Ainsworth Consolidated Industries Ltd v Universal Telecasters Queensland Ltd

[1982] FCA 259

J I N THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WhLES D I S T R I C T R E G I S T R Y

GENERAL D I V I S I O N

No.	G . 1 4 6 of 1982
MO.	G . 1 4 7 of 1 9 8 2

I N THE MATTER OF	THE	TRADE
PRACTICES	ACT	1 9 7 4
AINSWORTH	CONSOLIDATED	INDUSTRIES

LIMITED & ANOR.

Appl icants

and

UNIVERSAL TELECASTERS QUEENSLAND

LIMITED L ANOR.

Respondents

EDWARD PHILLIP VIBERT

r ippl icant

and

UNIVERSAL TELECASTERS QUEENSLAND

LIMITED & ANOR.

Respondents

ORDERS

JUDGE IGiWKING ORDER:	ST. JOHN, J.
DATE O F ORDERS:	THURSDAY 11 NOVEPrBER 1 9 8 2
WHEPE MADE :	AT SYDNEY

THE COURT ORDERS THAT:

1. The a p p l i c a t l o n t o s t r i k e o u t t h e s t a t e m e n t s of

c l a i m i n b o t h these matters is dismissed.

2.    The c o s t s of the applications are reserved.

' I N THE FEDERAL COURT OF AUSTRALIA

, NEW SOUTH VI'ALES DISTRICT REGISTRY

GEE!ERAL D I V I S I O N

No.	G . 1 4 6	of	1 9 8 2
No.	G . 1 4 7	of	1 9 8 2

I N THE KATTER OF THE TRADE

P L W T I C E S ACT	1 9 7 4
TLIIJSWORTH CONSOLIDATED	INDUSTRIES

L I M I T E D & ANOR.

A p p l i c a n t s

and

UNIVERSAL TELECASTERS QUEENSLAND

LIMITED & ANOR.

R e s p o n d e n t s

CDWARD	P H I L L I P	V I B E R T
A p p l i c a n t
and
UNIVERSAL	TELECASTERS	QUEENSLAND
L I M I T E D	&	ANOR.

R e s p o n d e n t s

REASONS FOR JUDGMENT

ST. JOHN, J.

WEDNESDAY 17 NOVEMBER 1 9 8 2

AT SYDNEY

I n both matters, appl ica t ion has been made by the

respondents p u r s u a n t t o O r d e r 20 r u l e 2 , t h a t t he

proceedings be s tayed or dismlssed upon the ground

tha t no r easonab le causes o f ac t ion are d i s c l o s e d

in the s ta tements o f c la im. On 11 th iblovember, I made

formal orders d i smis s ing the app l i ca t ions and

I n d i c a t e d t h a t	I	would	later	d e l i v e r r e a s o n s f o r
t h o s e d e c i s i o n s .

On the day upon which t h e a p p l i c a t l o n s t o d i s m i s s

came o n f o r h e a r l n g , t h e a p p l i c a n t s f l l e d i n c o u r t

0

amended s t a t emen t s of claim which were n o t o b j e c t e d t o

by	counse l fo r t he r e sponden t s , bu t	who	d l d	i n d i c a t e
t h a t t h e a p p l i c a n t s p o s i t i o n	as	t o c o s t s	would	be

preserved. One of t h e amendments I n t he s t a t emen t o f

claim could be r e g a r d e d a s a n e s s e n t i a l a l l e g a t i o n ;

t h a t a l l e g a t i o n was t h a t t h e a c t s t h e a p p l i c a n t s

complained of was done i n t r a d e o r commerce.

Both appl ica t ions are f o r i n j u n c t i o n s r e s t r a i n i n g

the r e sponden t s f rom t e l ecas t ing matter concerning

t h e a p p l l c a n t s t h a t is a l l e g e d t o be misleading or

decep t ive and o the rwise mak ing ce r t a in s t a t emen t s t o

t h e	effect	t h a t t h e a p p l l c a n t s	were	a s s o c i a t e d w i t h
the maf i a	and gangsterism, and	indulged	i n	o t h e r c o r r u p t

p r a c t i c e s .	The	a p p l i c a n t s	also	seek	damages	p u r s u a n t	t o
s e c t i o n	82	o f	t he	Trade	P r a c t i c e s	A c t 1 9 7 4	( " t h e A c t " )
and	amages	for	defamation.	Both	s ta tements	of	clalm

1J a l l e g e t h a t b o t h r e s p o n d e n t s , i n t r a d e o r commerce,

and be ing the holders of l l censes i ssued pursuant

t o the Broadcas t ing and Te lev l s ion	A c t	1 9 4 2 ,	e a c h t o
conduct a commercial	te levis ion	s t a t i o n ,	publ ished

misleadlng or decept ive s ta tements about each of the

a p p l i c a n t s . What p u r p o r t s t o be a t r a n s c r i p t of

what was	s a i d is	reproduced, and	the	false imputat ions
a r e extracted from	those	s ta tements .	The	b roadcas t s
were	made	by	t h e f l r s t r e s p o n d e n t	i n Brlsbane with

0

some p e n e t r a t i o n i n t o n o r t h e r n New South Wales and by

the second r e sponden t In Vic to r i a .

S e n i o r c o u n s e l f o r t h e a p p l i c a n t s p u t h i s c a s e

q u i t e s i m p l y as being based upon a breach of sec t ion 5 2

o f t he A c t I n t h e p r o v i s l o n o f s e r v l c e s by the respondents

t o consumers , the consumers belng those persons who watch

t h e p a r t i c u l a r programme t h a t was telecast t o t h e i r

r ece ive r s and tha t t he ac t lon fo r de fama t ion 1 s one which

t h e y a r e e n t i t l e d t o b r i n g p u r s u a n t t o s e c t l o n 3 2 of t h e

Federa l Cour t o f Aus t ra l ia A c t 1 9 7 6 as an a s soc ia t ed

matter within the meaning of t h a t s e c t i o n . R e l l a n c e 1s

placed upon the High Cour t dec is ion of P h l l l l p M o r r i s

Inc . & Anor. v. Adam P. Brown Male Fashions Pty. L i m l t e d ;

Un i t ed S ta t e s Surg ica l Corpora t lon v . Hosp i t a l P roduc t s

I n t e r n a t l o n a l P t y . L iml t ed & O r s . (1981) 33 A.L.R. 465

where Mason, J. h e l d t h a t a subs t r a tum o f f ac t s common

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to both the actions over which the court has ~url diction

and the associated actlon was sufficlent, and wlth this

view Stephen, J. agreed. Three other members of the court

expressed dlfferent and varying opinions; two members

held the sectlon to be unconstitutlonal.

The uses to which breaches of the consumer protectlon

provlsions of the Act can be put to protect Interests

other than the direct interest of the consumer ar stlll

in an exploratory stage. It is clear that the motivation

of the movlng party is irrelevant provided there 1s a

breach of the Act upon whlch the application to the court

is founded. The right of "any person" to brlng proceedlngs

based on a breach of the Act is obviously intended to

encourage the achievements of the purposes of the Act in
the same way as those actions which were characterised
as "qui tam" or "popular" by the courts. There is a long
history of such legislative devlces often with rewards

for common informers.

A number of arguments were advanced by counsel the respondents. Firstly, a formal submission was made that section 32 of the Federal Court of Australia Act for

1976 was unconstitutlonal and notice of that submission

was qiven to the Attorneys-General of the Commonwealth,

J

Queensland, New South Wales and Victoria. Each of them
declined the opportunity to intervene. The formality
of the submission before this court is the result of
the Iligh Court decision in the Phillip Morris case
(supra) where constitutional validlty was approved by

a majority decislon.

The transcript reproduced In the statements of

claim was OE a news broadcast and counsel for the first

E'

respondent argued that, because the granting of the television license was conditional upon the provision of such a service, the service was not given in trade

or commerce. The fact that the service was done under

compulsion, in my view, does not necessarily mean that

it 1 s not utilised for the business purposes of the
television station and evidence may reveal that the
provisions of such a news service IS within the phrase

"in trade or commerce". There remains to be declded

I

the question whether gratuitous services in any event

are within the scope of those words. Counsel for the

second respondent contended that the phrase	"in trade
or commerce" was a statenent not	of fact but of law.

I disagree. The phrase is part of the factual basls

laid down by the Act to deflne the prohibition
expressed. Whether the evidence supports the allegation

.i

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that the broadcast was done in trade or commerce withln
the meanlng of the section may arlse for decision on

interpretatlon of the section.

Another question for determination is whether or

not it 1s necessary for a consumer to have suffered

damage before "any person" can commence an action under

section 82.	It could be argued that the consumer
protection provlsions	can only be utilised where actual

I

or potentlal damage to consumers is proven. It is,

however, at least arguable that such gratuitous services

are within the "trade or commerce"	of a television
station corporation.

The appllcant corporation was alleged to be a manufacturer of poker machines. Senior counsel for the first respondent pointed to Victorian legislation

prohibitlng the use or possession of poker machines	in
that State	and contended that the applicants, one of

whom alleged he was the Chief Executive Offlcer of the

Australian Club Development hssoclatlon, and the

corporation applicant could not suffer damage as a result of a televlsion broadcast in that State. There

is no evldence that the corporate applicant does	not
have any buslness interests	In Victorla and, in any

. . ./7

e v e n t ,	t h e d i r e c t o r s	of	t h a t company,	f o r a l l t h a t	i s
known	a t t h e	moment,	may	b e r e s i d e n t s i n t h a t	State.

Damage	may	be su f fe red	by	the app l i can t s whe the r t hey
t r a d e i n	a	p a r t i c u l a r S t a t e o f t h e	Commonwealth	o r

no t . The a p p l i c a n t s p u t t h e i r c a s e on t h e b a s l s t h a t

t h e consumer t o be p ro tec t ed i s t h e t e l e v l s i o n w a t c h e r ,

not the poker machine consumer.

Both counsel fo r the respondents a rgued tha t there

were d i f f e r e n c e s m t h e l a w of defamation between New

South Wales and Vlc tor ia and tha t there would be some

embarrassment	In	the respondents ' p leading	to such	a
cause of	ac t ion ,	as i n Victoria,	t r u t h a l o n e	is a

defence and in	New	South Wales ,	t ruth alone	1s	no t .
If	t h e a c t i o n f o r d e f a m a t i o n	is	h e l d t o b e	an	a s s o c i a t e d

a c t i o n , I d o n o t t h i n k t h a t t h e d i f f e r e n c e s I n t h e law of

t h e two S t a t e s w i l l p r e s e n t a n y i n s u r m o u n t a b l e d i f f i c u l t i e s

t o the respondents . I t was a l so a rgued fo r t he r e sponden t s

t h a t , i n p r o c e e d i n g s f o r d e f a m a t i o n In S t a t e c o u r t s , e i t h e r

p a r t y c a n h a v e t h e r a t t e r t r i e d by a judge and jury as

opposed t o by judge a lone i n t h l s cou r t . Aga in , a s suming

the ma t t e r t o be p rope r ly an a s soc ia t ed ma t t e r w i th in

s e c t i o n 3 2 , I do not th in lc tha t the absence or presence of

a ~ u r y would be dec i s ive . The b a s l c q u e s t i o n of whether

o r n o t t h e a c t l o n for defamation is an a s soc ia t ed matter

. . ./8

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,	p	.
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remains, and i f it i s , t h e court h a s j u r l s d i c t l o n t o

d e a l w i t h	it	applying such	law	as	is	a p p r o p r i a t e t o t h e
p u b l i c a t i o n .	The	r e a l	q u e s t i o n	i s whether	the	common

subs t r a tum o f f ac t s is e s t a b l i s h e d .

Barwick, C . J . i n t h e General S t e e l Inc. v.

Commissioner for Railways (N.S.W.) and Others (1964-65)

1 1 2 C.L.R. 125 a t 1 2 9 c o l l e c t e d t o g e t h e r t h e v a r i o u s

tests which had been a p p l i e d I n a p p l i c a t l o n s t o s t r i k e

ou t s t a t emen t s o f c l a im and quoted Dixon, J. (as he

then was) i n Dey v. Vlctorian Railways Commissioners

( 1 9 4 9 ) 78 C.L.R. 62. That quota t ion inc luded: -

“A case must be very clear Indeed t o

j u s t i f y t h e	summary	i n t e r v e n t i o n	of	t h e
c o u r t	t o	p reven t	a	p l a i n t i f f s u b m i t t l n g

h i s case f o r de t e rmina t ion in the appo in ted

manner by t h e c o u r t w i t h o r w i t h o u t a

j u r y ...... once it a p p e a r s t h a t t h e r e i s a

r e a l q u e s t i o n t o be determined whether

of	f a c t or law and	t h a t t h e r i g h t s	of
t h e p a r t i e s	depend	upon	it, then It i s
no t	compe ten t fo r t he cour t	t o	d i s n i s s

t h e a c t i o n . . . . . . ‘I

Apply ing	those p r inc ip l e s ,	it	is	c l e a r t h a t t h e f a c t s
a l l e g e d	makes	it	a t	l e a s t a r g u a b l e t h a t t h e a p p l i c a n t s
have i n law a reasonable	cause	of a c t i o n .	I need	be

no more p o s i t i v e t h a n t h a t .

I t may well b e t h a t , a t t h e c l o s e of p l ead ings ,

a f t e r f u r t h e r a n d b e t t e r p a r t i c u l a r s h a v e b e e n o b t a i n e d

and	p o s s i b l y i n t e r s o g a t o r i e s a d m i n i s t e r e d ,	t h a t	t h e
facts	i n i s s u e	w i l l be more	c l ea r ly de f ined and the

p a r t i e s , o r e i ther of them, may cons ide r it appropr l a t e

t o have the ma t t e r s of law which a r i se on t h o s e f a c t s

argued w i t h o u t the expense of what pronlses t o be a

lengthy hear lng. That , of course, 1 s n o t for me t o

urge o r even encourage.

For these r e a s o n s , t h e a p p l i c a t l o n t o s t r i k e o u t

f a i l s and	I	s t and ove r	fo r argument	the	questlon	of
c o s t s	of	t h e a p p l i c a t i o n t o	a	d a t e t o	be	f i x e d .

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