Misleading or deceptive conduct is a separate legal claim a buyer can bring against a seller for false or misleading statements made during the sale process, on top of or instead of any warranty claim.
Technically, it is conduct prohibited under section 18 of the Australian Consumer Law, which applies to representations made in trade or commerce, including statements a seller makes to a buyer during due diligence and negotiations. Liability under section 18 does not require fraud or even negligence, and it cannot be excluded by contract.
Buyers like this cause of action because it sits outside the warranty schedule entirely, so it is not limited by the basket, the cap, or the survival period the parties negotiated for warranty claims. Sellers should treat it as the one risk that the deal’s negotiated liability architecture does not contain.
The practical exposure comes from casual statements made outside the formal disclosure process: an offhand comment in a management presentation, an optimistic email to the buyer’s adviser, a projection shared without qualification. Each of those can become the basis of a section 18 claim years after completion, regardless of what the share sale agreement says about caps and baskets.
What you as a seller should push back on: a non-reliance clause that only covers warranty claims and leaves section 18 exposure untouched. Be disciplined about every representation made outside the formal disclosure letter for the entire sale process, not only in the final document.