I am unable to see any basis upon which the statements could be said to fall within this subsection.
FAIR TRADING ACT CLAIM - IN TRADE OR COMMERCE
16 This part of the claim is more difficult. The defendants are seeking election or re-election as directors of NRMA. The statements in question were made in support of their claims for election. I do not consider standing for election to be a business or professional activity. The ramifications, if it were, considered together with s41 of the Fair Trading Act, would be rather frightening. A candidate for election as a union secretary or perhaps as a shop steward in a particular company might well stand on a platform of increasing workers' rewards by distributions from income regularly applied by a company to reserves and stated by the candidate to be not needed for that purpose in future years. This would be a representation as to a future matter in respect of which the representor would bear the onus to show reasonable grounds for its making. The activity of seeking election might be in connection with a future business intention if elected, but I do not consider it to be in trade or commerce. The boundaries in these matters are not always easy to determine, particularly when one is dealing with a matter which requires determination with great speed to give the determination any effect, but the boundaries are at least confined by the principles laid down in Concrete Constructions (NSW) Pty Limited v Nelson (1990) 169 CLR 594 at 604. I accept as was held in Plimer v Robertson (1997) 89 FCR 302 at 326 that the same principles and boundaries apply to conduct under s42 of the Fair Trading Act. It follows, as Lindgren J said in the latter case at page 326 that "it is necessary to enquire whether the representations of the defendants were made by them in trading or commercial dealings between persons" (or between a personal representor and a corporation). Statements directed to electors by election candidates may be made in connection with trade or commerce In that they may bear upon the commercial activities of the body to be governed as a result of the election, but in my view they are not made in trade or commerce. Neither do I think it could be said that the statements were made for the purpose of promoting the business of the other members of the NRMA as those members do not have a business. Neither could it be said that the statements were made for the purpose of promoting the business of NRMA itself. They are made for the purpose of giving the defendants the chance or opportunity to endeavour to bring about some change in the business of NRMA purportedly for the benefit of the members, but that in itself does not make it conduct in trade or commerce.
17 I have of course been directed to the recent decision of Santow J in NRMA Limited v Yates {1999} NSWSC 859, where he held that misleading advertisements as to past claimed loss of $50 million in one transaction of NRMA was misleading conduct in trade or commerce of NRMA. It is, I think with respect, somewhat difficult to see how misleading statements as to alleged inefficient management of NRMA, was conduct for the purpose of promoting the business of NRMA, rather than promoting the chances of Mr Yates' success at the election, but in any event the finding was partly based upon the position of Mr Yates as a director and his fiduciary obligations in that capacity which are no part of the present action. It follows that I have come to the conclusion that the statements were not made in trade or commerce so that relief as sought under s65 of the Fair Trading Act is not available.
MISLEADING AND DECEPTIVE CONDUCT
18 If I were wrong in the conclusion I have just reached, it would have been necessary to determine whether the impugned statements were misleading or are deceptive or likely to mislead or deceive and it is desirable I deal with this.
19 So far as the first statement complained of is concerned it seems to me to be the type of statement one often sees in advertisements or in election campaigns. In some ways it is like saying that some product is the best. When one considers it in the light of its being published in connection with an election campaign, the only complaint that could possibly be made about it, is the inclusion of the word "only". It is perfectly true, as appears from the affidavit of Mr Talbot, that members of rival teams have plans to improve NRMA road services. But the statement of Lockhart J in Stewart Alexander & Co (Interstate) Pty Ltd v Blinders Pty Ltd (1981) 53 FLR 307 at 310 as to a robust approach being called for when considering whether television commercials are misleading or deceptive applies with even greater force to an election campaign. There is of course no evidence of anyone having been misled, but I do not think that it could possibly be thought that the members would believe that no other course, apart from the election of the defendants, could improve the NRMA road service. I find that first statement was not misleading and deceptive within s42 of the Fair Trading Act.
20 So far as the second statement is concerned, two claims are made by the plaintiff against it. The first is that it is misleading and deceptive in that it implies that the shares will be free or given to NRMA without stating that it already controls the board of Insurance and is entitled to all its assets on a winding up. In the context in which the statement was made I do not think that anything was said about free shares. An advertisement is not to be read in the same light as the documents required for a take over offer or for a scheme of arrangement. The word "giving" in the second statement when read in its context can be taken just as appropriately to mean leaving NRMA with or delivering to NRMA shares worth $250 million. It would be wrong, in my view, to give any undue emphasis to the word "giving" as it appears in the advertisement. The second complaint is the statement of the shares as being worth at least $250 million. The difficulty about this is that the figure comes from the Macquarie Equities report and relies upon an assumption in that report that five percent of the net worth of Insurance will be received by NRMA under demutualisation if it goes ahead. As the source of this statement, or at least the value of the shares, is stated to be the report of Macquarie Equities, and nothing whatever is said against that, it would seem to me that as the defendants clearly and openly stated that the figure was based upon the Macquarie Equities report, there were reasonable grounds for making that representation, provided there was some proper basis for the assumption that five percent of the net worth of Insurance would end up in the hands of NRMA. This is a difficult matter, but on balance I have come to the conclusion that in clearly relying upon the Macquarie Equities report for the statement made, the defendants must have accepted the assumption and been prepared to so act as to work to bring it about and accordingly had reasonable grounds for making the representation. There can of course be no doubt that if a severe earthquake hit the whole of the central business district and a large part of the metropolitan district of Sydney, the value of Insurance would be substantially reduced. But that does not mean there were not reasonable grounds for making the representation. I do not consider that the requirements of s41(2) of the Fair Trading Act require direct evidence by the defendants that they would act so as to make good the assumption relied upon in the Macquarie Equities report. I do not consider the fact that it has been shown to be more probable than not that NRMA has received in the last two years payments from Insurance, make the statement "and yearly income" misleading or deceptive in the context in which it is considered. It would, I consider, be different, as I have said before, in the case of a prospectus or a take over document or a scheme of arrangement.
21 So far as the third statement is concerned, I consider the same position as to reliance on the report applies, although it would probably have been desirable to have had the statement refer to provision of "$3,000 worth of shares to the average member being a member of NRMA of fifteen years standing with two policies with Insurance". In other words, I consider the Macquarie Equities report provided reasonable grounds. Once again this is election material and in that context I do not think the statement to be misleading. Neither do I think there could be any complaint about the last part of the third statement, namely, "but only if you vote for all 8 members of the Members First Team". While it may not be necessary for all eight members of that team to be elected as directors for demutualisation to be achieved, and there is no evidence about that, in circumstances where, at least up to the present time, it has been well-known that the board of NRMA is divided on the question of demutualisation, but it is established by the evidence in this case, that the boards of both companies decided on 25 February 1999 to develop a restructure proposal which would involve demutualisation of the insurance business and the continued provision of road service through a new mutual, and that subject to final approval of the board, the restructure proposal would be put to members of both companies through schemes of arrangement, it does appear that there would be more certainty of the boards continuing to put such decisions into effect if all members of the Members First Team were elected as directors. Once again in the context of an election campaign, this last statement does not appear to me to be misleading or deceptive or in any way likely to mislead or deceive the electors in the context of this particular election.
22 It follows that had it been necessary to so find I would find the claim under this heading fails.
23 Finally I should add that had I considered the statements were in breach of the Act and it was proper to grant an injunction I would not have made an order for publication of some correcting advertisement as I would not have thought that to be necessary.
24 In coming to the conclusion which I have it is not to be thought that I am recommending to the defendants they go back to their original policy statement. On the other hand, as it has been raised, it is also right to say that I can see no objection to the statement which on the evidence presently appears on the Members First Team website, which states that if the insurance company is floated, every NRMA member would receive "a windfall benefit in the form of shares". One of the meanings of the word "windfall" is stated in the Macquarie Dictionary to be "an unexpected piece of good fortune". If the road service continues as the defendants state it will on demutualisation of Insurance, then I do not consider that the statement of a windfall could be said to be misleading or deceptive, albeit that it could not be said that the benefit was "free".
25 It follows from these reasons that the plaintiff's claim should be dismissed with costs and I so order. The summons will be dismissed with costs. The exhibits can be returned.