following agreed fact:

'... on or about 1 September 1986, [the plaintiffs] borrowed the sum of sixty thousand dollars from the Westpac Bank at a rate of eighteen point seven five per cent interest.'

Mr Stocks gave evidence that he and his wife used the overdraft to fit-out the shop and buy stock, as well as leaving an amount as a 'buffer'. He said that the stock was bought on 30 day payment. Although all the dockets evidencing the total cost of the fit-out were not tendered in evidence, the date on the earliest of those dockets that were tendered in evidence is 18 November 1986. There was no direct evidence of when any principal was paid, nor when any liability was incurred to pay interest. The agreed fact is vague about the precise date the plaintiffs' 'borrowed' the money. If the expression 'on or about 1 September' encompasses a date more than six days either side of 1 September, it is possible that the money was not borrowed until after 6 September 1986. I find that, in accordance with ordinary banking practice, when the loan was taken out the sum lent was credited to the plaintiffs' account and drawn by them when needed. Until drawn, the plaintiffs incurred no liability to pay interest or make any repayment. As the fit-out did not commence and the stock could not be put in the shop until two months after the money was borrowed, it is not likely that the plaintiffs withdrew any of the loan until well after 7 September 1986. That conclusion, coupled with the imprecision in the agreed fact as to the date the money was borrowed, leads me to find that I cannot be satisfied that it is more probable than not that the plaintiffs incurred any liability with respect to the bank loan prior to 7 September 1986."

24 With respect, I do not agree. The evidence established that the $60,000 was borrowed by way of personal loan and not by way of an overdraft or similar facility which might have permitted drawing down of the money as and when required. The agreed fact that the money was "borrowed" was not open to an interpretation that there was an agreement that the money would be borrowed but the loan had not been made. That the money was "borrowed" at a particular point in time meant just that, a payment of money as a loan. Nor was it open to conclude that the borrowed money was paid to the credit of an account the respondents had with Westpac. Mr Stocks' evidence was that they banked with the Commonwealth Bank and that they applied to the Westpac Bank for the personal loan because it was the bank of Mrs Stocks' parents, who guaranteed repayment of the loan. The finding that it was not likely that the respondents withdrew any of the money until well after 7 September 1986 was not open either.

25 In view of those errors, it falls to this Court to determine whether the respondents had borrowed the $60,000 and had incurred a then current liability to pay interest on the borrowed funds, at a point in time outside the six year limitation period. As the learned judge observed, that the money was borrowed "on or about 1 September 1986" contains a degree of imprecision and if it encompassed a date more than six days either side of 1 September, it was possible that the money was not borrowed until after 6 September 1986. Importantly however, the question that arises is one of probabilities and not mere possibilities. My conclusion is that a day that was "on or about 1 September" was probably before 7 September, in the same way that "on or about 12 September" would probably be a reference to a day after 6 September. The finding should have been made that, outside the limitation period, the respondents received $60,000 from Westpac, by way of a personal loan, and incurred a liability to pay interest thereon at a rate of 18.85 percent per annum. (I note that in Blackett v Clutterbuck Bros (Adelaide) Ltd [1923] SASR 301 at 307, Murray CJ considered that an agreement that provided for a Massey-Harris binder to be delivered to its hirer "on or about 1st day of October" did not extend to a delivery on a day that was outside two, or perhaps three, days either side of 1 October.) I add that I have not been persuaded to conclude differently by the fact that the writ was filed on a Monday and could not have been filed on either the Saturday or Sunday before, because the registries of the Court would have been closed on those two days, and accordingly, by virtue of the Acts Interpretation Act 1931, s29(4), it would not hurt the respondents' case if the money was borrowed by them as late as 5 or 6 September 1986.

26 Another factual basis relied on by the appellants at the hearing of the appeal for the success of the limitation defence, arose out of the payment of $500 by them to their solicitor for legal costs associated with the lease documents. It was a debt that the learned judge found to have been reasonably incurred and in a reasonable sum. It formed part of the awarded damages. There was contention before this Court concerning whether it should have been found by the learned trial judge that the respondents incurred liability for the costs outside the limitation period. It is unnecessary to consider the matter. If the appellants do not succeed with the limitation defence on any of the other factual bases to which I have referred, they will not succeed with it relying on the matter of legal costs. I add that it was not pleaded as a basis for the limitation defence and it was not the subject of submissions by counsel in their closing addresses when dealing with that defence.

27 In summary, the learned trial judge disposed of other arguments in support of the limitation defence in the following way. Concerning the entry into the equitable lease by the respondents, "there was no evidence to the effect that the value of the equitable lease entered into in late May 1986 was less than it would have been had the representations been true or not made". It is implicit from that statement that his Honour concluded that the appellants had failed to prove that when the respondents entered into the equitable lease they suffered a loss that was caused by the negligent misrepresentations. In response to a submission by defence counsel that on the plaintiffs' case, the business could never have been as profitable as it would have been had the negligent representations been true, his Honour said that any such loss of profitability would not have constituted actual loss until it occurred. Damage which is prospective or contingent does not qualify as actual damage for the purpose of giving rise to a cause of action for negligence. Wardley Australia Ltd v Western Australia (supra) at 530, 531. I respectfully agree with what the learned judge said about those matters.

28 It is to Wardley's case that I now turn. The respondents' counsel submitted that it saves them from the limitation defence in all of its aspects. The case concerned a claim for damages for loss alleged to have been suffered as a result of misleading and deceptive conduct, the claim being made under the Trade Practices Act 1974 (Cth). As a result of misleading and deceptive representations by the defendant concerning the assets and worth of Rothwells, the State of Western Australia executed an indemnity by which it agreed to indemnify a bank against any net loss which might arise if Rothwells did not satisfy in full its liability under a bill facility to be granted by the bank. The question that arose on appeal was whether the State's cause of action accrued when it executed the indemnity, in which case the action was barred by s82(2), which required an action to be commenced within three years after the date on which the cause of action accrued.

29 In a joint judgment, four of the seven members of the High Court, Mason CJ, Dawson, Gaudron and McHugh JJ, pointed out at 525, that as loss or damage was the gist of the statutory cause of action, the cause did not accrue until actual loss or damage was sustained because of the misleading or deceptive conduct which, in the case before the court, was in the form of misrepresentations. At 526, their Honours said that in determining when a plaintiff first suffers economic loss or damage in such an action, it is necessary to have regard to the applicable measure of damages and in the case in question, the plaintiff was entitled to recover a sum representing the prejudice or disadvantage suffered in consequence of altering its position under the inducement of the misleading conduct or the actual damage directly flowing from that conduct. Under s82(1), as under the common law in the case of actions for negligent misrepresentations and deceit, a plaintiff may only recover compensation for actual loss or damage incurred, as distinct from potential or likely damage, or prospective loss. At 527, their Honours made the point that although a plaintiff may have sustained a detriment in a general sense on entry into an agreement, because of the acquisition of obligations and liabilities, such a detriment has not universally been equated with the legal concept of "loss or damage". Their Honours approved of the statement of Ackner LJ in UBAF Ltd v European American Banking Corporation [1984] QB 713 at 725, that "the mere fact that the innocent but negligent misrepresentations caused the plaintiffs to enter into a contract which they otherwise would not have entered into, does not inevitably mean that they had suffered damage by merely entering into the contract", and made the point at 528, that evidence was required to establish that fact, if it was a fact. In the present case, the respondents did not claim damages upon the basis that they suffered a loss when, and merely because, they entered into the equitable lease, and they called no evidence to establish that they suffered such a loss. In the main, the damages they claimed were for the money they paid out as a consequence of the negligent misrepresentations. As will be seen, that is an important distinction between this case and Wardley's case. In the words of Dixon J in Potts v Miller [1940] HCA 43; (1940) 64 CLR 282 at 297, the measure of damages in this case consisted largely of "the loss or expenditure incurred by the plaintiff in consequence of the inducement upon which he relied."

30 Wardley is authority for the proposition that if as a result of a defendant's negligent misrepresentation, a plaintiff enters into a contract which exposes him or her to a contingent liability, that exposure does not amount to actual loss or damage. It will only be when the contingency is fulfilled that the loss becomes actual. See Wardley at 533. "Prospective loss is not enough." Wardley at 527. However, if the plaintiff suffers actual loss outside the limitation period then, notwithstanding that the plaintiff is also exposed to a contingent liability which is not fulfilled until within the limitation period, the cause of action is barred simply because of actual loss being suffered outside the limitation period. In order for a plaintiff's cause of action to be complete, all that is required is that there be actual loss which is "measurable" (Wardley at 531) or "beyond what can be regarded as negligible" (Cartledge v E Jopling & Sons Ltd [1963] AC 758 at 772). In this case, there was actual loss when the respondents paid the deposit of $3,942 on 31 May 1986, which was outside the limitation period. The damages recovered by the respondents included that sum, notwithstanding that it was referred to in particulars of the respondents' claim for damages as a part of $10,759.72 for "rent paid out to the defendant in respect of the shop for the period 17 November 1986 - 13 March 1987". There was also actual loss prior to the limitation period commencing when the respondents incurred a liability to pay interest on the $60,000 from the Westpac Bank on or about 1 September 2006. However, whether interest calculated from that date was in fact included in the awarded damages is not apparent from the information available to the Court.

31 Time commenced to run under the Limitation Act with the accrual of the cause of action, which occurred when damage in the form of actual loss was suffered as a result of the negligent misrepresentations, and that was so even if the respondents were unaware that they had suffered damage or that the representations amounted to negligent misrepresentations. Cartledge v E Jopling & Sons Ltd (supra) at 782 - 783; Hawkins v Clayton (1988) 164 CLR 539 at 560 - 561, 587 - 588, 598 - 601; Wardley at 540, 554 - 555; Scarcella v Lettice [2000] NSWCA 289; (2000) 51 NSWLR 302 at 306. "The general principle is that time runs from when the cause of action is complete, whether or not this is discovered or discoverable." Scarcella at 308. Further, and particularly for that reason, it is erroneous to regard the fulfilment of a "Wardley contingency" as occurring when the plaintiff becomes aware that the representations were misrepresentations or that actual damage had been suffered.

The effect of bankruptcy on the claim for damages by way of interest

33 The respondents claimed damages by way of interest in accordance with Hungerfords v Walker [1989] HCA 8; (1989) 171 CLR 125 on money paid out by them in reliance upon the negligent misrepresentations. They sought to have the interest calculated until the date of judgment. The learned judge awarded such damages for the period ending when the respondents became bankrupt on 15 December 1988 and for the period commencing on 30 August 1992 until judgment. The eighth and last ground of the appeal attacks the award for the period from 30 August 1992, asserting that "the learned trial judge erred in law in finding that the plaintiffs' entitlement to damages in the nature of interest for loss of use of sums of money expended in setting up and operating their business survived the plaintiffs' bankruptcy."

34 At the time when the respondents opened the store at Northgate they were operating another store at Centrepoint in Hobart. While still operating at Northgate, they opened another business in Moonah. After leaving Northgate, they transferred the Moonah business and the Centrepoint business to a new location in the centre of Hobart. None of those moves was successful. Their businesses collapsed and they faced financial ruin and bankruptcy. They did not prove that the appellants' negligent misrepresentations caused their bankruptcy, although it was a contributing factor. There were many reasons, which included the failure of the other businesses and their lack of equity.

35 They became bankrupts on 15 December 1988 with the making of a sequestration order. On 15 December 1991 they were discharged from bankruptcy by operation of law. See Bankruptcy Act 1966 (Cth), s149(1), as then in force. (The learned judge incorrectly stated the date as 23 December 1991, presumably relying on amendments to the Act by the Bankruptcy Amendment Act 1991 which were not in force at the relevant time.)

36 Upon them becoming bankrupts, all their property vested in the official trustee in bankruptcy in accordance with s58(1). By s5(1), property was defined to mean "real or personal property of every description". The right of the respondents to bring an action, such as the present proceedings, was property that vested in the official trustee. That chose in action was part of their property which became divisible amongst their creditors (s116(1)). Once they had become bankrupt, the recovery of any loans that had been made to them became unenforceable against them or their property (s58(3)), any amounts due from them becoming debts provable in their bankruptcies (s82).

37 Upon their discharge from their bankruptcies on 15 December 1991, they were released from all debts provable in their bankruptcies (s153(1)), including any loans they had taken out to set up and operate their businesses. However, their right of action against RBF remained vested in the official trustee. By a deed dated 29 September 1992 (not 29 September 1999 as stated by the learned judge) the official trustee purported to assign to the respondents all his right, title and interest in the chose in action as it existed immediately before the date of the sequestration order. However, notwithstanding the date of the deed, it was held by Slicer J, on the hearing of preliminary issues, that the chose in action was in fact assigned to the respondents on 30 August 1992. See Stocks v Retirement Benefits Fund Board [2003] TASSC 98. The action was commenced by the respondents a few days later on 7 September 1992. In return for the assignment the respondents paid the official trustee $500. The learned judge said that in addition, the respondents entered into a covenant to pay the official receiver 25 percent of the net proceeds of a verdict in their favour, whereas Slicer J said that by the end of the negotiations between them, the covenant was not required, although it had been earlier in the negotiations. Whichever is the case is immaterial to the resolution of the ground of appeal.

38 The damages awarded to the respondents amounted to $71,124.17 and were made up as follows:

Costs thrown away by the respondents in fitting out the shop

Rent paid (which included the deposit of $3,942.10)

Legal costs of the respondents' solicitor concerning the lease documents

Interest in accordance with the principles in Hungerfords v Walker (supra) on $27,558.42 to the date of bankruptcy on 15 December 1988

Interest in accordance with those principles on $27,558.42 from 30 August 1992 (date of assignment) until judgment

39 The learned judge pointed out that in accordance with the Hungerfords principle, the respondents were entitled to recover either the incurred expense, if it was reasonably foreseeable, associated with paying out the sum of $27,558.42, for example interest paid on funds borrowed for the purpose of paying the money, or alternatively, the opportunity cost, if it was reasonably foreseeable, that is the lost opportunity to invest or to maintain an investment because the money had to be paid out. See Hungerfords at 142 - 144. His Honour found that in this case, all the $27,558.42 paid away was borrowed money, for the whole of the Northgate business was established on borrowed money. It was also found that another shop of the respondents at Centrepoint was dependent upon a Commonwealth Bank overdraft and that if in March 2007, RBF had paid them the money that they had paid away as a result of the appellants' tortious conduct, that money would have been applied by them in reduction of that overdraft. As a result of those findings, the parties agreed that $8,565.75 was the appropriate sum for damages in the nature of interest to the date of bankruptcy on 15 December 1988, and it was included in the damages that were awarded. The awarding of that sum is not challenged by the appeal.

40 Concerning damages in the nature of interest following bankruptcy, it was submitted for the defence that all debts owing by the respondents were expunged on bankruptcy and that damages in the nature of interest could not survive the expunging of the debt that the repayment of the monies paid out in reliance on the negligent misrepresentations would have been used to retire. The learned judge had the following to say about that:

"The defendant does not challenge the plaintiffs' right to bring these proceedings, but submits that 'damages in the nature of interest could not survive the expunging of the debt it would have been used to retire'. That debt was not expunged on bankruptcy. The Act operated to prevent proceedings being brought to recover it. The creditors were given the right to prove in the bankruptcies and such proof would have included interest at the relevant rates until payment. The creditors still have the right to recover interest due if there is property available for payment to the creditors. More importantly, the chose in action assigned to the plaintiffs arose in 1986 and includes (inter alia) a right to recover damages being the foreseeable loss of the use of money paid away or withheld. It seems to me that the loss of the use of that money has continued uninterrupted since the time of payment or withholding, and financial loss to the plaintiffs as a result thereof was foreseeable throughout the whole of that period, except the period commencing with bankruptcy and in concluding with the assignment to them of the chose in action. To put this another way, the chose in action has remained intact from the time it arose. For a period of about three years, nine months, it was vested in a person other than the plaintiffs and during that time, they suffered no loss from the loss of use of $27,058.42 [sic]. After the bankruptcies had been discharged and the chose in action assigned to the plaintiffs, it was foreseeable that they would suffer the loss of the use of $27,058.42 [sic] that should have been paid to them, but this time by way of lost opportunity cost, since they were no longer liable to pay interest on the loans."

41 The statement that creditors had the right to prove interest at the relevant rates until payment was incorrect, and the statement that the creditors still had the right to recover interest due if there was property available for payment to the creditors, needs explanation. A creditor, upon whose debt interest is running at the time of bankruptcy, is not entitled to prove for the interest for the period after the date of bankruptcy. Bankruptcy Act, s82(3B). However, against the bankrupt, the creditor is entitled to receive, out of any surplus of the bankrupt estate, interest for the period from the date of the bankruptcy to the payment of the provable debt before any such surplus is payable to the bankrupt. Re Hyman; ex parte Law (1930) 3 ABC 61; Re Richards; ex parte Lloyd (1935) 8 ABC 37 at 46; Mackenzie v Rees [1941] HCA 21; (1941) 65 CLR 1. The interest is only payable out of a surplus and if there is no surplus, interest after bankruptcy cannot be claimed from the debtor. There is no suggestion of any such surplus in this case. Therefore, the respondents and their estates were not liable to pay any interest that may have fallen due after the date of the bankruptcy.

42 The statements by the learned judge that the chose in action remained intact from the time it arose in 1986, that for a period of about three years nine months it was vested in a person other than the plaintiffs and during that time they suffered no loss from their loss of use of $27,058.12 [sic], and that after they had been discharged from bankruptcy and the chose in action had been assigned to them it was foreseeable that they would suffer a lost opportunity cost by reason of their loss of the use of $27,058.42 [sic], also need explanation. As I have said, the right of the respondents to sue RBF was part of their property that vested in the official trustee upon the making of the sequestration order and notwithstanding their subsequent discharge from bankruptcy on 15 December 1991, it remained vested in the trustee until it was assigned back to them on 30 August 1992. What was assigned back to them was the right of action as it existed immediately before the date of the sequestration order. The right included the right to recover damages in the nature of interest from the accrual of the cause of action until judgment, but only to the extent that such loss and damage was foreseeable and proved. The mere making of the sequestration order did not, as a matter of law, suspend the right to recover Hungerfords damages until the right of action was assigned back to the respondents, although the right during that time was vested in the official trustee.

43 In supplementary reasons for judgment, the learned judge considered the question of Hungerfords damages from the date of the assignment on 30 August 1992 until judgment. His Honour approached the question in the following way:

"Not surprisingly, there was a paucity of evidence about what the plaintiffs would have done with the sum of $27,558.42 had it been paid to them some time between 30 August 1992 and now. During that period, there was no evidence that the plaintiffs had any debt carrying interest and thus it might be said that they would have been likely to have made a prudent investment, but, on the other hand, the evidence shows that after bankruptcy, the plaintiffs had a low income and no, or virtually no, assets, [and] may not have made any investment at all. Although it is appropriate to have regard to evidence of investments such as term deposits, at the end of the day, assessment of this head of damage is a matter of judgment and not calculation. The sum must be modest, having regard to the post-bankruptcy circumstances of the plaintiffs which tend to suggest that a term investment would not have been made or, at least, would not have been made for the whole of the period, and the high degree of speculation about what they would have done with the money thrown away, had it been paid to them some time after the chose in action was assigned."

44 The learned judge considered calculations based on evidence of investment interest available on three year term deposits, but adopted a broad brush approach and said that "as a matter of judgment and doing the best I can with limited material, I assess the sum of $25,000 for the plaintiffs' damages during the period 30 August 1992 to date."

45 With respect, the basic approach of the learned judge was erroneous. The appropriate question was not "what the plaintiffs would have done with the sum of $27,558.42 had it been paid to them sometime between 30 August 1992 and now". The question to be asked concerned what foreseeable loss of a Hungerfords kind was in fact suffered by the respondents as a result of them paying out a total of $27,558.42 between May 1986 and March 1987.

46 In his original reasons for judgment, the learned judge made the following findings:

"In this case, all the money paid away was borrowed money, for the whole of the Northgate business was established on borrowed money. In addition, the shop at Centrepoint was dependent upon an overdraft. I find that if in March 1987, the defendant had paid to the plaintiffs the money that they had paid away as a result of the defendant's tortious conduct, that money would have been applied to reduce the plaintiffs' overdraft."

47 It was because of those findings that the learned judge awarded Hungerfords damages of $8,565.75 for the period to the date of bankruptcy, a sum representing interest on the respondents' overdraft with the Commonwealth Bank that would not have had to be paid if they had not expended the $27,558.42. The evidence enabled a finding that approximately coinciding with the making of the sequestration order, whatever was owing on the overdraft was paid back to the Commonwealth Bank when it exercised its powers of sale under a mortgage over the respondents' house that secured their overdraft liability. It was Mrs Stocks' evidence that they "lost" the house a week before Christmas 1988, and it was in that month that the sequestration order was made. She said that nothing was owing to the bank following the sale. The finding was open that but for the tort, $27,558.42 would have been available to the respondents at that time. The next question that had to be considered was what would the respondents have done with the money thereafter. The evidence compelled a finding that it would have formed part of their property that passed to the official trustee upon their bankruptcies. It would have been available for the benefit of their creditors. If the total of the provable debts exceeded the value of their estates, including the $27,558.42, no further loss of a Hungerfords kind would have been suffered. It would all have been expended on repaying debts.

48 If, however, the introduction of $27,558.42 into their estates at that time would have generated a surplus of assets over liabilities, there may have been a surplus left over from the bankruptcy for the personal benefit of the respondents, in which case Hungerfords damages, of the lost opportunity kind, would have needed to be considered. However, the evidence did not allow the making of findings of fact that justified an award of Hungerfords damages for the period following December 1988. There was no evidence of the value of their bankrupt estates and the debts that they owed. It is known that they were discharged from bankruptcy because of the passage of three years from the making of the sequestration orders. It may be inferred from that, and from the fact that the official trustee did not thereupon assign the right of action back to the respondents, that the creditors were not fully satisfied, but the extent of the deficiency is unknown. The respondents carried the burden of proving a Hungerfords kind of loss beyond December 1988 and they did not discharge it. Foreseeability of loss is not enough. Actual loss must be proved. The ground of appeal succeeds. The damages should not have included the item for $25,000.

49 Because the first ground of appeal should succeed, the respondents were not entitled to judgment for negligent misrepresentations. That conclusion benefits the appellants. Whether it benefits RBF may be a matter of contention. Further, the respondents also claimed equitable damages for unjust enrichment. The learned judge did not determine that aspect of their claim. It may need to be remitted for determination. I would hear from the parties before determining what orders should be made.

ANDREW HAROLD EDWARDS and DAVID GEORGE ELLWOOD v

50 The facts, findings made and relevant principles of law are stated in the reasons of Crawford and Blow JJ and do not require repetition. I agree with the reasons and conclusion stated by Blow J in relation to grounds 2 - 7 of the notice of appeal and that those grounds ought be dismissed. I agree, for the reasons given by Crawford J, that ground 8 ought be upheld.

51 The respondent had claimed, by writ dated 7 September 1992, damages for negligent misrepresentation, breach of contract and misleading and deceptive conduct said to have occurred between 7 September 1986 and 31 March 1987. The original statement of claim stated that the respondents had gone into occupation of the shop on 31 October 1986, induced to do so by representations previously made by servants or agents of the second respondents. Those original pleadings included:

"6 The defendant, its servants or agents made the said representations negligently.

7 Further or in the alternative the defendant its servants or agents made the said representations fraudulently and either well knowing that the same were false or recklessly and not caring whether they were true or false.

8 Further or in the alternative by reason of the matters pleaded in paragraphs 3, 4 and 5 hereof the defendant has engaged in conduct which was or was likely to be misleading or deceptive contrary to the provisions of the Trade Practices Act 1974 (Commonwealth).

9 So soon as the plaintiffs discovered that the said representations were untrue or incorrect, the plaintiffs, declined to execute a written agreement for lease proffered by the defendant and subsequently, as they were entitled to do, quit the shop.

10 The defendant, as owner of the shop, took or purported to take the benefit of the improvements to the shop made by the plaintiffs as referred to in paragraph 4 hereof and has to the extent of the value of those improvements been unjustly enriched."

52 The loss and damage said to have been suffered was the cost of shop fit-out, and the claim was for:

"(a) Equitable damages pursuant to paragraph 10 hereof.

(b) Damages for fraudulent and/or negligent misrepresentation.

(c) Damages pursuant to Section 81 of the Trade Practices Act.

(d) Interest.

(e) Costs."

53 The second "further amended statement of claim" dated 30 November 2006 repeated the substance of the original pleading, but extended the time of the making of representations to a period "between December 1985 and October 1986". The particulars of damage were identified as:

Further particulars as have been supplied and vary due to continuing damages in the nature of loss of use of the plaintiffs' money"

"(a) Equitable damages pursuant to paragraph 9 hereof.

(b) Damages for negligent misrepresentations.

(c) Interest."

55 Further and better particulars provided at varying times before trial did not enlarge the basis of the cause of action, although they did specify actual losses said to have been a consequence of, or compounded by, the original harm. The amended defence pleaded the limitation law in the terms:

"... the cause of action relied upon by the plaintiffs in these proceedings accrued more than 6 years before the proceedings were commenced on 7th September 1992, and that the plaintiffs' action is accordingly barred pursuant to section 4(1)(a) of the Limitation Act 1974.

Particulars

The defendant says that the plaintiffs' cause of action accrued:

(a) By 31st May 1986 by which time the plaintiffs had agreed to enter into a lease of the shop and had paid a deposit of $3,942.00 being 1 month's rental for the shop.

(b) Alternatively, on or about 1st September 1986, if the plaintiffs borrowed the sum of $60,000.00 from the Westpac Bank and incurred a liability to pay interest on such borrowings from that date as alleged in paragraph 3 of the amended further and better particulars of the plaintiffs' damages dated 21st February 2005."

56 The action, although based on misrepresentation, was not one directly for loss of future profits or lessened financial return. The claim, based on the entry into an equitable lease, was for damages for the cost of fitting out the premises between November 1986 and March 1987, expenses associated with the lease, and general damages for loss of use of money expended in accordance with the principles stated in Hungerfords v Walker [1989] HCA 8; (1988) 171 CLR 125.

57 The learned trial judge rejected the plea on the basis that the entry into an agreement to lease the premises made in May 1986 gave rise to a contingent loss which did not crystallise until a time within the limitation period. The relevant findings of fact were that:

(1) the first respondents entered into an equitable lease of the premises on 2 May 1986;

(2) legal costs had been incurred in relation to the lease;

(3) the respondent paid a deposit of $3,942 on 31 May 1986, such money being held in a trust account until disbursed on 2 December 1986;

(4) rent was not payable to the second respondent until 17 November 1986;

(5) the first respondents funded their business enterprise from money sourced from the parents of Mrs Stocks and a joint personal loan, guaranteed by the parents, from a financial institution;

(6) the first respondents borrowed the sum of $60,000 from Westpac on or about 1 September 1986 and some of that money ($16,298) was later used for the costs of fitting out the premises.

58 The limitation period commenced on 7 September 1986. The money expended for the fitting out of the premises came within the limitation period but, given the facts agreed by the parties and the finding of the learned trial judge, the entry into a liability to Westpac was outside of that period. The payment of the deposit, likewise outside of the period, was not a payment of rent but one of "earnest" (Howe v Smith (1884) 27 Ch D 89) or guarantee of performance (Soper v Arnold (1889) 14 App Cas 429), permitting forfeiture upon default or allocation towards rent at a future time.

59 The payment of legal expenses made outside the limitation period ought be seen as associated with the entry into the lease itself and its formalisation, and not as a separate or distinct loss or damage governing the plea of limitation. Relevant to this appeal, as matters of loss or harm caused, are the payment of the sum of $3,942 on 31 May and the incurring of the liability to Westpac on 1 September.

60 The learned trial judge, in rejecting the plea of limitation, relied on the contingency principle applied by the High Court in Wardley Australia v Western Australia [1992] HCA 55; (1992) 175 CLR 514, subsequently restated in Murphy v Overton Investments Pty Ltd [2004] HCA 3; (2004) 216 CLR 388.

61 Wardley was an indemnity case. Although it concerned the provisions of the Trade Practices Act 1974 (Cth), ss52 and 82, the court observed that many propositions arising from the effect of that legislation were common to existing common law approaches. In their joint judgment at 526, Mason CJ, Dawson, Gaudron, and McHugh JJ, stated:

"In determining when a plaintiff first suffers economic loss or damage in an action under s82(1) based on misleading conduct constituting a contravention of s52, it is necessary to have regard to the applicable measure of damages. In this respect, it would not be right to conclude that the measure of damages recoverable under the sub-section necessarily coincides with the measure of damages applicable in an action for deceit or in an action for negligent misrepresentation. The measure of damages recoverable under s82(1) can only be fully ascertained after a thorough analysis of those provisions in Pts IV and V of the Act for contravention of which the statutory cause of action may be maintained. But the common law measure of damages will in many cases be an appropriate guide, though it will always be necessary to look to the provisions of the Act with a view to ascertaining the existence of any relevant legislative intention. In a case such as the present, it may safely be assumed that the plaintiff is entitled to recover 'a sum representing the prejudice or disadvantage (the plaintiff) has suffered in consequence of his altering his position under the inducement' (Toteff v Antonas [1952] HCA 16; (1952) 87 CLR 647, at p 650; see also Potts v Miller [1940] HCA 43; (1940) 64 CLR 282, at p 297; Gould v Vaggelas [1985] HCA 75; (1984) 157 CLR 215, at p 220; Gates v City Mutual Life Assurance Society Ltd [1986] HCA 3; (1986) 160 CLR 1, at p 12 (where that measure of damages was applied in an action for damages for contraventions of ss52 and 53(g) of the Trade Practices Act 1974 (Cth)) of the misleading conduct or 'the actual damage directly flowing from' (Clark v Urquhart (1930) AC 28, at p 68; State of South Australia v Johnson (1982) 42 ALR 161, at p 170) that conduct, to take up and adapt well-known statements of the measure of damage applicable in an action of deceit. Whether the condition of foreseeability, applicable to claims for consequential damages in cases of negligent misrepresentation inducing the purchase of property (State of South Australia v Johnson (1982) 42 ALR, at p 170), would apply to a claim for consequential damages under s82(1) is a question that may be put to one side for present purposes."

62 The orthodox or historic approach has been that in the case of the purchase of an asset, here a leasehold, as a result of misleading conduct, damages ought be assessed on the date of entry into an agreement since that is the event which gives rise to an obligation to pay a purchase price on completion (HTW Valuers (Central Qld) Pty Ltd v Astonland Pty Ltd [2004] HCA 54; (2004) 79 ALJR 190; Nykredit Mortgage Bank plc v Edward Erdman Group Ltd (No 2) [1997] UKHL 53; [1998] 1 All ER 305; Pine River Pty Ltd v Scordia [2001] WASC 105). The measure of damages in such a case is often the difference between the contract price and the market value of the property at the date of acquisition. However a party might suffer loss in a number of ways, diminished benefit or value, payment of money, transfer of property, or the incurring of a liability. The type and terms of a transaction might require that damage occurs at the date of entry into the contract, subject to the exception that loss may not occur, even though the disadvantageous contract is entered into (Gates v City Mutual (1986) 160 CLR 1; Forster v Outred & Co [1982] 2 All ER 753; Jobbins v Capel Court Corporation Limited [1989] FCA 538; (1989) 25 FCR 226; D W Moore v Ferrier [1988] 1 WLR 267) until some event in the future occurs which makes the loss reasonably ascertainable.

63 In their joint judgment in Wardley, the majority, Mason CJ, Deane, Gummow and McHugh JJ, stated at 527 as a general proposition:

"Economic loss may take a variety of forms ... When a plaintiff is induced by a misrepresentation to enter into an agreement which is, or proves to be, to his or her disadvantage, the plaintiff sustains a detriment in a general sense on entry into the agreement. That is because the agreement subjects the plaintiff to obligations and liabilities which exceed the value or worth of the rights and benefits which it confers upon the plaintiff. But, as will appear shortly, detriment in this general sense has not universally been equated with the legal concept of 'loss or damage'. And that is just as well. In many instances the disadvantageous character or effect of the agreement cannot be ascertained until some future date when its impact upon events as they unfold becomes known or apparent and, by then, the relevant limitation period may have expired. To compel a plaintiff to institute proceedings before the existence of his or her loss is ascertained or ascertainable would be unjust. Moreover, it would increase the possibility that the courts would be forced to estimate damages on the basis of likelihood or probability instead of assessing damages by reference to established events. In such a situation, there would be an ever-present risk of under compensation or overcompensation, the risk of the former being the greater."

64 In relation to the English cases (referred to above), the majority observed at 531:

"It has been contended that the principle underlying the English decisions extends to the point that a plaintiff sustains loss on entry into an agreement notwithstanding that the loss to which the plaintiff is subjected by the agreement is a loss upon a contingency. For our part, we doubt that the decisions travel so far. Rather, it seems to us, the decisions in cases which involve contingent loss were decisions which turned on the plaintiff sustaining measurable loss at an earlier time, quite apart from the contingent loss which threatened at a later date Forster v Outred and Co and D W Moore and Co v Ferrier illustrate the point."

65 That observation and disapproval of Jobbins (supra) are apposite here. In Karedis Enterprises Pty Ltd v Antoniou [1995] FCA 1356; (1995) 59 FCR 35, Burchett and Hill JJ, in considering Wardley, referred, at 43, to:

"The question ... will be ... the loss which the [tenants] ultimately suffered (or a more than negligible part of it) was either ascertained by them or reasonably ascertainable?"

Here it is a question not whether the cost of fitting out was a significant loss consequent upon a misrepresentation, but whether the payment of the "deposit" or earnest or the incurring of a liability to Westpac was in each case either an ascertained or ascertainable loss, fixing a date of commencement of a limitation period.

66 In his separate judgment in Wardley, Brennan J (as he then was) stated at 537 - 538:

"The quantification of the diminution in value of an asset or of a liability incurred or the value of any benefit acquired may not be ascertainable at the time when the burden of the transaction is borne. In that event, the suffering of any loss cannot be said to occur before it is reasonably ascertainable (not before it is ascertained) that the burdens which the plaintiff has borne are greater than the value of the benefits that the plaintiff has acquired or will acquire. In other words, no loss is suffered until it is reasonably ascertainable that, by bearing the burdens, the plaintiff is 'worse off than if he had not entered into the transaction'.

...

There is a sense in which it is right to say that, when a misrepresentation induces a plaintiff to enter into a transaction in which the plaintiff suffers a loss, the loss is suffered once the plaintiff becomes bound to the transaction. The die is then cast and what follows can be viewed as evidence proving the extent of the loss suffered when the first binding step was taken. That may be the correct analysis when the first binding step is such that, whatever extrinsic circumstances may transpire, a loss must be suffered. For example, when an asset is purchased for a price and, by reason of an inherent defect, it is worth less than the price paid (see Potts v Miller [1940] HCA 43; (1940) 64 CLR 282, at p 298), a loss may be said to be suffered when the plaintiff pays the price or becomes bound to pay the price. Similarly, when an agreement imposes on a plaintiff an obligation to pay an amount of money without acquiring a benefit and the amount to be paid is quantified by no factors extrinsic to the agreement save the passing of time, it is right to say that the loss is suffered when the agreement to pay becomes binding on the plaintiff. But when the actual loss that a plaintiff suffers depends not only on the making of an agreement but also on circumstances extrinsic thereto, the loss is not suffered until those circumstances have transpired and, in benefit and burden cases, not until the loss is ascertainable."

67 Those statements ought not be taken as the "ratio" of Wardley. There remains a distinction between a loss incurred and assessment which might be long delayed. An indemnity or its claimed operation gives rise to the cause of action not a basis for assessment of the measure of damages which might require considerable time before being quantifiable. The general position, as stated by Brennan J, might suggest a future course of authority, but I do not understand the majority to have travelled as far as Brennan J. My understanding of the ratio in Wardley is that there may be situations where it is not possible to ascertain that a loss has been suffered until some future time, as an exception to the ordinary rule, but that the distinction remains between an existing loss, even if not actually ascertained by the party, and a prospective loss which is not capable of being ascertained until some future time. That contingency is the happening of a future event, rather than one simply which has been caused by the misrepresentation (Marks v GIO Australia Holding [1998] HCA 69; (1998) 196 CLR 494).

68 The court applied Wardley in its decision of Marks v GIO Australia Holding (supra). In their joint judgment McHugh, Hayne and Callinan JJ stated at pars47 - 48:

"The bare fact that a contract has been made which confers rights or imposes obligations that are different from what one party represented to be the case does not demonstrate that the party that was misled has suffered loss or damage. The contrary view (which had been adopted by the Full Court of the Federal Court in Jobbins v Capel Court Corp Ltd [1989] FCA 538; 1989) 25 FCR 226) was rejected by the majority in Wardley [1992] HCA 55; (1992) 175 CLR 514 at 528-532 per Mason CJ, Dawson, Gaudron and McHugh JJ.

A party that is misled suffers no prejudice or disadvantage unless it is shown that that party could have acted in some other way (or refrained from acting in some way) which would have been of greater benefit or less detriment to it than the course in fact adopted. Thus, the party that is misled will have suffered loss if a chose in action which was acquired was worth less than the amount paid for it. There may well be other ways in which it might suffer loss or damage. For example, consequential loss may be suffered. But no loss of that kind was alleged in this case and, putting that kind of loss to one side, we focus only on loss said to be suffered by the making of the contract."

The question of consequential loss was not pursued. Wardley and Marks clearly establish that entry by the second respondents into the lease agreement alone would not provide the appellants with a limitation bar.

69 It is contingency of the event, not discovery of a further measurable loss, which governs limitation. Indemnity and guarantee are such events. Here it was the event of, at least, the entry into the agreement with Westpac, which constituted a loss or damage caused by the misrepresentation. In Blacker v National Australia Bank Ltd [2001] FCA 254; [2001] ATPR 41-817, the Federal Court considered the possibility of differing limitation periods between trading and "consequential losses", repeating the earlier statement in Karedis that:

"... the question of when the consequential losses (or more than a negligible part of those losses) were suffered is one of fact. The answer is not necessarily coincidental with the date on which it becomes manifest that the business will not be viable or the losses irrecoverable."

70 Reliance on a test of "more than a negligible part" is fraught with difficulty and weakened by principle. Wardley attracted little academic interest until the High Court had given judgment in Murphy v Overton (supra) (see Murphy v Overton: A further piece in the damages puzzle, McKinnon (2004) 12 TPLJ 197; Assessing loss of damage under sections 82 and 87 of the TPA, Maundrell (2004) Australia & New Zealand Trade Practices Law Bulletin, Vol 20, No 1; Ascertaining when loss is first suffered by misleading conduct: Relevance of contingencies, future predictions and concealment, Christensen and Lumb (2005) 13 TPLJ 149). Murphy involved misleading statements as to the level of maintenance fees which were associated with the lease of a retirement unit and the subsequent charging of a significantly different and higher fee by the representor. In its unanimous judgment, the court (Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ) determined at par55 that "It was only from the time when [Overton] in fact decided to depart from the 1992 position and charge for the wider categories that the adverse risk eventuated. When it did, but only then, the appellants suffered loss and damage."

71 While the court was primarily concerned with the form of losses and their assessment (from which limitation questions might follow) and the differing remedies, it restated, at par46, the effect of Wardley that "risk of loss is not in itself a category of loss" and that:

"Wardley illustrates that it is necessary to identify the detriment which is said to be the loss or damage which has occurred (or, when considering the application of s 87, has occurred or is likely to occur). In that case, the mere entry into obligations which might, but need not, have had detrimental consequences in the future was held not to have occasioned loss or damage to the party making the contract."

72 While the court did not conclude that a loss was necessarily singular and that as a consequence more than one remedy, with differing limitations or defences might be apposite, it did so in the light of the provisions of the statute, the Trade Practices Act, s87. It did not expand the limitation test to the extent suggested by Brennan J in his judgment in Wardley. Whilst one might discern that possibility in Murphy, the court stated, at par56 in relation to an alternate argument advanced by the appellant:

"However, even if one or other of these contentions had succeeded, it would not necessarily follow that all of the appellants' claims were statute barred. That is because while s 82(1) and s 87(1A) may prevent an applicant from suing for some items of loss or damage, they may leave open the possibility of recovering others, even though all items of loss or damage arose from a single piece of contravening conduct. The question was raised briefly in argument but not debated. Its resolution is unnecessary in this case, and should be postponed until some case arises in which its resolution is necessary and it is fully debated."

73 In Karedis (supra), Sackville J summarised his understanding of the effect of Wardley at par45 in terms:

"Wardley, itself, was therefore not a case where the party which had been misled had in fact sustained a loss at the relevant time (that is, in accordance with objective criteria supported by evidence at a subsequent trial), but did not then have the knowledge or the means of ascertaining that such a loss had occurred."

and having quoted from the majority judgment, added at par46:

"This passage suggests that, where the applicant has been induced by misleading and deceptive conduct to enter a lease, as in the present case, no loss is sustained unless and until the existence of the loss is ascertained or ascertainable by the applicant. The significance of 'events as they unfold' is that they bring home, or should bring home, to the lessee that the obligations imposed by the lease exceed the value of any offsetting benefits, such as the lessee's entitlement to conduct a business on the leasehold premises. It would seem that a loss is not sustained simply because evidence given at a subsequent hearing demonstrates, with the benefit of hindsight, that the prejudice or disadvantage in fact sustained by the lessee after taking possession and paying rent outweighed any offsetting advantage."

Here the comparable event was the payment of the "earnest money" in May 1986.

74 In Wardman v Hatfield [2003] NSWCA 283, the New South Wales Court of Appeal was concerned with the liability of a guarantor. In his reasons for judgment, Tobias JA (with whom Meagher and Foster JJA agreed) drew the distinction between actual loss and the quantification of that loss. His Honour stated at pars23 - 25:

"In my opinion, therefore, once the opponents' liability under the guarantee crystallised into an actual liability, he suffered loss which completed his cause of action against the claimants. Although it was submitted by the opponent that any monetary loss sustained by him could not be ascertained until judgment had been obtained in the landlord proceedings, that argument confuses the difference between sustaining an actual and measurable loss on the one hand and the quantification of that loss on the other. That distinction was referred to by Kaye J in Van Win in the following terms (at 489):

'that confusion is likely to enter into consideration of this type if the distinction between damage occasioned from a tortious act and damages resulting or flowing from such damage, injury or harm is not kept clear. Damage is injury or harm resulting from a wrongful act while damages are compensation and money awarded for the resultant injury or harm.'

A similar point was made by Cohen J in Vining v Marsden & Ors, 25 November 1996 (unreported) where, after citing from the joint judgment in Wardley, his Honour said:

'Thus the distinction to be drawn is on the one hand where there is a potential loss which may be suffered dependent upon a contingency, and on the other hand where a loss is suffered immediately even though the assessment of the damages might itself require a consideration of contingencies. In the case of the former situation time will not commence to run until the happening of the contingency, which is the first time when it can be said that damage has been suffered. In the latter case time runs as soon as some form of damage is suffered, even though the ascertainment of the amount of that damage might require the taking into account of unknown but possible situations.'

In the present case, the primary judge (in the passage from his judgment which I have set out in [9] above) has, with respect, confused the distinction to which Cohen J referred. Although his Honour recognised that it was necessary for the opponent's obligation under the guarantee to 'crystallise', he appears to have interpreted the time of crystallisation as the point at which it was possible to accurately quantify the opponent's claim, which was only when Cawood obtained judgment against the opponent on the guarantee in the landlord proceedings."

75 His reference to Van Win was to the Victorian case of Van Win Pty Limited v Eleventh Mirontron Pty Limited [1986] VicRp 49; [1986] VR 484 which concerned limitation of third party proceedings where the damage claimed was "inchoate". (See also St George Bank Limited v MJK Pty Ltd [1999] FCA 1752.) Here the loss suffered was the payment to the lessor's agent and the entry into a liability with Westpac.

76 In HTW Valuers (Central Qld) v Astonland Pty Ltd (supra), the High Court in a joint judgment (Gleeson CJ, McHugh, Gummow, Kirby and Heydon JJ) distinguished both Wardley and Murphy in a case involving valuation advice given on the profitability of a shipping complex. The trial judge had found that the relevant measure of damage was the difference between the purchase price and its value after a year's operation. The court rejected the reasoning, since it proceeded on the assumption that the purchaser had suffered no loss at the time of purchase. Whilst the court was dealing only with the method of assessment and not limitation, it dealt indirectly with the respective ratios of Wardley and Murphy. The vendor had advanced two bases of critique on the original reasoning, namely:

(1) the purchaser had suffered a loss at the time of purchase, namely the difference between the price agreed and the value of the property as at that date;

(2) loss suffered through retention was not compensable.

77 In relation to those propositions and relevant to limitation, the court stated at pars27 - 30:

"In this Court, the plaintiff attempted to support the reasoning of the courts below; against the possibility of that endeavour failing, it fell back successively on the two arguments it had put to the trial judge.

The plaintiff's endeavour to support the reasoning of the courts below must fail, because the first criticism of that reasoning made by the defendant is unquestionably correct and sufficient to undermine it entirely. If the plaintiff had learned the day after entering the contract to buy the Plaza, or the day after completing that contract, that the defendant's conduct had been misleading in the sense ultimately found by the trial judge, it could have started proceedings then and there. There was unchallenged evidence from Mr Dodds that on either of those dates the plaintiff was in fact worse off as a result of the defendant's breach, since the market value was less than the price. It was not necessary to wait for nearly two years to ascertain that some loss had been suffered. The plaintiff could have found out at once that it had bought something which was worth less than that which it had agreed to pay and did pay. It could have recovered at least the difference between the price paid for, and the market value of, the Plaza. The limitation period would have begun to run.

It is incorrect to treat this case as being like Wardley Australia Ltd v Western Australia, on which the trial judge relied. That case held that a risk of loss is not itself a category of loss, and that if a plaintiff enters a contract exposing it only to a contingent loss or liability, the plaintiff 'sustains no actual damage until the contingency is fulfilled and the loss becomes actual' (Wardley Australia Ltd v Western Australia [1992] HCA 55; (1992) 175 CLR 514 at 532 per Mason CJ, Dawson, Gaudron and McHugh J). The plaintiff was not exposed to a contingent loss; it had suffered an actual loss.

Nor is the present case one like Murphy v Overton Investments Pty Ltd [2004] HCA 3; (2004) 78 ALJR 324; 204 ALR 26. There the applicants had been induced to enter into a lease and incur an obligation to pay charges for outgoings. Whether the charges would rise above the level stated before the applicants entered the lease was contingent in the sense that it was not inevitable: the contingency could never eventuate unless the respondent exercised its discretion to increase the charges. There was thus a contingency hidden by the respondent's conduct which might or might not come to pass (Muprhy [2004] HCA 3; (2004) 78 ALJR 324 at 333 [55], 336 [70]). But in this case the risk of the catastrophic effect on rent levels of the Plaza after March 1999, to which the defendant had not alerted the plaintiff, had already had an impact on the value of the Plaza by April 1997. That, on the evidence, was not the case in Murphy v Overton Investments Pty Ltd [2004] HCA 3; (2004) 78 ALJR 324 at 329 [26]. The impact of the Beach Road Shopping Centre, unlike the contingency in Murphy v Overton Investments Pty Ltd, was not hidden and did not rest on any discretionary decision by anyone."

"At either of the relevant times, that is, the time when the contract was entered into or the time when it was completed, s 82(2) of the Act provided for a limitation period of 3 years 'after the date on which the cause of action accrued'."

78 The court did not revisit the question of differing limitation periods raised in Murphy. The Limitation Act required that the cause of action be "accrued". The fitting out of the shop might be a loss suffered as a consequence of the misrepresentation, but by that time the cause of action had accrued, either on 31 May or 1 September 1986.

79 For the purpose of this appeal, I will accept the characterisation of the May payment as a payment in the form of a loss, for the reasons given by Crawford J. But, irrespective, the entry into a liability to Westpac was a loss caused by the misrepresentation. It was both ascertained and ascertainable. Even if the moneys advanced by Westpac had not been fully appropriated as at 1 September 1986, the liability was a loss, the measure of which could be later determined by how much had been used and required repayment.

80 Here the representations found by the learned trial judge related not to projected future earnings but to an estimated traffic flow, the absence of a Tatslotto kiosk, the presence of specialty shops, and the nature of the Coles operation. The nature of the representations was relevant to both causation and form of loss. The respondents entered into a liability to Westpac and as a consequence of those representations, that liability was incurred outside of the limitation period. The initial entry into the lease agreement was not a loss in itself, but entry into an agreement with Westpac was both an ascertainment and ascertainable loss. The ground ought be upheld.

81 For the purpose of disposing of all matters raised on this appeal, I would agree with the calculation of $46,124.17 reached by Blow J in relation to the upholding of the appeal, ground 8.

ANDREW HAROLD EDWARDS and DAVID GEORGE ELLWOOD v

83 This appeal arises from an action for damages for negligent misrepresentation in respect of the leasing of a shop. One of the respondents, the Retirement Benefits Fund Board ("the landlord"), was at all material times the owner and developer of the Northgate Shopping Centre at Glenorchy. The appellants, Mr Edwards and Mr Ellwood, acted as its agents in negotiations with prospective tenants prior to the opening of the shopping centre. It opened on 17 November 1986. The other respondents, Mr and Mrs Stocks, whom I will refer to as "the respondents", negotiated with the appellants and leased a shop in the shopping centre. They subsequently brought an action against the landlord, alleging that the appellants, as its agents, had made negligent representations relevant to the profitability of the shop during the lease negotiations, and that they had suffered damage as a result of reliance on those representations. The landlord brought third party proceedings seeking an indemnity from the appellants. The proceedings went to trial. Findings of negligence and reliance were made. It was ordered that judgment be entered for the respondents against the landlord for $71,124.17. The appellants were ordered to indemnify the landlord. This is an appeal from those orders. The grounds of appeal relate to issues concerning liability (grounds 2 to 7), a limitation defence (ground 1), and the quantum of damages (ground 8).

84 In their amended statement of claim, the respondents pleaded that four representations had been made by the appellants as agents for the landlord, as follows:

"(a) That Coles Super K and Venture had been confirmed as two of the 3 major retailers for the Northgate Shopping Centre.

(b) That approximately 50,000 people would pass through the Northgate Shopping Centre per week.

(c) That a Tattslotto agency would be situated in close proximity to the shop.

(d) That nearly all the shops at the Northgate Shopping Centre had been let and that only three were then available for lease."

85 The learned trial judge made findings as to representations made to Mr Stocks at "a meeting about the end of January 1986", as follows:

• That Mr Edwards and/or Mr Ellwood told Mr Stocks "that Coles was committed to being the major tenant at Northgate and that it would operate a super store there".

• That the words then used "conveyed the impression that the Coles store would be very large and would comprise a supermarket with a substantial area devoted to the sale of variety goods".

• That "Mr Stocks was told by the same people that the estimated pedestrian traffic flow was approximately 50,000 people a week and that a Tattslotto agency would be established at a kiosk in the centre of the specialty shops area".

• That Mr Stocks was told "that nearly all the shops were let and that there were only three left".

86 When the learned trial judge was setting out his findings as to the representations made to Mr Stocks, he omitted to mention the allegation of a representation concerning Venture. He made a number of references to Venture earlier in his reasons, as follows:

•

He said that, by the time of the first meeting, Venture had not been a prospective tenant for the preceding seven months.

•

He referred to a meeting on 20 January 1986, not attended by Mr Stocks, when Mr Edwards agreed to re-approach Venture to see if they would reconsider their position.

•

He referred to evidence from Mr Stocks that Mr Ellwood told him that both Super K and Venture were confirmed major tenants for Northgate.

•

He referred to evidence from Mr Edwards that he had never told anyone that Venture was going into Northgate.

•

At one point he commented, "I find it is extremely unlikely that Mr Edwards would have said to Mr Stocks that Venture had been thinking of going into the Centre but had pulled out several months ago."

•

He referred to evidence of a tendency on the part of Mr Edwards to overstate the position.

•

He referred to inconsistencies between documentary evidence and Mr Edwards' evidence as to what was said about Venture.

•

He observed that Mr Stocks had written "Venture" in a space on a plan at some unknown time, and that that corroborated the evidence that Mr Stocks was told something about Venture.

•

He said he gave no credit to a denial by Mr Edwards that he had told Mr Stocks that Venture was committed.

•

He referred to a number of matters that, he said, generally adversely affected Mr Edwards' credit.

•

He referred to evidence from Mr Ellwood that his practice, if asked by a prospective tenant whether Venture was going into the centre, was to explain that they had a proposal from Venture at one stage, but that it had been withdrawn. He said he treated that answer with considerable scepticism.

•

He referred to evidence from a Mr Shea that Mr Ellwood had told him that Venture had signed a lease, and that he had written "Venture" on a plan as a result. He said that that corroborated Mr Stocks' evidence concerning statements made about Venture being a tenant.

87 Although when his Honour made findings as to the other pleaded representations, he omitted to state any conclusion in relation to Venture, he made the following general statement in the last paragraph of his reasons, when dealing with the third party proceedings:

"I find that the first and second third parties breached the duty they owed the defendant and acted in excess of their authority by making the pleaded representations when they did."

That implies that his Honour was satisfied on the balance of probabilities that all the pleaded representations, including the one relating to Venture, were made during the same meeting.

88 The learned trial judge also made findings relevant to the issue of negligence, to the following effect:

•

Coles was arranging to become a tenant when the representations were made, and did become one, but a Super K store was not part of the arrangement.

•

The situation as to Venture was as outlined above.

•

There was no sound basis for a prediction of 50,000 people per week passing through Northgate.

•

The location of a Tattslotto agency in close proximity to the shop was never more than a proposal under discussion.

•

At the time the representations were made, no leases had been signed, but only a limited number of shops were not the subject of discussions with prospective tenants. The statement that only three shops were left available for lease was not true.

Grounds 2 and 3 - Timing of the representations

89 Grounds 2 and 3 of the grounds of appeal relate to the findings as to the making of the representations. They read as follows:

"2 The learned trial judge erred in law and in fact and acted against the evidence and the weight of the evidence in determining that the representations the subject of the plaintiffs' claim were made in January 1986 or on any date prior to March 1986.

3 The learned trial judge erred in law in considering whether the representations the subject of the plaintiffs' claim were made in January 1986 or on any date prior to March 1986 when the plaintiffs' claim as pleaded was that the representations were made in March 1986."

90 The respondents pleaded in the statement of claim that the alleged representations "were made to the plaintiffs orally on divers [sic] dates between early December 1985 and October 1986". The statement of claim was amended several times, but those words always remained unchanged. A request for further and better particulars was made by the landlord's solicitors in March 2004. As to each alleged representation, they asked the respondents' solicitors to state "the dates on which the representation was made". As to each of the pleaded representations, the respondents' solicitors replied, "In or about March 1986". During the trial, the particular relating to the representation about a Tattslotto kiosk was amended to read, "In or about March or April 1986" but that amendment is of no present significance.

91 When opening the respondents' case at the trial, their counsel initially referred to two meetings attended by Mr Stocks at the appellants' offices. The first was initially described by counsel as being "in about October of 1985", but later described by him as being "in October of 1985". The second was said to have been in March 1986. Later in his opening, counsel said the following:

"This morning I opened that there were two meetings between Mr Stocks and Mr Ellwood and/or Mr Edwards, the first of those in October of 1985 and the second in March of 1986, however over the luncheon adjournment I've been instructed that there was in fact only one meeting of any real substance that took place and that Mr Ellwood and Mr Stocks commenced that meeting and were later joined by Mr Edwards. Mr Stocks will say that he cannot now say with certainty when that meeting took place except to say that he believes that it was in or after December of 1985."

92 Mr Stocks gave evidence at the trial of the making of the representations at a meeting at the appellants' offices, and as to the timing of that meeting. When asked by his counsel when he went to the appellants' offices, he replied, "I think that was around March of '86". Under cross-examination, he said that he had had a conversation with Mr Edwards about leasing a shop in Northgate before writing a letter dated 10 October 1985. Subsequently his counsel cross-examined each of the appellants on the basis that the crucial meeting took place "in or about" March 1986. None of the witnesses gave any specific evidence as to the date of the meeting.

93 The learned trial judge made a finding that the first meeting attended by Mr Stocks at the appellants' offices, that being the meeting at which the pleaded representations were made, was "in about January 1986 and not 'about March' as Mr Stocks said in his evidence."

94 The appellants contend that that finding was not open to the learned trial judge. Their counsel said the following in his written outline of submissions:

"Given that the case as particularised by the plaintiffs and the entire trial was conducted on the basis that the crucial meeting took place in March 1986 it was not open to the learned trial judge to make a finding that it took place two months earlier. Doing so was procedurally unfair as the cross examination of the plaintiffs [sic] witnesses was predicated on the particulars they filed and the evidence given by Mr Stocks as to the date of the crucial meeting. No opportunity was ever afforded to the defendant or the third party to address either in evidence or argument the proposition that the crucial meeting was two months earlier than had been asserted throughout."

95 The significance of an inconsistency between particulars and evidence was considered by the High Court in Dare v Pulham [1982] HCA 70; (1982) 148 CLR 658. In that case, at 664, Murphy, Wilson, Brennan, Deane and Dawson JJ said (omitting case references):

"Apart from cases where the parties choose to disregard the pleadings and to fight the case on issues chosen at the trial, the relief which may be granted to a party must be founded on the pleadings ... . But where there is no departure during the trial from the pleaded cause of action, a disconformity between the evidence and particulars earlier furnished will not disentitle a party to a verdict based upon the evidence. Particulars may be amended after the evidence in a trial has closed ... , though a failure to amend particulars to accord precisely with the facts which have emerged in the course of evidence does not necessarily preclude a plaintiff from seeking a verdict on the cause of action alleged in reliance upon the facts actually established by the evidence."

96 Clearly, for these grounds of appeal to succeed, it is not enough for the appellants to show that there has been a disconformity between the particulars and the findings of fact. It is necessary for them to establish that the making of the finding as to the timing of the representations involved procedural unfairness, or that that finding was one that should not have been made because it was "against the weight of the evidence".

97 If a departure from a plaintiff's case as particularised, or a late change in the nature of the plaintiff's case, results in unfair prejudice to the defendant, it is not open to the trial judge to make a finding in the plaintiff's favour that is inconsistent with the case as originally particularised or presented. Counsel for the appellants relied on Nambucca Shire Council v Connor [2004] NSWCA 13, a decision of the New South Wales Court of Appeal. In that case the plaintiff had succeeded on the basis of an allegation of negligence which, although mentioned in her particulars, had not been relied upon at trial. The appeal succeeded on the basis that there had been procedural unfairness.

98 In this case, the landlord and the appellants contended at that trial that the pleaded representations had not been made at all. Their fall-back position was that, if any or all of the pleaded representations were made, they were not made until after Mr Stocks had made up his mind once and for all to lease a shop in Northgate; that they therefore did not induce him to lease the shop or otherwise act to his detriment; that he and his wife did not act to their detriment in reliance upon them; and that the action should therefore fail. Mr Stocks was the only witness who gave direct evidence of the making of the pleaded representations. The appellants' principal contention as to unfair prejudice is that the cross-examination of Mr Stocks was conducted on the basis that the pleaded representations were alleged to have been made in March 1986, and not earlier.

99 Counsel for the appellants submitted that the finding that certain representations were made to Mr Stocks in about January 1986, rather than March 1986, defeated an argument that Mr Stocks had made up his mind to lease a shop in Northgate once and for all before any relevant representations were made. That argument was based on two answers given by Mr Stocks in cross-examination. I need to explain a little as to the context of those answers. Initially Mr Stocks was interested in Shop 17 at Northgate, which had a floor area of some 86 square metres. Eventually he and his wife rented Shop 31, which had a floor area of 135 square metres. Mr Stocks wrote Mr Edwards a letter dated 11 February 1986, in which he referred to a "recent discussion" concerning the smaller shop. Mr Stocks' cross-examination in relation to that letter included the following questions and answers:

"I suggest to you that you were in fact, at this point, committed to proceeding with a lease of a shop in the Northgate Shopping Centre? ... Yeah, discussion of leasing, yeah.

You were committed in your own mind to acquiring a shop in the Northgate Shopping Centre on the 11th of February 1986? ... That's correct, yeah."

Counsel for the appellants submitted that these answers established that the appellants' final decision to lease a shop in Northgate had been made by 11 February 1986. As I understand his argument, he contends that he would have cross-examined Mr Stocks differently if the respondents' case had then been that the representations were made in or about January 1986.

100 In my view, despite the state of the particulars, it must have been clear to all following the opening speech of counsel for the respondents (then the plaintiffs) that their case was that the pleaded representations were made at a meeting whose date could not be specified, but which took place in or after December 1985. Neither Mr Stocks nor his counsel ever asserted specifically that the meeting took place in March 1986. Mr Stocks' evidence - "I think that was around March of '86" - suggested a degree of uncertainty ("I think") as well as imprecision ("around March"). He was giving evidence in late 2006 about lease negotiations that took place in late 1985 and/or early 1986, over 20 years earlier. By the end of Mr Stocks' evidence-in-chief, the case presented was that the pleaded representations had been made at a meeting, and that that meeting was possibly in or around March 1986, and not earlier than December 1985. It follows that the making of a finding that the representations were made at a meeting in or about January 1986 did not involve any procedural unfairness.

101 I turn to the question of whether that finding is impeachable on the basis that it was "against the weight of the evidence". The evidence relied on by the learned trial judge as the basis for the finding as to the timing of the critical meeting comprised the following:

• A memorandum from Mr Ellwood to Mr Edwards dated 29 January 1988, in which Mr Ellwood said, "My discussions and meetings with Mr Stocks during the early days were quite numerous ...".

• Evidence given by Mr Stocks during his evidence-in-chief to the effect that the representations were made at the first meeting that he attended at the appellants' offices in Collins Street, Hobart.

• A diary note made by Mr Edwards in January 1986, which referred to Shop 17 being too small for Mr Stocks.

• Mr Stocks' letter to Mr Edwards dated 11 February 1986.

• The minutes of a management committee meeting of 10 March 1986, which showed that Mr Stocks was still interested in the smaller shop, not Shop 31, at that time.

102 As well as saying in his evidence-in-chief that he thought the critical meeting was around March 1986, Mr Stocks said in re-examination that the representations were made at a meeting that led him to become interested in a tenancy of greater than 86 square metres. Having regard to the documentary evidence, any such meeting must have been on or after 10 March 1986. However those pieces of evidence were potentially inconsistent with his evidence that the representations were made at the first meeting that he attended at the appellants' offices. The documentary evidence tended to suggest that that first meeting was in or about January 1986, as the learned trial judge found.

103 Counsel for the appellants also relied on a body of evidence that relates solely to the representation concerning the Tattslotto agency. There was evidence, in minutes of a meeting held on 3 June 1986, that a Mr Forsyth had made an offer in respect of Kiosk 4 at Northgate. There was evidence that Mr Forsyth was a newsagent; that he was interested in operating a Tattslotto kiosk at Northgate; and that a kiosk was proposed near Shop 31. There was evidence from Mr Edwards that it was his understanding that the developers had always wanted a Tattslotto outlet to be located at a kiosk near the entrance to Coles; that his discussions with Mr Forsyth took place "probably through a six month period"; and that those discussions ended in about October 1986. There was also an entry in the minutes of a management committee meeting of 24 February 1986 relating to arrangements for the nomination of kiosk locations. The learned trial judge rejected a submission to the effect that Mr Stocks' evidence as to a representation about a Tattslotto kiosk should be rejected because the first mention of an offer by Mr Forsyth to take a lease of Kiosk 4 was in the minutes of 3 June 1986. Plainly it was open to his Honour to do so.

104 It was open to the learned trial judge, when making findings as to the timing of events, to give greater weight to the documentary evidence than to evidence based on memories of events more than 20 years ago. It was open to him to find, on the basis of Mr Ellwood's memorandum of 29 January 1988, that Mr Stocks attended a number of meetings at the appellants' offices. It was open to him to infer that the first such meeting must have been in or about January 1986, when a lease of Shop 17 was still being contemplated, rather than in March 1986, or after a lease of Shop 31 had been proposed. It follows that the finding as to the date of the meeting was not "against the weight of the evidence". I therefore need not refer to the principles applicable to an appeal on such a ground. Grounds 2 and 3 must fail.

"4 The learned trial judge erred in law and in fact and acted against the evidence and the weight of the evidence in finding that the plaintiffs relied on the representations the subject of the plaintiffs' claim in deciding to take a lease over a shop in the Northgate Shopping Centre."

106 The impugned finding, and the reasoning relating to it, appears in par96 of his Honour's reasons, which reads as follows:

"Mr Stocks gave direct evidence that he was induced by the representations to take a lease of shop 31 at Northgate, and as Mr Sealy submitted, common sense decrees that that was the case. It was common ground with respect to all the parties to this litigation that a critical element in the success of Northgate was the extent of custom that would be attracted to the centre. It was also common ground that the statements claimed to have been made as negligent misrepresentations were, if made, all probative of that critical element. All the misrepresentations were about matters that were peculiarly within the knowledge of the defendant and its agents, and the plaintiffs were entirely dependent upon them when making a decision whether to take up a lease or not."

107 In his submissions relating to this ground, counsel for the appellants referred to a body of evidence as to Mr Stocks' enthusiasm for the idea of leasing a shop in Northgate. From about August 1985, he and his wife were in business together running a shop in Hobart, selling hair products and discount cosmetics. He spoke to Mr Edwards in early October 1985 about leasing a shop in Northgate to sell discount cosmetics. He followed up that conversation with the letter of 10 October 1985, in which he said that he would like to expand to Northgate; that he would require floor space of approximately 60 x 70 square metres; and that he would also like to submit an application for an ice cream parlour. When cross-examined, he agreed with a suggestion that he "just popped up" and that he had said, "I'm really interested in getting a shop in there." He gave evidence that he did research into the demographics of Glenorchy, that he prepared some cashflow projections with his accountant, and that he considered the likely demand in the Glenorchy area for the sorts of products that he proposed to sell there. But all that evidence was evidence of enthusiasm, as distinct from direct evidence as to decision-making.

108 Counsel for the appellants relied heavily on the two questions and answers that I quoted when dealing with grounds 2 and 3, ie the evidence that, as at 11 February 1986, Mr Stocks was committed to a discussion of leasing, and committed in his own mind (whatever that means) to acquiring a shop in Northgate. Counsel submitted that the pleaded representations could not have been made before March 1986; that Mr Stocks' commitment in his own mind meant that he had decided once and for all to lease a shop in Northgate by 11 February 1986; and that he therefore could not have placed any reliance on the representations. However I have already concluded that the finding that the representations were made in about January 1986 is unimpeachable. It follows that that submission should be rejected.

109 The minutes of a meeting of tenants held on 11 September 1986, which were tendered as an exhibit, show that Mr Stocks attended that meeting, and that the meeting was told that there were then still twelve vacant shops in Northgate. That information was inconsistent with the representation, found to have been made in about January 1986, that nearly all the shops were let and that there were only three left. Despite knowing that there were twelve vacancies, the respondents went into occupation some weeks later. However it is common ground that the respondents entered into an agreement to lease the premises, which the learned trial judge held to constitute an equitable lease, apparently with effect from some later date or event, on 14 May 1986. The evidence of knowledge of the true number of vacancies in September is not inconsistent with the proposition that the respondents were induced by the false representation as to the number of vacancies to enter into the agreement to lease Shop 31.

110 In my view it is quite clear that the finding of reliance, ie that Mr Stocks was induced by the representations to take the lease, was a finding that was open to the learned trial judge, and not a finding that was contrary to the evidence or the weight of the evidence. It was open to his Honour to reason, as he did, that the circumstances of the development of the shopping centre made it likely that the respondents would depend on the landlord and its agents for information as to matters concerning the likely success of Northgate.

111 Counsel for the appellants submitted that the reasons of the learned trial judge did not adequately address the arguments advanced on behalf of the appellants and the landlord on the question of reliance. Their principal argument on this question was that the respondents made their own decision to lease a shop in Northgate completely independently of any representations made by the appellants. The grounds of appeal do not contain any assertion that the learned trial judge erred by failing to provide adequate reasons for his decision, but I will still deal with this submission. The learned trial judge mentioned, in par10 of his reasons, that the landlord and the appellants denied that the respondents were induced by the pleaded misrepresentations to enter into occupation of a shop at Northgate. He referred to the evidence as to Mr Stocks' letter of 10 October 1985, his previous conversation with Mr Edwards, and a letter that Mr Edwards wrote in reply dated 15 October 1985. After summarising the evidence as to the making of the representations, his Honour said the following:

"Mr Stocks said that he left the meeting with a good impression of the prospects for a discount cosmetics shop, thinking that a combination of the major tenants, the fact that almost all the shops were let, the positioning of the Tattslotto agency and the pedestrian traffic survey together, all pointed to a volume of shoppers sufficiently high to make his proposed business successful. He went home and discussed it with his wife and they decided to enter into negotiations for a lease."

112 At par94 of his reasons, after referring to the evidence concerning the negotiations as to Shops 17 and 31 in February and March 1986, his Honour said, "All of this material indicates that the plaintiffs were keen to get a shop in Northgate soon after the initial meeting ...".

113 It is true that his Honour did not advert to the argument that the respondents made their own decision to lease a shop completely independently of any representations. However he made very clear the evidentiary basis and reasoning process that led to the finding as to reliance. As Mahoney JA said in Housing Commission of New South Wales v Tatmar Pastoral Co Pty Ltd [1983] 3 NSWLR 378 at 386, "Reasons need be given only so far as is necessary to indicate to the parties why the decision was made and to allow them to exercise such rights as may be available to them in respect of it." Bearing that principle in mind, I think it is clear that the reasons of the learned trial judge in relation to the reliance issue were adequate. He was not obliged to summarise and refute every unsuccessful argument that was put to him.

"5 The learned trial judge erred in law in finding that the representation concerning projected pedestrian traffic was a negligent misrepresentation."

The learned trial judge made a finding that Mr Stocks was told by the appellants at the crucial meeting "that the estimated pedestrian traffic flow was approximately 50,000 people a week". The appellants contend that it was not reasonably open to the learned trial judge to find, on the evidence, that such a representation was negligent.

116 There was evidence that, in the latter half of 1986, ie months after the representation in question was made, a Melbourne company named Plant Location International (Australia) Pty Limited provided "indicative information" as to "possible weekly pedestrian volumes for Northgate". That company's figure, based solely on calculations relating to a shopping complex in the Melbourne suburb of Burwood, was that the anticipated total weekly pedestrian volume was 59,000 persons.

117 In February 1988 Mr Edwards prepared a memorandum setting out his recollections of relevant events. That document contains the following as to anticipated pedestrian traffic:

"It was not until later in the leasing up period around about September 1986 that Plant Location were requested to provide a specific statement as to the number of customers likely to go through the Centre.

Bill White organised this and I recall their estimate to be around 59,000 people. I deemed this to be excessive and at no stage did we ever quote figures of 50,000 or more.

I had always anticipated that we would get slightly less than double Glenorchy Central which at that stage, according to Rudie Sypkes, was putting through about 25,000 per week. I had always advised tenants that we anticipated approximately 40,000 per week ...".

118 Counsel for the appellants made the following points in relation to this ground:

• There was evidence that Mr Edwards was an experienced real estate agent and valuer.

• The evidence as to the subsequent estimate of 59,000 pedestrians per week by Plant Location International suggested that his prediction of 50,000 pedestrians per week was reasonable.

• When optimistic predictions later prove to be inaccurate, it does not necessarily follow that, at the time of their making, a belief in their accuracy was unreasonable.

119 At par65 of his reasons, the learned trial judge said of Mr Edwards that "his desire to see Northgate fully tenanted led him to exaggeration and the making of false statements". As to the issue of negligence in relation to the representation concerning pedestrian traffic, his Honour reasoned that the only basis for the representation was an unsubstantiated guess, and that the estimate proved to be very inaccurate. It is implicit in his Honour's reasons that those findings led him to conclude that the making of the representation was negligent. What his Honour said, at par91, was as follows:

"The basis for the representation about the pedestrian traffic flow was Mr Edwards' unsubstantiated guess that the weekly traffic flow through Northgate would be twice the number that a competitor told him went through his centre each week. The evidence establishes that less than half the number represented by Mr Edwards went through Northgate each week. In a memorandum to the defendant written by Mr Allingham on 13 March 1987, Mr Allingham stated that, 'It has been indicated to the writer that the pedestrian traffic through the Centre is in the order of 20,000 per week rather than the 40,000 - 45,000 stated in the Plant Location Study.' Mr Shea complained to Mr Edwards by letter dated 13 March 1987 that, amongst other matters, the pedestrian traffic through Northgate was not as high as had been estimated. In his reply dated 18 March 1987 Mr Edwards says, 'Although we expected more than 20,000 passing through the Centre per week nowhere was it stated that 56,000 or thereabouts would be passing through the Centre.' This is the only evidence of the number of people passing through Northgate each week after it opened and I accept it."

120 In my view, the figure attributed to Mr Sypkes was an unreliable starting point for a prediction of pedestrian traffic volumes in Northgate. It was a round figure. According to Mr Edwards' evidence in cross-examination, it was provided during "some discussions" with Mr Sypkes. Mr Sypkes apparently controlled the Glenorchy Central shopping centre, with which Northgate was going to compete. There was no suggestion that Mr Sypkes substantiated his figure in any way.

121 According to Mr Edwards' evidence, he formed the view that the pedestrian traffic at Northgate would be likely to be slightly less than double that at Glenorchy Central. Under cross-examination, he said that he could not recall what considerations he took into account in forming that view.

122 There was no suggestion that, in estimating the amount of pedestrian traffic, he took into account the possibility of Northgate not being fully tenanted.

123 The evidence that Plant Location International later provided an estimate of 59,000 pedestrians per week is of little value for the purpose of assessing the reasonableness or otherwise of Mr Edwards' prediction. For one thing, that estimate was based on an assumption that Northgate would be fully tenanted. Further, the estimate was based on data concerning a single shopping centre of similar size, but described as "differently compositioned", without any reference to comparable data in respect of any other Australian suburban shopping centres of similar size. The report of Plant Location International did not undertake any analysis or consideration of factors relevant to the comparability or otherwise of the Burwood data. The raw information relating to the Burwood centre is of little value for the purpose of assessing the reasonableness or otherwise of Mr Edwards' prediction. The fact that it was contained in a report by a consultant adds little or nothing to its weight.

124 The learned trial judge accepted, on the basis of the available documentary evidence, that the pedestrian traffic through Northgate as at March 1987 was in the order of 20,000 per week. When a prediction as to something like pedestrian traffic volume does not come true, it does not necessarily follow that the person making the prediction failed to exercise reasonable care in making it. However, in the circumstances of this case, the gross discrepancy between the prediction of approximately 50,000 pedestrians per week and the estimated actual traffic of 20,000 per week is so significant that, in my view, it was open to the learned trial judge to use that estimated figure as a piece of circumstantial evidence tending to prove that the making of the representation in question was negligent.

125 Taking all of these matters into account, it was clearly open to the learned trial judge to conclude that the making of the representation as to future pedestrian traffic was negligent. Ground 5 must therefore fail. Even if it were to succeed, this appeal would still have to be dismissed unless one or more other grounds of appeal, relating to the other misrepresentations, were also to succeed.

"6 The learned trial judge erred in fact in finding that it was common ground that the statements claimed to have been made as negligent misrepresentations were, if made, all probative of the extent of custom that would be attracted to the Northgate centre.

7 The learned trial judge erred in finding that the plaintiffs had made out their cause of action in negligent misrepresentation in that there was no evidence to support a finding that any of matters the subject of the pleaded representations even if made, had any impact on the patronage of Northgate generally in the 16 week period 17 November 1986 to 13 March 1987 during which the plaintiffs operated their business."

127 If the learned trial judge did err as asserted in ground 6, I think that any such error was inconsequential. Almost without exception, the reason that retailers lease shops is that they wish to make profits. On the evidence, that must have been why the respondents leased Shop 31. The more a shopping centre, or a part of a shopping centre, is patronised, the more profitable a shop there is likely to be. A Coles Super K store, a Venture store or a Tattslotto agency is likely to attract shoppers. Empty shops are not. These things hardly need to be spelled out. It is self-evident that the pleaded representations, if made, were relevant to the extent of custom that would be attracted to Northgate. It therefore does not matter whether or not that very obvious point was common ground. There is no point in undertaking a tedious analysis of what counsel did or did not concede at the trial in relation to this point. Ground 6 has no merit.

128 As to ground 7, the submissions of counsel for the appellants were essentially as set out in par19 of his written outline, which reads as follows:

"19 There was no evidence to establish what impact a Coles store with a larger variety component, a Venture store or the location of the Tattslotto Kiosk would have had on the centre generally or the plaintiffs' business in particular. The extent of custom had been estimated at 50,000 people per week by Mr Edwards and at 59,000 by Plant Location International. For the reasons submitted in relation to ground 5 above the representation as to the estimated number was not negligent and accordingly absent any evidence that the other representations would or might reasonably have been expected to increase patronage above 50,000 people per week the plaintiffs' failed to demonstrate that the statements were causative of a loss."

129 The ground and the submissions relating to it were misconceived. The representations in question did not amount to contractual promises. It was therefore not necessary for the respondents to establish what position they would have been in if the representations had been accurate or true. They needed to establish the making of representations as to subjects that were material to their decision to lease the shop; that the representations were made negligently; that they were induced by the representations to lease the shop, in the sense that they relied on those representations when deciding to lease it; and that they suffered damage as a result of leasing it. Plainly the representations all related to subjects that were material to the decision to lease the shop, namely patronage and profitability. Ground 7 must fail.

130 The appellants contend that the claim in the action was statute barred. The respondents contend that it was not. The only claim was for damages for negligence. The applicable limitation period was 6 years: Limitation Act 1974, s4(1)(a). In relation to a cause of action for negligence, the limitation period does not commence to run until the plaintiff has suffered damage. See, for example, Pirelli General Cable Works Ltd v Oscar Faber and Partners [1983] 2 AC 1. There is a dispute between the parties as to when time commenced to run. The writ was issued on 7 September 1992. The appellants contend that the pleaded cause of action accrued more than six years before that date. The respondents contend that it did not.

131 The appellants contend that the respondents suffered damage prior to 7 September 1986 in four different respects:

• By entering into the equitable lease on 14 May 1986.

• By paying a deposit of $3,942 pursuant to the terms of that equitable lease on 31 May 1986.

• By borrowing money at interest from a bank on or about 1 September 1986.

• By engaging a solicitor, Mr McMullen, to act for them in relation to the lease transaction, and thereby incurring a liability for his professional costs from the time he commenced work in relation to the matter.

132 There was no precise evidence as to when Mr McMullen was engaged. However the landlord's solicitors wrote to him on 16 June 1986, having been informed that he was acting for the respondents. That letter strongly suggests that they engaged him in or about June 1986.

133 The respondents rely, inter alia, on Wardley Australia Ltd v Western Australia [1992] HCA 55; (1992) 175 CLR 514. That case concerned a claim for damages for misleading and deceptive conduct pursuant to the Trade Practices Act 1974 (Cth), which involved a dispute as to when the plaintiff had suffered loss or damage for the purpose of a limitation provision. The State of Western Australia had granted an indemnity to a bank as a result of misleading and deceptive conduct on the part of Wardley. Wardley contended that the cause of action, if any, arose upon the granting of the indemnity. The High Court held that no loss or damage had been suffered, and no cause of action had arisen, prior to the bank requesting the State to indemnify it in respect of a demand that it had received. The principal judgment was delivered by Mason CJ, Dawson, Gaudron and McHugh JJ. Their Honours took the view that "where, as a result of the defendant's negligent misrepresentation, the plaintiff enters into a contract which exposes him or her to a contingent loss or liability", the plaintiff first suffers loss or damage not on entry into the contract, but when the contingency is fulfilled. At 532 their Honours said:

"In our opinion, in such a case, the plaintiff sustains no actual damage until the contingency is fulfilled and the loss becomes actual; until that happens the loss is prospective and may never be incurred."

134 Brennan J was of the same opinion. At 536 - 537, he said the following:

" A plaintiff may suffer economic loss or damage in a number of ways: by payment of money, by transfer of property, by diminution in the value of an asset or by the incurring of a liability. Whether loss or damage is actually suffered when any of those events occurs depends on the value of the benefit, if any, acquired by the plaintiff by paying the money, transferring the property, having the value of the asset diminished or incurring the liability. If the plaintiff acquires no benefit, the loss or damage is suffered when the event occurs. At that time, the plaintiff's net worth is reduced. And that is so even if the quantification of that loss or damage is not then ascertainable. But if a benefit is acquired by the plaintiff, it may not be possible to ascertain whether loss or damage has been suffered at the time when the burden is borne - that is, at the time of the payment, the transfer, the diminution in value of the asset or the incurring of the liability. A transaction in which there are benefits and burdens results in loss or damage only if an adverse balance is struck. If the balance cannot be struck until certain events occur, no loss is suffered until those events occur (See Swingcastle Ltd v Gibson (1990) 1 WLR 1223, at p 1236). The quantification of the diminution in value of an asset or of a liability incurred or the value of any benefit acquired may not be ascertainable at the time when the burden of the transaction is borne. In that event, the suffering of any loss cannot be said to occur before it is reasonably ascertainable (not before it is ascertained) that the burdens which the plaintiff has borne are greater than the value of the benefits that the plaintiff has acquired or will acquire. In other words, no loss is suffered until it is reasonably ascertainable that, by bearing the burdens, the plaintiff is 'worse off than if he had not entered into the transaction'."

135 Although Wardley was a Trade Practices Act case, the same principles apply in relation to actions in tort for negligent misrepresentation: Christopoulos v Angelos (1996) 41 NSWLR 700.

136 There are some complexities in this case. There was not one negligent misrepresentation. There were several of them. There was no simple identifiable contingent event like the demand for an indemnity in Wardley. However, upon the opening of Northgate, (a) the Coles store did not have the qualities of a Super K store, ie a substantial area devoted to the sale of variety goods; (b) there was no Venture store and nothing like one; (c) substantially fewer than 50,000 people per week were passing through the shopping centre; (d) the Tattslotto agency was not in the centre of the specialty shops area; and (e) many shops were vacant. It may be that there was no easily identifiable point in time when it became reasonably ascertainable that, as a result of entering into the lease, the respondents had suffered damage. However there is no reason why, as a matter of logic or as a matter of public policy, the principles expounded in Wardley should not be applied to a case with such complexities.

137 An important question arising in this case is whether the respondents suffered damage on 31 May 1986 when they paid the deposit of $3,942. If they did, the limitation defence must succeed. I agree with Crawford J that, for the reasons stated by him, the deposit was not held on trust for both the landlord and the respondents, and was not held by the landlord's agents as stakeholders, but simply held by them on behalf of their principal. The payment of that deposit formed part of a transaction by which the respondents acquired a benefit in the form of the equitable lease. In my view, in the words of Brennan J quoted above, it was not then possible to ascertain whether loss or damage had been suffered at the time when the burden of paying the deposit was borne. The equitable lease transaction was a transaction in which there were benefits and burdens. A balance could not be struck, to determine whether loss or damage had been suffered, until later events occurred. It was in May 1986 that the respondents entered into the equitable lease and paid the deposit. Northgate did not open until 17 November 1986. It was not until the opening of Northgate, or shortly before the opening of Northgate, that the suffering of damage became reasonably ascertainable.

138 The judgment of Mason CJ, Dawson, Gaudron and McHugh JJ in Wardley supports this view. At 527, their Honours said the following:

"In many instances the disadvantageous character or effect of the agreement cannot be ascertained until some future date when its impact upon events as they unfold becomes known or apparent and, by then, the relevant limitation period may have expired. To compel a plaintiff to institute proceedings before the existence of his or her loss is ascertained or ascertainable would be unjust. Moreover, it would increase the possibility that the courts would be forced to estimate damages on the basis of likelihood or probability instead of assessing damages by reference to established events. In such a situation, there would be an ever-present risk of undercompensation or overcompensation, the risk of the former being the greater."

"It is unjust and unreasonable to expect the plaintiff to commence proceedings before the contingency is fulfilled. If an action is commenced before that date, it will fail if the events so transpire that it becomes clear that no loss is, or will be, incurred. Moreover, the plaintiff will run the risk that damages will be estimated on a contingency basis, in which event the compensation awarded may not fully compensate the plaintiff for the loss ultimately suffered. These practical consequences which would follow from an adoption of the view for which the appellants contend outweigh the strength of the argument that the principle applicable to the cases in which the plaintiff acquires property (or a chose in action) should be extended to cases where an agreement subjects the plaintiff to a contingent loss. In such cases, it is fair and sensible to say that the plaintiff does not incur loss until the contingency is fulfilled."

140 The deposit of $3,942 is something that the respondents brought into account for the purpose of quantifying their damages. It does not follow that the suffering of damage was ascertainable when that payment was made. I have doubts as to whether the inclusion in the action of a claim in respect of the deposit is consistent with the respondents' decision not to make any claim in respect of the trading losses of their Northgate shop, but no such question is raised by any ground of appeal. Since the deposit was ultimately taken in payment of the first month's rent, one might expect that it would ordinarily be brought into account only if a claim in respect of trading losses were pursued.

141 I have been unable to find any reported case since Wardley that is on all fours with this case. Karedis Enterprises Pty Ltd v Antoniou [1995] FCA 1356; (1995) 59 FCR 35 concerned misrepresentations that induced a couple to lease premises for a café business that subsequently traded unprofitably. Whilst that case concerned trading losses, and this case does not, it illustrates the proposition that loss is first suffered when it becomes reasonably ascertainable, even if that is long after wasted expenditure is first incurred. In that appeal the Full Court of the Federal Court remitted the matter to the trial judge for redetermination of the issue as to when the cause of action arose.

142 In this case, counsel for the appellants submitted that, on the facts as found by the learned trial judge, there was no "Wardley contingency", but that the respondents suffered damage on entering into the equitable lease. I disagree. Northgate did not open until 17 November 1986. Until then, or about then, it remained possible that Coles would devote a substantial area of its store to variety goods; that Venture or some similar company would rent one of the major retail spaces; that the prediction as to approximately 50,000 people per week would, more or less, come true; that the Tattslotto agency would be established in the centre of the specialty shops area; that nearly all the shops would be let; and that, consequently, the leasing of Shop 31 would prove to be a worthwhile transaction. On the facts as found, it was only at or about the time of the opening of Northgate that it became ascertainable that the facts did not accord with the appellants' representations, and that the respondents' shop was doomed to unprofitability. Those facts were not ascertainable when the respondents entered into the equitable lease on 14 May 1986, nor when they paid their deposit on 31 May 1986, nor when they committed themselves to interest payments on or about 1 September 1986, nor when they engaged a solicitor, whose work they were going to have to pay for, in or about June 1986.

143 Because the day on which the writ was issued - 7 September 1992 - was a Monday, and because of the Acts Interpretation Act 1991, s29(4), to which Crawford J has referred, the critical question is whether the respondents' cause of action arose on or before 4 September 1986. It may very well be that, by that date, the chances of the appellants' representations being fulfilled and the leasing of Shop 31 proving to be worthwhile were extremely slim. However I do not think that is to the point. Mason CJ, Dawson, Gaudron and McHugh JJ said in Wardley at 524 - 525, "The likelihood, perhaps the virtual certainty, that there would be a loss, in the light of Rothwell's actual financial position as it stood when the indemnity was executed, did not transform the liability into an actual or present liability at that time." I think it must follow that, in this case, an adverse outcome giving rise to a cause of action should be regarded as having been no more than a contingency until well after 4 September 1986.

144 The learned trial judge correctly observed that the landlord bore the onus of proof in relation to its limitation defence: Pullen v Gutteridge [1993] VicRp 4; [1993] 1 VR 27 at 65 - 77; Re Monger, ex parte Cross [2004] WASCA 176. He concluded that Wardley was applicable, and that he was not persuaded to the requisite degree that the respondents suffered any actual loss until after 7 September 1986. He rejected the limitation defence on that basis. In my view he did not make any material error in doing so. Ground 1 must fail.

145 In my view this ground must succeed, for the reasons stated by Crawford J. This ground relates to an award of $25,000 in respect of lost opportunity cost over the period from 30 August 1992 until judgment. Since I have concluded that no other grounds of appeal should succeed, it would follow that the judgment sum should be reduced by that amount, to $46,124.17.

146 Many might take the view that, since the respondents acquired the right to a payment of damages at the time of the assignment in August 1992, it would be just for them to recover interest on the sum payable as from that time. However Tasmania, unlike every other Australian jurisdiction, does not have a general statutory provision for the award of pre-judgment interest on damages. Such provisions are to be found in the Federal Court of Australia Act 1976 (Cth), s51A; the Civil Procedure Act 2005 (NSW), s100; the Supreme Court Act 1995 (Qld), s47; the Supreme Court Act 1935 (WA), s32; the Supreme Court Act 1986 (Vic), s60; the Supreme Court Act 1935 (SA), s30C; the Supreme Court Act 1979 (NT), s84; and the Court Procedures Rules 2006 (ACT), r1616. Tasmania has such a provision in the Commercial Arbitration Act 1986, s31, but there is no equivalent provision applicable to the Supreme Court or the Magistrates Court. As long ago as 1985, the Law Reform Commission of Tasmania recommended the introduction of such a provision: Report on Interest on Pre- and Post- Judgment Debts (Report No 44), pars6 - 8. In my view it is regrettable that Parliament has not yet considered acting on that recommendation.

147 I would allow the appeal and order that the judgment be varied by substituting the sum of $46,124.17 for the sum of $71,124.17.