Arfmas Pty Ltd v Victorian Football League

N o t

f o r

general dlstrlbutlon

Trade Practices - Trade Practices Act

1974 - Application for

interlocutory injunction under

s.80

professional footballer

refused permit by Football League to participate in competition games - restraint of trade - jurisdiction of court - cause of action under Trade Practices Act not specifically pleaded - interim injunction granted

Trade Practices	Act 1974 - s.80(2); EO(5)
Cases

Adamson v. West Perth Football Club Inc. and Others	(1979-1980) 27
ALR 457 at 499

Bucklev v. T

(1971) 125 CLR 353

Victorian Football Leasue

- Supreme Court

of Victoria -

unreported 31 August

1977)

The Australian Coarse Grain Pool Ptv Ltd	v. The Barley Marketinq
Board of Oueensland (1983) 57 ALJR 425.

TITLE:

ARFMAS PTY

LTD and MAURICE JOSEPH RIOLI

v. VICTORIAN

FOOTBALL LEAGUE

No. WA G38 of 1986

MUIRHEAD J.

PERTH

2ND MAY 1986

IN THE FEDERAL COURT	)
OF AUSTRALIA	)

WESTERN AUSTRALIA	)	No. WA G38 of 1986
DISTRICT REGISTRY	)
GENERAL DIVISION	)

B E T W E E N :

ARFMAS PTY LTD

Applicant

and

MAURICE JOSEPH RIOLI

Second Applicant

and

VICTORIAN FOOTBALL LEAGUE

Respondent

MINUTE OF ORDER

JUDGE MAKING ORDER:	MUIRHEAD J.
DATE OF ORDER:	2 MAY 1986
WHERE MADE:	Perth

THE COURT ORDERS

THAT:

The applicants having given

the usual undertaking as

t o

damages And Until Further Order, order that the respondent by

its proper officers, servants agents

or otherwise forthwith

grant such permit as

is or may be necessary to enable the

second applicant to play football

for

Sydney Rules Pty

Limited

professional

Australian

Rules

Football

competltltons

conducted by the

respondent

pendin?

final

determination

of the Issues arlsing between the appllcants

and the respondent in this applicatlon.

2. Liberty to the parties to apply for such further orders or

directions as they may be advised upon

48 hours written

notlce to the other party or parties.

3 . This order shall be entered forthwith

4 .

Service of this Order may be effected by telegram,

or letter

including facsimile letter to the respondent signed by

or on

behalf of the Registrar pursuant to Order

7 Rule 13.

5. Costs

reserved.

6 . The time for service of the Application, Statement of Claim

and Affidavits filed herein be abridged to the 1st

May 1986.

Note: Settlement and entry of

orders is dealt

with in Order

36 of the Federal

Court Rules.

IEJ THE FEDERAL COTJRT	)
OF AUSTRALIA	)

WESTERN

AUSTRALIA

)

Ns. I4A G33 of 1386

DISTRICT REGISTRY

GENERAL	DIVISION	)
B E T W E E N :
ARFMAS PTY LTD

Applicant

and

MAURICE JOSEPH RIOLI

Second Applicant

and

VICTORIAN FOOTBALL LEAGUE

Respondent

m: MUIRHEAD J.

2 May 1986

REASONS FOR JUDGMENT

Application

filed

this

Court

(at

the

Perth

Registry) on

30 April the applicants seek interlocutory relief,

primarily

an order directed to the respondent that it should

"forthwith grant the second applicant" (Rioll) "a permit to play

football for Sydney Rules Pty Llmited (Swans) in professional

Australian

Rules

Football

competitions

conducted

the

respondent" (VFL) "pendlng

final

determination of

the

issues

arising in the application.	The Statement of Claim was filed the
same date.

The application was brought in this Court yesterday,

far from the scene of controversy, because, as

I understand it,

this court was able to give

the earliest hearmg. The application

has been brought in haste, the

VF'L has only just been served and

has not had the opportunlty to place any factual material before

the court.

These

matters

make

determination

such

application difflcult and

if an interlocutory order is made it

must be of an interim nature (see 0 . 2 5 r.1 Federal Court Rules

Court and

s .80(2)

Trade Practices Act 1974). The

W L

which

opposes the application was however represented by senior counsel.

Whilst at

my invitation, he put submissions in opposition

on the

merits, the primary thrust

of his argument went to the question

Jurisdiction, a matter I must first determine.

I summarise the background facts as

they appear in the

affidavits of Rioli and Terence McAuliffe, and the exhibits

thereto.

Rioli, whose present income is derived from professional

football, until recently played for the Richmond club. Earlier

this month he was recruited to play for the Swans.

He obtained a

'clearance' from Richmond early this month "through",

he asserts,

the VFL.

He has been engaged to play with the Swans during

1986,

1987 and 1988 but the

VFL refuses to grant

a permit which is

apparently a necessary prerequisite to his participation in league

,a-(,..

- - h e -I.

9~ hzz : j di-i:?

mizc:vl

t c ir mstchcs by

+ h - -

L , L - 2

L"eaS0z.

His

income 1s thLis

d ~ m i n l s h e d and h?

swears he gave

up a posltlon as

an officer wlth the Department of Youth Sport

and Recreation of

Victoria as a consequence of ~olning

the Swans.

He seeks an order

of this Court whlch may permlt hlm t o play without delay.

The

Affidavit

of Mr

cAuliffe

exhibits

recent

communications between ARFMAS, its solicitors, VFL's solicitors

and

VFL.

will not deal with it save to comment that the

applicants have, at least since

April, made every effort to

obtain a permit. In

a telex to the

VFL dated 2 3 April, the

applicants'

solicitors

stressed

that

the

VFL's attitude if

maintained "would clearly be oppressive and in restraint of trade

and in this case in derogation of

professional footballer's

right to work".

In contrast to the applicants' vigorous efforts

to resolve the situation

the VFL has (in correspondence at least)

been reticent. By letter dated

24 April the

VFL's solicitors

wrote to the applicants' solicitors stating inter alia "The Sydney

Swans have exceeded the

Club's

Maximum Team Salary and are in

breach of Player Rule

50.

A permit will only issue when the Rules

have been complied with". Efforts on behalf of the applicants to

obtain an up to date copy of Rule

50 from the VFL or its advisers

do not appear to have met with success at the time of hearing.

do not know the content of Rule

50.

It may be concluded that

Rioli's Inability to play is not due to shortcomings on his part.

Anderson

Q.C.

submits

that

this

court

has

lurisdiction. If incldental jurisdiction exlsts, it is argued

correctly

that

can

only

reason

of the

stautory

4 .

!ur,Sldl,:tlsn

et'

t h l s C0L.t-t

L:E~EL- the T r z d e FrzctT.ces

Act 1 9 7 4 .

That jurisdiction, It 1s argued, can only exlst when on the

pleadings that jurisdiction

invoked. In Adamson v. West Perth

Football

C l u b

Inc. and others

(1979-1980)

ALR

475 at

499

Northrop J.

dealt with the source

of incidental power. Counsel

referred to this passage (lines 1 3

to 3 9 ) .

His Honour stated, at

p.500, and he was referring to the facts in the case before him"

"Applying the principles stated and on the facts of this

case, I am

the

opinion

that

court

has

jurisdiction to hear and determine the claim made by

the applicant in so far as

it is based on the common

law doctrine of restraint of trade and that the court

should exercise that jurisdiction. The facts on which

the claim is made under the Trade Practices Act are the

very same facts on which the claim is made under the

common

law

doctrine.

The

one

form

relief

claimed.

The claim made under the Trade Practices Act

is made bona fide and is substantial.

The common law

doctrine relied upon as

a ground is not completely

severable from the grounds supporting the claim under

the Trade Practices

Act".

The primary initial question is whether there is before the Court

"a matter vested in it by laws made by the Parliament being in

respect of matters arising under laws made by the Parliament".

The

nub of the objection to the jurisdication is that the pleadings,

(the Application and the Statement of

Claim) do not specifically

plead the provisions of the Trade Practices

Act, except perhaps in

i	a very general way.

The Statement of Claim alleges that both

ARFMAS and the

VFL are "corporations" within the meaning of the Trade Practices

Act.

That

allegation

consistent

only

I think

with

the

conclusion that

the cause OE

action arises under that Act. The

acpllcants'

'c-ounscl lnfc~rmzd

th?

G u r t t ha t h l s cllents' actlon 1 s

based on s.45(2)ta)li which provides that "A corporation shall not

make

a contract

or arrangement, or arrive at an understanding,

if ...... a provlsion

the proposed contract. arrangement

understanding has the purpose, or would have or be likely to have

the effect, of substantially lessening competition....".

The Statement

of Claim does not refer to

"a contract

arrangement or understanding", it makes no reference to s.45 nor indeed to 5.80 which deals generally with injunctions, including

an injunction of the nature

here sought under s.80(2),and s.80(5).

The Rules

of this Court relating to pleadings are

obviously designed for simplicity and brevity (see Order

111,

particularly Rules

2, 3 and 6 , and the powers of obtaining

particulars and indeed of amendment are wide. See Order

13 Rule

It is the material facts to which emphasis must be given.

do not consider the failure to specifically plead the cause of

action under the Trade Practices Act justifies the Court in

refusing

jurisdiction,

nor

indeed

oes

deprive

jurisdiction. The facts pleaded are in

my view sufficient to

invoke this Court's jurisdiction under the Trade Practices Act.

If I	had thought to the contrary I would have given leave (if

indeed leave is required bearing in mind Order 13

Rule 3(1)) to

amend to enable the Court to determine the real questions raised

upon the application. It must also be borne in mind that Order 25

Rule 1 empowers

this

Court

grant

injunctions

before

the

commencement of proceedings; in such cases of urgency the Court

would

have

rely

counsel's ubmissions

examining

' !lw-lsdictlon.

In rearhlng my

c c ~ n c l u s l c n 1 am not

Iunmlnrlfhl of the

applicants

r e f e r e w e

r;hc

r~ztralnt of

trade

the

correspondence.

and

I am satlsfled

that

VFL

1s not

embarrassed, at this stage,

by the form of pleading. This is not

to say that

I hold the

Statement of Claim is in adequate form for

resolution of the substantive issues In due course - that is not now a matter for me - but I am satisfled that the cause of action is based on the Trade Practlces Act and the jurisiction granted to

this Court by that Act.

Mr	Anderson Q.C. also referred to the inconvenicne

caused by the matter being determined in Perth.

He submits that I

should decline to make

an order and adjourn it elsewhere closer to

the seat of contention. I can understand this submission

- in

fact I

have some selfish sympathy for it. But on the evidence

before me Rioli is suffering

a continuing loss and he is entitled

to seek relief in the Federal Court in Perth, if it is the venue

which offers prospects for early relief.

' "',It

is as I have

said,

inappropriate

make

substantive determination of the issues but

I consider the justice

I .

the-kse requires that

I must now consider whether it is

"desirab1e":to grant an interim injunction, the specific power

to do being provided by

s.82(2) of the Act.

I - .

- It is of course not possible at this stage to assess the

applicants prospects of obtaining relief and damages under the different. There Northrop J. examined the relationship between a

slay?r. a

z l c b ana the ieaque.

Re corr.mented (at

p.504) "It was

not really disputed and I find that the rules and regulations of

the various leagues and clubs constitute a contract arrangement

understanding wlthin 5.45

of the Act and that In

so far as those

rules and regulations prevent a person from playing football with

club of

his choice, contain a provision which is capable

having a purpose which has or is likely to have the effect of

substantially lessening competition .....

By complying with the

permit and clearance provislons of those rules and regulations the

respondents, being corporations within

s.45 of the Act are parties

to the contract arrangement or undertaking and are giving effect

to a provislon which is capable of being proscribed by

s . 4 5 " .

(See generally

Buckley

Tuttv

(1971) 125 CLR 353 and

Victorian Football Leaque	- Supreme Court	of Victoria - unreported
31 August 1977).

Upon the material now before me it is evident that Rioli

a talented professional footballer is now prevented from pursuing

his professional calling. This does not appear to

be by virtue of

any breach of rules or conduct on his part. He

is not in dispute

with a club. The source of the dispute which is disqualifying him

a5 an individual apparently lies between Swans and the

VFL and has

its origins in matters which are probably beyond his control.	He
appears to be the 'meat in the sandwich' and it is at least

arguable that

the refusal to grant a permit imposes upon Rioli a

restraint of trade which is unreasonable and unjustified. His

advisers have acted with expedition. The

VFL, so

the exhibits

demonstrate, has not responded with the same expedition and

I find

it difflcult to understand the delay in supplying the copy of the

9 .

rule reqcl.2stc-i;.

T i l c 7 affidavit evidence psta311shas he is

suffering

acontlnuina

flnanclal

loss.

The

factors to be

considered are whether there 1 s

a serious questlon to be trled,

followed by a determination of the balance of convenlence

(The

Australlan Coarse Grain

Pool Ptv Ltd v. TheBarlev Marketlnq Board

of Oueensland

(1983) 57

ALJR 4 2 5 ) .

I am satisfied there is a

serlous question to be tried. There can hardly be dispute on this

issue.

As to

the

balance

convenience,

that

balance

heavily weighed in favour of the applicants. Both, in their

affidavits, have given an undertaking in damages to this court.

As I have said Rioli is suffering financial loss but also he is

currently subject to a disqualification and

an absence from match

play which could operate to his detriment.

appreciate it has

many and wide responsibilities but the

VFL

is unlikely to suffer

prejudice by reason of

Rioli’s appearance on the field. In fact

one would think that football generally will benefit by the

participation of such a fine footballer, assuming

as I do that the

promotion of Australian Rules is one of the functions of the

W L .

Its counsel contends that

interim injunction in the form

proposed may have extensive repercussions

as it may require the

VFL to grant

a permit contrary to its rules and regulations

- that

may, as it were, set a difficult precedent.

I would be

surprised if

an interlocutory order of this Court which requires

the granting of

a permit to enable one player to take the field,

an	order which is subject to review, could possibly serve to

jeopardise the

VFL in its administrative responsibilities.

I am

satisfle5 that t he jczti,:e

of th? matter requires

that an lnlunctlon be granted.

I order as follows:

The time for service

of the

Appllcation, Statement of Claim

and Affidavits filed herein be abridged to the 1st May

1986.

2. The applicants having undertaken to abide by any order which

the Court may make as to damages in the event that the Court

is of the opinion that any party

has been adversely affected

by reason of this Order, order that until further order the

respondent

its

proper

officers,

servants,

agents

otherwise forthwith grant such permit

is or may be

necessary to enable the second applicant to play football for

Sydney Rules Pty Limited in professional Australian Rules

Football competitions conducted by the respondent pending

final

determination of

the

issues

arising

between

the

applicants and the respondent in this application.

3 .

Liberty to the parties to apply for such further orders

directions as they may be advised upon

40 hours written

notice to the other party or parties.

4 . This Order shall be entered forthwith.

Service of

this Order may be effected by telegram, telex, or

facslmlle. to the respondent pursuant to Order

7 Rule 13.

6. Costs

reserved.

I certlfy that thls and the precedlng nlne pages are a true copy of the reasons for declslon hereln of hls Honour Mr Justlce Mumhead.

Assoclate

Dated: 2 May 1986

[1986] FCA 177

5 Feb 1986