On or before 29 December 2006 the Respondent must pay to the Applicant the sum of $5,900.00.

The Applicant must return the goods which are the subject of this dispute to the Respondent within 14 days of the payment of the sum ordered in order 1 above.

1 The Applicant purchased share-trading software from the Respondent. Almost two years later, he applied, under the Fair Trading Act 1999 ("the Act") for an order that his money be refunded. He said he had never been able to use the software and that the Respondent had refused his requests for a refund. The Respondent disputed the tribunal's jurisdiction, relying on a written term that the agreement was to be governed by the laws of Queensland and stating that it is a Queensland company and the Applicant (a Victorian) was in South Australia at the time he agreed by phone to purchase the package. I heard the application, first ruling that the tribunal did have the required jurisdiction, and reserved my decision. The issue for me to decide was whether, under the Act, the Applicant was entitled to an order that his money be refunded.

2 Some of the facts to be found in this case go to whether or not the Respondent has breached a provision of the Fair Trading Act 1999. In making such findings, I have taken into account relevant matters such as the seriousness of the possible contraventions and the gravity of the consequences, guided by the principles enunciated by Dixon J (as he was then) in Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336, for example (at p362).

"The seriousness of the allegation made, the inherent unlikelihood of an occurrence of a given description or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the Tribunal".

3 At the hearing, the Applicant, Mr Kiley, gave evidence that while he was away from home in South Australia, he received a call on his mobile phone from a representative of the Respondent, offering to sell him a share trading package. The Applicant accepted the offer and agreed to pay $5,900.00 for the package, providing his credit card details over the phone. The Respondent agreed with most of this but said Mr Killey had made the phone call.

4 Mr Ellis an employee of the Respondent who attended the hearing, disputed the Applicant's evidence about what had occurred before that phone call. Mr Ellis said that the first contact was made by the Applicant phoning the Respondent on 1 September 2004, that the Respondent phoned the Applicant back on 3, 6 and 10 September, and that the Applicant made the call which concluded the purchase on 13 September 2004. The Applicant denied making any call on 1 September and receiving the other calls. The Respondent's evidence at first, was that the Applicant phoned by mobile phone from South Australia on 1 September 2004. The Applicant said he was in Melbourne that day and produced a diary showing an appointment in the Melbourne suburb of Sunshine that day. In my view this was a factor indicating that the Applicant's account was more likely to be correct.

5 The Respondent's evidence was based on written records produced by Mr Ellis, but they were prepared on the basis of information given by other employees of the Respondent and Mr Ellis had not been involved in those phone conversations. Mr Ellis did say that the 'print out' he produced came from a 'sealed data base', but the print out records dated only from 15 September 2004. As I explained to Mr Ellis at the hearing, in the absence of any other reason to doubt the sworn evidence of the Applicant I have given it greater weight than Mr Ellis' evidence of what he had been told by another representative of the Respondent, who was not present to answer questions about the disputed issues.

6 The Respondent contended that the Applicant told their representative he was responding to a 'mail out' and that this was recorded in writing. Mr Kiley denied saying that he was responding to a mail out and the Respondent's written record was not produced. I accepted Mr Kiley's evidence as he was present to give it and the Respondent relied only on what he said other employees had told him. Taking into account all the circumstances I found the Applicants to be more the coherent and consistent account.

7 Accordingly, I found that the Respondent made the first contact to the Applicant by telephone.

8 At the hearing, the Applicant said he had received that first call from the Respondent on 10 September 2004, although in his written application he said it was on 13 September 2004. This seemed the more likely date, as that was the date on the credit card docket prepared by the Respondent (and later apparently signed by the Applicant) and produced at the hearing. Ultimately, whether the call took place on 13 September or 10 September 2004, was not material to my findings. While Mr Kiley was hazy about actual dates, there was no suggestion he was fabricating his evidence and I accepted his evidence that the first contact came from the Respondent to him. He said his daughter, who had also purchased a package from the Respondent, later told him that she had given his mobile phone number to a representative of the Respondent, which seemed a likely explanation. I considered that the fact that the Applicant's daughter had been in contact with the Respondent also explained his willingness to make the purchase so readily.

9 It was undisputed that the Applicant was in South Australia when he agreed by phone to the purchase from the Respondents and provided his credit card details.

10 When the Applicant returned home to Swan Hill in Victoria, he changed his mind. He telephoned the Respondent and sought a refund. The Applicant said this occurred on 13 September 2004 and the Respondent disputed this, saying Mr Kiley first sought a refund on 15 September 2004. The Respondent produced a print-out of an email dated 15 September 2004 apparently from the Applicant, saying "I have had an opportunity to go through it and have found that this is not what I am after. It is a lot more involved then I was lead to believe .... I will return the program to you immediately". There was a response to this email, of the same date, from Mr Ellis, to the effect that "Stuart" would phone the Applicant. Mr Ellis' evidence was that Stuart did phone the Applicant who agreed to keep the program. However, Mr Ellis provided no direct evidence from "Stuart" about any such agreement.

11 The Applicant's evidence was that he phoned the Respondent before the package arrived at his home. This could not effectively be disputed. However, I was not satisfied that the Applicant had clearly sought a refund at this point, whether in one or two calls. If there were two, the second call appeared to have been made by "Stuart" in response to the email of 15 September 2004. In the Applicant's application, he said that after he phoned to seek a refund "later that same day, I was contacted by the salesperson, whom I had dealt with initially, wanting to know why I wanted my money returned and didn't I want to make money. He was rather convincing so I decided to give it a go".

12 At the hearing, the Applicant's account was slightly different. He said that in that phone call he had been told no refunds were available and that he should "try it out" and "do some dummy runs".

13 About this time or soon after, on 17 September 2004, the Applicant signed and returned documents he received from the Respondent, including a "daily data download order form" and a "software and copyright declaration" and a "credit card proof of purchase". The order form agreed to a further $42.90 monthly charge against his credit card. The Respondent produced these documents and the Applicant agreed he had signed them. At the hearing, when I asked the Applicant why he had signed the documents at this point if he really wanted a refund, he said he had done this because the Respondent told him that his money was already spent and no refund was available. The Applicant's application suggests he withdrew his request for a refund because the Respondent's representative was "pretty convincing" and that seemed to me a more likely explanation, although the issue is not ultimately of importance in my determination.

14 The Respondent produced emails indicating that on 17 September 2004 the Applicant asked why his daughter had received a cheaper package from the Respondent for the same software. The Applicant did not dispute this. At the hearing the Applicant said that he had made a number of refund requests, which all had been refused. The Respondent did not dispute this, except to say in effect that the request of 15 September 2004 had been withdrawn. In its written submission the Respondent claimed that the Applicant "decided to retain the software".

15 It was not disputed that the Applicant made subsequent email requests for a refund because he had difficulty using the software in his particular computer, as the firewall installed by his employer was a barrier. The Applicant contended in those emails and later at the hearing that he should have been told by the Respondent that the program was only for use on a home computer. However, there was no evidence to indicate to me that the software was unusable in the absence of a firewall. Neither was there much evidence about the complexity of the program. The Applicant said the program was not what he wanted and that he only discovered that when he tried to use it. I had no reason to doubt that this was the course of events. However, there was no evidence about what the Applicant knew or was told of the program before he agreed to buy it. There was no evidence, for example, that the Respondent told him it was easy to use.

16 I accept the Applicant's evidence that since purchase he had played with the program but had been unable to put it to any use. The Respondent said that its data use records showed the Applicant was an active user of the software, but I was satisfied only that the Applicant had downloaded data and opened it a few times, as he agreed he had done.

17 The Applicant said that after October 2004 when he was again refused a refund, he "wrote it off as a bad investment" and only played with the program a few times. He said he then made his application to the tribunal when he heard that another purchaser of the same program had made a similar application and been successful. I accepted all that evidence as well.

18 Mr Ellis (who is not a lawyer) submitted for the Respondent that the contract between the Applicant and Respondent was made in South Australia or Queensland, where the two respective parties were located at the time of the agreement. He submitted that the contract was governed exclusively by the laws of Queensland because the terms which he said had been accepted by the Applicant stipulated this.

19 As his Honour Justice Morris (President) explained in Law v MCI Technologies Pty Ltd [2006] VCAT 415, the tribunal has two kinds of relevant jurisdiction under the Fair Trading Act 1999. There is jurisdiction under section 159 of the Act to hear and determine an action for damages resulting from contravention of a provision of the Act. There is also jurisdiction under Part 9 of the Act (sections 108 and 109) to hear and determine a "consumer and trader" dispute. I am guided by his Honour's reasons in that case and will not refer in detail to Mr Ellis's submissions about the applicable law. Those submissions did not refer to his Honour's reasoning in Law v MCI and were directed mostly to the question of where the contract was formed. I agree with the simple statement in Law v MCI (para 44):

"The jurisdiction of VCAT to hear an action for damages under section 159 of the FTA, or to hear and determine a consumer and trader dispute, does not depend upon the existence of a contract. The word "contract" does not appear in section 159; nor does it appear in section 107 of the FTA. Rather it turns on whether there has been a contravention of the FTA or a supply of goods or services in Victoria. Hence VCAT's jurisdiction cannot depend upon the place in which a contract is made, or a provision in a contract that the contract is formed in a particular location, or that a named jurisdiction is to be the exclusive jurisdiction for determining disputes under the contract".

20 Accordingly, in my view, the tribunal has jurisdiction to deal with the present consumer and trader dispute, applying the provisions in part 9 of the Act. In addition, the tribunal may have jurisdiction under section 159 of the Act to award damages for any contravention by the Respondent of the telemarketing provisions of the Act.

21 Part 4 Division 2 A of the Act defines a telemarketing agreement and makes a number of provisions for such agreements, including, most relevantly, for a cooling off period during which the purchaser may cancel the agreement (section 67H).

22 Section 67A provides:

(1) An agreement is a telephone marketing agreement if -

(a) it is for the supply in trade or commerce of goods or services of a kind ordinarily used for personal, household or domestic use; and

(b) the negotiations leading to the making of the agreement (whether or not they are the only negotiations that precede the making of the agreement) take place between the supplier or a person acting on behalf of the supplier and the purchaser over the telephone; and

(c) the initial telephone call for the purpose of entering into the negotiations was made by or on behalf of the supplier; and

(d) the total consideration payable by the purchaser under the agreement -

(i) is not ascertainable at the time of making the agreement; or

(ii) is ascertainable at the time of making the agreement and exceeds $100.

23 The 'initial telephone call' as I have found, was made by the Respondent in Queensland to the Applicant who was at that time in South Australia. During the course of that phone call, the Applicant agreed to purchase the software and gave the Respondent his credit card details. The Respondent gave evidence about the documents it sent to the Applicant. These did not include the cancellation notice required by section 67E. Assuming for the moment that the agreement between the parties otherwise falls within the section 67A definition, has there been a contravention of the Act?

24 For the telemarketing provisions of the Act to apply to an agreement entered by the Applicant when he was in South Australia, it is necessary for me to conclude that the Act operates outside the territory of Victoria.

25 Section 6 of the Fair Trading Act 1999 is headed "extra territorial application of the Act" and provides:

(2) This Act applies outside Victoria to the full extent of the extra-territorial legislative power of the Parliament.

26 In Froesch v Mohi [2005] VCAT 1933 Senior Member Vassie considered the degree of connection which might be required between legislation and subject matter before the tribunal could be sure that the legislation applied extra-territorially to the subject matter.

27 Assuming as Senior Member Vassie did there, an approach favourable to the Respondent, I will also assume that the Act may only apply outside Victoria's territory when the subject matter has a substantial connection with Victoria. In this case, the goods were to be supplied to a purchaser in Victoria. This must have been clear to the Respondent during the phone call when the Applicant provided his address for the package to be sent to him. There was some evidence in a statutory declaration submitted by Mr Ellis that the Applicant supplied several different addresses to the Respondent, but they were all in Victoria.

28 In the same statutory declaration, Mr Ellis submitted that Senior Member Vassie's decision in Froesch v Mohi supported the Respondent's position. He quoted the following words from (paragraph 20 of) that decision:

"In my opinion, a provision like Section 9 has a substantial connection with Victoria if its operation extends to conduct which involves a person in Victoria hearing or reading words spoken or generated by another person outside Victoria in circumstances in which it would be envisaged that the words would be acted upon in Victoria."

29 The Respondent argued that as the Applicant was in South Australia when he heard and acted on the Respondent's offer, then there should on this logic, be no jurisdiction in Victoria. I disagree. The fact that words heard and acted upon in Victoria have a substantial connection with Victoria need not imply that words heard and acted upon outside Victoria lack that connection. In this case, the connection is not where the words were heard and acted upon, but rather where the goods were to be supplied. It was part of the agreement between the Applicant and the Respondent that the goods would be supplied to Victoria for the use of a person who lived in Victoria.

30 The Applicant's presence in South Australia when he took a phone call should not deny him the protection of the Fair Trading Act 1999. Telephones are no longer fixed to the wall in a subscriber's home. A person may receive a telephone call just about anywhere. Since Parliament has made specific laws about marketing to Victorians by telephone, it makes no sense to deny a person the protection of those laws simply because he was away from home when he received a telemarketing call. The Respondent, when it made the call, was not in a position to know where the Applicant was located. The Respondent must however have known during that phone call that the goods would be supplied to Victoria, as the Respondent ordered them to be sent to his address.

31 In his written application and at the hearing, the Applicant made no submissions about the law and did not attempt to characterise his application as one falling under Part 9 or under section 159 of the Act. The Applicant did not make any submissions about whether the Respondent had contravened any provisions of the Act. While it was apparent from the Respondent's submissions that it was aware of the territorial issues I have raised, it made no submissions about the telemarketing provisions of the Act. I did not ask the parties specifically about those provisions. However, I have proceeded to consider the application of those provisions without offering the parties any opportunity to make further submissions. I consider that all the questions of fact raised by those provisions were addressed in the evidence given by the parties and because the Respondent has already made its submissions about the extra-territorial operation of the Act. I have also taken into account that the parties were not legally represented and so unlikely to be able to assist me with submissions about the law. I am prohibited from making any order for costs, so that the parties would be unable to recover any costs incurred should I require them to make submissions about the law.

32 The dispute in this case concerns the supply of goods and involves the purchaser and supplier, therefore the tribunal has jurisdiction under Part 9 of the Act to decide this "consumer and trader dispute".

33 In Law v MCI Technologies, His Honour Justice Morris concluded that it was fair to order a refund for the applicant, exercising the tribunal's power under section 109 to make "any order it considers fair ... including declaring void any unjust term of a contract or otherwise varying a contract to avoid injustice". The factors which led to the conclusion that it was fair to order a refund were as follows: the transaction between the parties was similar to a telephone marketing agreement; the respondent made eight calls to the applicant - she rejected the respondent's initial advances and the respondent pursued her; the respondent used a "disingenuous" selling strategy of "special offers" intended to build pressure on the applicant in that case; the applicant sought a refund the day after she had signed the documents sent to her and a few days after agreeing to the purchase and the product purchased required considerable skill which the applicant could not reasonably be expected to have.

34 The present case is different. Leaving aside the telemarketing provisions, and the nature of the product and comparing the other factors, there was in the present case no evidence that the Respondent pursued the Applicant or wore him down. There was no evidence of any pressurised strategy of special offers. The evidence was that when the Applicant purchased the software he was accepting the first "special offer" made to him. In the present case I have found that while the Applicant sought a refund soon after purchase he withdrew his refund request and agreed to go ahead, only then signing the Respondent's documents and returning them.

35 In the present case, there was no evidence that the Applicant entered the agreement because of any disadvantage or pressure or enticement, except the idea of making money. On the evidence before me, if the Applicant's decision was a poor one, that was his free, unpressured choice; consequently it is not possible for me to conclude simply that it would be fair to order a refund. I was unable to identify any other reason for ordering that the contract should be void, or for orders under part 9 of the Act.

36 In the present case, it is necessary to turn to the telemarketing provisions. These provisions were inserted into the Fair Trading Act 1999 by the Fair Trading (Further Amendment) Act 2003 an amending Act passed in December 2003 and came into operation on 30 August 2004 (see Government Gazette 13 May 2004 page 1218), only days before the events which led to the present application. It is possible the Respondent was unaware of this legislation and its obligations under it, but the Act makes no exceptions for such a situation. These are consumer protection provisions applying to any supplier who enters a telemarketing agreement to which the Victorian Fair Trading Act applies. A supplier in such a situation is obliged to comply with the applicable law.

37 Here, although I heard no specific argument about Division 2 of part 4 of the Act (the telemarketing provisions) I am satisfied the parties had an opportunity to give evidence about all the factual issues raised by the relevant provisions.

38 I have already set out section 67A(1) which defines a telemarketing agreement. By paragraph (a) the agreement must be "in trade or commerce", for the supply of goods of a kind "ordinarily used for personal household or domestic use". Is share trading software a good "of a kind ordinarily used for personal household or domestic use"?

39 In Begbie v State Bank of New South Wales Ltd, unreported Federal Court of Australia 3 December [1993] FCA 579; 1993 (1994) ATPR 41-288, Drummond J, considering the question whether a service was "of a kind ordinarily acquired ... personal household or domestic use" said "the borrowing of funds, even substantial in amount, e.g. the borrowing of funds by a person sufficient to enable that person to buy a private residence, can be a service of such a kind". He went on to conclude that the borrowing of a sum to "assist a corporation to buy a business, to enable it to assist a director to pay off ... another and to assist it to undertake the commercial development of real estate is not a service of the kind" (see 41,898). By analogy, in my view share trading software designed for use by an individual person investing on his own behalf can be a good of a kind "ordinarily used for personal ... use", while share trading software designed to be used by, say, a business or to be made available for use of the purchaser's customers, would not be a good of such a kind.

40 The Respondent gave much emphasis to the "License Agreement" attached to the outside of the software package sent to the Applicant. That document stated in part "We authorise or prohibit you (as the case may be) to use the product solely for your own purposes and not for another's purpose or allow another person to use the product for that person's own purposes". In my view it is logical to imply from this that the product is intended for "personal" use.

41 The evidence was that the Applicant purchased the software for his own use, in his own time, not as part of a business. He planned originally to use the computer supplied by his employer, but there was nothing to suggest that he planned to use the software for any but his own personal investments.

42 The negotiations or sale of the software took place over the telephone, as section 67A(1)(b) requires. In my view the fact that neither of the parties was in Victoria does not prevent the Act and these provisions from applying "extra-territorially" as the agreement was for the supply of goods to Victoria for use in Victoria.

43 After careful consideration of all the available evidence, I found that the initial telephone call was made by the supplier, as required by section 67A(1)(c). Mr Ellis gave evidence for the Respondent that it did not use "telemarketers" at the time of this transaction. I had no reason to doubt him. However, the call as described by the Applicant was not from a "telemarketer" working through a list. It was from a salesperson who had, according to the Applicant's evidence which I had no reason to doubt, been given the Applicant's telephone number by his daughter.

44 As for section 67H(1)(d) it was not disputed that the amount payable by the purchaser exceeded $100.00.

45 Section 67H(2) makes some exceptions to sub-section (1) but none of those exceptions applied to the present case.

46 Section 67D provides that a telephone marketing agreement is void unless the purchaser first gives "explicit informed consent", which is defined as consent given by the purchaser in writing (and signed) or orally (and recorded) after the supplier has "fully and adequately disclosed all matters relevant to the consent of the purchaser". Since I did not ask the parties for evidence about the information given to the Applicant during the Respondent's telephone call which led to the agreement, I cannot find that the Respondent failed to disclose all such matters.

47 Section 67D(8) provides that it is an offence for a supplier to enter or purport to enter a telephone marketing agreement unless during negotiations the supplier has verbally advised the purchaser of the right to cancel the agreement during the cooling-off period. Section 67H(1) provides that the cooling-off period is at least ten days and section 67H(3) that where the supplier has not given the purchaser a notice which can be used to cancel the agreement, the purchaser may cancel up to six months after entering the agreement.

48 Section 67F provides that it is an offence to fail to send to the purchaser a notice which can be used to cancel the agreement.

49 The evidence shows that the Respondent consistently refused to allow the Applicant to cancel the transaction and it is obvious therefore that the Respondent failed to advise the Applicant during the negotiations before the agreement was entered that the Applicant would be able to cancel within the cooling-off period. Thus the Respondent has apparently breached section 67D(8). Even more certainly it is obvious from the evidence that the Respondent did not send to the Applicant a notice which could be used to cancel the agreement, thus breaching section 67F. Although I did not ask the parties about this, it was clear that the Respondent was unaware of the requirements and that the documents it sent, which were before me, were inconsistent with any suggestion that the Respondent provided a cancellation notice for use by the Applicant. This is a serious matter and I am aware that it is unusual to form such a view without asking the parties directly whether the document was sent, but all the weight of the Respondent's own evidence was that it consistently opposed any suggestion that the Applicant could cancel the agreement.

50 Accordingly, in my view the Respondent has contravened sections 67D(8) and 67F of the Act. Characterising the Applicant's application for a refund as one under section 159 for damages for contravention of the Act, I turn now to the question of what damage the Applicant has suffered by those contraventions.

51 Had the Applicant been told of the cooling-off period, as required by section 67(B)(8), he would have better understood his options when he attempted to cancel on 15 September 2004 and may well have persisted with his request for a refund. More importantly, had he been sent a cancellation notice for his use, as required by section 67F, he would have been able to give that notice without entering any further telephone conversation and without being "convinced" all over again by the Respondent's salesperson.

52 Section 67H(6)(c) provides that a purchaser may give a cancellation notice by telephone. Applying section 67H(3) the Applicant had six months to cancel the agreement and his various refund requests (not disputed by the Respondent) could be interpreted as notice of cancellation. Section 67J then provides that on cancellation the supplier must immediately repay the purchaser's money. It is therefore arguable that the Respondent has also contravened section 67J.

53 The effect of these contraventions is that the Applicant has missed opportunities to cancel a telemarketing agreement, of which opportunities the Respondent is required by the Act to inform the Applicant. It was clear from the evidence before me that the Applicant wanted to cancel the agreement and said so to the Respondent within days and (after one occasion when he was talked out of his refund request) continued to make those requests to the Respondent for several months. In those circumstances, the Applicant has in my view suffered loss and damage measurable by the amount of refund he would have received from the Respondent had cancellation proceeded properly.

54 Section 67K provides that on cancellation a supplier may make a reasonable charge for any goods which the purchaser is unable to return and that amount may be deducted from the amount to be returned to the purchaser under section 67J. Had the Respondent complied with section 67E and 67D(8), the Applicant would have been in a position to return the goods either unopened or unused or barely used. At the hearing, the Respondent referred to what Mr Ellis said was a usual practice that software is sold on a non-refundable basis, because of copyright implications. Whether or not that is so, in this case I have found that the Applicant lost the opportunity to cancel the agreement at a very early stage because the Respondent did not comply with its obligation to inform him. In these circumstances it would not now, in my view, be fair to deduct from the amount returnable to the Applicant any amount to allow for the fact that the goods are no longer new or able to be returned in their original state.

55 Accordingly I made the orders that the Applicant receive a refund from the Respondent and return the goods to the Respondent.