Thursday, January 15, 2004

David Tweed, ?buyer beware? and profiteering pensioners

Melbourne millionaire share-trader David Tweed has been called a ?bottom feeder?, a ?lousy share scavenger? and probably many other things, besides. Undoubtedly he sails close to the wind, in terms of his business tactics, and on occasion he has even crossed the line.

Convincing (usually affluent) pensioners to sell Tweed shares for far less than their market value ordinarily belongs in the realm of sharp practice alone ? it is not (and should not be) illegal, or otherwise subject to civil penalty. Apart from the standard remedies to do with misleading and deceptive conduct, the only further (in Tweed?s case) exception would be equitable relief on the grounds of unconscionable conduct. Some of Tweed?s victims may indeed have been so infirm as to justify being excused from the normal consequences of their contractual bargain.

Not so, however, the Pymble couple who appeared on ?A Current Affair?* (no URL) last night. Both in their late 80s, they appeared to have their full quota of wits about them. Oh, and these ostensible ?victims? still lived independently, in a house on a large allotment in Sydney?s leafy northern suburbs ? estimated land-only value, $1 million. Almost certainly, the couple acquired this property long ago, for a modest sum. If they want Australia?s legal system to become a communitarian one ? so dispensing with ?buyer beware? ? I?m most amenable to this change. Under such a system, untaxed windfall profits, like those the millionaire pensioner couple have made on their home, would revert to the common weal.

Update 17 January 2004

The tale of the Pymble couple was written up by David Elias in The Age on 15 Jan: "Share scavenger takes court action against blind, deaf woman, 88" (no URL). Despite the screaming and emotive headline, the action in question is effectively against the woman?s husband, who signed the contract on her behalf, but who is now using the fact that he lacked any formal authority to do so as a proxy defence to Tweed?s action against the wife.

One other thing ? ?buyer beware? doesn?t literally apply to capitalists being induced to part with some of their investments, of course. The deal-is-a-deal philosophy under-pinning the maxim, though, should apply with as much, if not more, force to such contracts ? again (I stress), with the appropriate equitable safeguards being in place to protect the truly vulnerable.

* Possibly it was ?Today Tonight?

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