Australian Surf Life Saver Pty Ltd v S & I Publishing Pty Ltd

[1998] FCA 1092

FEDERAL COURT OF AUSTRALIA

PRACTICE AND PROCEDURE – APPEAL – application for stay of orders pending appeal

Powerflex Services Pty Ltd v Data Access Corporation (1996) 67 FCR 65, applied

AUSTRALIAN SURF LIFE SAVER PTY LTD v S AND I PUBLISHING PTY LTD
NG 684 of 1998

MADGWICK J
SYDNEY
24 AUGUST 1998

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 684  of  1998

BETWEEN:

AUSTRALIAN SURF LIFE SAVER PTY LTD

APPLICANT

AND:

S AND I PUBLISHING PTY LTD

RESPONDENT

JUDGE(S):

MADGWICK

DATE OF ORDER:

24 AUGUST 1998

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1. The application is refused.

1. The applicant to the Notice of Motion is to pay the respondent's costs.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 684  of  1998

BETWEEN:

AUSTRALIAN SURF LIFE SAVER PTY LTD

APPLICANT

AND:

S AND I PUBLISHING PTY LTD

RESPONDENT

JUDGE(S):	MADGWICK
DATE:	24 AUGUST 1998
PLACE:	SYDNEY

REASONS FOR JUDGMENT
(revised from transcript)

HIS HONOUR:   In this matter the Court is asked to stay the orders made by Moore J on 20 August 1998 pending the determination of an appeal against those orders.  The orders made by his Honour were that the respondent "be restrained from selling, offering for sale or distributing in Australia its publication, Triathalon and Multi Sport Magazine with a get-up of that title reproduced in the manner depicted in [an exhibit] tendered in the proceedings or in any substantially similar matter", and an order for costs.

The applicant in the proceedings before his Honour had for some years produced a magazine called Sports Triathalon and, as might be expected, it had prominently featured the word "Triathalon" across the top of the front cover or mast head of the magazine. The respondent proposes to enter into competition against the applicant in relation to this field of sports publishing and its first issue featured the word "Triathalon" very prominently across the top of its masthead. His Honour was satisfied that the respondent's use of the word "Triathalon" in these circumstances amounted to misleading conduct and found that the applicant had otherwise made out grounds for injunctive relief under s 80 of the Trade Practices Act 1974 (Cth).

The respondent proposes to appeal and in support of the present application offers an appropriate undertaking as to damages and as to prompt prosecution of the appeal.  The specific loss or detriment which it is thought the respondent will suffer unless a stay is granted is that its choices will be to either publish with a revised masthead (with the title well below the top of the page) pending the appeal, or not to publish at all.  If the revised masthead were published, costs would be incurred in relation to new brochures, price lists, letterheads and other printed business materials which would have to be made available to the respondent's advertisers and potential advertisers.  Further revised promotional material would need to be distributed to the intended retail outlets of the magazine and it is estimated that all these costs would add up to something of the order of $75,000.  If the respondent were to succeed on the appeal it would then have the option of keeping its revised masthead, which seems unlikely given the near-universal use of the top of a magazine masthead for the title, or to again reprint all the kinds of material referred to, at a further cost of about $75,000.  In addition there would be, it is said, further loss not readily quantifiable on account of the confusion to advertisers, readers and potential purchasers of the publication.  In particular, it is said that commercial advertisers are very keen to have a stable image for the medium of their advertisements.

It appears to me that there is a fairly arguable case on an appeal and that the determination of that question is not affected by issues of credit which were resolved adversely to one or more of the respondent's witnesses by his Honour.

The ruling authority in this Court, counsel are agreed, is that of Powerflex Services Pty Ltd v Data Access Corporation (1996) 67 FCR 65 in which a Full Court adopted the view of the New South Wales Court of Appeal expressed in Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685, where at 694 that Court said that it was:

"sufficient that the applicant for the stay demonstrates a reason or an appropriate case to warrant the exercise of discretion in his favour."

The Court approved an earlier statement by Mahoney JA in re Middle Harbour Investments Limited (unreported, New South Wales Court of Appeal, 15 December 1976) in which his Honour, with the concurrence of the other members of the Court, said:

"Prima facie a successful party is entitled to the benefit of the judgment obtained by him and is entitled to commence with the presumption that the judgment is correct. These are not matters of rigid principle and the court asked to grant a stay will consider each case upon its merits but, where an applicant for a stay has not demonstrated an appropriate case but has left the situation in a state of speculation or of mere argument, weight must be given to the fact that the judgment below has been in favour of the other party."

To my mind it is important to consider the essential nature of this case.  It is that the periodic publisher of a magazine, that is to say one who produces goods periodically, has been held entitled to an injunction to restrain a competitor from proceeding to publish another magazine, that is to say other goods, in a form where it is apprehended that so to do would cause confusion to consumers.

There are cases where persons produce goods at periodical intervals and there are cases where they produce them continuously.  I see no specially relevant distinction between them nor, in such cases, between the likely nature of the losses and inconvenience caused to an unsuccessful respondent who wishes to appeal the determination of the Court at first instance.  Likewise, some services are produced periodically and some are produced continuously and, again, where one producer manages to persuade the Court that the conduct of another is misleading, so that the latter is restrained from producing his services in a particular form, it is very likely that some changes pending appeal must occur.  If the respondent at first instance succeeds on the appeal then some further changes may occur, in both cases with consequential loss, and in both cases with the sorts of further loss, difficult to identify, which I spoke about earlier.

In short, the consequence of an applicant's success at first instance in such a case will be to cast a degree of loss upon the respondent pending and perhaps after the appeal.  This just appears to be inevitable.  It may or may not be that these are factors that should be present to the mind of the Court at first instance.  (The Trade Practices Act does not, of course, operate in a regime entirely of case-made law.)  It seems to me that nothing has been demonstrated that would make this, as distinct from other cases of its type, an appropriate case for a stay pending the hearing of the appeal.  It does not seem to me that a stay is appropriate in all

cases of this type, which constitute a considerable proportion of the commercial cases heard in this Court.  The application for a stay of relief will be refused with costs.

I certify that this and the preceding three (3) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Madgwick

Associate:

Dated:             24 August 1998

Counsel for the Appellant:	T Hancock
Solicitor for the Appellant:	Minter Ellison
Counsel for the Respondent:	R Webb
Solicitor for the Respondent:	Webster O'Halloran
Date of Hearing:	24 August 1998
Date of Judgment:	24 August 1998