Lotteries' arguments on appeal
98 Lotteries advanced two arguments in support of its contention that the primary judge had erred in making the findings that he did.
99 First, Lotteries contended that the primary judge erred by construing the second play instruction as having primacy over the contract as a whole, which includes the Lotteries Act and the Rules.
100 The second play instruction written on the ticket reads:
If the word shown in any one Game matches the picture shown in the same Game, you win the prize shown for that Game.
101 Lotteries contended that the second play instruction is not to be construed in isolation, without also taking into account all other terms of the contract, and the surrounding circumstances.
102 According to Lotteries, the Kuzmanovskis purchased a ticket that stated in plain terms the legal position that existed anyway, namely that it was governed by the Lotteries Act and the Rules. The Kuzmanovskis knew that the ticket was so governed, but simply did not know what the Lotteries Act and the Rules said, and they also chose not to find out.
103 Lotteries relied on Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592 in support of its first contention.
104 Lotteries' argument is not accepted. Whether a representation is misleading or deceptive is to be determined by reference to the meaning the representation conveyed to the ordinary and reasonable member of the class of consumers to which the representation was addressed: see Campomar Sociedad Limitada v Nike International Ltd (2000) 202 CLR 45 at [103].
105 Furthermore, it is well settled that s 52 of the Trade Practices Act should be interpreted broadly due to its remedial nature. In Accounting Systems 2000 (Developments) Pty Ltd v CCH Australia Ltd (1993) 42 FCR 470, Lockhart and Gummow JJ stated at 503:
… the evident purpose and policy underlying Pt V, which includes s 52, recommends a broad construction of its constituent provisions, the legislation being of a remedial character so that it should be construed so as to give the fullest relief which the fair meaning of its language will allow.
106 The class of consumers to which the representations on the ticket was addressed was a very large class of consumers including people from all walks of life and educational backgrounds. As mentioned, the primary judge characterised the meaning attributed to the representation by Mr Kuzmanovski, namely, that there was nothing in the Lotteries Act or the Rules that was inconsistent with the second play instruction, to be a matter of common sense.
107 In our view, the finding of the primary judge amounts to a finding that an ordinary and reasonable member of the class of consumers to whom the writing on the ticket was addressed, would have understood it to convey the same meaning as it conveyed to Mr Kuzmanovski. In coming to that view, for the reasons that he gave, the primary judge did not err.
108 The Butcher case is distinguishable on the facts.
109 In Butcher, the appellants were purchasers of a waterfront property on which there was located a swimming pool. Prior to purchasing the property, they received from the respondent, a suburban real estate agent, a brochure which contained a survey diagram which showed the location of the pool being entirely within the freehold land. The pool was not, in fact, entirely within the freehold land. The real estate agent's brochure contained disclaimers, which stated that it was not a surveyor and it did not engage a surveyor to do the survey, and that the diagram recorded what a particular surveyor had found. One of the disclaimers, reproduced in Butcher at [50], stated:
…We believe the vendor and the surveyor are reliable, but we cannot guarantee the accuracy of the information they have provided. Whatever you rely on, you must rely on your own inquiries.
110 The High Court held that the agent did not engage in misleading or deceptive conduct, since he did no more than to pass on the information provided to him by the vendor, without adopting or endorsing it. In coming to that conclusion, Gleeson CJ, Hayne and Heydon JJ at [40] took into account "the nature of the parties, the character of the transaction contemplated, and the contents of the brochure itself".
111 The class of the persons to whom the statements in the brochure, in that case, was addressed, was small. There were only 100 brochures printed. Further, the property that was being advertised for sale was an expensive waterfront property and, therefore, likely to attract only persons who could afford to buy the property. The appellants in Butcher were property investors. It was in that context that the observations of Gleeson CJ, Hayne and Heydon JJ were applied to support the finding that the conduct of the agent was not misleading or deceptive. By contrast, the class of consumers to whom the writing on the tickets was addressed in this case, was very large and comprised persons from a wide diversity of backgrounds. In our view, construing the representations made on the ticket, in the context of its surrounding circumstances in this case, supports the finding made by the primary judge. The qualification to the second play instruction contained in the Lotteries Act and Rules, so undermined the integrity of the representation contained in the second play instruction, that the bland reference on the ticket to the Lotteries Act and the Rules was not sufficient to apprise the consumer of the qualification to the representation in the second play instruction, and, therefore, to the true circumstances in which the prize would be paid.
112 Secondly, Lotteries contended that the primary judge erred by focussing too much on the "face of the ticket", as the basis on which to make conclusions about the representations conveyed by Lotteries' conduct.
113 Lotteries' contention was that the primary judge should not have paid exclusive attention to the "face" of the ticket, and that his erroneous construction of the second play instruction was an incorrect and incomplete basis on which to make findings about what Lotteries' conduct conveyed. Lotteries contended that no reasonable person inspecting the ticket, who chose to exercise a modicum of care and attention to its entirety and to its context, could come to the conclusion that the ticket, in the second play instruction, provided all the relevant information required to determine whether it is a winning or losing ticket. Lotteries submitted that, if the law is to give governing force to the Lotteries Act and, particularly if that is also noted on the ticket, the reasonable person would be expected to read the ticket so as to understand that the game will be played in accordance with the entirety of the contract, and not merely a part of it.
114 Lotteries' second contention is not accepted for the same reasons as the first contention is not accepted. By making no reference to the fact that the effect of the Lotteries Act and the Rules was to falsify the second play instruction, Lotteries created the impression in the mind of an ordinary and reasonable consumer of reading the ticket that there was nothing in the Lotteries Act or the Rules which would nullify the truth and integrity of the second play instruction.
115 It follows that ground 8 of the grounds of appeal is dismissed.
116 Lotteries also appealed on the grounds that the primary judge erred in the quantum of damages which he awarded.
117 The primary judge concluded that the Kuzmanovskis had suffered loss or damage as a result of Lotteries' misleading conduct. Lotteries submitted no loss or damage was suffered by the Kuzmanovskis, and that the award of damages of $20,000 by his Honour was "plainly excessive".
118 The primary judge found Mr and Mrs Kuzmanovski to be honest witnesses. However, he did not conclude that Mr and Mrs Kuzmanovski were misled into the purchase of the ticket. Rather, the terms of the ticket, once purchased and scratched, misled them as to its inherent characteristics.
119 The primary judge accepted that, as the misrepresentation inherent in the ticket became more and more apparent, the sense of disappointment, anger and frustration felt by the Kuzmanovskis increased, especially on the part of Mr Kuzmanovski. Mr Kuzmanovski had planned to use the money for, among other things, financing a trip to Macedonia to visit his ailing grandmother.
120 While recognising that there were no objective criteria for assessing the value of such injured feelings, his Honour proceeded to assess the damages under the Trade Practices Act at $20,000 ($15,000 for Mr Kuzmanovski and $5,000 for Mrs Kuzmanovski).
121 Lotteries contended that the award was plainly excessive. Lotteries contended that Mr and Mrs Kuzmanovski became aware of the correct position at law the morning after they scratched the ticket. That is, although they stayed up for most of the night with excitement at the thought of winning, the following morning they were informed by the agent for Lotteries that the ticket was in fact not a winning ticket. Regardless of the fact that their disappointment had continued to mount since that time, they had suffered no compensable loss because the day after scratching it they found out the answer to the question of whether they had a winning ticket.
122 In our view, this contention is not to be accepted. The primary judge found that Lotteries' conduct had caused an initial soaring of the Kuzmanovskis' hopes and dreams and then, when those hopes and dreams were dashed, prolonged feelings of disappointment, anger and frustration arising from a sense of feeling cheated. The primary judge went on to find that that initial feeling of elation by the Kuzmanovskis was the very kind of human emotion played on by the sales pitch of Lotteries.
123 In our view, Lotteries has not demonstrated that the primary judge erred in principle in the manner in which he approached the question of damages. The assessment of damages for disappointment and injury to feelings is not a precise science. In our view, the primary judge did not err in taking into account the fact that the 'sales pitch' of Lotteries was directed to inducing consumers to believe that with a stroke of luck, they could experience the very elation which the Kuzmanovskis felt when, by reason of the Lotteries' contravening conduct, they believed that their ticket was a winning ticket. Nor, in our view, did the primary judge err in concluding that the deep and lingering sense of disappointment, anger and frustration felt by Mr Kuzmanovski and, to a lesser extent Mrs Kuzmanovski, was a natural human emotional response to Lotteries' contravening conduct. It was, in our view, open to the primary judge to award damages in the sum which he did.
124 Grounds 9 and 10 of the appeal are dismissed.