Cox & Coxon Ltd v Leipst

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Cox & Coxon Ltd v Leipst (Court of Appeal, New Zealand) clarifies damages under the Fair Trading Act.

Facts:
- In 1995, Barry and Barbara Leipst bought a 5-acre Hastings lifestyle block with a pear orchard. Real estate agents Cox & Coxon Ltd misrepresented 1994 pear sales as $12,000, when the actual figure was $8,801.16.
- The Leipsts sued under the Fair Trading Act for “expected damages” of $27,233.64, calculated as a $3,198.84 annual loss for 20 years at a 10% discount.
- District Court: no damages. High Court: awarded $16,000.

Issue:
- Can damages for future losses (expectation loss) from a misrepresentation be awarded under the Fair Trading Act, or do such losses belong to contract or tort damages?

Decision:
- The Court of Appeal held that under the Fair Trading Act, damages can only be awarded as tort damages, not as contract damages. This means the “expected damages” argument under the Act was not available; the Leipsts could pursue such losses only in tort, not under the Act.

Significance:
- This case clarifies that the Fair Trading Act does not permit recovery of expectation damages for misrepresentation; claimants must seek such damages through tort law rather than under the Act.