Australian Competition and Consumer Commission v Campbell - [2019] FCA 886

FEDERAL COURT OF AUSTRALIA
Australian Competition and Consumer Commission v Campbell [2019] FCA 886

File number(s): VID 612 of 2019

Judge(s): O'BRYAN J

Date of judgment: 7 June 2019

Catchwords: PRACTICE AND PROCEDURE – ex parte application by ACCC for freezing orders – alleged contraventions of the Australian Consumer Law – whether freezing orders should be made – whether ancillary disclosure orders should be made – whether ACCC required to provide undertaking as to damages

Legislation:
Competition and Consumer Act 2010 (Cth) s 137F

Federal Court of Australia Act 1976 (Cth) s 23

Federal Court Rules 2011 (Cth) Div 7.4, rr 7.32, 7.33, 7.34

Cases cited:
ACCC v Get Qualified Australia Pty Ltd (2016) 244 FCR 538

Barnes v Addy (1874) LR 9 Ch App 244

Basi v Namitha Nakul Pty Ltd [2019] FCA 743

Cardile v LED Builders Pty Ltd (1999) 198 CLR 380

Deputy Commissioner of Taxation v Hua Wang Bank Berhad (2010) 273 ALR 194

Donnelly v Porteous [2001] FCA 345

Hyder Consulting (Victoria) Pty Ltd v Transfield Pty Ltd [2002] VSC 315

Pearce v Waterhouse [1986] VR 603

PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1

Robmatjus Pty Ltd v Violet Home Loans Australia Pty Ltd [2007] VSC 165

Date of hearing: 6-7 June 2019

Registry: Victoria

Division: General Division

National Practice Area: Commercial and Corporations

Sub-area: Regulator and Consumer Protection

Category: Catchwords

Number of paragraphs: 42

Counsel for the Prospective Applicant: Dr O Bigos

Solicitor for the Prospective Applicant: Australian Government Solicitor

Counsel for the Prospective Respondents: The First, Second and Third Prospective Respondents did not appear

ORDERS

VID 612 of 2019

BETWEEN:
AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

Prospective Applicant

AND:
IAN MICHAEL CAMPBELL

First Prospective Respondent

SWIM LOOPS HOLDINGS PTY LTD

Second Prospective Respondent

JUMP LOOPS PTY LTD

Third Prospective Respondent

JUDGE:

O'BRYAN J

DATE OF ORDER:

7 JUNE 2019

THE COURT ORDERS THAT:
INTRODUCTION
1.
(a)The application for this order is made returnable immediately.
(b)The time for service of the application and supporting affidavit is abridged and service is to be effected by 6 pm on Monday 10 June 2019.

2.Subject to the next paragraph, this order has effect up to and including 12 June 2019 (the Return Date). On the Return Date at 9.00 am there will be a further hearing in respect of this order before Justice O’Bryan.
3.Anyone served with or notified of this order, including you, may apply to the Court at any time to vary or discharge this order or so much of it as affects the person served or notified.
4.In this order:
(a)‘you’ includes all of you and includes you if you are a corporation;
(b)‘third party’ means a person other than you and the prospective applicant;
(c)‘unencumbered value’ means value free of mortgages, charges, liens or other encumbrances.

5.
(a)If you are ordered to do something, you must do it by yourself or through directors, officers, partners, employees, agents or others acting on your behalf or on your instructions.
(b)If…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2019] FCA 886
Decision Date: 7 June 2019

CaseChat Overview and Summary

The Australian Competition and Consumer Commission (ACCC) filed an ex parte application for freezing orders against Campbell, alleging contraventions of the Australian Consumer Law. The Federal Court was required to decide whether the freezing orders and ancillary disclosure orders should be granted, and whether the ACCC was required to provide an undertaking as to damages. The court found that the ACCC had made out a prima facie case that Campbell had contravened the Australian Consumer Law by engaging in conduct that was misleading or deceptive or likely to mislead or deceive. The court also found that the ACCC had demonstrated a serious issue to be tried and that the balance of convenience favoured the making of the orders. The court granted the freezing orders and ancillary disclosure orders, subject to certain exceptions. The final orders included directions for the ACCC to provide disclosure to Campbell and for Campbell to provide information to the ACCC, as well as provisions for the variation or discharge of the orders and the enforcement of the orders outside Australia. The costs of the application were reserved for determination at a later date.

Orders

Orders of the court

INTRODUCTION

(a) The application for this order is made returnable immediately.

(b) The time for service of the application and supporting affidavit is abridged and service is to be effected by 6 pm on Monday 10 June 2019.

2. Subject to the next paragraph, this order has effect up to and including 12 June 2019 (the Return Date). On the Return Date at 9.00 am there will be a further hearing in respect of this order before Justice O’Bryan.

3. Anyone served with or notified of this order, including you, may apply to the Court at any time to vary or discharge this order or so much of it as affects the person served or notified.

4. In this order:

(a) ‘you’ includes all of you and includes you if you are a corporation;

(b) ‘third party’ means a person other than you and the prospective applicant;

(a) If you are ordered to do something, you must do it by yourself or through directors, officers, partners, employees, agents or others acting on your behalf or on your instructions.

(b) If you are ordered not to do something, you must not do it yourself or through directors, officers, partners, employees, agents or others acting on your behalf or on your instructions or with your encouragement or in any other way.

FREEZING OF ASSETS

6. You must not remove from Australia or in any way dispose of, deal with or diminish the value of any of your assets in Australia (‘Australian assets’).

7. For the purposes of this order, your assets include:

(a) all your assets, whether or not they are in your name and whether they are solely or co-owned, and whether or not they are beneficially owned; and

(b) any asset which you have the power, directly or indirectly, to dispose of or deal with as if it were your own (you are to be regarded as having such power if a third party holds or controls the asset in accordance with your direct or indirect instructions).

PROVISION OF INFORMATION

8. Subject to paragraph 9, you must:

(a) at or before the further hearing on the Return Date (or within such further time as the Court may allow) to the best of your ability inform the prospective applicant in writing of all your liquid assets world-wide comprising cash, securities and deposits of any kind held with a financial institution, giving their value, location and details and the extent of your interest in the assets;

(b) within 14 working days after being served with this order, swear and serve on the prospective applicant an affidavit setting out the above information.

(a) This paragraph 9 applies if you are not a corporation and you wish to object to complying with paragraph 8 on the grounds that some or all of the information required to be disclosed may tend to prove that you:

(i) have committed an offence against or arising under an Australian law or a law of a foreign country; or

(ii) are liable to a civil penalty.

(b) This paragraph 9 also applies if you are a corporation and all of the persons who are able to comply with paragraph 8 on your behalf and with whom you have been able to communicate, wish to object to your complying with paragraph 8 on the grounds that some or all of the information required to be disclosed may tend to prove that they respectively:

(i) have committed an offence against or arising under an Australian law or a law of a foreign country; or

(ii) are liable to a civil penalty.

(i) disclose so much of the information required to be disclosed to which no objection is taken; and

(ii) prepare an affidavit containing so much of the information required to be disclosed to which objection is taken, and deliver it to the Court in a sealed envelope; and

(iii) file and serve on each other party a separate affidavit setting out the basis of the objection.

EXCEPTIONS TO THIS ORDER

10. This order does not prohibit you from:

(a) in the case of Ian Michael Campbell, paying up to $2,000 a week on living expenses;

(b) paying your reasonable legal expenses;

(c) other than for Ian Campbell, dealing with or disposing of any of your assets in the ordinary and proper course of your business, including paying business expenses bona fide and properly incurred; and

(d) other than for Ian Campbell, in relation to matters not falling within (a), (b) or (c), dealing with or disposing of any of your assets in discharging obligations bona fide and properly incurred under a contract entered into before this order was made, provided that before doing so you give the prospective applicant, if possible, at least two working days written notice of the particulars of the obligation.

11. You and the prospective applicant may agree in writing that the exceptions in the preceding paragraph are to be varied. In that case the prospective applicant or you must as soon as practicable file with the Court and serve on the other a minute of a proposed consent order recording the variation signed by or on behalf of the prospective applicant and you, and the Court may order that the exceptions are varied accordingly.

COSTS

12. The costs of this application are reserved to the Court hearing the application on the Return Date.

Set off by banks

13. This order does not prevent any bank from exercising any right of set off it has in respect of any facility which it gave you before it was notified of this order.

Bank withdrawals by the respondent

14. No bank need inquire as to the application or proposed application of any money withdrawn by you if the withdrawal appears to be permitted by this order.

Persons outside Australia

15.

(a) Except as provided in subparagraph (b) below, the terms of this order do not affect or concern anyone outside Australia.

(b) The terms of this order will affect the following persons outside Australia:

(i) you and your directors, officers, employees and agents (except banks and financial institutions);

(ii) any person (including a bank or financial institution) who:

(A) is subject to the jurisdiction of this Court; and

(B) has been given written notice of this order, or has actual knowledge of the substance of the order and of its requirements; and

(C) is able to prevent or impede acts or omissions outside Australia which constitute or assist in a disobedience of the terms of this order; and

(iii) any other person (including a bank of financial institution), only to the extent that this order is declared enforceable by or is enforced by a court in a country or state that has jurisdiction over that person or over any of that person’s assets.

Assets located outside Australia

16. Nothing in this order shall, in respect of assets located outside Australia, prevent any third party from complying or acting in conformity with what it reasonably believes to be its bona fide and properly incurred legal obligations, whether contractual or pursuant to a court order or otherwise, under the law of the country or state in which those assets are situated or under the proper law of any contract between a third party and you, provided that in the case of any future order of a court of that country or state made on your or the third party’s application, reasonable written notice of the making of the application is given to the prospective applicant.

SCHEDULE A

UNDERTAKINGS GIVEN TO THE COURT BY THE PROSPECTIVE APPLICANT

1. As soon as practicable, the prospective applicant will file and serve upon the Prospective Respondents copies of:

(a) this order;

(b) the urgent application before start of proceeding for this order for hearing on the return date;

(i) affidavits including annexures;

(ii) a copy of Exhibit A1; and

(iii) outline of submissions relied on by the prospective applicant;

(d) a transcript, if available, of the hearing in which this order was made.

2. As soon as practicable, the prospective applicant will cause anyone notified of this order to be given a copy of it.

3. If this order ceases to have effect the prospective applicant will promptly take all reasonable steps to inform in writing anyone to who has been notified of this order, or who he has reasonable grounds for supposing may act upon this order, that it has ceased to have effect.

4. The prospective applicant will not, without leave of the Court, use any information obtained as a result of this order for the purpose of any civil or criminal proceedings, either in or outside Australia, other than this proceeding or the substantive proceeding that is contemplated to be issued by the prospective applicant.

5. The prospective applicant will not, without leave of the Court, seek to enforce this order in any country outside Australia or seek in any country outside Australia an order of a similar nature or an order conferring a charge or other security against the respondent or the respondent’s assets.

6. The prospective applicant must start a proceeding in relation to the subject matter of the urgent application within 14 days of the date of this order.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

File number(s):	VID 612 of 2019
Judge(s):	O'BRYAN J
Date of judgment:	7 June 2019
Catchwords:	PRACTICE AND PROCEDURE – ex parte application by ACCC for freezing orders – alleged contraventions of the Australian Consumer Law – whether freezing orders should be made – whether ancillary disclosure orders should be made – whether ACCC required to provide undertaking as to damages
Legislation:	Competition and Consumer Act 2010 (Cth) s 137F Federal Court of Australia Act 1976 (Cth) s 23 Federal Court Rules 2011 (Cth) Div 7.4, rr 7.32, 7.33, 7.34
Cases cited:	ACCC v Get Qualified Australia Pty Ltd (2016) 244 FCR 538 Barnes v Addy (1874) LR 9 Ch App 244 Basi v Namitha Nakul Pty Ltd [2019] FCA 743 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 Deputy Commissioner of Taxation v Hua Wang Bank Berhad (2010) 273 ALR 194 Donnelly v Porteous [2001] FCA 345 Hyder Consulting (Victoria) Pty Ltd v Transfield Pty Ltd [2002] VSC 315 Pearce v Waterhouse [1986] VR 603 PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 Robmatjus Pty Ltd v Violet Home Loans Australia Pty Ltd [2007] VSC 165
Date of hearing:	6-7 June 2019
Registry:	Victoria
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	Regulator and Consumer Protection
Category:	Catchwords
Number of paragraphs:	42
Counsel for the Prospective Applicant:	Dr O Bigos
Solicitor for the Prospective Applicant:	Australian Government Solicitor
Counsel for the Prospective Respondents:	The First, Second and Third Prospective Respondents did not appear