One of the important aspects for anyone engaged in trade or commerce is not to engage in misleading or deceptive conduct, or conduct that is likely to mislead or deceive, as outlined in s 18(1) of the Australian Consumer Law (the ACL). However, most business owners will be asking themselves, what constitutes “misleading or deceptive” conduct? It’s an important question to ask and this piece will provide a brief introduction to representations that are misleading, or likely to mislead.
Although s 18(1) doesn’t define what behaviours constitute misleading or deceptive conduct, we can look to case law for some guidance to s 18(1), where the concept has been interpreted by the courts in relation to s 52 of the Trade Practices Act 1974 (Cth) (the TPA). Gibbs CJ held in Parkdale Custom Built Furniture Pty Ltd Puxu Pty Ltd (1982) 149 CLR 191:
“The words of s 52 require the Court to consider the nature of the conduct of the corporation against which proceedings are brought and to decide whether that conduct was, within the meaning of that section, misleading or deceptive or likely to mislead or deceive. Those words are on any view tautologous. One meaning which the words “mislead” and “deceive” share in common is “to lead into error”. If the word “deceptive” in s 52 stood alone, it would be a question whether it was used in a bad sense, with a connotation of craft or overreaching, but “misleading” carries no such flavour, and the use of that word appears to render “deceptive” redundant. The words “likely to mislead or deceive”, which were inserted by amendments in 1977, add little to the section; at most they make it clear that it is unnecessary to prove that the conduct in question actually deceived or misled anyone.”
Upon the identifying of the representation or representations, it is then essential to show that they were misleading, therefore, it is important to look at the context surrounding the representation as Gibbs CJ noted in Parkdale (at 199):
“The conduct of a defendant must be viewed as a whole. It would be wrong to select some words or act, which alone, would be likely to mislead if those words or acts, when viewed in their context, were not capable of misleading. It is obvious that where the conduct complained of consists of words it would not be right to select some words only and to ignore others which provided the context which gave meaning to the particular words. The same is true of acts.”
The courts will generally take the approach of looking at the facts of each individual case and the surrounding context when determining whether a representation is seen to be misleading or deceptive conduct.