Australian Competition and Consumer Commission v J Hutchinson Pty Ltd

The Australian Competition and Consumer Commission (ACCC) appealed decisions of the Full Court of the Federal Court of Australia concerning alleged contraventions of sections 45E(3) and 45EA of the *Competition and Consumer Act 2010* (Cth). The dispute involved J Hutchinson Pty Ltd (Hutchinson), a head contractor, and the Construction, Forestry, Maritime, Mining and Energy Union (CFMEU). The ACCC contended that Hutchinson and the CFMEU had entered into an "understanding" that Hutchinson would terminate a subcontract with a particular waterproofing company to avoid threatened industrial action by the CFMEU.

The central legal issue before the High Court was whether Hutchinson's act of terminating the subcontract, in response to the CFMEU's threat of industrial action, constituted "arriving at an understanding" for the purposes of sections 45E(3) and 45EA of the Act, in the absence of any express or tacit communication of Hutchinson's commitment to the CFMEU. The ACCC argued that Hutchinson's conduct, coupled with the prior threat and subsequent cessation of services, was sufficient to infer an understanding.

The High Court, affirming the Full Court's decision, held that arriving at an understanding requires proof of express or tacit communication between the parties demonstrating a mutual commitment. The Court reasoned that merely succumbing to a threat by doing what was demanded, without communicating a commitment to do so, does not give rise to an "understanding" as contemplated by the Act. Therefore, Hutchinson's termination of the subcontract, undertaken to avoid the threatened industrial action but not communicated to the CFMEU, did not satisfy the requirement of a shared consensus or meeting of minds.

Consequently, the High Court dismissed the ACCC's appeals in both matters, upholding the Full Court's conclusion that no contract, arrangement, or understanding had been formed between Hutchinson and the CFMEU. The appeals were dismissed with costs.