Parkdale Custom Built Furniture v Puxu (1982)149 CLR 191

Facts: Puxu, P, manufactured and sold “Post and Rail” furniture including its “Contour” range of lounges and chairs. Parkdale, D, brought out a similar but cheaper product as part of its “Rawhide” range. Unfortunately, the labels could be cut off and there was evidence that some retailers had done that to misrepresent the chairs. Puxu sued, alleging that Parkdale’s conduct breached s 52, Trade Practices Act (equivalent to now s 18, Australian Consumer Law). Parkdale appealed.

Held: The appeal was allowed. It was only misleading to consumers due to the action of an intervening third party, so D is not liable. Also, the classes were different (e.g. compare price points).

Generally, the sale by one manufacturer of goods which closely resemble those of another manufacturer is not a breach of the section if the goods are properly labelled. If an article is properly labelled to show the manufacturer, its close resemblance to another article will not mislead an ordinary reasonable member of the public. If the label is removed by a retailer for whose acts D is not responsible and the purchaser is misled, D is not liable.

Ratio: For the purpose of deciding whether conduct is misleading or deceptive or likely to mislead or deceive, consideration must be given to the class of consumers likely to be affected by the conduct, including both the inexperienced and the experienced, that is, the effect of reasonable members of the class.