Hollis, L.S. v. P.H. & D. Stephens Investments Pty Ltd [1985] FCA 358

Federal Court of Australia|1985-05-10|Before: Spender J

go TRADE PRACTICES - false representation that goods have a

particular history - whether constituted by inaccurate odometer reading of vehicle in car yard - whether a representation -

meaning of "particular history" - Trade Practices Act 1974 3.53(a).

L.S. HOLLIS V. P.H. & D. STEPHENS INVESTMENTS PTY.LTD. NOS. Gl and G2 of 1985

QUEENSLAND DISTRICT REGISTRY ) QLD Gl and G2 of 1985 GENERAL DIVISION )

Judge Making Order: SPENDER J. Date of Order: 10 May, 1985

The defendant be convicted in respect of both informations.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules

QUEENSLAND DISTRICT REGISTRY ) QLD Gl and G2 of 1985 GENERAL DIVISION )

Prosecutor AND: P.H. AND D. STEPHENS INVESTMENTS PTY.LTD. Defendant SPENDER J. 10 May, 1985

These are two prosecutions for offences under 38.79 of

the Trade Practices Act 1974 ("the Act") arising out of

contraventions of s.53(a) of that Act by the defendant, P.H. and D. Stephens Investments Pty.Ltd.

Each offence arises out of alleged false representations

by the defendant that goods were of a particular. history.

"That on or about the sixth day of January 1984 P H AND DBD STEPHENS INVESTMENTS PTY. LTD., did in connection with the supply of goods

to wit an XD Ford Falcon GL station wagon registered number 761-NSY, falsely represent to Robert Allen Lane that the said vehicle had travelled 60,690 kilometres whereas the said vehicle had travelled substantially in excess of that distance."

"That on or about the tenth day of February 1984 PH AND D STEPHENS INVESTMENTS PTY. LTD., did in connection with the

supply of goods to wit a Toyota Corona sedan registered number

857 NCP, falsely represent to Sheila Jacqueline Lister that the said vehicle had travelled 70,100 kilometres whereas the said

vehicle had travelled substantially in excess of that distance."

(i) between receipt by the defendant of each of these vehicles and their subsequent sale,

the odometers in each vehicle were replaced by employees of the defendant;

(ti) the odometer reading in each of the replaced odometers showed substantially fewer

kilometres than were shown on the odometers which were replaced;

(iii) no sales representative or other employee of the defendant told the respective purchaser of each vehicle that the odometers had been replaced or that the readings shown on the odometer in the vehicle did not represent the distance travelled by that vehicle.

It is possible to state relatively briefly the facts

In 1977, Robert Allen Lane purchased a new Toyota Corona sedan, with registered number 857 NCP, the vehicle the subject of

the second information. In relation to this vehicle, Mr. Lane

kept a petrol log book in which was recorded the distance travelled by the vehicle, its odometer reading, and the price and

quantity of petrol on each occasion that it was purchased for the vehicle.

On 8 January 1984, the log book records that the odometer reading was 119,086 kilometres. Shortly afterwards, Mr. Lane traded this vehicle to the defendant on the purchase of the

Ford Falcon station wagon, registration number 761 NSY, the vehicle the subject of the first information.

The Ford vehicle had previously been owned by Nicholas Kiwi (Pacific) Pty.Ltd. Trevor Jones, a former employee of that company, was the person to whom the vehicle was assigned within the company. Ina sales representative's expenditure claim forn, he recorded, amongst other things, the daily odometer reading, daily mileage, and particulars of petrol purchased. This form records that on 22 December 1983, when Nicholas Kiwi (Pacific) Pty.Ltd. traded the vehicle through Toowong Mitsubishi Motors, a

retailer of new vehicles, at Milton Road, Toowong, the odometer

Daniel Theodore Duggan, an account sales representative

for Nicholas Kiwi (Pacific) Pty.Ltd., was familiar with the vehicle and had driven it on several occasions. He can recall that its odometer reading was approaching the 100,000 kilometre

mark at about the same time as his own company vehicle was

The used car stock book of Toowong Mitsubishi Motors records that the odometer reading of the vehicle at the time of

its purchase by that company was 140,587 kilometres.

The evidence before me, which I accept, establishes that the vehicle, when traded through Toowong Mitsubishi Motors, had

an odometer reading in excess of 61,000 kilometres.

On 28 December 1983, Toowong Mitsubishi Motors sold the

vehicle to Brisbane Discount Motor Mart, the business name under which the defendant operated. No work had been done on the

vehicle while it was in the possession of Toowong Mitsubishi, and

it was sold to the defendant undetailed and uncleaned.

On a date which Mr. Lane now fixes as about 9 January 1984, he went to the premises of Brisbane Discount Motor Mart at 354 Gympie Road, Kedron, with the intention of purchasing an XD

Ford Falcon station wagon. He was accompanied by his wife.

He there saw a Ford Falcon station wagon, registration number 761 NSY, which was on display. The price indicated was $6,999.00. On inspection, the odometer reading showed approximately 60,000 kilometres. He was approached by a sales representative of the defendant, who introduced himself as John Carry. Mr. Lane indicated that he wanted to trade in a 1977 Toyota Corona and purchase a Ford Falcon, subject to a satisfactory inspection by aR.A.C.Q. mechanic. He paid a

holding deposit on that date, and the further holding deposit at

He contacted the R.A.C.Q. and a Mr. Ronnie Altmann, an R.A.C.Q. inspector, inspected the vehicle on 11 January 1984. In

the course of that inspection, Mr. Altmann observed that the

On 13 January 1984, Mr. Lane took delivery of the vehicle, paid the balance of the purchase money owing, and was issued with a receipt. He was also issued with a certificate of roadworthiness. This was given by a servant of the defendant who indicated that the reading on 11 January 1984, when the

roadworthiness certificate was issued, was 60,697 kilometres.

However, following a conversation between Mr. Lane's wife and Trevor Jones, Mr. Lane complained to Brisbane Discount Motor Mart that the odometer had been altered and that the vehicle had travelled considerably more at the time that he had

purchased it than the odometer reading had indicated.

Some months later, an agreement was reached whereby the

defendant supplied to Mr. Lane, in exchange for the Ford Falcon,

a 1979 Fairmont with an odometer reading of some 42,000

kilometres. This odometer reading was supported by original log

Between the time of his complaint and this agreement,

Mr. Lane conducted a Main Roads search in an attempt to locate the person who had purchased the Toyota Corona which he had

traded in on the Ford Falcon. He had, after that trade in,

observed the vehicle in the used car yard of the defendant, and

had inspected it on an evening in February 1984, He gave

evidence that that inspection seemed to indicate that a '1' did

not appear in the 100,000 mark on the odometer, as it ought

properly to have in the light of the kilometres travelled prior to its trade in.

Through the Main Roads search, Mr. Lane located Shirley

Jacqueline Lister, the purchaser of the Toyota Corona.

At the time when Mr. Lane traded that vehicle in, its odometer reading was 119,686 kilometres. This is recorded on the stock card of the defendant. The vehicle was then sent to a self employed motor mechanic, Peter Francis Whitbourne, who issued a roadworthiness certificate for the vehicle as well as a job cost card. On both of these documents he noted that the odometer reading was 119,750 kilometres. The job cost card also noted

On 16 February 1984, Mr. Whitbourne again inspected the

Toyota, and issued a further roadworthiness certificate. On this

occasion, he noted on the certificate that the odometer reading

Previously, on about 10 February 1984, Mrs. Lister had gone with her son to the premises of Brisbane Discount Motor Mart

and had there spoken to a sales representative, John Legg. She

had indicated to him that she was interested in the two Toyota

Coronas which the defendant had advertised, both priced at $3,899.00.

She drove the Toyota Corona, registration number 857 NCP, noting that it had approximately 70,100 kilometres on the

On about 17 February 1984, Mr. Lee called at her residence and, after some discussion about the price, she agreed to purchase the vehicle for $3,724.00, which was to include sales tax on the vehicle. She arranged to collect the vehicle on Monday, 20 February 1984. On that day, she went to Brisbane

Discount Motor Mart and took possession of the vehicle.

On no occasion did Mr. Lee, or any other employee of Brisbane Discount Motor Mart, inform Mrs. Lister that the odometer had been replaced or altered in any way. Similarly, on no occasion did Mr. Carry or any other employee of Brisbane Discount Motor Mart inform Mr. Lane that the odometer in the Ford

complaint to the defendant. She subsequently declined their

offer to refund her purchase money and has since disposed of the

There is no dispute that the defendant is a trading

corporation and was at all material times engaged in the trade of

selling used motor vehicles. The evidence establishes that it is quite a large used car dealer and has a large used vehicle

display yard. The defendant employs six mechanics and a staff in

There is no challenge to the evidence that the Ford Falcon had travelled in excess of 140,000 kilometres at the time that it was acquired by the defendant and that, at the time of its display, inspection, and subsequent purchase by Mr. Lane, the cdometer in that vehicle read under 61,000 kilometres.

In the case of the Toyota Corona, there is no challenge to the evidence that the vehicle had travelled in excess of 119,000 kilometres at the time that it was traded in by Mr. Lane to the defendant and that, at the time of its display, inspection, and subsequent purchase by Mrs. Lister, the odometer

reading on that vehicle was under 71,000 kilometres.

In both cases, the odometer reading at the time of each vehicle's display and subsequent purchase indicated

substantially fewer kilometres than that vehicle had actually travelled.

Counsel's submissions on behalf of the defendant fall

The first such category was not strongly pressed. It

She says in her evidence that the Toyota Corona inspected by her and the odometer of which she recalls having noted had registration number 587 NCP. The vehicle the subject of the second information, though, is a Toyota Corona

registration number 857 NCP. However, it is clear beyond argument, from both the documentary and oral evidence before me, that the vehicle inspected by and gold to Mrs. Lister was the vehicle the subject of the second information. This transposition is amere and understandable misdescription and, in fact, had

also occurred in conversations between officers of the Trade

Practices Commission and Peter Henry Stephens, a director of the

The second submission within this first category relates to a variance between the date at which the first information alleges a false representation as to the Ford Falcon was made and

the evidence of Mr. Lane as to the date that he inspected that

The information alleges the representation to have been

made on or about 6 January 1984, while Mr. Lane gave evidence

that he now thinks he inspected that vehicle on 9 January 1984.

However, in my view, his evidence is not inconsistent with the allegation contained in the information and, in any

event, were I to be of a different view, I would amend the

A further submission within this first category is, however, of more consequence. It relates to the evidence of Mr.

Lane as to the odometer reading at the time of his inspection of the vehicle.

In the course of his evidence, Mr. Lane stated that, when he inspected the Ford Falcon at the defendant's premises,

his recollection of the approximate mileage shown on the odometer

was "sixty thousand and something. I only looked at the first two digits."

However, the information in respect of that vehicle contained an allegation that the defendant falsely represented to Mr. Lane that the vehicle had travelled 60,690 kilometres,

whereas it had travelled substantially in excess of that

The evidence, however, does not establish with absolute precision what the odometer reading at the time of the first inspection by Mr. Lane was. Even so, the gravamen of the offence

is the representation that the odometer of the vehicle indicated that it had travelled something in the order of 60,690

kilometres, whereas it had in fact travelled substantially in

Moreover, the evidence establishes that the actual odometer reading in the vehicle increased by small amounts during

the period between its initial acquisition by the defendant and

In my view, the dictates of justice require that that information and summons be amended so as to accord with the

nature of the case which, on the material, the defendant was called upon to meet and has, in fact, attempted to meet. That case was that the false representation was that the vehicle had travelled something under 61,000 kilometres when in fact it had

travelled substantially in excess of that distance. Accordingly, the amendment would embody that allegation.

In fairness to counsel for the defendant, it was not asserted by him that this formulation in the charge constituted a

basis on which the defendant was entitled to be acquitted.

It was accepted by counsel for the defendant that, between the date of receipt of the vehicles by the defendant and their subsequent sale, the odometers in each had been replaced by servants of the defendant, each such replacement odometer showing considerably fewer kilometres than indicated on the odometer which had heen replaced. Indeed, so much was .inferentially

admitted by Mr. Stephens in conversations that he had with

The more substantive submissions of counsel on behalf of

the defendant fell within the second category of his submission.

The first of these concerned the interpretation of the phrase "had a particular history" as used in s.53(a) of the Act.

"A corporation shall not, in trade or commerce, in connexion with the supply or possible supply of

promotion by any means of the supply or use of goods or services -

(a) falsely represent that goods are of a particular standard, quality, grade, composition,

style or model or have had a particular history or particular previous use; ...""

Counsel submitted that an indication on an odometer is not a representation that that vehicle has "had a particular history" for the purposes of this section. "History", it was said, is "the whole train of events connected with a thing". The submission was that the distance a vehicle has travelled is not the history of that vehicle, but merely a limited element of that vehicle's history. A representation as to distance is not,

therefore, a representation that that vehicle had a particular

Reference was made to Given v. C.V. Holland (Holdings)

Pty.Ltd. (1977) A.T.P.R. 40-029. In that case, Franki J. was dealing with facts quite similar to those in the present case. The motor vehicle there in question had been displayed for sale in the defendant's second-hand used car yard. The odometer showed a mileage of 23,700. However, it was subsequently established that the vehicle had travelled approximately 69,012 miles. Evidence was given on behalf of the defendant explaining the difference. The original speedometer had been replaced as it had

not been functioning correctly. The replacement had been taken

His Honour held that the words "of a particular quality" in s.53(a) of the Act were apt to describe the number of miles a particular vehicle had travelled. He considered that the step of displaying the vehicle for sale ina used car dealer's yard with a mileage shown on the odometer amounted to a representation that the car had travelled the number of miles shown. That representation not being correct, his Honour concluded that the display of the odometer reading in those circumstances was a

false representation that the vehicle was of a particular

At the time of the dealings with which Franki J. was

"A corporation shall not, in trade or commerce, in connexion with the supply or possible supply of goods or services or in connexion with the

promotion by any means of the supply or use of goods or services -

(a) falsely represent that goods or services are of a particular standard, quality or grade,

or that goods are of a particular style or model; ..."

The allegation in Given was that the display of the odometer reading constituted a false representation that the vehicle was of a particular quality. In each of the informations with which I am concerned, the assertion is that such a display

constitutes a representation that the vehicle had "had a

In my opinion, "history" is used in its primary sense as get out in the Shorter Oxford Dictionary. It is there said to

There is no requirement that the catalogue of the past record of the vehicle be exhaustive or complete. A representation as to the distance travelled is a representation that a vehicle had a particular history. The word "particular" in s.53(a) of the Act is used, in my view, to highlight the element of the past record of the vehicle which is being represented. Its use is to focus attention on the attribute of

the past record of that vehicle as contrasted with the generality

A representation as to the number of previous owners of the vehicle, the characteristics of any or all of such owners, or the geographical areas where the vehicle had seen service, would

be a representation that the vehicle had had a particular

It is not difficult to appreciate that a particular instance of the past history of a vehicle would have an important bearing on its attractiveness to potential purchasers. Those aspects of its past record would generally be understood as being relevant indications of the condition of the vehicle in question. They are, of course, not determinative of any particular

condition. In the Given case, Franki J. stated at p.17,386 that:-

"In my opinion the number of miles a particular vehicle has travelled describes a particular attribute, or a special feature of that vehicle,

and therefore describes a particular quality of that vehicle."

With respect, that observation is generally true. However, it is not necessarily the case that the number of miles a vehicle has travelled is indicative of the quality of that particular vehicle. It may, therefore, be that that was one

consideration relevant to the amendment of the formulation of the

For my part, I am satisfied beyond a reasonable doubt

that a representation as to the distance a particular vehicle has

travelled is a representation that that vehicle has had a

The second submission in the more substantive category of submissions on behalf of the defendant was that the displaying of a vehicle with an odometer reading shown was not a

representation that that vehicle had travelled the number of

Counsel for the defendant submitted that a seller of used vehicles, when it acquires a vehicle as part of its stock, is not aware of whether the odometer in that vehicle had been

previously replaced or tampered with by any earlier owner.

Therefore, when that used car dealer displayed the vehicle with

an odometer reading, it was not representing to any person

inspecting the vehicle that it had travelled the distance shown

"I pass now to consider whether the reading on the odometer of a used motor vehicle is a representation of the miles that vehicle has travelled when that vehicle is displayed by a dealer in its used car yard. It was made clear by Senior Counsel for the informant that no verbal representation, or representation of any kind other than the mere appearance of the figures on the odometer was alleged. There was no suggestion that any officer of the company had drawn the attention of any customer to the odometer reading. However, the defendant had taken the step of placing the car on display for sale in its used cay yard and the odometer reading was there for prospective purchasers to observe. I do not consider that any statement or assertion by a servant or agent of the company, with an intention to convey information to a prospective purchaser is necessary in this case. I consider that the step of placing the car on display for sale with a mileage shown on the odometer ina used car dealer's yard, where the vehicle is placed with the intention that it will be inspected by prospective purchasers is, in the absence of any special circumstances, a representation by the used car dealer that the car has travelled the number of miles shown on the odometer."

Whether the conduct by a used-car seller in displaying a vehicle for sale constitutes a representation as to the distance

the vehicle has travelled is a question of fact. In my opinion, display without more of a vehicle showing a particular reading on the odometer is a representation by the person displaying that

vehicle of the distance which the vehicle had travelled. I am of

that view notwithstanding that the used car seller may not be aware of any earlier tampering with or replacement of the odometer of any vehicle which comes into his possession. There can be no doubt in my view that such a display is meant by the sales representative, and is certainly taken by the prospective

purchaser, to be a representation as to the distance which the

"hodometer" and is defined by the Shorter Oxford Dictionary as:-

"An instrument attached to a wheeled vehicle, which records the distance traversed; also a wheel used by surveyors, having a recording apparatus in the centre and trundled along by a handle. Also applied to a pedometer." As is generally understood, an odometer ina motor vehicle is an instrument by means of which the distance traversed is recorded. The purpose of such an instrument is plain - so as

to afford information on inquiry as to the distance that that

The circumstance of the sales representative's ignorance as to the precise history of the vehicle - in particular as to whether there has been any tampering with or replacement of the odometer and, therefore, as to whether the odometer accurately records the distance actually travelled by the vehicle, has to be considered in the context of the provisions of 3.85 of the Act

which provide certain defences. Section 85(1) and (2) provide:-

"(1) Subject to sub-section (2), ina prosecution under this Part In relation to a contravention of

a provision of Part V, it is adefence if the defendant establishes -

the proceeding was instituted was due to reasonable mistake;

(b) that the contravention in respect of which the proceeding was instituted was due to reasonable reliance on information supplied by another person; or

(i) the contravention in respect of which the proceeding was instituted was due to the act or default of another person, to an accident or to some other cause beyond the defendant's control; and

precautions and exercised due diligence to avoid the contravention.

(2) If a defence provided by sub-section (1) involves an allegation that a contravention was due to reliance on information supplied by another person or to the act or default of another person, the defendant is not, without leave of the Court, entitled to rely on that defence unless he has, not later than 7 days

before the day on which the hearing of the proceeding commences, served on the person by

whom the proceeding was instituted a notice in writing giving such information that would identify or assist in the identification of the other person as was then in his possession."

The reading on an odometer is taken into account as a

quite important consideration by prospective purchasers. I am satisfied then beyond a reasonable doubt that each of the elements of the two informations is made out. I convict the

defendant in respect of both of those informations.

At a glance

Court

Decision date

Before

Source

Judgment (191 paragraphs)