Alto Pty Ltd v General Motors Australia and New Zealand Pty Ltd

1. [1]

   The broad context for this claim is the decision of General Motors Corporation (GMC), a company based in Detroit, United States, communicated on 17 February 2020, to wind down the supply of new Holden cars in Australia, and the declining performance of the Holden brand in the years leading up to this decision. The plaintiff is Alto Pty Ltd (Alto), a company which began operating car dealerships in 1968 and for some time has (together with other members of what was described in evidence as the Alto Group) operated a significant car dealership business in Australia. Between 1 January 2012 and May 2020, Alto was party to Holden Dealers Sales and Service Agreements (DSSAs) pursuant to which it operated a Holden dealership in North Sydney (Alto Holden dealership), first at a site owned by the Alto Group at 387 Pacific Highway, Artarmon (Hotham Parade site) and from January 2016 at a site owned by the Alto Group at 734 Pacific Highway, Chatswood (Chatswood site). Since 1995, Anthony Altomonte (Mr Altomonte) has been the Managing Director and Chief Executive Officer (CEO) of the Alto Group.

2. [2]

   Each of the first two defendants, General Motors Australia and New Zealand Pty Ltd (formerly GM Holden Ltd) (GM Holden) and General Motors Holden Australia NSC Pty Ltd (NSC) (together, Holden) were, at various times, the counterparty to DSSAs with Alto. The third defendant, Mark Bernhard, was employed by Holden, in various roles, at all relevant times.

3. [3]

   Alto contends that GM Holden made representations to it on 8 March 2017 (March 2017 representations) and 23 May 2017 (May 2017 representations) which contravened the prohibition on misleading or deceptive conduct in s 18(1) of the Competition and Consumer Act 2010 (Cth), Sch 2 (s 18 and the ACL, respectively). Alto seeks damages under s 236 of the ACL, interest and costs. Alto abandoned a separate claim for breach of the DSSA which it entered into with NSC in early 2018 in its closing submissions. Alto also abandoned a third claim under s 18 (advanced against NSC) in its closing submissions. Given that no claim was ultimately advanced against NSC, the proceedings against NSC must be dismissed.

4. [4]

   As is well known, s 18 provides, relevantly:

5. [5]

   Section 236 of the ACL provides, relevantly:

6. [6]

   The March 2017 representations are said have been made by an email of 8 March 2017 from Peter Keley to all Holden dealer principals. The representations are said to be that:

   1. (1)

      GMC is 100 percent committed to its business in Australia; and

   2. (2)

      the key point is that we can remove any doubt about GMC’s commitment to Holden and to Australia.

7. [7]

   The May 2017 representations are said to have been made orally by Mr Bernhard, on his own behalf and on behalf of GM Holden, at a meeting attended by Peter Jamieson, Sandy Alchi (both Holden employees) and Mr Altomonte. The representations Alto alleges were made are that:

   1. (1)

      Holden is here to stay;

   2. (2)

      the new model vehicles are still coming;

   3. (3)

      it is business as usual; and

   4. (4)

      the future with Holden is bright.

8. [8]

   Alto also contends that, for the purposes of ss 2 and 236(1) of the ACL, Mr Bernhard is a person who “has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention” by GM Holden arising out of the May 2017 representations.

9. [9]

   Alto contends, in essence, that at the time of the March and May 2017 representations the true position, having regard to a range of matters that I consider in some detail below, was that GMC’s commitment to Holden was uncertain, it was not business as usual and Holden’s future was not bright such that the March and May 2017 representations were false and neither GM Holden nor Mr Bernhard had reasonable grounds for making the representations. To the extent that Alto contends that the representations were with respect to a future matter, Alto relies also upon ss 4(1) and 4(2) of the ACL which provide:

10. [10]

    Mr Altomonte says that he relied upon the March and May 2017 representations and that, but for the representations, he would have caused Alto either to sell or relocate the Alto Holden dealership and instead to have operated a prestige or premium dealership from the Chatswood site. Relying upon reports from Stephen Bragg, a chartered accountant with expertise in the motor industry (a industry expert), and Alan Max, a chartered accountant with valuation expertise (a valuation expert), both of whom were from Pitcher Partners, Alto says that it thereby suffered losses quantified at between $15,710,200 and $24,162,400 (unless otherwise indicated monetary figures are in AUD).

11. [11]

    The defendants deny that the representations were made as alleged by Alto or that, if made, they were false or made without reasonable grounds. The defendants also deny that Mr Altomonte relied upon the representations and, relying upon the expert evidence of Graham Killer, an industry expert from Grant Thornton, and Christine Oliver, a valuation expert from Ankura, say that Alto’s counterfactual cannot be established on the balance of probabilities, and even if it is, Alto’s loss is in a range from nothing to $4,571,400.

12. [12]

    For the reasons set out below, Alto’s claims are dismissed.

13. [13]

    Whilst I have rejected Alto’s claim that the March 2017 representations constituted misleading or deceptive conduct under s 18 of the ACL and I am not satisfied that the May 2017 representations were made, given that I have heard a large amount of evidence going to other issues, and that in a claim of this size there may be some prospect of an appeal, I have gone on to make findings as to some further issues which turn on my assessment of the evidence, in order to enhance efficiency overall: by analogy with the approach discussed in Boensch v Pascoe (2019) 268 CLR 593; [2019] HCA 49 at [8].

Alto

1. [14]

   The Alto Group was started by George Altomonte, Mr Altomonte’s father, at the Chatswood site in 1956. So far as relevant to the present proceedings, the Alto Group now comprises a holding company, Altomonte Holdings Pty Ltd (Altomonte Holdings) and a number of subsidiaries including Alto, Alto Prestige Pty Ltd (Alto Prestige) and Altomonte Artarmon Pty Ltd (Alto Artarmon). At all relevant times both Mr Altomonte and his father were directors of Alto, Alto Artarmon, Alto Prestige and Altomonte Holdings.

2. [15]

   Mr Altomonte gave detailed evidence about his background. Since 1995 he has been responsible for the day-to-day running of the Alto Group, particularly its car dealership and related businesses. He provides the strategic direction for the Alto Group. He has been the general sales manager for the Alto Group since around 1992. He is also responsible for maintaining the relationships between the Alto Group and its original equipment manufacturers (OEMs, sometimes described as brands). He has also been chairman of the Land Rover/Jaguar and Audi “Dealer Councils” and attended meetings of Holden’s NSW dealers group from time to time.

3. [16]

   Since 1996, Mr Altomonte has also had extensive experience negotiating dealership agreements with a range of OEMs ranging from prestige (at the very top end of the market), through premium (middle level brands), to what he described as “volume” brands, of which Holden was one. Since 1995 the Alto Group has acquired approximately 25 to 30 dealerships. For each, Mr Altomonte conducted the negotiations and was the ultimate decision-maker within the Alto Group. To give an idea of the extent of his commercial responsibility, the Alto Group’s car dealership business employed over 600 staff and had revenue of $685 million in the financial year ending June 2017. Mr Altomonte has at all material times been a highly experienced and sophisticated commercial operator in the car dealership business with a wealth of commercial and industry experience. This is the backdrop against which the credibility and reliability of his evidence must be considered.

4. [17]

   As for the sites owned by the Alto Group, the Chatswood site is in a prime position for a car dealership and is a large site. The Hotham Parade site (owned by Alto Artarmon) and 393 Pacific Highway, Artarmon (Artarmon site) (owned by Altomonte Holdings) are smaller. For as long as Mr Altomonte could remember these three sites had been zoned for car dealerships. Over the period relevant to Alto’s claims, the Alto Group operated a number of dealerships from these three sites (and for some periods the sites were vacant):

   1. (1)

      Hotham Parade site: from 2 January 2012 to January 2016, Holden dealership (operated by Alto); January 2016 to end of June 2020, Hyundai dealership (operated by Alto); July 2020 to end of July 2022, the site was vacant save for temporary use in March 2021 for storage and car washing; from May to July 2022, renovations to Cupra’s requirements; from August 2022, Cupra dealership (operated by Alto Prestige).

   2. (2)

      Chatswood site: from 2006 to 2007, motorcycle dealership; apparently vacant thereafter; excavation and construction work for the Holden dealership commenced in January 2013 and cost $12,288,657 (excluding GST); January 2016 to either April or end June 2019, Holden dealership (operated by Alto); from July 2019 to end December 2019 renovations to meet Volkswagen’s (VW) requirements; from January 2020 onwards VW dealership (operated by Alto Prestige).

   3. (3)

      Artarmon site (shared between two Alto Group dealerships): from October 2016 throughout period, Skoda dealership (Alto Artarmon); from either 1 July or October 2016 to end April 2019, Mitsubishi dealership (unknown Alto Group operator); May to June 2019, renovations to Holden’s specifications; from April or 1 July 2019 to May or 30 June 2020, Holden dealership (Alto: relocated from Chatswood site); from 1 July 2020 to end January 2023, Hyundai dealership (Alto: relocated from Hotham Parade site and sold for $850,000 goodwill with sale completed on 1 February 2023); February 2023, vacant; from 1 March 2023 onwards, MG dealership (unknown Alto Group operator).

5. [18]

   Mr Altomonte did not know which Alto Group companies owned which of his dealership sites. He also said that the decision as to which Alto Group company a dealership goes into is “a minor decision”.

6. [19]

   The Alto Group also provides servicing facilities for at least some of its dealerships and has properties which are leased out to companies within and outside of the Alto Group. It also has other businesses.

GMC and Holden

1. [20]

   The parent company of both GM Holden and NSC is GMC (although detail of the corporate structure was not in evidence). GMC operated in various jurisdictions through business units, including both sales and manufacturing.

2. [21]

   From 2014 onwards Mary Barra was the Chairman and CEO of GMC. Between January 2014 and December 2018, Daniel Ammann was the President of GMC. Charles (Chuck) Stevens III, who gave evidence in these proceedings, was an Executive Vice President and Chief Financial Officer (CFO) of GMC from January 2014 to 1 September 2018 and was part of the Senior Leadership Team (SLT) of GMC. GMC divided its operations into different geographic areas, and General Motors International (GMI), a management entity of GMC (but without separate corporate identity) was responsible for some but not all of GMC’s international operations, including Holden in Australia. From August 2013 to January 2018 Stefan Jacoby was the President of GMI, an Executive Vice President of GMC and was also part of the GMC SLT.

3. [22]

   Holden reported to both GMI and GMC on its financial performance and budgets and targets were set for Holden by GMI and GMC. Decisions as to investment in Australia and as to what, if any, cars would be supplied to the Australian market were made by GMC. Strategy and budget for the operations of GMC in Australia through Holden were determined ultimately by GMC, but in the first instance by GMI.

4. [23]

   On 10 December 2013, GMC announced that it would discontinue vehicle and engine manufacturing and reduce its engineering operations in Australia by the end of 2017. NSC was established in order to assume the sales and distribution functions in Australia following this announcement. In September 2015 a GMC subsidiary, General Motors International Operations Pte Ltd, and NSC entered into a distribution agreement for the supply of Holden cars.

5. [24]

   Mr Bernhard worked for GM Holden first in January 1986 and subsequently in various different roles for different entities within the GMC umbrella, including for GMI and in China (which was not within GMI). He was appointed as Chairman and Managing Director of GM Holden in July 2015. He remained in that role until 3 August 2018. He was also Chairman and Managing Director of NSC from 16 January 2017 until 3 August 2018. From 1983 Mr Keley was employed by Holden in various roles, including between 2013 and 31 March 2017, as Executive Director – Sales of GM Holden, with responsibility for sales through the dealer network. He was a director of NSC from 16 January 2017 to 22 September 2020. Mr Alchi was employed by Holden between November 2013 and September 2020 and from November 2013 until 17 July 2018 he was a zone manager responsible for managing the dealer network in New South Wales.

Evidence

1. [25]

   The documentary evidence tendered was extensive, extending to over 7,000 pages comprising primarily internal documents of, or communications from or within, GMC, GMI or Holden over many years. The inference I draw is that those documents were available by reason of compulsory document production procedures both in Australia and abroad. As has often been observed, “contemporaneous documents generally furnish the most reliable source of evidence as to what occurred or, at the very least, provide a generally reliable reference point from which to assess the reliability of witness testimony”: ET-China.com International Holdings Ltd v Cheung [2021] NSWCA 24; 388 ALR 128 at [25] (Bell P, Bathurst CJ and Leeming JA agreeing). Given the passage of time between the central events relied upon by Alto and these proceedings, I have necessarily placed primary reliance upon this extensive body of documentary evidence. However, I have also been mindful of the observation of Bell P in ET-China at [29] that documents and events take their meaning from context.

2. [26]

   Alto relied upon five affidavits from Mr Altomonte and two affidavits from Mr Elabbasi, who entered into a Heads of Agreement (which ultimately did not proceed) to purchase Alto’s Holden and Hyundai dealerships for $1 goodwill in late 2019. Both Mr Altomonte and Mr Elabbasi were required for cross-examination and gave oral evidence.

3. [27]

   The defendants relied upon three affidavits from Mr Bernhard, two affidavits from Mr Keley, two affidavits from Mr Jacoby, and affidavits from Mr Jamieson (Executive Director, Customer Experience of GM Holden from February 2016 to April 2018), Mr Alchi, Nicholas Senior (employed by Subaru Australia, a subsidiary of Inchcape Australia Ltd (Inchcape), from 1991 and CEO of Inchcape from October 2016 until April 2020), Stephanie Trajcevska (a solicitor), Dahlia Shnider (an employee of GM Holden) and Mr Stevens. Mr Bernhard, Mr Keley, Mr Jacoby, Mr Alchi, Mr Senior and Mr Stevens were required for cross-examination and gave oral evidence.

4. [28]

   Consistent with established principle, given that the matters in dispute took place largely in 2017, I have evaluated the credibility and reliability of the evidence given by the various witnesses primarily by reference to “the objective factual surrounding material and the inherent commercial probabilities, together with the documentation tendered in evidence”: Effem Foods Pty Limited trading as Uncle Ben’s of Australia v Lake Cumbeline Pty Limited [1999] HCA 15; 161 ALR 599 at [16] (Gleeson CJ, Gaudron, Kirby and Hayne JJ).

5. [29]

   In assessing credibility and reliability I have placed primary reliance upon my assessment of the probabilities and consistency of the various witnesses’ accounts with all relevant evidence: Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 at [30]-[31] (Gleeson CJ, Gummow and Kirby JJ); Goodrich Aerospace Pty Ltd v Arsic (2006) 66 NSWLR 186; [2006] NSWCA 187 at [17]-[27] (Ipp JA, Mason P and Tobias JA agreeing). I have also approached the evidence consistent with the observations of Leggatt J in Gestmin SGPS SA v Credit Suisse (UK) Ltd [2013] EWHC (Comm) 3560 at [19], [22], recently cited with approval in Warne v ACN 603 541 411 Pty Ltd trading as Chandlers International Lawyers [2025] NSWCA 57 at [64], [74]:

6. [30]

   I have also approached the evidence on the basis that I am not bound to accept evidence simply because it was not challenged in cross-examination: Amaca Pty Limited (Under NSW Administered Winding Up) v Roseanne Cleary as the Legal Personal Representative of the Estate of the Late Fortunato (aka Frank) Gatt [2022] NSWCA 151 at [36]. This is particularly so where the defendants made clear in their submissions that aspects of Alto’s case which relied directly upon Mr Altomonte’s evidence, such as whether the May 2017 representations were made and generally as to reliance and the counterfactual, should not be accepted, and the lines of cross-examination were necessarily directed to showing that Mr Altomonte’s actual recollection differed from the account given in his affidavit evidence.

7. [31]

   Mr Altomonte gave evidence in a straightforward manner and I do not doubt his honesty. I did, however, get the strong impression from his evidence as a whole that his belief that he was wronged by the defendants and that they have caused him significant losses, has become very entrenched and that this has subconsciously coloured his recollection of what occurred in the period from 2017 to 2020, his understanding of the significance of this and his opinion about what steps he would have taken on the counterfactual. Notwithstanding this, mindful of the risks in making global findings about the credibility of a witness: Sangha v Baxter [2009] NSWCA 78 at [155] (Basten JA, Handley AJA agreeing), I do not reject Mr Altomonte’s evidence as a whole. Rather, I have approached his evidence as a whole with some caution. The following matters also suggested the need for a cautious approach to his evidence.

8. [32]

   First, in many respects (as might objectively be expected) Mr Altomonte had very little or no recollection of matters from some years past, such as what Holden’s market share was in 2017, which of the Alto Group’s companies owned which of the Alto Group’s sites, who paid for the renovation of the Artarmon site to meet Holden’s requirements, which of the Alto Group’s companies owned or operated which dealership, and what occurred at a meeting of the NSW Holden dealers group he attended on 6 April 2017. However, in his affidavit he set out a detailed and highly specific account of what was said at the 23 May 2017 meeting: [256] below. It is inherently improbable that he would have such accurate and detailed recollection, particularly given the very limited ambit of the note he kept from this meeting.

9. [33]

   Second, in significant respects evidence of Mr Altomonte, which was of central significance to one of the abandoned claims, turned out to be wrong or unreliable. Two aspects of this were his evidence that he signed the acknowledgement of receipt on the offer dated 24 November 2017 to enter into a DSSA and his evidence that he was “the only one that signs our acknowledgement receipt”. Neither turned out to be true. Further, Mr Altomonte gave evidence as to his understanding of the DSSA which Alto entered into with NSC in early 2018 but it transpired from his oral evidence that he would not have read that agreement and that he had no recollection of what happened with its signing.

10. [34]

    Third, Mr Altomonte’s evidence about how he would have been prepared to use the Hotham Parade site (which was relied upon in the abandoned breach of contract claim), which was vacant between July 2020 and August 2022, contained significant inconsistencies.

11. [35]

    Fourth, Mr Altomonte said that he did not “really differentiate between General Motors Company and General Motors Holden. I don’t – that’s – that’s their business, not mine”. This evidence was significant to Alto’s claims that Holden contravened s 18, but lacked credibility given Mr Altomonte’s commercial and business experience, that he knew that GMC owned Holden and in circumstances where he was well aware that in 2013 it was announced that Holden would stop manufacturing cars in Australia and the email Mr Altomonte received on 16 December 2013 (sent by Mr Keley to all Holden dealer principals) identified this as a decision of “General Motors”. It is objectively likely that, at least from that point in time, he knew that decisions about the future of Holden in Australia were taken by GMC. Mr Altomonte’s oral evidence that he did not know that GMC might make a decision adverse to the Holden business also lacked credibility, given all of the matters above.

12. [36]

    Fifth, on matters of critical significance to Alto’s claim, namely Mr Altomonte’s understanding of the March 2017 representations, his evidence as to the May 2017 representations, and his evidence as to reliance and the counterfactual, I have found that his evidence lacks credibility and is unreliable (at [229]-[231], [239], [257], [263]-[264], [266] and [268]-[269] below). There are also other instances, identified in my reasons below, where I find that Mr Altomonte’s evidence lacks credibility or is unreliable.

13. [37]

    Mr Elabbasi gave honest and straightforward evidence as to the limited matters with which his affidavit dealt.

14. [38]

    Alto accepts that the evidence of the defendants’ witnesses was credible and reliable as far as it went and eschewed any suggestion that they were lying. I agree that each of the defendants’ witnesses were honest witnesses who gave credible and reliable evidence, accepting where they lacked recollection and appropriately making concessions even if against the defendants’ interests.

Standard of proof

1. [39]

   Alto’s pleaded case relies upon statements in the email of 8 March 2017. The question from the standpoint of liability is how the statements relied upon should be characterised and what was represented; whether or not the representations were misleading or deceptive; whether Alto, through Mr Altomonte relied upon the representations; and whether, if proved, that reliance was reasonable. The starting point as to the standard of proof is the balance of probabilities: s 140 of the Evidence Act 1995 (NSW). This requires “actual persuasion” of the occurrence or existence of a fact in issue: Singh v AKM Investments Group Pty Ltd [2024] NSWCA 268 at [43]-[47].

2. [40]

   As the May 2017 representations rely upon precise words which Alto claims, but Holden disputes, were said, in addition to the matters set out above, Alto must prove that the words relied upon were in fact said. It is also apt to recall what was said by McLelland CJ in Eq in Watson v Foxman (1995) 49 NSWLR 315 at 318-19:

Matters of context and my findings as to these matters

1. [41]

   In June 2010 the Alto Group’s preferred option in relation to the Chatswood site (which had been vacant since 2007) was to seek to reach an agreement with an OEM to develop the site and then to operate a car dealership there. To this end, in 2010 Mr Altomonte had a conversation with Geoff Bennett, then the dealer development manager for Holden, in which Mr Altomonte (who had earlier been approached to sell or lease the Chatswood site to two other Holden dealers) suggested that the Chatswood site was available if Holden was interested. After some discussions, on 22 September 2010 Mr Bennett wrote to Mr Altomonte inviting the Alto Group to tender for the new Chatswood Area of Primary Responsibility (APR), amalgamating the St Leonards and Gordon APRs, commencing 1 January 2012. Mr Altomonte responded by sending a proposal for a Holden dealership at the Chatswood site incorporating both new and used vehicle departments and an onsite service department.

2. [42]

   Mr Altomonte sought a 10 year agreement from completion given the likely cost of developing the Chatswood site, and his recollection, which I accept broadly reflects the sentiment expressed, was that Mr Bennett said words to the effect of “yeah yeah, we get that”. He says he was subsequently told by Mr Bennett that Holden would not do a 10 year agreement but that they always renew their dealer agreements, and I accept he was given this impression. On 20 December 2011 Mr Altomonte, on behalf of Alto, signed a 12 month DSSA with GM Holden to commence on 1 January 2012, premised upon Alto temporarily operating from the Hotham Parade site and moving to the Chatswood site when it had been developed. On 17 August 2011, Altomonte Holdings lodged a development application for works at the Chatswood site with an estimated cost of work of $9,832,900 (including GST). Pending completion of the work at the Chatswood site Alto operated the Holden dealership at the Hotham Parade site from 2 January 2012.

3. [43]

   In late 2012 Alto entered into a further DSSA with GM Holden for the term 1 January 2013 to 31 December 2017. Work on the Chatswood site commenced in January 2013.

4. [44]

   Mr Altomonte was very unhappy when GMC announced in 2013 that it would discontinue vehicle and engineering manufacturing in Australia by the end of 2017. He says that at this time he received an email as to Holden’s new advertising campaign called “We’re Here to Stay” which was “designed to clear up confusion about Holden’s future in Australia” as the announcement that Holden was ceasing manufacturing in Australia had led people to believe that Holden was “leaving the market altogether”. The email explained: “The fact is Holden is not going anywhere”. This email would have informed Mr Altomonte’s understanding of the use by Holden of the slogan “We’re Here to Stay”, which would in that context have been understood by him to mean that Holden at that time had no plans to exit the Australian market and was continuing to support the business in Australia.

5. [45]

   On 6 March 2014, Mr Altomonte sent an email to Mr Bennett expressing his concern that he was about to “significantly over invest in what looks to be a shrinking opportunity”. The matters he identified in that email were the cessation of manufacturing in Australia, the cessation of the Commodore and that, contrary to what he had been led to believe, there was to be only one Volt (Holden electric car) dealer in Sydney and that it was not him. This shows the significance to Mr Altomonte of the products available for him to sell. At a meeting with Mr Bennett and Mr Alchi on 24 April 2014, Mr Altomonte says that he suggested that he could keep the Holden dealership at the Hotham Parade site but Mr Bennett told him that that was not acceptable, that Holden only did the deal with him because he agreed to build the new building, and that if he did that they would not renew his DSSA. He says that he was also told that the future for Holden was positive, and “long and bright” as big cars were no longer wanted by the market and there was an extensive line up of cars from Europe and the United States which would sell well in Australia, and that he accepted and relied upon these assurances.

6. [46]

   I consider it likely that Mr Altomonte had little actual recall of what was said at this meeting. He says that he agreed that big cars were no longer wanted by the market and thought that the new models Holden intended to bring into Australia was “where the market was heading”. Overall, I consider it most likely that the matter of significance to Mr Altomonte was that Holden’s planned products coincided with Mr Altomonte’s view of the market at that time. That is what, objectively, would be expected given his commercial and industry experience.

7. [47]

   These matters have significance as they demonstrate that in 2013 to 2014, Mr Altomonte had concerns about investing the significant sums needed for the construction work at the Chatswood site but, notwithstanding these concerns, he did not terminate the DSSA (as he could have at any time by giving three months written notice: cl 19.1(a)).

8. [48]

   Alto’s financial statements show that the Alto Holden dealership made a net loss of $260,670 in FY14 (with sales revenue of $32,140,276), and a net loss of $485,466 in FY15 (with sales revenue of $33,925,190).

9. [49]

   The Alto Holden dealership moved into the Chatswood site in January 2016. The full cost of the improvements on site were $12,288,657 (excluding GST). These costs were in part attributable to meeting Holden’s specifications.

10. [50]

    In April 2016, Mr Altomonte tried to arrange a meeting with Mr Keley to discuss concerns he then had about the scale of the losses the Alto Holden dealership was sustaining. In June 2016 Mr Altomonte met with Mr Bernhard and Mr Alchi at the Chatswood site. Mr Altomonte showed Mr Bernhard the Alto Holden dealership’s losses and he says that Mr Bernhard told him that he had strong confidence in Holden improving significantly with the new models, that it may get worse before it gets better, but that the team at Holden would “turn it around” and the “future is bright”. I accept that Mr Bernhard may have made positive statements and also would likely have referred to Holden’s plans to bring new models to Australia but I do not accept that Mr Altomonte has the detailed recollection of this meeting that he set out in his affidavit.

11. [51]

    Alto’s financial statements show that the Alto Holden dealership made a net loss of $1,434,089 in FY16 (with sales revenue of $35,578,200). The Alto Holden dealership continued to suffer losses, with net losses of either $975,615 or $1,409,060 in FY17 (there are discrepancies in the documents as to this) (with sales revenue of $26,180,942), $969,023 in FY18 (with sales revenue of $33,821,370) and $2,216,541 in FY19 (with sales revenue of $24,489,768) and $1,054,924 in FY20 (with sales revenue of $9,793,449, noting that in February 2020 Holden announced the wind down of Holden in Australia with sales continuing at a diminishing level until May 2020).

12. [52]

    Notwithstanding this, Alto never sought to terminate the DSSA, although at the meeting on 23 May 2017 Mr Altomonte says he repeatedly said he wanted out (and I consider this below), and, in August 2018, Mr Altomonte says that he told Dave Buttner, then Chairman and Managing Director of GM Holden, that he was at the point of handing the franchise back (but he did not do so). Also, there is no evidence of Alto taking any step to sell the Holden dealership until late 2019 when Mr Altomonte signed the Heads of Agreement with Mr Elabbasi.

13. [53]

    On 1 October 2014, GMC announced a company-wide strategic plan including a number of initiatives to deliver earnings before interest and tax (EBIT) adjusted margins of 9-10% by the early part of the next decade. GMC also announced that it was continuing to address challenges in its international operations outside of China, including brand strategy, cost structure and sourcing to return to consistent profitability. In a GMC presentation entitled “General Motors, Strategic and Operational Overview” on 21 September 2016, GMC referred to an aim of achieving growth of 20+% return on investment of capital (ROIC) and identified that it was seeking to meet this target by taking a number of measures, including “[a]llocating capital to healthy and growing segments and markets to optimize profitability”. GMC’s “overall philosophy … that every country, every market segment has to earn its cost of capital” was restated by Ms Barra in March 2017.

14. [54]

    These initiatives were global and Mr Stevens explained that GMC’s strategic plan involved looking at all countries and asking whether there was a path forward to make them viable, albeit that this did not involve every country of sale (COS) or product line making 20% ROIC. The 20% ROIC was GMC’s overall target for the entire business. He also explained that the approach taken with any COS was a matter of judgment and that “there was never any hard and fast rule or benchmark applied”, and that by 2015 GMC had only relatively recently obtained the capability to look at profitability at the COS level. I accept this evidence.

15. [55]

    The GMC corporate strategy as introduced on 1 October 2014, considered in the context of the evidence as a whole, was not something that suggested that, as at March or May 2017, Holden’s future was uncertain or that GMC was other than committed to taking steps to support Holden’s business.

16. [56]

    In December 2015, there was a “GMI Country BMTP [budget mid-term plan] Review Follow-Up” meeting of the GMC executive, including Mr Jacoby, in Detroit which was attended also by regional responsible managers, including Mr Bernhard. I accept Mr Jacoby’s description of this as being part of the budget process and not “an unusual meeting”. Mr Bernhard made a presentation at this meeting. The slides prepared for this identified that Holden’s 2016 mid-term plan (MTP) was down ~USD 200M EBIT per year from prior plan, primarily due to a shift in exchange rate forecasts. Mr Jacoby explained, and I accept, that this was “not in the hand[s] of Holden”.

17. [57]

    The slides prepared for this meeting showed that the COS EBIT figure for Holden, which was based upon seven months of actual and five months of forecast, was negative USD 400 million, and that figure was forecast to get worse in 2016 (negative USD 412 million) and 2017 (negative USD 450 million) before improving in 2018 (negative USD 368 million). COS EBIT included corporate costs of GMC, which were allocated on a revenue basis across all operations globally (global allocations), allocated costs from source plants manufacturing Holden’s vehicles which were outside the selling unit’s control (source allocations) and Holden’s local fixed costs. To illustrate the significance of global and source allocations to the overall COS EBIT figures, in 2015, out of a total of USD 518 million, Holden’s local fixed costs were USD 56 million, source allocations were USD 276 million and global allocations were USD 186 million. This provides important context to the evidence, set out below, that Holden expected that source cost relief might be made available by GMC.

18. [58]

    At the meeting in December 2015, GMC set a target that NSC cover all of Holden’s fixed costs including source allocations but excluding global allocations by 2020 (this was described during the hearing as the break-even target). I accept Mr Bernhard’s evidence that this was a target for the 2020 calendar year. A number of directions were selected for achieving the target, including a price increase across the board for Holden vehicles, higher positioning of the brand and European high standard products, better brand representation by the dealers and marketing activities. When it was put to Mr Jacoby that GMC had set NSC a target to be achieved by 2020 he said:

19. [59]

    Mr Jacoby explained that targets set by GMC were always demanding and, once set, were incorporated into the budget, albeit that part of the process was the acceptance by local management to implement the target. He said that sometimes the budgets were met, sometimes they were not met and often they were re-set along the way, although in his oral evidence he said that GMC would stick very much with the MTP rather than changing the budget or the assumptions. Mr Jacoby described the meeting in December 2015 as a “very frank and open meeting” but said that there was no discussion at the meeting of any possibility of closure of Holden. He also explained that GMC used a number of different metrics to assess the performance of markets, and that overall profitability and return on capital was most readily achieved in its “highly integrated business” by building up areas rather than eliminating them. He observed that closing a market could have knock-on effects on other GMC businesses and may not eliminate some of the capital invested in that market, for example the costs associated with manufacturing facilities. I accept Mr Jacoby’s evidence as set out above and at [58].

20. [60]

    Mr Bernhard characterised the break-even target as an objective to strive to achieve, or a challenge, and said that GMC worked by continuing “to lift the bar”. He explained that it was:

21. [61]

    He said that “[h]istorically, in GM[C], we’ve had objectives and missed objectives, and there’s been no consequence”. He said that he did not believe that the break-even target was a “commitment” given that, in his career within GMC, he had seen targets given and “they were more objectives to strive to achieve”. He did not agree that there may be consequences for Holden (as opposed to for him personally) if the break-even target was not met and he denied that he thought that there was a serious risk that GMC would close Holden down if it did not meet the break-even target. Mr Bernhard’s clear evidence, reflecting his understanding, was that Holden would be permitted by GMC to continue to operate whether or not it met the break-even target in 2020 and that there was no material risk that GMC would cease supporting Holden if the break-even target was not met in 2020. His position is encapsulated in the following exchange during his cross-examination:

22. [62]

    The consistent explanation he gave for this was that meeting the break-even target in 2020 was not simply down to Holden’s performance but also depended upon a range of initiatives over the period from 2015 to 2020, many of which required investment of money, people and resources of GMC or other GMC business units. I understood this to be why he responded to a question as to whether he was saying that he thought it did not matter if Holden met the break-even target by saying: “I think it’s grey as opposed to the black and white that you’re painting it to be”. Alto submits that this was an implicit acceptance by Mr Bernhard that GMC might exit the Australian market if the break-even target was not met in the 2020 calendar year. I do not agree. I understand Mr Bernhard here as trying to convey to the cross-examiner that meeting the break-even target was not simply down to Holden and for this reason was not indicative of the long-term viability of Holden’s business.

23. [63]

    I accept Mr Bernhard’s evidence at [60]-[62] above as regards his understanding of the consequences of not meeting the break-even target and as to the nuances involved. Consistent with this, Mr Bernhard also explained that he took the opportunity to talk to the GMC executive in August 2016 “about where we needed support on different initiatives”, noting that some of the initiatives to bridge the gap were within Holden’s own control but others required support from GMC. In this regard, reference was made to support for Maven and OnStar to be brought to the Australian market (discussed below), GM Financial being reintroduced to the Australian market, the establishment of a design and engineering facility at Fisherman’s Bend in Victoria, and continued support on right hand drive vehicles, including the mid-size truck “on back of improved financials (since December) and future market opportunities”. This is consistent with Mr Bernhard’s evidence that, on an ongoing basis, he focussed upon, and sought to develop new initiatives to assist Holden in meeting the break-even target, and that these required support from GMC, albeit that, as Mr Bernhard explained, Holden “had significant influence over in selling that to key executives in Detroit or Singapore [where GMI was headquartered]”.

24. [64]

    A further way in which Holden was reliant upon GMC support to meet the break-even target was in GMC giving Holden cost relief as regards source plant costs. As Mr Bernhard observed, when explaining why he disagreed that at particular points in time it was unlikely that Holden would meet the break-even target, whether Holden met the target depended not just upon its own initiatives but also upon matters outside its control, “which were in the control of source plants or global functions as well”. He explained that 95% of the costs taken into account for the break-even target were outside of Holden, such that Holden “needed significant support from GM[C] source plants, global purchasing, global manufacturing” to meet the target. This demonstrates that a failure to meet the break-even target would largely be attributable to decisions taken by GMC, which supports Mr Bernhard’s characterisation of the consequences of not meeting the target as “grey”. This in turn suggests that, consistent with the evidence of Mr Stevens at [54] above, a failure to meet the break-even target would not necessarily suggest that Holden was not a valuable component of GMC’s business as a whole or was not a viable business. Consistent with this, Mr Stevens said:

25. [65]

    Contrary to Alto’s submission, Mr Bernhard’s evidence as to the break-even target did not seek to diminish its importance. He accepted that meeting it was an important objective for Holden, and that it mattered. However, I accept his evidence that there were a significant number of initiatives to meet the target which required investment of money, people and resources to support Holden and that source and global allocations to Holden were outside of Holden’s control. I accept that he did not at any material time understand that there was a serious (which I understand to mean material) risk that GMC would close Holden down if it did not meet the break-even target. Further, contrary to Alto’s contention, I do not consider that the evidence permits a conclusion that, as at March or May 2017, Holden was unlikely to meet the break-even target or that GMC was likely to exit the Australian market if Holden did not meet the break-even target. I accept Mr Bernhard’s evidence that he “never got any indication” that exiting the Australian market was a realistic possibility, and that, in his view, Holden would be permitted by GMC to operate whether or not the break-even target was met. That is consistent with the matters set out above, and also with his evidence that there was never any discussion between himself and Mr Jacoby, who through GMI was effectively managing the Australian market for GMC, as to what might happen if the break-even target was not met.

26. [66]

    The evidence as a whole supports the conclusion that, as at March or May 2017, GMC did not plan, nor intend, that if Holden did not meet the break-even target, it would reconsider whether or not it would continue to support Holden.

27. [67]

    One issue considered within GMC in 2016 to 2017 was whether its manufacturing plant in Rayong, Thailand would be closed or would continue to manufacture the Colorado or the next generation converged mid-size truck (NG mid-size truck, also referred to as the NG Colorado). Mr Jacoby explained, and I accept, that this was because, as at August 2016, the Rayong plant was underutilised as most of the vehicles from that plant could not be priced so as to be competitive in the Thai domestic market, which was a challenging market for GMC. This issue had significance for Holden, in particular because the Colorado was made at the Rayong plant and in 2016 it had been proposed that the NG Colorado would also be made there. There is no doubt that at all material times the Colorado and the NG Colorado were considered to be instrumental for the future financial health of Holden, Colorados were budgeted to form a significant component of Holden sales moving forward and that it would have a very detrimental effect on Holden if GMC did not supply it with the Colorado or the NG Colorado.

28. [68]

    It is apparent that in 2016 and 2017 there were different views within GMC as to whether or not the Rayong plant should be closed, and if so, where the Colorado or NG Colorado would be sourced. A decision as to this was expected within GMI to be taken in early 2017. As to this, Mr Jacoby said that in 2016 and 2017 he was working on a restructuring program for Rayong to enable it to participate in the NG Colorado program.

29. [69]

    In August 2016, in an exchange of emails between Russell Williams and Rick Westernberg (both in the corporate finance team at GMC) copied to Niharika Ramdev (CFO of GMI) and Mahmoud Gamil (also in the corporate finance team at GMC), it was said that exiting Thailand would impact Holden by cancelling the NG Colorado “which represent ~20% of their volume. Holden will need to close 76 or 1/3 of their network”. Mr Jacoby was asked about this during his oral evidence and said that this was a normal process of communication within finance departments and did not represent the views of the mainstream. His evidence was that there was no basis of which he was aware for an assumption that the closure of the Rayong plant would mean that GMC would not supply the Colorado or NG Colorado to Holden and that the general assumption at the time was that there would be other places from which to source these vehicles. He said there were various scenarios being considered around March 2017 for sourcing the NG Colorado. I accept his evidence as to these matters.

30. [70]

    An email of 31 March 2017 from Salvatore Basile, director of global portfolio planning at GMC to Lowell Paddock, head of planning at GMI, copied to Mr Jacoby and Mike Devereux (a VP of GMI) set out a summary position on the issue of a possible mid-2018 ASEAN network shut down as including that:

31. [71]

    That is consistent with Mr Bernhard’s evidence as to the initiatives that were being considered to support Holden at this time.

32. [72]

    At a GMI Business Review meeting in South Korea in April 2017, various options for production of the NG Colorado through to 2026, including Rayong and North America, were considered. Mr Jacoby agreed that these were options being proposed by GMI. Slides produced for this meeting also showed that Colorado volume and variable profit was above the budget plan in GMI and that Australian momentum was increasing. Follow up actions from this meeting included various study options, including for a viable Thailand manufacturing footprint and for sourcing from China and Brazil. Mr Jacoby agreed that the upshot of this meeting was that GMC had a choice between producing the Colorado in Thailand or studying whether it would be feasible to produce it in Brazil. He also said that the meeting also addressed where Holden was with its current budget plan compared with its old budget plan and finding a bridge where Holden reached operational profit by 2022.

33. [73]

    The issue of where Colorados would be manufactured continued to be discussed through 2017. In May 2017, Mr Jacoby wrote to Mr Basile seeking to ensure that further consideration was given to whether to close the Rayong plant given the importance of the mid-size truck to the viability of “both Holden and ASEAN”. On 15 May 2017, Mr Bernhard reported to Mr Devereux that he had received feedback that Mr Ammann was “supporting Rayong” as the source of the Colorado. Later in 2017, other options for production of the Colorado were considered, including Mexico. Consistent with this evidence, Mr Jacoby accepted that as at May 2017, there was uncertainty as to whether or not GMC would permit Rayong to continue to produce Colorados. Mr Bernhard was also aware that GMC was considering whether or not to cease manufacturing the Colorado at the Rayong plant at this time. As to this, however, I accept Mr Jacoby’s evidence that the “decisive factor for Holden” was to have the concept for the NG Colorado, “not the Rayong production place”.

34. [74]

    Overall, I am satisfied that the commitment by GMC to investigate alternatives to the Rayong plant for the production of the Colorado and NG Colorado, and the support by Mr Jacoby and apparently also Mr Ammann for continuing production for Holden at Rayong, demonstrate support and commitment by GMC for Holden’s business into the future. Contrary to Alto’s contention, the fact that no approved proposal for production of the NG Colorado was in place as at March or May 2017 does not, in these circumstances, suggest uncertainty (by which, in these reasons, I mean a material risk to) as to Holden’s future or a lack of commitment by GMC to Holden.

35. [75]

    In June 2016 Holden decided to proceed with a “GMI and Global” review to gain support for its preferred option for redevelopment of a facility at Fisherman’s Bend. Fisherman’s Bend was the location of the NSC headquarters but it was too large for what was becoming just a sales and distribution company and had significant leasing costs. It was for this reason that “NSC location”, meaning altering where the NSC headquarters were located, was one of the initiatives identified in 14 June 2016 to “close the gap” to meet the break-even target (at [147] below). The aim was to develop a new design and engineering centre, together with a new “headquarters” office and an operations building, and to dispose of the rest of Holden’s site at Fisherman’s Bend. In about July 2016, Mr Jacoby for GMI and Mr Ammann and Mr Stevens for GMC approved the proposed sale of land, being some of the Fisherman’s Bend site, to the Victorian State Government. Approval for the proposed development agreement for the site was to be reviewed in Q1 2017, and Mr Bernhard’s position (as expressed in an email of 21 July 2016 to Mr Stevens, Mr Ammann and others) was that “we have maximum flexibility and no constraints until ~April [2017] when we need firm decisions”.

36. [76]

    By February 2017, Holden was no longer seeking approval for its headquarters to be located at Fisherman’s Bend, but it was still seeking approval for a design and engineering centre there. At around that time, Mr Jacoby’s feedback was that Holden’s ability to reach the break-even target was compromised if the option of leasing (the alternative to building) rather than owning the design and engineering centre was adopted, due to higher annual operating expenses. When Mr Bernhard was asked in cross-examination whether approval of a new design facility was important, he responded:

37. [77]

    Mr Bernhard explained that there was a “significant amount of activity” on the project to develop the design and engineering centre at Fisherman’s Bend between July 2016 and April 2017, albeit that by May 2017 he did not know whether the project would proceed. He explained that engineering and design was not part of the NSC business, but was part of the global structure, and for that reason he was less focussed on this than on other initiatives. He said GM Financial and OnStar were “much more important to the Holden brand than the design centre”. He did not view GMC support for the engineering and design centre as something that was important to demonstrate that GMC actually wanted Holden to continue to be here. I accept this evidence.

38. [78]

    By 2 August 2017, it was calculated within GMC that closing the engineering and design centre in Australia and transferring it to the United States was USD 73 million better for GMC. Responding to this, Mr Stevens wrote to Mr Ammann that the decision whether to invest in the design and engineering centre in Australia boiled down to “do we need capacity … are there special skills in Australia … will it help Holden meaningfully”. The decision was subsequently taken not to build the new engineering and design centre at Fisherman’s Bend.

39. [79]

    I do not accept that GMC’s failure to make a decision approving the project by March or May 2017 was indicative or symptomatic of a lack of commitment by GMC to Holden or was itself a matter which objectively suggested a material risk (by which I mean real likelihood) that GMC would exit the Australian market in the foreseeable future or that Holden’s future was uncertain. Rather, GMC’s approach to this is indicative of a careful and prudent review of investment decisions in its business in Australia, a market in which it was seeking to “fix” and “grow” the Holden business.

40. [80]

    Maven and OnStar were initiatives which involved no cost to, but potentially some income for, Holden. They were supported by GMC at a budgeted expense for OnStar of USD 1.9 million for 2017, USD 5.53 million for 2018 and USD 8.79 million for 2019. Maven was a car and ride-sharing platform which used Holden vehicles. It was in the planning phase in late 2016, including with a “Roadmap-Australia”. It was launched in Australia by GMC in September 2017 following a pilot beginning in March 2017. OnStar was a subscription program for a “Global Connected Customer Experience”, offering in-vehicle security, emergency security, navigation connections and vehicle manager services, which had been launched in North America, South America and Europe and in late 2016 was planned to be resourced in Australia from 2017. In July 2017 it was still planned for Australia to be the “OnStar Headquarters for [the] GMI region”. OnStar was announced by Holden in October 2017 for a proposed launch in Australia in 2019, ultimately extending to all Holden products.

41. [81]

    The launch of both of these programs, which were planned from 2016, is consistent with GMC providing ongoing support to Holden in Australia and with GMC planning an ongoing presence in the Australian market as at 2016 to 2017.

42. [82]

    On 3 February 2017, GMC announced that it was investing USD 27 million for a facility in Spring Hill, outside of Nashville, to assemble a right-hand drive Acadia for export to Australia. This was an SUV, which was significant because Holden had been late to the market shift to SUVs and the Acadia was one of two right hand drive vehicles which gave Holden the opportunity to enter what was described by Mr Bernhard as a key market segment.

43. [83]

    One of the initiatives that Mr Bernhard was focussing on in February 2017 was the re-introduction to the Australian market of GM Financial, which provided financing products for car purchases and dealers. He explained that Holden at that time had arrangements with St George Bank, but that Holden could not get a program for guaranteed buyback with St George to work, which had impacts on revenue recognition.

44. [84]

    Between May and September 2017, GM Financial and Holden were working together on a business case. Ultimately, in September 2017, approval was given for GM Financial to return to the Australian market and this was announced in February 2018. Mr Bernhard also said, and I accept, that in May 2017, at the Grand Masters meeting in Detroit, Mr Ammann had “expressed support to go back and talk to GM Financial” and to work on the business case and that he had “support from [Mr Ammann] to go and talk to GM [Financial] to – to make it happen”. On 13 May 2017, Mr Bernhard reported to Mr Ammann that GM Financial had “a high willingness to help out and see what they can do” but had issues with the cost of funds disadvantage and high operating costs, on account of which they had assessed that they did not see any value in entering the Australian market. He said, and I accept, that he thought that was the first time that GM Financial had come back and said no. Mr Bernhard also reported that:

45. [85]

    Thus, whilst as at May 2017 Mr Bernhard did not know whether GM Financial would re-enter the Australian market, work was being progressed towards this and he know that GMC, through Mr Ammann, was supporting this. Contrary to Alto’s contention, the position as regards GM Financial in March or May 2017 did not, itself, suggest uncertainty or a lack of commitment by GMC as to Holden’s future.

46. [86]

    Opel had manufactured GMC vehicles in Europe. On 6 March 2017, it was publicly announced that Opel had been sold to PSA. Mr Jacoby (whose responsibility did not include Europe as it was not part of GMI) first became aware that the GMC board had approved the sale either at the time it was announced, or perhaps the night before. From February 2017 Mr Bernhard had known that GMC was considering the sale. He was informed that the board of GMC had approved the sale on around 3 March 2017. The sale of Opel had obvious significance for Holden given the extent to which Holden cars were, or were projected to be, manufactured in Europe.

47. [87]

    On 6 March 2017, shortly before the public announcement, the GMI communications team sent Mr Bernhard and others documents about the sale “for use in your market”. These included information that:

48. [88]

    Later that day, Mr Bernhard sent an email to Holden dealer principals (which Mr Altomonte received and read) which used the text of a draft attached to the email of 6 March 2017 from GMI communications:

49. [89]

    As set out at [170] below, I would infer that Mr Bernhard was involved in the preparation of these communications. He said, and I accept, that, when he sent this email, he knew that there was a broad umbrella agreement between GMC (or a GMC entity) and PSA and believed that there would be continuity of supply of vehicles where PSA was the source plant because he had had communications to this effect. By inference, his, and through him Holden’s, understanding at that time was that Holden would continue to operate in Australia with continuity of supply of vehicles from Europe. Consistent with Mr Bernhard’s understanding, the evidence includes a Master Vehicle Supply Agreement between General Motors Holding LLC (which I infer to be a holding company related to GMC) and Opel (MVSA), which is undated but was to become legally effective on the transfer of shares in Opel to PSA which it said was anticipated to take place on 31 July 2017. The MVSA refers, in its preamble, to a Master Agreement (which is not in evidence) dated 5 March 2017:

50. [90]

    The MVSA included what the defendants describe as a “take or pay” clause, to the effect that General Motors Holding LLC was to make a defined payment in the event that it (or its subsidiaries) actually took less than 80% of the “aggregate Reserved Capacity” allocated to it in a calendar year (cl 7.3.1.1). I infer from this that the “take or pay” clause was likely one of the general terms and principles in the 5 March 2017 Master Agreement. Addenda to the MVSA were executed in or about July 2017, making provision for NSC (defined as a “Buyer”) to purchase Astra and Commodore vehicles from Opel (defined as “Seller”). “The Production Period End Dates” for Astra were, variously, 31 August 2022 and 31 January 2023, and the allocated “Reserved Capacity” continued from 2017 through to 2022 or 2023, and for Commodore was through to 30 November 2024. The evidence does not disclose whether these were the only Holden products (or proposed Holden products) manufactured or to be manufactured in Europe, but there is no suggestion in the evidence that there was any significant gap anticipated in the supply of European vehicles to Holden following the Opel sale. Indeed, Mr Jacoby’s evidence, which I accept, was that he understood that, following the sale of Opel in March 2017, the expectation that more than a third of Holden’s future product line would be European sourced did not change.

51. [91]

    Following the sale of Opel, Mr Ammann had an arranged interview with Australian media at the Geneva motor show. By email of 7 March 2017 Sean Poppitt, at that time Director-Communications at Holden, reported to a number of people within the Holden SLT, including Mr Bernhard and Mr Keley, that this had been arranged “to reinforce GM’s commitment to Holden in Australia and NZ in the wake of the Opel-PSA announcement”. I would infer that Mr Poppitt’s statements as to why Mr Ammann had arranged to speak to the media were derived from communications with GMC and that that is how this would have been read by the Holden SLT. This email, and Mr Ammann’s statements, are discussed further below, as they form part of the immediate context for the March 2017 representations.

52. [92]

    For present purposes, it suffices to observe media reports linked in Mr Poppitt’s email included the following:

53. [93]

    These media articles were admitted subject to a limitation that they were not admissible as to the truth of the matters reported in them.

54. [94]

    On 9 March 2017, Lori Arpin, in the GMC communications division, sent Mr Bernhard and Mr Poppitt a draft brief for their field staff, which included key messages and responses to “tough questions” following the Opel sale. This included repeating the key message that Mr Ammann had conveyed to the Australian media, namely that GMC was 100 percent committed to the business in Australia, that the transaction would not impact “our brand and fantastic products” and reinforcing that GMC wanted nothing more than to see the Holden business being “totally successful and we are committed to making that happen”. I infer that these statements accurately reflected GMC’s position at that time, albeit that the Q&A format had these answers being given by Holden.

55. [95]

    Having regard to the evidence as a whole, I am satisfied that following the sale of Opel to PSA nothing changed as regards GMC’s intention to continue sourcing European produced Commodore and Astra vehicles, and to continue to support Holden, nor as regards Holden’s intention to continue operating in Australia as it had before the Opel sale, and that Mr Bernhard understood all of this to be the case.

56. [96]

    It was, however, clear that the source costs of European vehicles would be affected by the fact that there would likely be some mark-up on cost because vehicles had to be purchased from Opel rather than supplied from a GMC subsidiary (described in evidence as an effect on “transfer pricing”). This had an accounting impact upon Holden, as the cost of supplying vehicles under the MVSA would become one of Holden’s variable costs rather than part of its source plant allocation. Mr Bernhard’s evidence, which I accept, was that he knew that this could lead to additional costs to Holden, and make it more difficult for Holden to meet the break-even target (although he did not know how the take or pay clauses would play out). Subsequent financial data presented to GMC in April 2017 suggested that what was described as the Opel transfer pricing markup would impact the prior Holden planning figures in the USD 10-15 million range. Mr Bernhard understood that an adjustment would be made to compensate Holden for this external impact on its operating profit.

57. [97]

    On 10 May 2017, Ms Arpin prepared a GMI “Executive Brief” for the announcement that GMC was making changes to its operations in India and South Africa, including the cessation of manufacturing in South Africa and for the domestic market in India, the cessation of the sale of Chevrolet vehicles in the domestic market in India, and a restructure of GMI. The GMI Executive Brief included, under the heading “Holden: Is GM exiting Australia/New Zealand?”:

58. [98]

    Mr Bernhard’s evidence, which I accept, was that he did not understand this announcement to suggest that Holden would be next for cost-cutting, and that Holden as an NSC was a very different business to the manufacturing businesses in India and South Africa that were being discontinued. The GMI restructure does not itself suggest uncertainty for Holden.

59. [99]

    Mr Jacoby explained, and I accept, that as at February 2017 there was an ongoing discussion within the GMC internal teams and with joint venture partners about Chinese, Korean and other sourcing of Holden products. He also explained that this was not in relation to products that would otherwise be sourced from Opel, given that the MVSA covered those products, and his understanding from Ms Barra and Mr Ammann was that there was no indication that Opel/PSA would cease the supply of products dedicated to Opel’s export markets. Mr Bernhard’s evidence (reflecting a different understanding from that of Mr Jacoby) was that he did not think the Opel sale would significantly impact Holden because Holden products could all be sourced from somewhere else “within the General Motors family”. In this regard, he referred to his knowledge at that time that GMC had a joint venture in China (where Mr Bernhard had previously worked) building the same products as those produced in Europe, but under different badges.

60. [100]

    By August 2017 it remained unclear whether GMC would approve the sourcing of Holden vehicles from China (although GMC had approved a study by GMC of this option, and that study was underway) and the earliest time at which a China sourced product for Australia was contemplated was 2020. Mr Bernhard explained, however, that the approval and undertaking of a study meant that GMC was spending money on the program. Consistent with the evidence as to what was being considered, in October 2017 GMC gave interim approval for Holden to source the Encore vehicle from China in place of the Opel-made Mokka from August 2020 and in November 2017 GMC approved a proposal for an upgrade of the Equinox vehicle in China rather than Mexico from 2023.

61. [101]

    The fact that from February 2017 GMC was taking steps to investigate sourcing of Holden vehicles from China is consistent with it seeking to support Holden’s business. Further, there is nothing to suggest that the period involved in making a significant change to Holden’s sourcing footprint was unexpected or that this created any particular uncertainty for the Holden business as at 2017. I reject Alto’s contention that the absence of approval to source Holden vehicles from China meant that Holden’s future was uncertain or that GMC was not committed to Holden as at March or May 2017.

62. [102]

    In the many thousands of pages of documents in evidence in these proceedings there are only seven documents that were identified by Alto as referencing the possibility of Holden exiting the Australian market.

63. [103]

    The first was part of a slide deck which Mr Bernhard presented to the GMC executive at the meeting in December 2015. Mr Bernhard explained that these slides had a standard layout which was done “by the region” for all of GMI. One slide was headed “Sustainability Scenarios” with three boxes: “Baseline BMTP”, “Recommended Changes” and “Exit Analysis”. Holden then filled in these boxes with its proposal. In the “Baseline BMTP” box it was recorded that Holden’s projected market share was 10.5%, NSC’s projected operating profit was USD 141 million, and that if FX rates reverted to 15 or 25 year averages then that would improve by about USD 250-350 million. Mr Bernhard explained that these figures were used because the focus was upon NSC operating profit or incremental profit to GMC, meaning the profit made from the Australian business without incorporating source or global allocations. As regards the template box “Exit Analysis”, Mr Bernhard explained that numbers were “pulled together to complete the template” but “[to] call it an analysis would probably be a stretch”.

64. [104]

    There were also some slides behind a heading slide: “Mark’s Deep Back Up”. These included figures which broadly reflected those in the template “Exit Analysis” box. Mr Bernhard said that sometimes back up slides were given to him and sometimes they were not, He said he believed the deep back up slides did not go to the people to whom he was presenting. Even a cursory look at these slides shows that they included only very high level numbers. For example, the cost for dealer closures was based upon an estimated cost of USD 1 million per dealer, people related costs were based upon 500 redundancies at an estimate of USD 100,000 per person, retraining at USD 2,000 per person, there was a placeholder of USD 1 million for retention and “TBD” for tooling and manufacturing impairments. Mr Bernhard denied that Holden had modelled the cost of exiting Australia and I accept his evidence as to this. It is consistent with the impression given by the slides themselves. He said that he did not recall any discussion at the meeting of Holden exiting Australia and believed that if there had been such discussion he would have remembered it. He said that the focus at the meeting was how Holden could improve its profitability.

65. [105]

    The second is a slide prepared by Mr Bernhard in January 2016 to brief the Holden SLT on the Detroit meeting in December 2015. It included, under the heading “Summary”:

66. [106]

    After having this slide drawn to his attention, Mr Bernhard maintained that he did not recall Holden exiting Australia being discussed. I would infer that at the meeting there may have been some reference to what Mr Bernhard recorded in the second bullet point (above), but that, consistent with Mr Bernhard’s recollection, the option of Holden exiting Australia was not given any consideration when he was at the meeting. If there had been such discussion, as he said, he would have recalled this.

67. [107]

    The third is a deck of slides described as “Consolidate exit analysis (Mar 2017).pptx”. This was sent by Jordan Coughlin to Ms Ramdev on 21 March 2017 after Ms Ramdev asked for “one deck with all the consolidated exit costs - India and South Africa ASAP, and then with other markets as well (SEA, Holden)”. The slides in that deck included all of GMI’s South East Asian and Australian markets. Mr Stevens said that the ongoing preparation and maintenance of up-to-date exit analyses for the various markets within GMI (and others) was undertaken “as a matter of good financial discipline so that this information would always be available at short notice” in case there was consideration by the executive leadership team and the GMC board, at any point in time, of exiting the GMI markets. He said that as CFO of GMC he had a need for potential exit analyses if, and when, GMC ever reached a decision to exit any of the GMI markets. He added that, at that time, GMI was underperforming across the board so he “wanted to be prepared in the event the question came up” during executive leadership or board discussions. He explained that it was his responsibility as CFO to be prepared “if there was a possibility that, at some point in time, a decision was made to - or a discussion was going to be had – had, or an evaluation was going to be had relative to the potential exit of Australia, or any other country”. He added (in evidence limited to his own understanding):

68. [108]

    Mr Jacoby explained that this slide deck was “an internal finance, corporate finance” document modelling different scenarios. The modelling in these slides for Holden was based upon closure of the Australian market on 1 January 2018. Consistent with this, Mr Jacoby said they were based upon “very theoretical assumptions. Again, it’s a modelling … it’s a modelling by the finance folks”. The following exchange later occurred:

69. [109]

    I accept Mr Stevens’ and Mr Jacoby’s evidence as to the nature and purpose of the modelling. It is consistent with the fact that there is no suggestion in the evidence that in 2017 GMC was considering exiting the Australian market, let alone doing so on 1 January 2018. It is also far from clear when the modelling for Australia was actually done, noting that the FX figures used in it were based on a “2015 YE balance sheet rate”. Further, whereas the modelling for each of South Africa, India and Thailand (where other documents suggest some winding down or exit was being considered) comprised multiple pages, the modelling for Australia, New Zealand, Indonesia and Vietnam comprised only one page each.

70. [110]

    The fourth is an email dated 12 May 2017 from Vahan Bagdasarian, CFO of South East Asia in GMI, to Ms Ramdev and Mr Coughlin, attaching a document called “GMI Consolidate Exit Analysis_distribution version.pdf”, described in the body of the email as the “updated exit closure decks” which still maintained a range “until we do specific off balance sheet calcs on dealer payments, etc”. The decks again included exit closure data for South Africa, India, Thailand, Indonesia, Vietnam, Australia and New Zealand. Mr Jacoby explained, and I accept, that this was, again, an internal finance document and that he had not seen it in 2017. Again, there was only one slide relating to Holden, and the slide was identical to that in the “Consolidate exit analysis (Mar 2017).pptx” discussed above, from which I infer that no steps had been taken between March and May 2017 to update the modelling. There is nothing to suggest that this analysis was requested for any particular purpose, or that this analysis was sent on to anyone in the SLT either at Holden or at GMC.

71. [111]

    Fifth, on 13 March 2017, Mr Stevens sent an email to Dave Prystash (CFO, Global Product Development and Purchasing and Supply Chain) copying Ms Ramdev, both of whom reported to him, about potential investment by GMC in the engineering and design centre at Fisherman’s Bend. In this email he said:

72. [112]

    Mr Prystash replied:

73. [113]

    Mr Stevens then responded:

74. [114]

    It appears from his email that Mr Prystash understood that the view of Mr Ammann and others at the time was that Australian capacity was still needed by GMC after the Opel sale. Mr Stevens said that it was his view at the time that “we were all committed to seeking to make Australia work, which was the purpose of the review [in Seoul in April 2017]”. Mr Stevens also explained that in his email at [111] above he was making a “personal observation”, expressing his view, and that he did not know the answer to the question whether GMC might exit the Australian market, but “certainly, there had been no discussions about exiting the market”. Mr Stevens then explained that in his mind there was “always a question around the long-term viability in Australia” and for him there was always a doubt as to whether or not GMC would exit the Australian market.

75. [115]

    When asked whether he personally thought that there “some doubt attending” GMC’s commitment to Australia following the Opel sale he said that he had given Australia “zero thought” at that time but that around that time GMC were working through “a number of initiatives related to Australia”. It was put to Mr Stevens in cross-examination that “between the date of the Opel sale announcement and [his email described above], some doubt attended General Motors commitment to Holden in Australia” and he replied “No. They’re unrelated”. He said that the question he asked in the email “if we were to exit Australia” is a question that he would ask about almost any country GMC was engaged in. He said the question was unanswered because “we hadn’t evaluated it”. I accept Mr Stevens’ evidence as to these matters.

76. [116]

    Having regard to this evidence, and to the evidence as a whole, it is apparent that, whilst Mr Stevens personally had doubts about the future viability of Holden, GMC remained committed to the Holden business throughout 2016 and 2017 and there was no consideration within GMC of exiting the Australian market. None of the documents suggest otherwise. Alto’s contention that it is “fanciful” to suggest that GMC was modelling a scenario that had no chance of coming to fruition ignores that there is nothing to suggest that the modelling was current as at March or May 2017 or that it was requested for the purpose of considering GMC exiting the Australian market. It also ignores Mr Stevens’ and Mr Jacoby’s cogent evidence to the contrary. It is nothing but speculation to contend, as Alto does, that the modelling was undertaken to aid GMC’s board in its consideration of whether or not to exit the Australian market. Moreover, that contention is undermined by the absence of any evidence that the SLT or board of GMC gave any consideration to exiting the Australian market in 2016 or 2017.

77. [117]

    Sixth, in an email of 4 April 2017 Mr Paddock wrote to Mr Jacoby, copied to Mr Devereux and Ms Ramdev that he had discussed with Sam (presumably Mr Basile) some of the key issues for the “Holden review” included China sourcing and “NSC vs distributor model”. He wrote that “[o]ne of the drivers for interest in Holden is a decision on whether or not to invest in the design center there, based on the premise that there would not be a design center if there wasn’t a Holden NSC”. Mr Jacoby was asked about this email and his evidence, which I accept, was that a distributor model for Holden was “never discussed” and “never on the table”. He said that this email reflected nothing more than Mr Paddock’s personal opinion. In these circumstances and bearing in mind that no document reflects consideration by GMC of moving Holden to a distributor model, I place no material weight on this email.

78. [118]

    Seventh, on 2 August 2017, James Bunnell, who had been brought into the GMI region to support sales and marketing, was asked to give Mr Ammann his “diagnosis” of the situations in Korea and Australia, where Mr Bunnell had reported weak performance in relatively strong GMC markets. As regards Holden, Mr Bunnell replied with a detailed analysis of the market, including the critical role of a number of the cars that were “on the way”. He ultimately concluded that he was “[n]ot sure this is a long-term play unless we can turn around the brand reputation and determine a viable future product pipeline in the very near term”. There is nothing in this email chain that suggests any plan to exit, or consideration being given by GMC to exiting, the Australian market as at August 2017, still less at March or May 2017.

79. [119]

    As already noted, the two witnesses from GMC were Mr Jacoby and Mr Stevens.

80. [120]

    As set out at [114] above, Mr Stevens’ evidence was that in April 2017, GMC was committed to seeking to make “Australia work”. He said that there was no discussion or consideration of GMC exiting the Australian market at the meeting in Seoul on 21 April 2017. He said that throughout his time at GMC it remained the position that Australia was in the “grow/fix” rather than “restructure” column. He explained that a key takeaway from a meeting to review Holden’s progress against its long-term plan, that he attended on 11 October 2017, was that Holden was “on track to deliver OPBGA [operating profit before global allocations] breakeven even [sic] or better by CY20”, which he accepted at the time.

81. [121]

    Mr Jacoby said that GMC’s strategy throughout his time as president of GMI was, as described in remarks Ms Barra made in a video recorded for a Holden dealer conference in February 2015, that “one thing that is not changing is our commitment to the Australian market” and that “Holden operations will remain a key component of GM’s global enterprise”. He said that throughout his time as President of GMI he understood that GMC’s strategy was to win in Australia. He said that there was never any discussion of GMC exiting the Australian market at GMC SLT meetings when he was present, nor in any other meeting or communication of which he was aware. He said that it was “business as usual for GM Holden when I left GMI”, which was in January 2018. He also explained that as at early April 2017 “[o]ur core direction was to maintain [Holden] as a GM-owned national sales company”.

82. [122]

    I accept this evidence. Further, contrary to Alto’s contention, I would not infer from the fact that Mr Jacoby was not aware of the GMC board’s decision to sell Opel until just before it was announced that there may well have been discussions within the GMC SLT of exiting the Australian market without Mr Jacoby being aware of those discussions. Unlike the European market, the Australian market fell under Mr Jacoby’s responsibility. There is nothing to suggest, in these circumstances, that GMC would make plans or decisions as regards the Australian market without involving or communicating with Mr Jacoby.

83. [123]

    In March 2015, in a slide headed “ROIC Driving Capital Discipline” in a GMC presentation entitled “Driving Shareholder Value”, the strategic actions included “Russia under serious review” but as regards Australia, referred only to “exit Australia manufacturing”.

84. [124]

    In early 2016, Mr Jacoby presented on GMI “2015 Recap and 2016 Priorities” at a GMI all executive meeting. At this meeting, he noted that the region, including Australia, had suffered from significant headwinds, including that Holden had been “hurt” by FX. As regards Australia, his presentation said, under the heading “Drive Key Markets”, that GMI was revitalising Holden to appeal to modern Australia. Around this time, GMC was approving expenditure on Holden’s supply operations in Australia. On 20 April 2016, expenditure of USD 6.25 million was approved for a “GM Holden Vehicle Emissions Lab” upgrade in Lang Lang, Victoria, and, in June 2016, further expenditure on a “Ride and Handling Track Safety Upgrade” was approved by GMC in the sum of USD 402,000.

85. [125]

    In a presentation dated 12 September 2016, entitled “GM International Region Update: Potential Restructuring Plan”, which was part of the papers for GMC board meetings from “2016-17”, Australia was identified in a slide entitled “GMI Business Unit Illustrative Action Plan” as a “GC” (Going Concern) rather than “R” (Restructure) with a proposed action: “Brand and price repositioning, new launch execution”. Another presentation dated 12 September 2016 for the “2016-17” GMC board meetings, entitled “EBIT and ROIC Review”, had markets listed under the headings: “Invest (Generating Strong Returns)”, “Grow/Fix” and “Restructure/Exit”. Australia/Holden was under the “Grow/Fix” heading. Australia was identified at that time as having EBIT of negative USD 0.4 billion and ROIC of -111%.

86. [126]

    In October 2016, a slide deck (which Mr Jacoby believed he read on 5 October 2016, and which was described in a covering email from Russel Williams of GMI as having been updated “post review with Stefan [Mr Jacoby] today”) identified the GMI baseline assumption for Australia/New Zealand over the period 2017-2020 as “continue with operations” with the comment “considers price/volume optimization”. Mr Jacoby said that this accorded with his recollection of GMC’s strategy during the second half of 2016. Contrary to Alto’s submission, this document does not suggest that a decision had been taken that Holden would only continue to operate “between 2017-2020”. Rather, this document considered baseline assumptions over that period because, as Mr Jacoby explained and I accept, that was the “planning horizon which had been structured within the GM planning world”.

87. [127]

    Another document from October 2016, entitled “GM International Study Guide” (which Mr Jacoby believed was a guide for external communications by GMI), which was circulated to executives of GMC and Holden (including Mr Bernhard and Mr Poppitt), conveyed a “key message” that GMI overall was undergoing a market-driven and region-wide transformation, and in Australia:

88. [128]

    The goal in Australia was to:

89. [129]

    This document recorded that on 1 September 2016 GM Holden had launched a new brand campaign in Australia to transform the Holden brand and unveiled five new vehicles, the Astra, Barina, Trailblazer, Trax and an all-new Acadia SUV. It also said: “[w]e are transforming the Holden brand to meet a modern and multicultural Australia with a renewed focus on dependability, technology and style”, “Holden is an iconic Australian brand and is here to stay, with the full support of GM behind it” and “GM wants Holden to win in Australia and Holden has a strong plan for the future”.

90. [130]

    On 24 January 2017, Mr Jacoby participated in a global GMC SLT meeting, attended also by Ms Barra, Mr Ammann, Mark Reuss and Mr Stevens. His talking points included that he would respond to a question “Is GM exiting Australia” with:

91. [131]

    I accept that this reflected his understanding and intention at that time.

92. [132]

    Mr Jacoby’s talking points for the meeting on 24 January 2017 also included, as regards Australia and New Zealand, that “Holden is shifting the brand toward more modern and progressive Australian/New Zealand customers. Holden will do this with our strongest product lineup ever”.

93. [133]

    A GMI or GMC presentation on 18 April 2017, entitled “GM International Region Update: Restructuring Plan”, which requested approval to exit South African and local Indian operations and to restructure GMI, continued to identify the action plan for Holden as “GC” (going concern) as opposed to “R” (restructure), with the proposed action remaining as “[b]rand and price repositioning, new launch execution”.

94. [134]

    Material produced by Ms Arpin and circulated to a range of people, including Mr Jacoby and Mr Bernhard, on 5 May 2017, for the purposes of the GMI Grandmasters meeting of dealers in May 2017, had the following under the heading “Is GM exiting Australia?”:

95. [135]

    On 23 June 2017, Mr Jacoby (on behalf of General Motors LLC) signed a new umbrella agreement between GM Holden and Holden Special Vehicles (known as HSV or Premoso) (which delivered niche modified Holden vehicles under the HSV brand) under which future programs would be operated at the expiry of the existing agreement, although it appears that this was not something that required GMC capital and only required minimal engineering input.

96. [136]

    In June 2017, GMC approved further funding of USD 5 million for the Lang Lang facility in Victoria.

97. [137]

    A document from the GMI leadership team, entitled “GMI Study Guide – August 2017”, noted that Maven was looking to expand in Australia, that GMI was working to get OnStar into GMI markets and outlined a future product plan for Holden including introducing 24 new models and 36 powertrain combinations by the end of 2020 that “will be Holden’s best vehicle range ever”. Under the heading “Impact of Opel/Vauxhall Sale on Holden” it said:

98. [138]

    A GMI review of Korea and Holden Australia on 28 August 2017 showed that the prediction for the 2017 calendar year was that by year end Holden would be USD 106 million short of achieving break-even on OPBGA. That was USD 2 million better than had been budgeted. On a slide headed “MTP Profit (OPBGA) Evolution (AUS + NZ)”, it was stated that the OPBGA estimate on the current plan was a surplus of USD 40 million by the end of 2020, namely achievement of the break-even target. This was to be achieved by USD 89 million of baseline OpEx initiatives (noting that FX tailwinds were flowing through to the bottom line but that Opel PSA transfer prices were higher than anticipated) and also what were described as “what must be true” initiatives, meaning things that have to happen to achieve a particular profit number. Whilst that suggests that the plan to exceed the break-even target depended upon initiatives that had not yet been formulated, it is consistent with Mr Bernhard’s confidence that initiatives would be developed to enable the break-even target to be met. These slides also identified the ongoing studies of China sourcing of vehicles were being conducted, with a potential EBIT improvement of over USD 100 million “in steady state” and that GM Financial had agreed to re-enter Australia.

99. [139]

    In late 2017, GMI approved a 2018 budget for Holden that included USD 122 million for consumer influence and sales promotion (which was an increase from the budget of USD 103 million for 2017). That is consistent with continuing investment by GMC in Holden’s business.

100. [140]

     A “GMI Leadership Announcement Executive Brief” dated 3 October 2017 on the announcement of a restructuring of GMI to include all GMC operations outside of North America and China, included, as notes for a Q&A, the question “Will/should GM exit Korea/India/SE Asia/Australia?,” with the answer:

101. [141]

     I infer from its content that this is a GMI document. It suggests a belief within GMC at that time that the Australian market was one of the right markets for GMC to be in globally.

102. [142]

     Having regard to this evidence, and as also set out at [201] below, I am satisfied that, as at both March and May 2017, GMC was committed to Holden remaining in Australia and to supporting Holden to do so and was not considering and had no plans to exit the Australian market, this was known to Holden, and there was nothing to indicate any caveats to GMC’s commitment.

103. [143]

     I am satisfied that, to the extent that it is relevant to consider what GM Holden’s understanding or intention was as at the dates of the March and May 2017 representations, Mr Bernhard’s state of mind is attributable to GM Holden. Consistent with the analysis in Anderson v Canaccord Genuity Financial Ltd [2023] NSWCA 294 at [230]-[238], the attribution of a state of mind to a corporation must be approached by asking whose state of mind should count as that of the relevant corporation having regard to the liability rule in issue. Here, that unquestionably points to Mr Bernhard’s state of mind being the relevant state of mind for GM Holden when considering whether GM Holden (or indeed Mr Bernhard) had engaged in misleading or deceptive conduct. He was at the head of the Holden SLT and engaged directly with both Mr Jacoby and Mr Ammann both in presenting Holden’s current position, projections and plans for the future, and as regards GMC and GMI’s current and future engagement with, commitment to, and intentions and plans for, Holden.

104. [144]

     As the expert evidence shows, the decision in 2013 to cease manufacturing in Australia in 2017 impacted upon Holden’s sales in Australia, including because the presence of a manufacturing plant in a location acts as a boost to sales.

105. [145]

     At a Holden dealer conference in February 2015, when Mr Bernhard’s appointment as Managing Director of GM Holden was announced, Mr Jacoby announced a five year strategy for Holden to 2020, including the introduction of the 24 new vehicles (including a replacement for the Commodore) and 36 powertrain combinations referred to in documents set out above. He said words to the effect “we have the commitment and the right plans” to fix problems with product quality and “[w]e believe NOW is the time to invest in Holden’s future success”. I accept Mr Jacoby’s oral evidence that, as he indicated at that conference, he believed at that time that “we are on the cusp of very exciting times for Holden in Australia”.

106. [146]

     From December 2015, Holden remained focussed upon achieving the break-even target, albeit that Mr Bernhard said, and I accept, that his understanding from conversations with Mr Jacoby, Mr Ammann and Mr Stevens was that the “most relevant measure of GM Holden’s financial performance was the amount of incremental profit that it contributed to defray General Motors’ global overheads” (noting that this evidence was admitted only as to Mr Bernhard’s understanding). Mr Bernhard also explained, and I accept, that the focus of the business units was on NSC’s incremental profit rather than on COS EBIT.

107. [147]

     In June 2016, Mr Bernhard presented Holden’s transformation strategy to Mr Ammann. This presentation recognised that the shortfall in meeting OPBGA in December 2015 had been USD 125 million and as at June 2016 it was USD 106 million. Gap closure initiatives identified on the slide were: “Volumes/Mix”, “NSC Location” (see [75] above), “HNZ” (Holden New Zealand), “Connected Customer”, “Local SG&A” (which I infer is selling, general and administrative expenses) and “Holden Financial”.

108. [148]

     In July 2016, Mr Bernhard reported to Mr Jacoby that Holden was progressing with a plan to launch the pilot Maven Campus, for Holden pool fleet vehicles, in Q4 of 2016.

109. [149]

     In August 2016, Mr Bernhard made a presentation to Mr Ammann and Mr Stevens as to Holden’s current and anticipated trading position. In the executive summary he described a strong financial performance in budget period 2016 with COS EBIT “+$42M, FCF +$57M” (all USD), “primarily driven by carline/trim mix initiatives, cost focus and GPSC performance”. Consistent with this, the budgeted OPBGA was negative USD 237 million but the actual was negative USD 187 million. He also reported that Holden’s market share outlook was trending favourably and sales were expected to maintain a 1% year-on-year growth. The “key takeaway” was that while the financials were favourable when compared with the prior plan, there was more work to do to achieve targets, and Holden was exploring all gap closure initiatives. Mr Bernhard said, and I accept, that there were a number of initiatives that were not included in Holden’s figures in this MTP.

110. [150]

     On 31 August 2016, four new Holden models were physically revealed to the public for the first time: Acadia, Astra Hatch, Barina and Trax.

111. [151]

     A presentation dated 20 September 2016, prepared by Holden for GMI and headed “Australia 2017 Budget Review Meeting”, identified in the “Executive Summary” that the key focus areas in 2017 were “transformation of brand and final year of vehicle manufacturing as we transition to an NSC” but also said that “our profitability needs to improve … and we must continue to identify revenue & cost initiatives to achieve financial target of being COS EBIT breakeven before global allocations by 2019”. The current 2017 EBIT result was said to represent a gap to the GMI target of around USD 30 million but the presentation said that there were gap closure initiatives under development and noted that the current FX environment was challenging. A number of building blocks of brand transformation were identified, including advertising, a renewed focus on customers and launching 24 new models by 2020. It was also noted that Holden’s portfolio of cars was significantly older than competitors. The major brand relaunch on 1 September 2016 was said to have received a positive media and public response.

112. [152]

     A slide headed “Australia Strategic Initiatives Summary” indicated that matters that were included (presumably in the figures) were premium price positioning strategy, brand recovery initiative, NSC glide path, restructuring and exit costs (from manufacturing in Australia) and the Maven pilot. matters not included were pricing opportunities for FX, asset sale recovery, site strategy and the OnStar Headquarters. Identified “Gap Closure Initiatives” included a range of revenue and cost initiatives, noting that a “$10m stretch was assumed in baseline submission, currently ~$30m short to target, hence $40m of initiatives required” (all USD). This slide noted that Holden was “committed to meeting 2017 GMI profitability target with a combination of above initiatives”. It was projected that, based upon seven months of actual figures and five months of forecast, for the 2016 calendar year the OPBGA would be negative USD 149 million. Mr Bernhard explained that this was because of the impact of the upcoming cessation of local manufacturing in Australia in 2017, and that it was his understanding (and this evidence was limited to his understanding) that, for this reason, GMI were more comfortable with the position. I accept his evidence. A range of items of support needed from GMI were identified, including with OnStar and Maven and “to reduce material, fixed costs & corporate allocations which makes up ~95% of the future cost base and execute product programs to business case targets”.

113. [153]

     In 2016 Mr Jacoby approved the GM Holden 2017 budget, which included plans to transform Holden’s brand and business by introducing programs such as Maven and OnStar which GMC would fund. That budget included USD 13.9 million capital expenditure (up from USD 8.7 million in 2016) and USD 99 million for consumer influence and sales promotion, and this was budgeted to increase to USD 111 million in 2018. The budget presentation slides included a slide headed “Support needed from GMI”, which included support for increased consumer influence and sales promotion for the brand transition, support for new product launches, Maven and OnStar and support from GMC to reduce material, fixed costs and corporate allocations. Also in September 2016, GM Holden signed a three-year $10.5 million sponsorship agreement for the Red Bull Holden Racing Team.

114. [154]

     In a media release on 1 September 2016, Mr Bernhard was reported as saying that Holden was “now well underway in delivering on its 2015 commitment to deliver 24 new models by the end 2020”. In late 2016 Mr Bernhard presented the “Holden Brand Revamp” at a regional GMI executive meeting. In an announcement in October 2016, when the last small car was built by Holden in Australia, Holden announced that:

115. [155]

     I would infer from the evidence overall that this statement would not have been made absent GMC having communicated to Holden that it supported that position.

116. [156]

     In November 2016, Mr Jacoby approved the transfer of Mark Harland from the Singapore regional headquarters of GMI to become the “Executive Director – Marketing” of GM Holden and he regarded this as part of GMC’s strategy of commitment to the Australian market and keeping Holden as a key component of GM’s global enterprise. Mr Bernhard said that the transfer of Mr Harland from Singapore was made so he could take responsibility for leading the acceleration of the Holden brand transformation efforts. Also in November 2016, the 2017 Barina was launched.

117. [157]

     In December 2016, Mr Bernhard wrote to Mr Jacoby and Anthony Riemann, Director - Holden Corporate Strategy & GMI Urban Mobility, that Maven allowed Holden “to reach a new audience that may not consider a Holden product” and “provides us a huge opportunity to make a difference quickly”. Maven clearly continued to have significance for Holden as it was one of the items listed for discussion in a one-on-one meeting between Mr Bernhard and Mr Jacoby on 6 February 2017.

118. [158]

     On 9 December 2016, Mr Bernhard presented to a meeting of Holden and some GMC staff as to Holden’s “recovery”. The purpose of the meeting was for Mr Bernhard to unite the team to create ownership and accountability. In the presentation he identified the history of big losses and that GMC had Holden “under the microscope”. He explained this slide by reference to the purpose of this meeting and said that what he understood was that “the senior people in Detroit were looking for Holden to succeed, and they wanted to know how they could help with that journey”. I accept his evidence as to this. One of the slides Mr Bernhard presented to the Holden and GMC staff at the meeting on 9 December 2016, headed “The reality of our current position” said:

119. [159]

     Notes relating to that slide, which Mr Bernhard said he likely did not prepare, said “[p]erhaps you could ask them what they would do with Holden if they were sitting in the board room in Detroit with pressure from share holders”. It was put to Mr Bernhard in cross-examination that he thought that things were sufficiently bad that GMC might decide to close Holden down and he denied this. He also denied that he thought that this was a serious risk. He said that this was a slide designed “to get an impact in the room that we needed to work faster on the initiatives”. In context, it is readily explicable why Mr Bernhard would have wished to use such a slide to seek to motivate Holden staff, and there is a danger in attributing significance to such a slide without giving full weight to its context. I accept his evidence explaining this slide and his belief at the time. His belief is consistent with the evidence as a whole on this topic, as I set out at [142] above and [181] below. I reject Alto’s submission that these slides show that Holden knew at that time that its viability was a live issue and one that GMC was “on alert about”.

120. [160]

     It is also significant that the next slide was headed “So off I went to Detroit …” and the remainder of the slides in this presentation emphasised what Holden could do to rebuild its brand, price position and volume to drive “a financial outcome that will see us cover the unique costs of Holden operating in Australia”, explaining that having presented Holden’s strategy to Mr Ammann “we gained his full support”. On a slide headed “Where are we at now?”, the long-term plan figures showed only a USD 30 million gap to meeting the break-even target, although other figures in the presentation put the gap as at 2020 at USD 54 million. Mr Bernhard did not agree that he understood at the time that Holden was unlikely to meet the break-even target in 2020, explaining that there was time to find other initiatives, which would include other areas of cost which were controlled by source plants and by GMC. Again, I accept Mr Bernhard’s evidence as to this. It is consistent with the documents generally that show the consideration and implementation of a range of initiatives including source plan relief.

121. [161]

     In January 2017, Mr Jacoby approved expenditure of USD 200,000 to enable the Australian Holden dealers attending a Grand Masters event in the United States in May 2017 to spend an extra one to two days in Detroit.

122. [162]

     In February 2017, Holden introduced the Trax, describing it as “the latest model to be released in Holden’s new product onslaught”. Mr Jacoby attended a “National Holden Dealers Business Meeting” in Australia on 6-7 February 2017 and he agreed that around this time he understood that Holden dealers were concerned about GMC’s commitment to Holden in the long-term, given Holden’s financial results

123. [163]

     On 15 February 2017, Mr Keley sent an email to Holden dealer principals, which Mr Altomonte read, after he became aware that there would be possible media reports about the potential sale of Opel to PSA. He said that he thought that the last thing Holden needed at the time was “doubt over our future model strategy”. In this email he reiterated GMC’s commitment to Holden and that “we don’t expect any changes to our vehicle portfolio”, adding that it “is business as usual for Holden”.

124. [164]

     Mr Keley explained in his evidence that this set out his understanding of the “official position” as at that time, namely that Holden was executing its product plans and business strategy as normal, albeit that he did not have answers to a number of questions about how things would pan out after the sale. I would infer that the “official position” is a reference to the position of GMC as communicated to Mr Keley at the time. As Mr Keley explained to one Holden dealer who asked questions about this email, both in Detroit and locally it had been said that GMC remained committed to the Holden brand in Australia. Whilst Mr Keley could not, when giving evidence, recall specific conversations, I accept his evidence as to this.

125. [165]

     Mr Altomonte says that this email caused him concern, and he contacted Mr Keley and asked him if GMC was “closing Australia down”. He says, and I accept that this reflects the general tenor of what Mr Keley said but not his actual words, that Mr Keley responded:

126. [166]

     On 4 March 2017, Mr Keley sent another email to Holden dealer principals, which Mr Altomonte also read, referring to the media reports about a possible sale of Opel and, in the third paragraph of his email, reiterating “GM’s ongoing commitment to Holden and our product line-up”. He also said:

127. [167]

     Mr Keley said that he wanted to send this note to cater for the 10% of the dealer network that he thought were following this issue closely. Whilst it appears that Mr Keley wrongly attributed the quotation set out above to GMC when it was in fact a statement made in his own earlier email, he explained in his evidence that this statement would have been run through the Holden corporate affairs team and he also explained that his understanding of GMC’s official position was as set out in the third paragraph of this email.

128. [168]

     On 6 March 2017, Mr Bernhard sent an email to Holden dealers, the circumstances and text of which I have set out at [87]-[89] above.

129. [169]

     I accept that these emails set out Holden’s understanding as at the dates when they were sent.

130. [170]

     I have already set out Mr Bernhard’s understanding, and both GM Holden and GMC’s intention, following the announcement of the sale of Opel to PSA (at [95] above). Mr Bernhard had been involved in communications prepared over the weekend prior to the announcement of the sale (which are likely to be those discussed at [87]-[88] above), having signed a non-disclosure agreement. I infer that he was involved in discussions with GMC as to the implications of the sale for Holden, as to GMC’s intentions and plans at that time and as to the content of what should be communicated by Holden when the Opel sale was announced. He explained in an email to Anna Betts, a Senior Manager in Holden’s communications team, and Bianca Mundy, a technical adviser at Holden, that Australia was one of only two markets able to communicate with its dealers immediately after the GMC release “so we have been a high priority market”. He was aware that Mr Ammann had arranged to talk directly to the Australian media at the Geneva motor show and his understanding was that Mr Ammann was “trying to instil confidence” that GMC was committed to Australia given that there was scepticism in the media that Australia was going to get a continued supply of product from Europe.

131. [171]

     Given the corporate relationship between GMC and Holden, the role of Mr Ammann and that decisions as to Holden’s future ultimately rested with GMC, I am satisfied that Mr Bernhard could reasonably rely upon statements from Mr Ammann, communications from GMC and, in the context set out above, upon media reports of what Mr Ammann said at the Geneva motor show, as reliably reflecting both Mr Ammann and GMC’s position at the relevant time. In the immediate context of the Opel sale, my general finding as to the reasonableness of Mr Bernhard’s reliance upon GMC is bolstered by the fact of Mr Bernhard’s involvement with GMC in the weekend prior to the announcement of the Opel sale.

132. [172]

     In his email of 8 March 2017 to Ms Betts, Mr Bernhard wrote:

133. [173]

     When cross-examined as to this, Mr Bernhard denied that he considered the future of Holden to be doubtful at this time. He explained that this was because his intent was to take the steps set out in his email. He accepted that at that point in time Holden was not delivering on its MTP, but said that his understanding was that Holden had to deliver incremental profits for GMC to invest in the Australian market and in many cases it was doing that even if not on “fully allocated profits”. He also explained that as regards “cost of capital” (referencing GMC’s overall philosophy that every country will earn its cost of capital in the statement from Ms Barra at [53] above), Holden was “well ahead” as that was calculated on an incremental basis (namely disregarding allocated source costs). He denied that at this time he regarded Holden as “on the chopping block”, again explaining that Holden had high profit potential, particularly incremental profits, and a strong dealer network. I accept his evidence as to these matters. His evidence as to Holden being profitable is consistent with Mr Jacoby’s evidence that as of 31 March 2017, Holden was profitable having regard to variable profit.

134. [174]

     I deal with the 8 March 2017 email, containing the March 2017 representations, at [205] below.

135. [175]

     On 31 March 2017, Holden announced the launch of the next generation Commodore which had been developed predominantly for Australia and was on track for a launch in early 2018.

136. [176]

     By 21 April 2017, when some of the initiatives for which Holden had sought GMC approval were not yet approved and notwithstanding the anticipated financial impact of the Opel sale, Mr Bernhard explained that he did not think that GMC would close Holden down, nor did he accept that that was a realistic possibility. This was so notwithstanding that, as at that date, Holden did not “have all of the initiatives” to meet the target. A presentation prepared by Mr Bernhard for Mr Jacoby and Ms Ramdev to deliver to Mr Ammann showed a USD 30 million (or alternatively USD 54 million) shortfall in meeting the break-even target by the 2020 calendar year (which Mr Bernhard did not think took account of the impact of the Opel sale). However, the presentation also included a range of business improvement initiatives and the concluding summary included statements that “[i]mproving Brand health is the key near term priority to support strong price positions and volume” and “[s]uccessful new product launches will be the primary driver to achieve Holden B/E OPGA target”.

137. [177]

     In May 2017, at the Detroit add-on to the Grand Masters meeting, Mr Ammann spent some time with the Australian Holden dealers and with Mr Bernhard. Following this, on 14 May 2017, Mr Bernhard reported that Mr Ammann had “[p]rovided commitment/confidence in the Australia/NZ business and referenced Equinox/Acadia” and that he had “[p]ointed out people in Detroit want Holden to succeed”. Mr Bernhard also reported that he had spoken with Mr Ammann after the meeting and they had agreed to pull together positive stories ahead of the closure of manufacturing later that year, giving the examples of the OnStar announcement, Maven, the new design building and the next generation Commodore V6 turbo. He said that Mr Ammann “is engaged in how the business is going and wants to help”. Consistent with my finding at [171] above, Mr Bernhard could reasonably rely upon these statements as reflecting GMC’s position.

138. [178]

     On 18 May 2017, when it was announced that GMC was ceasing sales of Chevrolet in India and South Africa and making other significant changes in South Africa, Mr Bernhard sent an email to Holden dealer principals assuring them that “Holden and our local operations are not impacted – GM remains 100 percent committed to the Holden brand in Australia and New Zealand”. Mr Bernhard also emphasised that Holden showrooms were being filled “with some of the best vehicles Holden has ever offered”, the upcoming launches of the Equinox SUV, the next generation Commodore and the Acadia SUV, “along with a surprise or two along the way”, and the Maven pilot and upcoming launch of OnStar. Mr Bernhard said that he knew that “we are not in an easy place at the moment” but said that:

139. [179]

     In August 2017, Mr Bernhard was asked by email to comment on Mr Bunnell’s email, discussed at [118] above. He sent an email saying that he agreed “overall” with what Mr Bunnell had said and clarified some matters. In his oral evidence he said that he agreed at that time that Holden needed to improve brand reputation and needed a viable product portfolio. He did not agree, however, that as at August 2017 he was unsure about whether Holden was a “long-term play” or that at that time the future for Holden was uncertain. I accept his evidence as to this. Whilst this is after the time of the March or May 2017 representations, it is consistent with his evidence overall.

140. [180]

     Mr Bernhard was also cross-examined as to presentations by Holden to GMC or GMI in August and November 2017 and, in particular, that the financial information in these presentations (in particular going to Holden’s progress or lack of progress towards meeting the break-even target in 2020) showed that it was unlikely that the break-even target would be met. He did not agree with this proposition. He relied in this regard upon OpEx initiatives that Holden had in place, explaining that “most units have a history of delivering [on] their OpEx objectives”, which were not built into the plan. He also relied upon the improvement in NSC’s operating profit from 2017 to 2018, which indicated that they were “moving in the right direction”. I accept his evidence as to his belief at that time.

141. [181]

     I am satisfied on the basis of my analysis of the evidence as a whole that as at both March and May 2017, Mr Bernhard believed that GMC was committed to supporting Holden to remain in Australia, that the initiatives that were already in place, together with other initiatives that would be developed over time, would lead to an improvement in Holden’s financial position and that there was a real chance that Holden would meet the break-even target in the 2020 calendar year. I am also satisfied that by May 2017 initiatives, such as the launch of new vehicles to update Holden’s portfolio, Maven and OnStar, had been put in place which provided reasonable grounds for Mr Bernhard to consider that Holden’s fortunes would improve. I am also satisfied that Mr Bernhard did not, as at March or May 2017, believe there to be any material risk of GMC exiting the Australian market, although I infer from his commercial and industry experience that he knew that GMC’s support of Holden would not continue unconditionally if Holden’s financial position did not improve or if it underwent a downturn and that there was a possibility that that would happen. For the reasons set out already, I am also satisfied, on the evidence as a whole, that Holden’s future was not uncertain as at March or May 2017 in the sense of there being any material risk at those times that GMC would exit the Australian market, although the possibility of GMC doing so if Holden’s financial position did not improve or if it underwent a downturn was, of course, always there.

Misleading and deceptive conduct: relevant principles

1. [182]

   The question of characterisation of conduct to ascertain whether it is misleading or deceptive involves two steps: a finding as to what is conveyed by impugned conduct and a finding as to whether it is misleading or deceptive: Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd (2023) 277 CLR 186; [2023] HCA 8 at [80]. These are objective questions of fact to be answered in light of all of surrounding facts and circumstances, and looking at the conduct as a whole and not only to isolated parts: Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; [2004] HCA 60 at [109]; Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304; [2009] HCA 24 at [102]. As the plurality in Butcher explained at [37], in assessing whether conduct is misleading, regard must be had to the nature of the parties, the character of the transaction contemplated, the facts that each knew about the other as a result of the nature of their dealings and the conversations between them, or which each may be taken to have known. It involves an objective characterisation of “a notional cause and effect relationship between the conduct and the state of mind of the relevant person or class of persons”: Campbell at [25].

2. [183]

   Conduct is misleading or deceptive if, viewed as a whole, it has a tendency to lead a person into error: Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191 at 198-199; [1982] HCA 44; Campbell at [25]; Self Care at [80]-[83]. The effect of any relevant statements must be deduced from the whole course of conduct: Campbell at [102]. For conduct to be “likely to mislead or deceive” there must be a real or not remote chance or possibility of it doing so: Global Sportsman Pty Ltd v Mirror Newspapers Pty Ltd (1984) 2 FCR 82 at 87; [1984] FCA 167. This may be so even if there is a less than 50 per cent chance of that occurring: Butcher at [112].

3. [184]

   Where the public or section of the public is involved, the Court must consider the likely characteristics of the persons who comprise the class to whom the conduct is directed: Campomar Sociedad Limitada v Nike International Ltd (2000) 202 CLR 45; [2000] HCA 12 at [101]-[105]. As explained in Self Care at [83]:

4. [185]

   As regards conduct directed at an individual, the state of knowledge and circumstances of the person or persons to whom the conduct is directed may be relevant: Campbell at [26], [102]; Butcher at [37]. As held in Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2020) 278 FCR 450; [2020] FCAFC 130 at [22(c)] (and recently endorsed in Medical Device Technologies Pty Ltd v Health Administration Corporation [2024] NSWCA 142 (Payne JA, Stern and Harrison JJA agreeing) at [133]):

5. [186]

   As regards a representation characterised as an opinion, French CJ in Campbell at [33] said:

6. [187]

   However, as was observed in Global Sportsman at 88:

7. [188]

   The enquiry into reasonable grounds, as relevant both to representations of opinion and as to future matters, must be approached from the representor’s position as at the date of the representation but does not require testimony from the representor: City of Botany Bay Council v Jazabas Pty Ltd [2001] NSWCA 94 at [82]-[83] (Mason P, Beazley JA agreeing). Future events may throw light upon the overall probabilities but it “remains vital to guard against hindsight illusion”: Jazabas at [83].

8. [189]

   In Australian Competition and Consumer Commission v Dateline Imports Pty Ltd [2015] FCAFC 114 the Court said at [100]:

9. [190]

   The principles stated in Dateline “apply with equal force where the relevant enquiry arises in circumstances where it is alleged that reasonable grounds are represented, by implication or otherwise, for a representation of opinion”: Australian Competition and Consumer Commission v Mazda Australia Pty Limited [2023] FCAFC 45 at [108] (Mortimer and Halley JJ; Lee J agreeing).

10. [191]

    It has also been held that matters relied upon as reasonable grounds must in fact have been relied upon by the representor: Sykes v Reserve Bank of Australia (1998) 88 FCR 511 at 513 (Heerey J); [1998] FCA 1405; Jazabas at [84]-[85]. In that case which concerned a representation as to the expected release date for new $5 notes, Sundberg J at 520 noted that the question “whether a representation about the representor’s state of mind concerning a future matter lacks the character of a representation as to the future because it states his present belief … will depend on the facts of the particular case”. Similarly, in Doppstadt Australia Pty Ltd v Lovick & Son Developments Pty Ltd [2014] NSWCA 158 at [171] Gleeson JA (Ward and Emmett JJA agreeing) said that “[w]hether an expressed belief related to a future matter depends on the words used and the context in which they were used”, citing Digi-Tech (Australia) Ltd v Brand [2004] NSWCA 58; 62 IPR 184 at [99]-[102]. In Doppstadt, the fact that the words related to the future performance of equipment meant it was properly characterised as being as to a future matter.

11. [192]

    As set out by Heerey J in Sykes at 513, to establish reasonable grounds a representor must show: some facts or circumstances; existing at the time of the representation; on which the representor in fact relied; which are objectively reasonable; and which support the representation made. The fact that a representor may believe a particular state of affairs does not necessarily mean that there are reasonable grounds for that belief: Cummings v Lewis (1993) 41 FCR 559 at 565; [1993] FCA 190.

12. [193]

    Contrary to Alto’s submission, I would not read Heerey J’s statement in Sykes, nor Mason P’s observation in Jazabas at [85], that a representor is required to “identify” the facts or circumstances relied upon, as requiring either that those matters must in every case be pleaded, or that reliance by a representor on facts and circumstances cannot be inferred from all of the circumstances.

13. [194]

    It would be highly artificial otherwise, particularly where in many circumstances, the person making the representation will have little actual memory of his or her thought processes at the time. It would also preclude a representor ever being able to show reasonable grounds for a representation that he or she denied making. Alto’s submission in this regard is inconsistent with the analysis in Cummings at 565-566 (cited with approval by Mason P in Jazabas at [83], which was in turn cited with approval by Gleeson JA (Ward and Emmett JJA agreeing) in Doppstadt at [190]; see also Rosebanner Pty Ltd v Energy-Australia [2009] NSWSC 43; 223 FLR 406 at [435] (Ward J)):

14. [195]

    As these authorities show, the enquiry as to reasonable grounds is one as to that which was in fact relied upon in making a representation, viewed without the benefit of hindsight. Provided that, as was the case here, a plaintiff is given reasonable notice of the matters that might be relied upon by way of reasonable grounds, including by reference to how the case is conducted, the court may consider those matters irrespective of whether they are pleaded.

March 2017 representations

1. [196]

   Alto contends that the March 2017 representations were misleading in three alternative ways:

   1. (1)

      First, because GMC was not at that time 100 percent committed to its business in Australia and GM Holden could not remove any doubt about GMC’s commitment to Holden in Australia. Thus, Alto says, Mr Ammann’s statement, as repeated by Mr Keley, was false, as was Mr Keley’s statement about removing doubt. Thus, irrespective of the question of reasonable grounds, this was misleading or deceptive conduct contravening s 18. In oral closing submissions, Alto relied, by way of example upon the uncertainty about what might happen if the break-even target were not met in support of this contention, showing that for Alto, the representation as to GMC’s 100 percent commitment was falsified if there was a possibility that, in 2020, GMC might exit the Australian market. Alto’s submission was that if there was any possibility of GMC exiting the Australian market then it could not be said to be 100 percent committed.

   2. (2)

      Second, because the March 2017 representations were representations as to the future made in circumstances where there was a real possibility that they might not be fulfilled, irrespective of whether this was known to GM Holden at the time. Whilst Alto submitted that the March 2017 representations required qualification so as not to be misleading, in oral closing submissions Alto confirmed that this was really just another way of saying that, as made, the representations were misleading.

   3. (3)

      Third, and relatedly, Alto says that the March 2017 representations were representations as to the future and GM Holden has not shown that it had reasonable grounds for making these representations, including because Mr Bernhard did not give evidence of precisely what matters he relied upon, and given that Mr Keley relied upon what Mr Bernhard said in making the representations. Alto says that it was incumbent upon GM Holden to make some rudimentary enquiry to satisfy itself as to the accuracy of Mr Ammann’s statements and resists the proposition that GM Holden was entitled to rely upon those statements as accurately setting out GMC’s position.

2. [197]

   The defendants deny that the March 2017 representations, as characterised by Alto, were made. They say, moreover, that the 8 March 2017 email involves GM Holden passing on public comments made by Mr Ammann, and that to the extent it involved something more, the impugned representations are properly characterised as GM Holden expressing a belief about GMC’s then present, not future, commitment. The defendants contend that the representations were not as to future matters, so do not fall within s 4 of the ACL, but, even if they were as to future matters, there were reasonable grounds for what was said. They say, in any event, that whether as representations as to a present state of mind or as to the future, the representations actually made in the 8 March 2017 email were not misleading or deceptive.

3. [198]

   The broader context for the March 2017 representations is the position of GMC and Holden leading up to 8 March 2017, and the understanding of Mr Bernhard over that period, as set out above. To the extent that I refer above to matters after March 2017, and rely upon those matters below, I have relied upon that material only to the extent that it supports findings as to the position of GMC and Holden as at 8 March 2017. The broader context, relevant on the issue of reliance, also includes the sustained losses made by the Alto Holden dealership from at least 2014 and the significant investment that Alto had made in the Chatswood site.

4. [199]

   The immediate context for the March 2017 representations is the sale of Opel to PSA, and the emails discussed at [87]-[89] and [163]-[168] above. That provides the context for how a reasonable member of the class of Holden principal dealers (the class) would have understood the email. The sale of Opel to PSA gave rise to two particular issues which would have been live in the minds of a reasonable member of the class at that time. First, whether the sale of Opel suggested that GMC was also considering selling Holden or exiting the Australian market. Second, what the sale of Opel meant for the supply of European sourced vehicles to Holden, given that these had been described as key to Holden’s success. Mr Keley reported ([167] above) that he thought about 10% of Holden dealers were following the news story around the Opel sale and I have approached the reasonable member of the class on the basis that he or she may well have had interest in the Opel sale for the reasons I have given. Some questions put to Mr Keley at around the time of the Opel sale, and indeed Mr Altomonte’s own question to Mr Keley, support my conclusion that the concerns I have set out above were concerns that would have been felt by a reasonable member of the class. In addition, as Mr Jacoby explained in his evidence, Holden dealers were concerned about GMC’s long-term commitment to Holden given its financial results ([162] above). I would infer that this would also have been a concern of a reasonable member of the class as at March 2017 but I consider that the primary matter of concern would have been whether GMC was committed to supporting Holden to try to improve its financial position.

5. [200]

   I would also infer that generally available information as to the automobile market in Australia, in particular the VFACTS data showing Holden’s significant but diminishing market share, would have been known to a reasonable member of the class.

6. [201]

   Consistent with my conclusion as to the overall position of GMC at [142] above, having regard to the following matters, I am satisfied that as at the time of the March 2017 representations (and, as this is relevant also to the May 2017 representations, as at 23 May 2017), GMC was not considering and did not have any plans to exit the Australian market, it intended to continue its support for Holden in the Australian market, and it was committed to continuing the Holden pipeline of products and to supporting Holden to be a success in the Australian market. Whilst this was not a commitment extending to the indefinite future irrespective of Holden’s performance or financial position, it was a commitment which did extend into the future, albeit not for any defined period. In this regard I have relied upon my finding at [142] above and upon my analysis of the extensive witness and documentary evidence before me and have placed particular reliance upon the following matters (in no particular order):

   1. (1)

      I am satisfied that Mr Ammann’s comments as to GMC’s commitment reported at the Geneva motor show at [92] above (admitted subject to the limitation set out at [93]) whilst not evidence of GMC’s position did in fact reflect GMC’s position at the time;

   2. (2)

      Mr Jacoby and Mr Stevens’ understanding of GMC’s position ([90], [117], [120]-[122] and [145] above), which I am satisfied reflects GMC’s position, and the absence of any suggestion by Mr Ammann or Mr Jacoby (or anyone else in GMC) to Mr Bernhard or anyone else that GMC was considering exiting the Australian market;

   3. (3)

      The GMC or GMI presentations or executive briefs in early 2016 ([124] above), on 12 September 2016 ([125] above), in October 2016 ([126]-[129] above), on 24 January 2017 ([130]-[132] above), on 18 April 2017 ([133] above), on 10 May 2017 ([97] above) and 3 October 2017 ([140]-[141] above);

   4. (4)

      The content of the GMC briefings and “GM International Study Guide” (direct and indirect, through Mr Poppitt) or material provided by GMC or GMI to Holden (including Mr Bernhard) around this time ([87]-[88], [91], [94], [137] and [170] above). I infer that the plans, statements of commitment and indications in these documents reflect the position of GMC, including through GMI, at the relevant times. There is nothing in the evidence to suggest that this was not the case;

   5. (5)

      The support provided by GMC (and GMI) generally and including as to the launch of new vehicles (including beyond March 2017, but from which inferences may be drawn as to GMC’s commitment and intentions as at March 2017) [68]- [74] (sourcing production for the Colorado and NG mid-size truck), [80]-[81] (Maven and OnStar), [82] (Spring Hill facility), [83]-[85] (GM Financial), [90] (the MVSA with its take or pay commitments), [139] (the 2018 budget), [135] (HSV/Premoso), [124] and [136] (Lang Lang), [153] (the support for GM Holden’s 2017 budget including significantly increased sums for advertising/promotion), [156] (moving Mr Harland to GM Holden), [161] (the Grand Masters event in Detroit) and [128]-[154] (new vehicles).

   6. (6)

      The ongoing designation of Australia as a market to “grow/fix” rather than “restructure/exit” and to “continue with operations” at that time ([120] and [125]-[126] above);

   7. (7)

      That in February 2017 GMI was looking at different options for sourcing products for the Australian market ([99] above);

   8. (8)

      Statements by Mr Ammann to Mr Bernhard at the Detroit Grand Masters in May 2017 as to GMC’s commitment and confidence in the Australian business which again I am satisfied he could reasonably rely upon ([177] above);

   9. (9)

      My findings as to GMC’s corporate strategy announced in 2014 ([53]-[55] above), the break-even target ([65]-[66] above), whether there was uncertainty as to Holden’s future arising from the potential closure of the Rayong plant ([74] above), the significance of there being no decision approving the engineering and design centre at Fisherman’s Bend ([79] above), GM Financial ([85] above), sourcing of vehicles from China ([101] above), the GMI restructure ([98] above) and the references in documents to Holden exiting Australia ([104], [106], [109]-[110] and [116]-[118] above), none of which suggest that the future of Holden was uncertain as at March or May 2017, nor that GMC was other than committed to supporting Holden; and

   10. (10)

       The absence of any suggestion in the many documents emanating from GMC and GMI in evidence that GMC was considering exiting the Australian market in the event that Holden did not meet the break-even target or that anyone in GMC or GMI considered that this was a real possibility. The documents I consider at [102]-[118] above fall comfortably short of this.

7. [202]

   The parties addressed the issue of reasonable grounds by reference to Mr Bernhard’s, and not Mr Keley’s, understanding given that the March 2017 representation was made by GM Holden, and Mr Keley was briefed by Mr Bernhard. As I have already set out, Mr Bernhard’s understanding at the time of the March 2017 representations (and, as this is relevant also to the May 2017 representations, as at 23 May 2017) was that Holden had continuity of supply and there was a broad umbrella agreement in place to ensure this ([89] above), that there was no material risk of GMC deciding to exit the Australian market ([95], [142] and [181] above) and that GMC was committed to making the Holden business a success. I am satisfied, having regard to the following matters, that his belief in this regard was based upon reasonable grounds. Matters which provide reasonable grounds for Mr Bernhard’s belief are:

   1. (1)

      The matters set out at [201] above, to the extent that they were sent to or known by Mr Bernhard, including Mr Ammann’s statements and statements by Mr Ammann or GMC of its commitment to Holden as communicated to Holden and communications which GMC prepared for Holden to send to its dealers, at around the time of the Opel sale. I have already explained that Holden was entitled to rely upon such statements ([171] above);

   2. (2)

      Mr Jacoby’s comments from February 2015 and the strategy unveiled at that time ([145] above) noting that, given the occasion, Mr Bernhard was likely present or at least aware of these;

   3. (3)

      Mr Bernhard’s understanding of GMC’s commitment to Australia and right hand drive at the GMC December 2015 meeting, as reported by him in January 2016 ([105] and [146] above);

   4. (4)

      The significance Mr Bernhard attributed to Maven which, with GMC support, was introduced into Australia ([80] and [157] above);

   5. (5)

      The new brand campaign and vehicles physically revealed on 31 August 2016 ([150] above) and launched from September or October 2016 ([128]-[130] above) on an ongoing basis ([154], [162] and (as relevant to the May 2017 representation [175])) which are consistent with GMC taking steps to improve Holden’s position in the Australian market and its financial position, and thus with GMC supporting Holden to achieve these things into the future. In April 2017 Mr Bernhard described successful new product launches as “the primary driver to achieve” the break-even target ([176] above) showing how important the ongoing launches were to Holden’s financial performance moving forwards;

   6. (6)

      GM Holden signing the 3-year Red Bull sponsorship agreement ([153] above);

   7. (7)

      Holden’s statement in October 2016, including that it was committed to refreshing or replacing every product in its portfolio by the end of 2020 ([154]-[155] above) which, as set out above, I would infer was supported by GMC;

   8. (8)

      Mr Bernhard’s understanding as to the significance for GMC of incremental profit and Holden’s positive performance on this measure ([103], [146], [173] and [180] above);

   9. (9)

      The fact that senior people in Detroit attended a Holden meeting on 9 December 2016 and were looking for Holden to succeed and to see how they could help ([158] above); and

   10. (10)

       Mr Bernhard’s understanding that there was no material risk that GMC would cease supporting Holden if it did not meet the break-even target ([61] and [65] above). As set out above, that is consistent with the position of GMC and GMI.

8. [203]

   Further, the email containing the March 2017 representations was prompted by an email on 7 March 2017 from Mr Poppitt to a number of people, including Mr Bernhard and Mr Keley, which included the following:

9. [204]

   Both Mr Keley and Mr Bernhard could reasonably have inferred from this that Mr Poppitt had been briefed by GMC as to these matters as that is how I would infer Mr Poppitt became aware of the matters he set out. Both could reasonably have relied upon Mr Ammann’s statements as reflecting GMC’s position for the reasons I have already given. Mr Keley said that he had been briefed by Mr Bernhard that there was no doubt about GMC’s ongoing commitment to Holden and had also read Mr Ammann’s comments as set out in the email. I accept this evidence.

10. [205]

    Consistent with the principles set out above, it is important to consider the full text of the 8 March 2017 email containing the March 2017 representations:

11. [206]

    I have underlined the March 2017 representations. The bold italicised text above was bold, italicised and in blue (contrasting with surrounding text in the email which was in black) in the email, thereby clearly conveying that these were quotations from what Mr Ammann had been reported to say. The URL addresses were in blue ink and underlined and were hyperlinked to the media articles, extracts of which are at [92] above, and I would infer that the reasonable member of the class would have realised this and would have accessed at least some of these links.

12. [207]

    Alto does not dispute that Mr Ammann made the statements attributed to him in this email.

13. [208]

    The first representation, comprised in Mr Ammann’s words as repeated in the email, is a representation by GM Holden as to what was said by Mr Ammann at the Geneva motor show. This is implicitly a representation by GM Holden that those words could be relied upon by the class, and thus that GM Holden had reason to believe that the words were in fact spoken by Mr Ammann and had reasonable grounds to believe that they accurately set out GMC’s position.

14. [209]

    The reasonable member of the class (with the concerns that I have already discussed but also with some industry and commercial experience) would read all of the quotations in the 8 March 2017 email and also at least some of the hyperlinked media reports, and see that Mr Ammann’s statement as to GMC’s commitment was part of one composite statement that GMC “want[ed]” to see the Holden business succeed, and that his comments emphasised that, to that end, GMC was developing its architectures globally, increasing flexibility with and were committed to right hand drive and releasing new products with supply agreements in place and that this was the “work” that Mr Ammann considered GMC needed to “stick to … [to] get where we need to go”. The reasonable member of the class would also be aware that GM Holden was reporting Mr Ammann’s statement and would be aware that GM Holden and NSC were Australian business entities under the umbrella of GMC who would be expected to accept a statement by the President of GMC as accurately reflecting the position of GMC unless it had any reason to doubt the accuracy of it.

15. [210]

    As to what the representation meant in that context, it is clear that the focus of this representation is the current state of GMC’s corporate mind, namely that as at 8 March 2017 it had the stated commitment. Objectively understood, that conveyed that it was not considering and had no plans to exit the Australian market and intended to support the Holden business in Australia. In that sense it is a representation as to GMC’s intention for the future, albeit that it would not objectively have been understood by the hypothetical reasonable member of the class as encompassing any commitment to maintain the Holden business in Australia for any fixed period of time. Rather, the reasonable member of the class would be well aware that GMC might revise its position if, over time, it transpired that, notwithstanding GMC’s support, the Holden business did not prosper or if other events altered the viability of maintaining Holden in Australia. It follows that the statement of 100 percent commitment would not be read by the reasonable member of the class as a “come what may” commitment continuing into the indefinite future or even continuing for any fixed period of time, particularly given what was known about Holden’s diminishing market share ([200] above). More particularly, it would not have been understood to convey either a statement, or an opinion, that GMC would never exit the Australian market. Nor would it have been understood as a representation that, objectively, there was no uncertainty as to whether the Holden business would continue in Australia. This is because it was a representation as to GMC’s commitment, not as to whether that commitment would ultimately succeed in maintaining Holden as a viable business.

16. [211]

    The second representation, GM Holden’s statement as to the “key point” of Mr Ammann’s comments, is a representation as to GM Holden’s understanding or opinion, more particularly, that in GM Holden’s opinion Mr Ammann’s comments could be relied upon to remove doubt about GMC’s commitment, in the sense I have described above. Whilst this has the added element of being a statement of opinion, the meaning conveyed by the second representation to the reasonable member of the class would be effectively the same as that conveyed by the first representation, as it would objectively be read as being premised upon what Mr Ammann was being reported as having said to the media.

17. [212]

    It follows that I accept that there was an element to which the March 2017 representations were representations as to the future to which s 4 of the ACL applies and also an element to which they were representations that GM Holden had reasonable grounds to consider that Mr Ammann’s comments accurately reflected GMC’s position.

18. [213]

    In its contentions that the March and May 2017 representations (and it is convenient to deal with these matters together) were false, Alto relied upon a number of matters as set out below. To the extent that these matters suggest, objectively, that there was a possibility as at March or May 2017 that Holden would not ultimately succeed as a viable business, they do not suggest falsity given my characterisation of the March 2017 representations above. I deal with the issue of falsity of the May 2017 representations at [267] below.

19. [214]

    First, Alto says that GMC’s focus from 2014 was on markets which were profitable and exiting from markets where there was no path to profitable returns. However, as is clear from my analysis of the evidence above, that did not involve any plan to exit, or consideration by GMC of exiting, the Australian market and the evidence strongly suggests that GMC was supporting Holden to improve its financial position. As I have already observed, Alto’s interpretation of some of the financial documents as suggesting that financial planning for, or commitment to, Holden only continued up until 2020 is incorrect ([126] above).

20. [215]

    Second, underperformance by GMI in 2015, and decisions taken by GMC to exit from or wind down in some GMI markets over the period from 2015 to 2017. However, consistent with the analysis set out above, the evidence as a whole does not support the contention that these matters led to any material risk as at March or May 2017 that GMC would exit the Australian market or that at that time GMC was considering or planning to do that.

21. [216]

    Third, Alto asserts that it was known that 2020 was a decision-point in relation to whether GMC would continue to operate in Australia. There is, however, no evidence to support this contention, and it is inconsistent with my analysis of the evidence above. There is no evidentiary support for Alto’s contention that “in all likelihood” GMC would exit the Australian market if Holden did not meet the break-even target, and there was considerable evidence indicating in March and May 2017 that this was not anticipated to be the case. Moreover, to the extent that Alto relies upon Holden’s scheduled new product launches not extending beyond 2020, and the lease on the engineering and design studio only extending to 2020, those matters provide no support for the contention that, as at 2017, 2020 was anticipated to be a decision-point for Holden. It should also be noted that some documents (such as the supply agreements at [90] above) contemplate ongoing supply by Holden to 2022 and 2024. To the extent that Alto relies upon uncertainty as to whether Holden would meet the break-even target, I have already dealt with that.

22. [217]

    Fourth, Alto says that Holden’s future post-2020 was uncertain by March (and May) 2017. In this regard, reliance is placed upon Mr Stevens’ view as set out in his email of 13 March 2017 and in his oral evidence ([111]-[115] above) as well as Mr Paddock’s comment in the email of 4 April 2017 ([117] above). I have already dealt with both. Reliance is also placed on the modelling which I have also already dealt with ([107]-[110] above), and upon the uncertainty as to where the NG Colorado would be manufactured, which is also dealt with above. To the extent that Alto also relies upon the decision-making as regards the engineering and design centre, I do not consider that that suggested any uncertainty as to Holden’s future or GMC’s commitment. Nor, for the reasons I have already given, did the break-even target and Holden’s progress or otherwise towards meeting that indicate that as at March or May 2017 there was uncertainty as to Holden’s future or that there were caveats to GMC’s commitment to Holden.

23. [218]

    Fifth, Alto relies upon uncertainty as to future locations from which Holden products would be sourced and as to whether GM Financial would be approved to enter the Australian market. Again, whilst these were matters to be addressed, neither of these matters suggested any uncertainty as to Holden’s future or doubt as to GMC’s commitment to the business in Australia. GMC was taking steps to study alternatives for the sourcing of Holden products and the evidence suggests that GMC was committed to finding a viable alternative for sourcing the Colorado and NG Colorado. Contrary to Alto’s submission, the active consideration being given by GMC to GM Financial entering the Australian market and to investigating options for sourcing Holden vehicles are matters which reflect its commitment to the Australian business as at 2017.

24. [219]

    Sixth, Alto relies upon the announcement made in February 2020 when GMC announced the winding down of Holden, and more particularly that this identified its decision was being built on the strategy which GMC laid out in 2015 (described at [53]-[54] above). Alto submits that this confirms that it was always GMC’s intention to exit the Australian market if the break-even target was not met. That submission must be rejected. There is nothing in evidence to support it, and the announcement in 2020 falls short of supporting such an inference.

25. [220]

    Finally, Alto relies upon the following exchange during Mr Bernhard’s cross-examination:

26. [221]

    There is some obscurity as to Mr Bernhard’s evidence in this regard. First, it is far from clear whether Mr Bernhard was giving his hindsight response having regard to how matters in fact developed over the period after May 2017. Second it is also not clear whether Mr Bernhard gave the answer he did because he understood that he had to do so by reference only to the factual matters selectively put to him by the cross-examiner. This doubt stems from the following exchange, which occurred in follow up questions to Mr Bernhard after Mr Bernhard left the room for a discussion in his absence:

27. [222]

    That suggests that Mr Bernhard’s answer had regard only to the “selective” matters put to him, rather than to all of the circumstances he knew at the time.

28. [223]

    For these reasons, contrary to Alto’s contention, I do not read Mr Bernhard’s evidence as an acceptance that the true position as at 23 May 2017 was that the future for Holden was uncertain, still less that he agreed, without the benefit of hindsight, that this was the case. That is also consistent with the exchange immediately following that at [221] above:

29. [224]

    It follows that I reject Alto’s contentions that the March 2017 representations were false.

30. [225]

    I am satisfied that GM Holden had reasonable grounds for making the representations.

31. [226]

    Given my analysis of the relevant principles at [188]-[195] above, I reject Alto’s contention that the only matters that can be relied upon in determining whether GM Holden had reasonable grounds for making the representations are those matters pleaded in its Commercial List Response, or particularised, which Mr Bernhard or Mr Keley affirmatively gave evidence of having relied upon. The defendants adduced a vast amount of evidence going to the factual issue of GM Holden’s corporate state of mind, through Mr Bernhard, as at the time of the March and May 2017 representations. In that way, both explicitly and implicitly, the defendants identified what Mr Bernhard was relying upon to support the March and May 2017 representations. In any event, the defendants’ particulars relied upon “other actions of GM[C] in relation to the Australian business, [in addition to Mr Ammann’s statement to the media] including …” thus generally comprehended the evidence going to GMC’s actions as relevant to Holden’s understanding at the material time and also relied upon GM Holden’s ongoing commitment to its business.

32. [227]

    I would infer that Mr Bernhard relied upon the matters at [202] above (to the extent that they pre-date 8 March 2017) in the sense that these provided background to his general understanding as to GMC’s commitment to Holden as at 8 March 2017, which (having regard to those matters) was itself based upon reasonable grounds. I would infer that in an immediate sense Mr Bernhard relied upon that understanding, and also upon Mr Ammann’s comments at the Geneva motor show, his involvement with GMC preparing communications over the weekend before the announcement of the Opel sale (see [170]-[171] above), his understanding of the position as regards the supply of vehicles and GMC’s commitment following the Opel sale ([89] above) and his general understanding as at March and May 2017 of GMC’s plans to launch new Holden products. Mr Bernhard would also have relied upon the email from Mr Poppitt at [203]-[204] above.

33. [228]

    I also accept that, for all the reasons I have already addressed as to the corporate structure of GMC and the role of Mr Ammann and also having regard to Mr Bernhard’s role at Holden, these matters provided reasonable grounds for GM Holden to include the text that was included in the email. Contrary to Alto’s contention, it was not incumbent upon Mr Bernhard or Mr Keley to make enquiries of GMC to confirm the accuracy of Mr Ammann’s comments before sending the email. It follows that the evidence adduced by the defendants establishes that GM Holden had reasonable grounds for making the March 2017 representations.

34. [229]

    Whilst I have not relied upon this in reaching my conclusions as set out above, it is perhaps instructive that Mr Altomonte ultimately agreed with the proposition, put to him in cross-examination, that what he took from the 8 March 2017 email was:

35. [230]

    This understanding of the March 2017 representations is consistent with my characterisation of them.

36. [231]

    Mr Altomonte’s earlier evidence that he understood the email of 8 March 2017 to mean that Holden was committed “certainly for longer than three years” had an air of unreality to it and I do not accept that this was how he, or any reasonable member of the class, would have read it. Indeed, when it was put to him that he did not understand for how long any commitment was he said:

37. [232]

    Consistent with my approach explained at [13] above, notwithstanding my findings I will explain why I would have rejected Alto’s claimed reliance upon the March 2017 representations, based as it was on Mr Altomonte’s evidence of what he believed that he would have done if the March 2017 representations had not been made.

38. [233]

    Reliance forms the necessary causative link between the misleading or deceptive conduct and any loss. In Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 353; [1994] HCA 4 the majority confirmed that on the issue of causation, as opposed to damages, the general civil standard of proof ordinarily governs. The impugned conduct need not be the sole inducement, provided it made a non-trivial or material contribution to the loss, or had a substantial rather than negligible effect: I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109; [2002] HCA 41 at [33], [57]-[58] and Henville v Walker (2001) 206 CLR 459; [2001] HCA 52 at [60]-[61], [109], [163]. On questions of causation and whether Alto has sustained loss or damage, Alto bears the onus of proof: Berry v CCL Secure (2020) 271 CLR 151; [2020] HCA 27 at [28] (Bell, Keane and Nettle JJ); Sellars at 355. This involves proving some “actual damage”: Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 527; [1992] HCA 55. Further, as was observed in Chappel v Hart (1998) 195 CLR 232; [1998] HCA 55 at [32] fn 64 (McHugh J):

39. [234]

    That is not to say that evidence from a representee as to what he or she would have done is to be ignored. Rather, as set out in Elanor Funds Management Ltd v Alceon Group Pty Ltd [2024] FCAFC 121; 424 ALR 601 at [291] (Bromwich and Thawley JJ) that:

40. [235]

    Where a representation is calculated to have a particular effect, and is in terms apt to have that effect, that may lead to an inference that it did in fact have that effect: Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640; [2013] HCA 54 at [55]. A representation may be causally significant even if it confirms a pre-existing impression or belief: Care A2 Plus Pty Ltd v Pichardo [2024] NSWCA 35 at [116] (Bell CJ, Stern JA and Basten AJA agreeing).

41. [236]

    Alto has sought to prove reliance, and the extent of its loss, on the basis of a counterfactual premised on Mr Altomonte’s evidence that, if the March 2017 representations had not been made:

    1. (1)

       He would have attempted to cause Alto to sell the Alto Holden dealership and would have tried to negotiate with a prospective purchaser for him or her to take a short term lease to operate as a Holden dealer from the Chatswood site, to give the purchaser time to find a smaller site to operate from;

    2. (2)

       If Alto was unable to find a purchaser, then he would have moved the business to the Artarmon site; and

    3. (3)

       In either case, he would have sought in 2017 to have Alto operate a VW dealership (that the Alto Group in fact acquired through Alto Prestige from the Trivett Group in August 2019 (the Trivett VW dealership)) from the Chatswood site.

42. [237]

    Alto claims that these steps would have either stemmed or minimised Alto’s losses from operating the Alto Holden dealership, that if it sold the Alto Holden dealership it would be paid a significant sum by way of goodwill for the purchase, and that it would have made very significant profits from operating the Trivett VW dealership at the Chatswood site up to the date of the end of 2022 when the DSSA ended.

43. [238]

    The defendants submit that Alto has not established reliance and that Mr Altomonte’s evidence as to this should not be accepted. This was made very clear in their written opening submissions. Thus, irrespective of whether Mr Altomonte’s evidence was directly challenged in cross-examination, Alto was very much on notice that the defendants challenged the reliability of Mr Altomonte’s evidence which provides the starting point for its case as to reliance. Fairness thus did not require that he be cross-examined on these matters: NU v NSW Secretary of Family and Community Services (2017) 95 NSWLR 577; [2017] NSWCA 221 at [58].

44. [239]

    My reasons for rejecting Mr Altomonte’s evidence as to reliance on the March 2017 representations are as follows (noting that I use the expression “as at March 2017” to include the period following March 2017 during which a sale or relocation may have in fact taken place and these findings apply also as regards the May 2017 representations which I consider below):

    1. (1)

       Save for his ultimate response in cross-examination at [229] above, I have found Mr Altomonte’s evidence as to how he understood these representations to be unreliable and to lack credibility. This necessarily undermines his evidence as to reliance, as that evidence is predicated upon his evidence as to how he understood the representations.

    2. (2)

       I have also found Mr Altomonte’s evidence as to reliance to be unreliable and to lack credibility having regard to my cautious approach to his evidence and, as set out below, when assessed against the objective probabilities.

    3. (3)

       Objectively, it is inherently likely that GMC’s ongoing supply of Holden vehicles, including the proposed new products, to the Australian market after the Opel sale, and the fact that GMC was going to stick with the work that it was doing in the Australian market and wanted to make a success of Holden, all of which were set out in parts of the 8 March 2017 email which are not said to be misleading or deceptive, were what Mr Altomonte relied upon in his decision-making following the Opel sale. In this context, I consider it objectively unlikely that high-level statements such as the reference to 100 percent commitment had any material influence upon Mr Altomonte’s decision whether or not to try to sell or to relocate the Alto Holden dealership.

    4. (4)

       Reflecting a degree of positivity about Holden’s future which I infer he also had as at March 2017, Mr Altomonte’s oral evidence was that by May 2017 Holden “had arrested the slide, but they hadn’t turned it around”, that he believed that the risk that despite their plans Holden might not recover the market share was “extremely, extremely low”, and when it was put to him in cross-examination that it was “commercially beneficial to [him] to take up the anticipation that the business would improve” he responded “[a]nd that they would turn it around”. Whilst Mr Altomonte said his understanding as to some of these matters was based on what Holden had “told me”, I do not accept his evidence as to this. It is also objectively more plausible that this was based upon his commercial judgment given his industry and commercial experience.

    5. (5)

       There is no evidence of Mr Altomonte making contact with Holden seeking clarification of what was meant by “100 percent” commitment when he received the email containing the March 2017 representations or at any time thereafter. If this was really a matter on which Mr Altomonte relied in not trying to sell his business at that time, then I consider it likely that he would have sought such clarification. He had, in the past, showed himself willing to make similar enquiries where appropriate. Even on his account (which as set out below, I do not accept is reliable), by May 2017 his question was not as to what 100 percent committed meant but was whether Holden was leaving Australia.

    6. (6)

       There is no evidence of Mr Altomonte taking any steps to try to sell the Alto Holden dealership or to terminate the DSSA at any time prior to late 2019, when he entered the Heads of Agreement with Mr Elabbasi, save for Mr Altomonte’s evidence, which I reject at [263] below, that at the meeting on 23 May 2017 he repeatedly said that he wanted out. If, indeed, absent the March 2017 representations, Mr Altomonte would have tried to sell the Alto Holden dealership, then I consider it likely that he would have taken some steps over the period between March 2017 and late 2019 to try to sell the dealership. This is particularly so given that Holden’s market share slid particularly aggressively in 2018 and 2019 whilst the Alto Holden dealership was making significant losses. That no such steps were taken suggests that over the period 2017 to at least mid-2019 Mr Altomonte was not interested in selling the Alto Holden dealership and that he would not have done so in 2017 irrespective of whether or not the March 2017 representations had been made. Even if I were to have accepted Mr Altomonte’s evidence that he said he wanted out at the 23 May 2017 meeting, that was in a context where he was asking for help from Holden and seeking “financial compensation for [his] losses”. Having regard to that, I would have inferred that the statements from Mr Altomonte that he wanted out, if made, were more aimed at seeking to persuade Holden to give him financial assistance than a reflection of his true intention at that time.

    7. (7)

       Mr Altomonte’s evidence was that he would have relocated the Alto Holden dealership to Artarmon if he could not sell it. Thus, the option of relocation only arises if I am satisfied that Mr Altomonte would have first sought to sell the Alto Holden dealership as at March 2017.

    8. (8)

       In any event, the evidence is that from October 2016, the Alto Group was operating Mitsubishi and Skoda dealerships from the Artarmon site. There is no evidence that, as at September 2017 (allowing a notional period of six months for Mr Altomonte to try to sell the Alto Holden dealership), a Holden dealership would have been more profitable at the Artarmon site than one or other of those dealerships, or that Mr Altomonte would have been able to move those dealerships to another Alto site. Moreover, those dealerships had only been operating at Artarmon since July or October 2016. It is objectively improbable that Mr Altomonte would have wanted either to get rid of or move them within a relatively short period of time after they commenced operating at the site given that the evidence as regards Holden and VW was that a manufacturer had particular requirements of a dealership and that these were costly to install, and I would infer that Mitsubishi had similar requirements.

    9. (9)

       In this regard, Mr Altomonte’s evidence that Alto could easily have moved its Mitsubishi dealership from the Artarmon site to allow Holden to move there in 2017 lacked credibility given his acceptance that he had not prepared any analysis of the comparative profitability of the Mitsubishi and Holden dealerships and he would only have made that move if it was beneficial to the Alto Group.

    10. (10)

        There is also real doubt as to whether Holden would have given approval for Alto to move the Alto Holden dealership to the Artarmon site in 2017. The evidence suggests that the Chatswood site was an important factor in Holden agreeing to Alto being a Holden dealer and also that Holden had particular requirements for their dealerships. When Mr Altomonte did in fact move the Holden dealership to the Artarmon site in 2019, Holden’s approval was based upon representations made by Mr Altomonte as to what was apparent of the financial performance of the Alto Holden dealership at that time and was also conditional upon facilities being subsequently established to meet Holden’s requirements. Whilst Holden would likely have wanted to retain a dealership in the Chatwood APR, a refusal to approve the relocation of the Alto Holden dealership would have meant that that dealership remained at the Chatswood site. Whilst Mr Altomonte said in his oral evidence that “the alternative would’ve been – hypothetically, the alternative would’ve been to have no dealership” he did not affirmatively say that he would have handed the dealership back if Holden did not approve the relocation.

45. [240]

    It follows from my conclusions at [224] and [228] above that Alto’s claim based upon the March 2017 representations must be dismissed.

May 2017 representations

1. [241]

   As already observed, Alto contends that the May 2017 representations were made by Mr Bernhard, both on his own behalf and on behalf of GM Holden, during a meeting with Mr Altomonte and others at the Chatswood site on 23 May 2017. Alto says that the relevant context for these representations was the announcements of the Opel sale in March 2017 and of GMC leaving or reducing its footprint in South Africa and India, Mr Altomonte’s concerns about the future of Holden and the mounting losses at Alto’s Holden dealership.

2. [242]

   Alto contends that these representations were misleading in effectively two ways:

   1. (1)

      First, because they were actually false, and required qualification. Alto contends that as at 23 May 2017 Holden was not “here to stay”, the new models were not “still coming”, it was not “business as usual” and the future for Holden was not “bright”. Alto relies in this regard largely upon the matters set out at [214]-[220] above. Alto also relies upon the fact that Mr Bernhard knew by 23 May 2017 that GMC was considering whether or not to continue manufacturing the Colorado and NG Colorado at the Rayong plant, that GM Financial had declined to enter the Australian market (albeit that there were then ongoing negotiations about that) and that no answer had been given as to whether Holden vehicles would be sourced from China. In addition, Alto relies upon what it says was modelling by GMC between March and May 2017 of Holden’s exit from the Australian market, which is a reference to the evidence at [107]-[110] above.

   2. (2)

      Second, Alto says these are representations as to the future and Mr Bernhard and GM Holden did not have reasonable grounds for making them. I have already rejected Alto’s further contention that in this regard the defendants can rely only upon such matters as Mr Bernhard positively said he relied upon in making the representations. The artificiality of Alto’s submission as to this is particularly apparent as regards the May 2017 representations given that Mr Bernhard had no recollection of what he actually said at the meeting on 23 May 2017.

3. [243]

   The defendants submit that I could not, on the evidence, be satisfied that the May 2017 representations were made because there is insufficient evidentiary precision for this purpose. The defendants also submit that, if made, the May 2017 representations should be objectively characterised as statements of Mr Bernhard (as GM Holden’s corporate mind) as to his current understanding both of the position that Holden was in and of GMC’s intention to support Holden’s business, and his opinion, as at that date, that the future for Holden was bright. The defendants accept that a statement that the “future is bright” is a representation as to the future but contend that whether or not that is also so for a statement that “Holden is here to stay” depends upon context (although that this is a representation as to a future matter is admitted in their pleading).

4. [244]

   The defendants say, moreover, that whether as statements of present fact, opinion, or statements as to the future, none of the representations alleged to have been made were misleading or deceptive and, to the extent relevant, GM Holden and Mr Bernhard had reasonable grounds for making them. They also contend that Mr Bernhard is neither personally nor accessorily liable, for any contravention, as his role was merely ministerial: see Anchorage Capital Master Offshore Ltd v Sparkes (2023) 111 NSWLR 304; [2023] NSWCA 88 at [362], [370]-[371], and having regard to the principle that an accessory has to have knowledge of the falsity of the representation, not merely facts from which falsity could be inferred: Anchorage at [330].

5. [245]

   The broader context for the May 2017 representations includes the matters I have set out as regards the March 2017 representations, and also an indication by Mr Altomonte to Mr Alchi at some time prior to May 2017 that the Alto Group’s board was “questioning the viability of retaining the Holden dealership, given its losses”, which caused Mr Alchi to arrange a meeting between Mr Altomonte and Mr Bernhard.

6. [246]

   The immediate context for the May 2017 representations is an email from Mr Alchi to Mr Bernhard including an “Alto Holden summary” in advance of the 23 May 2017 meeting, which Mr Alchi had arranged. This noted the Alto Holden dealership’s ongoing losses and diminishing sales up until May 2017, that Mr Altomonte’s budgets were predicated upon achieving 100 units per month but had dropped to an average of 39 units per month, and that if Mr Altomonte converted the Chatswood site to a head office only his monthly losses would reduce. In the email Mr Alchi then said:

7. [247]

   Mr Alchi said that the information in this email was either derived from Mr Altomonte or held by Holden. Mr Alchi also knew that the Alto Group’s board was “putting a lot of pressure on and questioning” Mr Altomonte’s association with Holden. Mr Alchi also recalled Mr Altomonte saying to him something like “I’m better off to just close this down and leave it empty rather than continue to do a Holden franchise”.

8. [248]

   Mr Altomonte says that by 23 May 2017 he was ready to quit his dealings with Holden. I accept that the Alto Group’s board was raising questions about whether Alto should continue with the Holden dealership, but I do not accept Mr Altomonte’s evidence that he was ready to quit. I consider this evidence was infected by hindsight perspective. Rather, I consider that Mr Alchi’s note that Mr Altomonte was considering his future more aptly reflects his position at the time. Having regard to the fact that Mr Altomonte never took any step prior to late 2019 to sell or return the Alto Holden dealership notwithstanding its ongoing losses and Holden’s diminishing market share, I consider that Mr Altomonte’s statements to Mr Alchi to the effect that it would be better to close the Alto Holden dealership do not reflect an intention as at that time to return or sell the Alto Holden dealership. Rather, they reflect his frustration at the losses the Alto Holden dealership was sustaining and (consistent with the focus of the meeting on 23 May 2017 as set out below) his aim to get some assistance, for example (as referred to in the email from Mr Alchi and, as Mr Altomonte recalled, also at the meeting) a rent relief offset, from Holden.

9. [249]

   There are two contemporaneous accounts of what happened at the 23 May 2017 meeting. The first is Mr Altomonte’s own note made during the meeting:

10. [250]

    When Mr Altomonte was asked what led him to write what he did in this note his candid answer was:

11. [251]

    The second is an email which Mr Alchi sent at 1.27 pm on 23 May 2017 to Mr Bernhard, Mr Jamieson and Joanne Stogiannis, Director of Dealer Excellence at Holden, which was said to include the “main points from the meeting”. This set out the substance of the notes which Mr Alchi took during the meeting which “would have been pretty fresh” when he wrote the email. Those notes did not purport to set out verbatim what was said but rather reflected the discussion. Mr Alchi said that everything in this email was touched on in the meeting. The email set out in some detail the background of the Alto Holden dealership’s losses and sales volume then said:

12. [252]

    The email then listed a number of “Initiatives/thought starters”, namely a comprehensive digital footprint overview for the dealership, a shopping centre display, steps to drive more service business to the workshop, and noted that:

13. [253]

    A number of “next steps” were then identified, including potential marketing initiatives and comprehending the associated “timings/proposed Holden investment/resource to support”.

14. [254]

    As suggested in the email, after the 23 May 2017 meeting Holden assisted Alto in paying for a shopping centre display at a cost of around $50,000, an offer which Mr Altomonte said he was disgusted with. Notwithstanding this response to Holden’s offer of assistance after the 23 May 2017 meeting, Mr Altomonte did not take any steps to hand back or sell the Alto Holden dealership between the 23 May 2017 meeting and his negotiations with Mr Elabbasi nearly two and a half years later.

15. [255]

    I accept that the matters set out in Mr Alchi’s email were all discussed at the meeting. I also accept that, consistent with Mr Altomonte’s note, Mr Bernhard said something at the meeting to the effect that GMC had no plans to exit the Australian market, told Mr Altomonte about the new products proposed for the Australian market, and that the topic of Holden giving Mr Altomonte a subsidy was discussed. I am not, however, satisfied that Mr Bernhard used the words “here to stay”, given that that slogan, of which Mr Altomonte was aware, may well have been used by Mr Altomonte in his note to paraphrase what was said, his note did not have those words in quotation marks, and it is not clear whether this purported to be a verbatim note of what Mr Bernhard said or a record of Mr Altomonte’s impression and what he took from the meeting. Mr Altomonte’s evidence about his note taking did not suggest that he purported to record the words used at a meeting. Rather, he said that he took notes to “help jog my memory” and because it “helps me to clarify my thinking in meetings”. Moreover, as set out below, when asked what he recalled of the meeting ([259] below), Mr Altomonte did not suggest that Mr Bernhard had actually used the words in the note.

16. [256]

    Mr Altomonte set out in his affidavit what purported to be a detailed account of the words actually spoken at the meeting and it is of some significance that, unlike most conversations recorded in his affidavit, he did not suggest that it was only “words to this effect” that were spoken. Rather, he said in his affidavit that “the following exchange occurred”:

17. [257]

    It is objectively unlikely that Mr Altomonte would have been able to recall the precise words spoken at this meeting after the passage of nearly four and a half years between the meeting and 15 October 2021 when this affidavit (his first in the proceedings) was sworn. This detailed account also stands in stark contrast to his oral evidence as set out below, which did not include the precise terms of any of the four representations (and only, in part when prompted, words to the effect of two of them) having been said. In these circumstances, I do not accept that the above exchange occurred. Moreover, this affidavit evidence is one of the matters that caused me to have doubts as to the credibility and reliability of Mr Altomonte’s evidence more generally.

18. [258]

    In his oral evidence, Mr Altomonte was asked if he remembered what was actually said at the meeting, he responded:

19. [259]

    Whilst this question was put as at the date of the hearing, it is inherently likely that that was also the case as at 15 October 2021 when Mr Altomonte’s first affidavit was sworn. Mr Altomonte was then asked what he remembered being the substance of what was said at the meeting and the following exchange occurred:

20. [260]

    As for Mr Alchi’s recollection, he candidly agreed that he did not recall the substance of who said what at the meeting but recalled what was discussed in terms of some of the key points discussed. He did not recall Mr Altomonte saying “I want out” or “I want to get out”. He said that the “meeting didn’t go that way” and that it was a robust conversation about what Holden could do to improve the Alto Holden dealership’s business. He characterised it as a meeting about sustainability moving forward and “trying to get some confidence about what was happening in order to – to turn that around”.

21. [261]

    Mr Bernhard also candidly said that he had no independent recollection of what was said at the meeting. He said, however, that he believes that he would have recalled if Mr Altomonte had said “I want out” or that he was planning to stop being a Holden dealer as that would have amounted to a declaration that he wanted to end the DSSA, which Mr Bernhard would have regarded as being of significance. He said that he could not recall any dealer saying they wanted to get out in the time he was Managing Director of GM Holden, so “it would have been a significant comment”. He also accepted that he would likely have spoken positively about Holden’s future and the new models being brought to Australia, and that he may have said the words relied upon as the May 2017 representations.

22. [262]

    Mr Jamieson, who was also at the meeting, had no recollection of specific statements made at the meeting but, having been shown Mr Alchi’s email of 23 May 2017 ([251]-[253] above) recalled “general discussion regarding the possibility of GM Holden assisting [Alto] with local marketing support for its Holden dealership”.

23. [263]

    Consistent with the authorities set out above, the documentary evidence provides the most reliable account of what occurred at the meeting on 23 May 2017. It is objectively likely that if Mr Altomonte had said that he “wanted out”, that would have been reflected in both his note and in Mr Alchi’s email, as it would have been a statement of some significance to Mr Altomonte and, for the reasons given by Mr Bernhard, to Holden. Mr Altomonte also did not refer to having said these words in his oral evidence of what transpired at the meeting ([259] above). It follows that, notwithstanding that it was not positively put to Mr Altomonte in cross-examination that he did not say this, I reject Mr Altomonte’s affidavit evidence that at the meeting on 23 May 2017 he said that he “wanted out”. In Mr Altomonte’s affidavit evidence, these words were the immediate trigger for Mr Bernhard making the May 2017 representations. Thus, my finding that these words were not said necessarily casts doubt upon Mr Altomonte’s evidence as to what he says that Mr Bernhard said in response.

24. [264]

    I do not, in any event, accept that the words of the May 2017 representations were said by Mr Bernhard, although it is likely that Mr Bernhard made some general positive comments that the vehicles that were going to be introduced into the Australian market provided a basis for optimism that Holden’s performance would improve and likely also (given Mr Altomonte’s note) that GMC had no plans to exit the Australian market. Beyond this, as is common ground, the meeting focussed upon the losses suffered by the Alto Holden dealership, what could be done to improve the Alto Holden dealership’s financial position, and Mr Altomonte’s concerns about the Alto Holden dealership’s losses. My findings as to what was said at the meeting on 23 May 2017 are largely consistent with Mr Altomonte’s oral evidence when asked to focus upon the substance of what was said ([259] above).

25. [265]

    It follows that there is no reliable account of the words Mr Bernhard actually used at the meeting and there is no clear indication of the conversational context in which those words were spoken. Consistent with the principles set out above, the evidence thus lacks the precision necessary for me to make any finding as to what, if any, representations were made at the 23 May 2017 meeting.

26. [266]

    I would add that Mr Altomonte’s oral evidence at [259] above as to how he understood the words spoken by Mr Bernhard at the 23 May 2017 meeting lacks credibility. Mr Altomonte said that he would have known Holden’s market share in May 2017 and that Holden’s market share had been sliding since 2013, and that he was conscious in the week prior to the 23 May 2017 meeting of “Holden’s declining sales and market share in Australia”. Objectively, it is improbable that someone with his commercial and industry experience would, in these circumstances, understand Mr Bernhard to have been giving him an assurance as to how Holden would perform in the future. His evidence as to this is objectively reflected poorly on his reliability as a witness. It is consistent with my view that his recollection (whilst genuine) has been coloured by his belief in his claim.

27. [267]

    I would, in any event, have found that the May 2017 representations, if made as Mr Altomonte said, would not, individually or together, objectively have conveyed anything more than that GMC was not considering and had no plans to exit the Australian market or to change the products it was supplying or had planned for Holden following the Opel sale and that GM Holden had reasonable grounds for saying that, that new vehicles were coming to the Australian market, and that GM Holden (and Mr Bernhard) believed that these were likely to improve Holden’s market and financial position moving forwards and that GM Holden (and Mr Bernhard) had reasonable grounds for saying that. In light of my findings and analysis of the evidence, including as to the new vehicles being introduced into the Australian market and the initiatives that were planned by May 2017, I would not have found that this constituted misleading or deceptive conduct. I would have rejected Alto’s contentions that these statements were false or made without reasonable grounds. I would also have found that Mr Bernhard actually relied upon the initiatives that had by then been put in place, and upon the matters at [202] and [227]-[228] above, had I been satisfied that the May 2017 representations were made. It follows that the evidence adduced by the defendants would have established that GM Holden and Mr Bernhard had reasonable grounds for making the May 2017 representations.

28. [268]

    I would also have rejected Alto’s claimed reliance upon the May 2017 representations. My rejection of Mr Altomonte’s understanding of the May 2017 representations undermines his evidence as to reliance. In any event, it is objectively unlikely that Mr Altomonte, with his wealth of industry and commercial experience and his knowledge of the market at the time, would have placed material reliance upon statements of this generality in deciding whether or not to try to sell, or relocate, the Alto Holden dealership. If Mr Altomonte was considering such a serious decision, it is objectively likely that he would have taken careful steps to ascertain what new models were coming and when, and in what ways and in what timescale Mr Bernhard believed that things were going to get better for Holden. Further, my analysis set out above in relation to Alto’s claimed reliance upon the March 2017 representations apply equally as regards the May 2017 representations.

29. [269]

    Having regard to all of the evidence, I am satisfied that, notwithstanding the pressure of Alto’s board and that Mr Altomonte was considering his future, he took no steps to hand back or sell the Alto Holden dealership in May 2017 because, with his commercial and industry experience, his analysis was that it was likely that with the new models that were to be introduced into the Australian market, and given its lengthy history, Holden’s fortunes were likely to improve, as would those of Alto’s Holden dealership.

30. [270]

    It follows from my finding at [265] above that Alto’s claim based upon the May 2017 representations must be dismissed.

The claims against Mr Bernhard

1. [271]

   It is unnecessary to consider the pleaded claims against Mr Bernhard.

Alto’s claimed loss

1. [272]

   In light of my findings, I do not propose to set out my findings as to Alto’s claimed loss in any detail. Rather, I propose to deal with this but only by reference to the key substantive issues arising, and on the assumption (contrary to my findings) that Alto had succeeded in establishing that at least one of the alleged representations was false and that Mr Altomonte relied on it in not attempting to sell or relocate the Alto Holden dealership in either March or May 2017.

2. [273]

   I have already set out the counterfactual upon which Alto relies to establish its loss ([236] above). On the counterfactual, Alto contends it would have either sold the Alto Holden dealership (sale scenario) or relocated the Alto Holden dealership to the Artarmon site (relocation scenario).

3. [274]

   Where, as here, a plaintiff seeks to prove its loss in reliance on a counterfactual that it says would have occurred but for a breach of s 18, it is incumbent upon it to prove the counterfactual on the balance of probabilities: see eg Anchorage Capital Master Offshore Ltd v Sparkes (No 3); Bank of Communications Co Ltd v Sparkes (No 2) [2021] NSWSC 1025 (Anchorage (Ball J)) at [548] (not challenged on appeal). In this regard, Alto’s claim is analogous to a “different transaction” case. It was thus necessary for Alto to establish what different transactions would have been entered into: Leadenhall Australia Ltd & Ors v Peptech Ltd [2001] NSWCA 272 at [56], [59]. That is consistent also with the approach taken in Daniels v Anderson (1995) 37 NSWLR 438 at 528-30 where the Court found that a plaintiff, who alleged that but for a breach of contract it would have entered into arrangements to avoid a loss-making transaction, had to prove on the balance of probabilities that that course would have been taken.

4. [275]

   As to how the counterfactual should be approached, in the context of false imprisonment, it has been said that questions of causation of loss require assessment on a counterfactual where no other fact or circumstance is changed other than the wrongful act: Lewis v Australian Capital Territory (2020) 271 CLR 192; [2020] HCA 26 at [178] (Edelman J) and that analysis has been applied in the context of misleading or deceptive conduct: Anchorage (Ball J) at [526], [533]-[534]. However, as observed by the Court of Appeal in Anchorage [2023] NSWCA 88 at [381]:

5. [276]

   That is consistent with the well-established principle that the approach to loss and damage under s 82 of the Competition and Consumer Act 2010, and it would follow also s 236 of the ACL, must also have regard to the objects of the ACL, being to promote competition and fair trading and the protection of consumers: Henville at [96]; Travel Compensation Fund v Tambree (2005) 244 CLR 627; [2005] HCA 69 at [30]. In this regard, it may be necessary to separate out losses from the wrong from losses resulting from extraneous causes: Henville at [27]-[29], citing Gould v Vaggelas (1985) 157 CLR 215 at 221-222, 267; [1984] HCA 68. Also, provided there is some evidence of damage, a tribunal of fact must do the best it can in assessing damages: HTW Valuers (Central QLD) Pty Ltd v Astonland Pty Ltd (2004) 217 CLR 640; [2004] HCA 54 at [47], citing Barwick CJ in Ted Brown Quarries Pty Ltd v General Quarries (Gilston) Pty Ltd (1977) 16 ALR 23 at 26, where his Honour said that where there was ample evidence that the plaintiff had suffered considerable damage by the appellant’s fraud:

6. [277]

   I have no doubt that both of the valuation experts have the necessary expertise to give evidence as to valuation, including as to the likely valuation of the Alto Holden dealership in 2017. I am also satisfied that both the industry experts have the necessary expertise to give evidence as to the state of the automobile market between 2017 and 2022. Both are clearly experienced accountants who have for many years worked in matters involving the automobile industry and who, in their professional roles, have informed themselves on an ongoing basis of developments in that industry. Whilst Mr Killer’s experience is in the context of receiverships or engagements by financiers, he has had involvement in assessing the viability of financing relating to, and of negotiating sales of, automobile dealerships, and has been head of Grant Thornton’s “Automotive Dealership Industry” team since 2008. Mr Bragg also has extensive industry experience and has been involved as corporate adviser in a number of automobile dealership transactions, including advising on a number of sales and purchases. I thus reject Alto’s contention that Mr Killer’s evidence should be “put to one side” on account of the fact that he has only personally been involved in selling one car dealership in Sydney.

7. [278]

   As to the issue whether it was more probable than not that Alto could have sold the Alto Holden dealership in 2017, and on what terms, I have (as set out below) given weight to the industry expert evidence, in particular as to the state of the market, how that would have impacted the likelihood and terms of sale, and upon the factors that were likely significant to a potential purchaser. The ultimate question, namely whether it is more likely than not that Alto could have sold the Alto Holden dealership at the relevant time, is, however, one for the Court, having regard to the available evidence (including expert evidence) going to the likelihood of this particular sale taking place. I have given weight also to the valuation experts’ evidence as to the value of the Alto Holden dealership in 2017 on this issue, as this bears upon whether or not any material amount would have been paid by way of goodwill.

8. [279]

   Alto contended that, having regard to Mr Bragg’s evidence and the objective probabilities, it is more likely than not that Alto would have sold the Alto Holden dealership in 2017. It relies in this regard upon the following matters: Holden was then ranked fourth in Australia for volumes of sales; the dealership would have been attractive given this; dealers acquire brands not just for profit but also for prestige; loss-making dealerships are sold; in 2017 other Holden dealerships in Australia were purchased; Alto was able to negotiate Heads of Agreement with Mr Elabbasi in 2019; the industry experts agreed that if the dealership could have been moved to smaller and cheaper premises it was likely that it would have sold and it was no obstacle to this that no such sites were identified in the evidence; Holden would have wanted in 2017 to be represented in the Chatswood APR; and Holden would not have insisted on on-site servicing as it did not insist on this on 11 February 2019 when Holden approved Alto moving the Alto Holden dealership to the Artarmon site. Alto contends that it is thus entitled to be compensated for the proceeds of the hypothetical sale, for its ongoing trading losses and also for the profit which it would have made by operating the Trivett VW dealership at the Chatswood site from 2017. On the relocation scenario, Alto contends that its trading losses would have been reduced and it is entitled to be compensated for the profit it would have made by operating the Trivett VW dealership from 2017 at the Chatswood site.

9. [280]

   As to these matters, the evidence disclosed that in the lead up to and including 2017 there was strong competition across the industry, and that over this period Holden’s market share trended as follows:

10. [281]

    The evidence also disclosed that in 2017 Holden was the fourth largest brand nationally and remained a significant presence in the market.

11. [282]

    Mr Altomonte said in his affidavit that, “if Alto was unable to find a purchaser” he would instead have relocated it to the Artarmon site. I would infer from this he would have allowed a reasonable time to find a purchaser. Mr Altomonte does not say anything about what amount he would have been prepared to accept for the Alto Holden dealership but, given the absence of any suggestion that Mr Altomonte was willing to give the dealership back to Holden at that time, I would infer that he would only have been willing to sell the dealership if the purchaser was willing to pay a material sum to purchase the dealership’s goodwill. Whilst in late 2019 Mr Altomonte was willing to sell the dealership for only a nominal sum for goodwill, both the circumstances of the Alto Holden dealership and Holden’s market share were very different in late 2019 from what they were in mid to late 2017.

12. [283]

    The key issue is thus whether Alto has proved, on the balance of probabilities, that within a reasonable time after either March or May 2017, it would have been able to sell the Alto Holden dealership with payment of a material sum for goodwill.

13. [284]

    This issue must be addressed having regard to Alto’s financial position at around that time. As already set out, to the extent that there is evidence of this, the Alto Holden dealership made losses at all times:

14. [285]

    There is nothing in the evidence indicating Alto’s forecasts for the Alto Holden dealership beyond 2017. In particular, there was nothing in the evidence projecting as at 2017 that the Alto Holden dealership could be profit making either at the Chatswood site or elsewhere. Whilst Mr Bragg gave examples of nine (or maybe ultimately eight) loss-making dealerships (including luxury, prestige and volume brands) that he had sold between 2018 and 2023 with substantial amounts paid for goodwill, and on the basis of these said that the Alto Holden dealership could have been sold in 2017 for goodwill of $750,000-$1,000,000, he accepted in cross-examination that each of these transactions involved the publication of information memoranda expressing a view about positive future maintainable earnings and all involved a reasonable estimate of future maintainable earnings which were positive or profit-making. He agreed that goodwill is calculated by multiplying future maintainable earnings by a multiple, which requires that the vendor or purchaser forecast future maintainable earnings. Mr Bragg also agreed that for a historically loss-making dealership to be sold for goodwill value, “the purchaser must come to a view that … it’s going to make money going forward”. There was no evidence that that was, or could have been, done for the Alto Holden dealership in 2017. Mr Bragg did not do any modelling.

15. [286]

    In the joint report of Ms Oliver and Mr Max, Ms Oliver said that a “fundamental tenet of valuation theory” is that a business’ value is derived from its future cash flows, discounted for the time value of money and risk. She said that it followed from this that a business that is not expected to have positive future cash flows has no value beyond the recoverable value of its assets, meaning, it has no goodwill. She explained that whilst a business that is presently loss-making can have goodwill value if there is a reasonable expectation of it generating positive cash flows in the future that exceed the value of its assets, not all businesses generating losses have goodwill value.

16. [287]

    As to the examples Mr Bragg had included in his report where substantial goodwill had been paid for loss-making businesses, Ms Oliver said that one could readily see why those businesses would be expected to be profitable in the future as they had all been profitable at some time before their sale, they all reported profits on a normalised basis, and the majority had forecasts projecting future profits. By contrast, she said, there was no evidence offered that the Alto Holden dealership could be profitable in the future, noting that it had not been profitable since at least FY16, no normalised profits were reported and there were no contemporaneous forecasts available at the time of the counterfactual sale projecting profits.

17. [288]

    Mr Max’s response to Ms Oliver’s opinion as set out above was that her interpretation of valuation theory was “technically correct” but that the Alto Holden dealership’s lack of historical profitability and the absence of forecasts did “not conclusively demonstrate that the dealership had no goodwill value”, noting that strategic value, turnaround potential and operational synergies were qualitative factors which “often play a significant role in buyer decision-making, even where historical profitability is absent”. Mr Max in his report had used the goodwill figure that he had been asked to assume and relied upon Mr Bragg’s expertise as to the likely goodwill that a sale would achieve.

18. [289]

    Mr Killer’s opinion was that, unless the Alto Holden dealership could be moved to premises substantially smaller and cheaper to operate than the Chatswood site, then it was unlikely that Alto would have been able to sell it in 2017. However, neither Alto nor Mr Bragg identified any smaller of cheaper site in the Chatswood APR from which the Alto Holden dealership could have been operated from March or May 2017, or six months later (assuming a short-term lease at the Chatswood site which Mr Altomonte said he would have given). Other than some references during Mr Bragg and Mr Killer’s oral evidence to the suitability of the Hotham Parade site, which was owned by Alto and at that time was where Alto’s Hyundai dealership was located (and was not suggested to be available to a purchaser of the Alto Holden dealership), they did not identify any potential sites which might have been used by a potential purchaser of the Alto Holden dealership in 2017. Further, Holden clearly had fixed requirements for its dealerships, and the fact that Holden showed some short-term flexibility to Mr Altomonte in approving the move to the Artarmon site in February 2019 does not provide a reliable basis for finding that it would have done so in 2017, after only 15-18 months of the dealership operating at the Chatswood site. This is particularly so given that the evidence discussed above shows that the Chatswood site was important to Holden and was the reason why they appointed Alto as a Holden dealer.

19. [290]

    Thus, whilst the industry experts agreed that it was likely that the Alto Holden dealership could have been sold in 2017 if the purchaser would have been able to move the dealership to premises substantially smaller and cheaper to operate than the Chatswood site, the factual premise for that opinion has not been established on the balance of probabilities.

20. [291]

    It follows that, whilst the evidence shows that dealerships will be bought for strategic reasons, that a purchaser may take the view that it can operate a dealership more profitably than the vendor, and that Holden still had considerable market share and was a valued brand with dealerships being bought and sold in 2017, on the evidence before me, I am not satisfied that the Alto Holden dealership could have been sold in 2017 for anything other than a nominal goodwill value. Mr Altomonte did not suggest he would have sold the Alto Holden dealership on such terms. Alto would thus not have proved its losses on the sale scenario, even if I had accepted Alto’s contentions on liability.

21. [292]

    I would add that I would also have found that Alto had not shown on the balance of probabilities that it could, in 2017, have acquired the Trivett VW dealership that the Alto Group in fact acquired through Alto Prestige in August 2019.

22. [293]

    Mr Senior was the CEO of Inchcape from 2016 to 2020. In 2017 to 2018 Inchcape owned a number of dealerships including the Trivett Group dealerships, which in turn included the Trivett VW dealership. He said that on 26 September 2018 Inchcape engaged KPMG to undertake a sale process of all of the Trivett Group dealerships (except for Subaru and Peugeot/Citroen) in a single transaction. His reasons for preferring to sell all the dealerships in a single transaction included price and costs of sale. He said that at this time he did not consider offering any of the dealerships individually, including the Trivett VW dealership, despite some approaches being made by purchasers seeking individual dealerships. This changed in February 2019 when it became clear that none of the bidders who had expressed interest in purchasing the dealerships as a whole would make an offer. Mr Bragg was part of the KPMG team instructed on this sale, and he agreed that KPMG had been instructed to sell the whole Inchcape dealership network (other than Subaru and Peugeot/Citroen) and it was “certainly after October 2018” that KPMG was instructed that Inchcape would consider the sale of individual dealerships.

23. [294]

    Alto contends that it is more likely than not that Inchcape would have sold the Trivett VW dealership to Alto in 2017 on two bases. First, it was loss making at that time. Second, Mr Senior’s evidence was that it was not until shortly after July 2018 that Inchcape’s preference was to sell multiple dealerships in the one transaction. These contentions ignore, however, Mr Senior’s evidence that it was not until the first half of 2018 that he considered even the possibility of selling at least some of the dealerships and it was not until February 2019 that Inchcape was willing to consider offering the dealerships for sale individually. Thus, in 2017 he was not considering selling the Trivett Group’s dealerships and it was not put to him that he would have considered doing so had Mr Altomonte approached him at that time. In these circumstances it is speculation to suggest that Inchcape would have sold that dealership to Alto in 2017.

24. [295]

    In these circumstances, Alto’s claimed loss predicated upon the sale scenario would have been rejected.

25. [296]

    It is unnecessary to consider questions of quantification, noting that Alto accepted in its submissions that Mr Bragg’s figures for Alto’s lost profits could reasonably be regarded as artificially inflated. It is also unnecessary to consider whether Alto’s claim (which claimed loss of profits from operating the Trivett VW dealership up until the end of 2022 and with a terminal value) should be reduced to reflect the fact that the Alto Group, through Alto Prestige, in fact acquired and was operating the Trivett VW dealership from August 2019, and at the Chatswood site from January 2020. It suffices to observe that the decision of the Alto Group to acquire that dealership through Alto Prestige rather than Alto did not flow from the claimed misleading and deceptive conduct, and thus, consistent with the principles I have discussed above, might well not be characterised as loss suffered because of the contravention within the meaning of s 236.

26. [297]

    The key issues as regards Alto’s relocation scenario are whether Alto has proved on the balance of probabilities that Mr Altomonte would have moved the Alto Holden dealership to the Artarmon site in 2017 if he was not able to sell it within a reasonable period and whether Holden would have agreed to this. Alto has not established either proposition on the balance of probabilities, having regard to my analysis of both the sale scenario and the issue of reliance. In these circumstances, Alto’s claimed loss predicated upon the relocation scenario would have been rejected.

27. [298]

    It follows that I would have rejected Alto’s claimed losses predicated as they are on counterfactuals that Alto failed to establish.

Would Alto have been permitted to claim damages for loss of a chance per se

1. [299]

   Alto contended in closing submissions that it need only establish on the balance of probabilities that it lost a commercial opportunity of some value, as opposed to showing on the balance of probabilities that it would have sold or relocated the Alto Holden dealership and operated a more profitable dealership from the Chatswood site. More particularly, Alto contended that its claim should be considered, by inference in the alternative, as one for the loss of a chance.

2. [300]

   Alto did not, however, plead or particularise its loss as the loss of a chance. Alto described its claims in its Third Further Amended Commercial List Statement (3FACLS) as follows:

3. [301]

   As is clear, Alto’s contention was not that it lost the chance to sell or relocate the Alto Holden dealership. Moreover, while the language set out above would appear to contemplate a claim for the lost chance of operating a more profitable dealership, Alto’s pleading as to loss in the 3FACLS at [61] indicated otherwise:

4. [302]

   No claim for loss of a chance was suggested by that pleading.

5. [303]

   Consistent with this, Alto did not open its case on the basis that it was claiming a loss of a chance as a head of loss. Indeed, during Alto’s oral opening submissions the following exchange occurred:

6. [304]

   None of the experts were asked to value a loss of a chance, and Alto did not, until the service of its written closing submissions, seek to advance its case on that basis.

7. [305]

   Alto would not have been permitted to advance a case as to loss other than by reference to its pleaded case. As was observed by Beach J (Siopis and Flick JJ agreeing) in Barnes v Forty Two International Pty Limited [2014] FCAFC 152 at [122]-[123], to allow a claim for a loss of opportunity as a head of loss to be advanced for the first time in closing addresses produces an inherent unfairness to the opposing party. This is because a party is entitled to have that head of damage properly particularised, to meet the basic requirement of procedural fairness that a party is entitled to know the case it has to meet.

8. [306]

   Had the percentage likelihood of Alto selling or relocating the Alto Holden dealership and purchasing a premium or prestige dealership itself been a critical issue as to the value of the claim (as it would be in a loss of a chance claim), there is every reason to believe that evidence would have been adduced going to that particular issue and cross-examination would similarly have been focussed upon identifying with precision the percentage chance which Alto lost. As Mr Giles SC for the defendants submitted, the evidence and cross-examination would likely have been informed by particulars as to how the loss of a chance claim was advanced.

Conclusion

1. [307]

   In light of my reasons set out above, Alto’s claims must be dismissed. As requested, I will give the parties leave to file short written submissions as to costs. My orders are:

   1. (1)

      The plaintiff’s claims are dismissed.

   2. (2)

      The defendants are to file submissions on costs, limited to 3 pages, by 4 pm on 6 February 2026.

   3. (3)

      The plaintiff is to file responsive submissions on costs, limited to 3 pages, by 4 pm on 13 February 2026.

   4. (4)

      Unless otherwise ordered, the issue of costs will be determined on the papers.