Brisbane Gas Co. v Hartogen Energy Ltd

[1982] FCA 152

TRADE PRACTICES - acquisition of shares - control or domination of market - interim

injunction pending determination	of application
for declaration and order	of divestiture -

application by person other than the Minister or

the Commission -	whether Court may entertain such
application in respect	of a breach of s.50.

Trade Practices Act,	s s . 50,	80(1), 80(1A), 81.
BRISBANE GAS	CO v. HARTOGEN ENERGY	LTD (First Respondent)

and STREET NOMINEES PTY LTD (Second Respondent)

Qld No. G76 of 1982

22 JULY 1982

FITZGERALD J.
BRISBANE

IN THE FEDERAL COURT	OF AUSTRALIA )
QUEENSLAND DISTRICT REGISTRY	) Qld No. G76 of 1982
GENERAL DIVISION	)

BETWEEN:

BRISBANE GAS CO LTD

Applicant

- AND :

HARTOGEN ENERGY LTD

First Respondent

AND :

STREET NOMINEES PTY LTD

Second Respondent

JUDGE MAKING ORDER:	Fitzqerald J.
DATE OF ORDER:	21 July 1982
WHERE LNADE:	Brisbane
THE COURT ORDERS	THAT:

The Flrst and Second Respondents' Application

to strike out paragraph 7 of the Applicant's

Application be dismissed.

IN THE FEDERAL COURT	OF AUSTRALIA	)
QUEENSLAND DISTRICT REGISTRY	)	Qld No. G76 of 1982
GENERAL DIVISION	1

BETWEEN:

BRISBANE GAS CO LTD

Applicant

- AND :

HARTOGEN ENERGY LTD

First Respondent

- AND :

STREET NOMINEES PTY LTD

Second Respondent

EX TEMPORE REASONS FOR JUDGMENT

FITZGERALD J.

21 JULY 1982

Brlsbane Gas Company Llmited, presently a registered
shareholder in Oil Company of Australia No Liability, has
commenced proceedings against Hartogcn Energy Llmited
and Street Nominees Pty Llmited clalming, inter alia,

the following relief:

" 3 . A declaratron that in acquirlng

fourteen million and thirty two thousand

ordinary shares in the capital	of
Oil ComPanv of Australia	No Liabllitv.
the First sespondent	and the Second Respondent

-	contravened Section	50 of	the Trade Practices
-	Act, 1974.

4.      An order for directions pursuant to

Section 81 of the Trade Practices	Act, 1974
for the purpose of securlng the dlsposal	by

the First Respondent and the Second Respondent

of all of the shares so acquired in

contravention of Sectlon	50 of the Trade
Practices Act, 1974."

By paragraph 5 of the Application, Brisbane Gas

asks, in addition -

"An injunctlon pending the dlsposal

of the said shares restraining the
First Resuondent and the Second
Respondeni and themselves, their
servants or agents or otherwise
from dealing with the said shares
and from exerclsing such voting

rlghts which attach thereto."

A substantially identical injunction is sought by

paragraph 7 of the Application "pending the hearing".

When the application for that interlocutory

order came on before me this mornmg, senior counsel

for the respondents, Hartogen Energy Llmited and

Street Nominees Pty Limited, raised a preliminary

objection and submitted that I should strike out

paragraph 7 of the application. In substance, it

was argued that this court has no power	to grant
such an order except on	the application of the
Minister or the Trade	Practxes Commission. Reliance

was placed upon the decision of the High Court in

Thomson Australian Holdings Pty Limited v. The Trade
Practices Commission (1981) 55 A.L.J.R.	614 for the
-proposition that	s .80 of thc Trade Practices Act is

the exclusive source of thls court's power to grant

an injunction in proceedings brought under that Act.
It was further submitted that, where proceedings

relate t o a n a l l e g e d c o n t r a v e n t i o n o f s.50 o f t h e

A c t ,	n o p e r s o n o t h e r t h a n t h e M i n i s t e r o r	t h e
Commlssion can apply for an inlunctlon	by	v i r t u e
of s.80(1A).

There are circumstances of urgency surrounding

t h e a p p l i c a t l o n f o r a n i n t e r l o c u t o r y i n l u n c t i o n , a n d

it i s accord ing ly necessa ry fo r me t o d e a l w l t h t h c

p r e l i m i n a r y o b j e c t l o n f o r t h w i t h . Two m a t t e r s may be

no ted immedia t e ly . F i r s t l y , no twi ths t and ing t ha t it

i n c l u d e s r e f e r e n c e t o a pas t con t r aven t ion o f s.50,

t he ope ra t ion o f sub - s . (1A) of s .80 is confined t o

r e s t r l c t i n g t h e c l a s s o f p e r s o n s who may "make an

app l i ca t ion unde r sub-S. (1) f o r a n i n j u n c t i o n . . . " .

Subsect lon	(In) of	s.80	imposes no l i m i t a t l o n upon
t h o s e	who	may	o t h e r w i s e a p p l y f o r a n i n j u n c t i o n ,
even where the conduct	upon whlch the appl	icat	lon

f o r a n i n j u n c t i o n i s based inc ludes an a l leged

breach of s.50. Secondly, s . 8 0 ( 1 ) r e l a t e s o n l y

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

en t ry i n to o r con t inua t ion o f t he conduc t wh lch

c o n s t i t u t e s a contravent lon of a p rov i s lon o f t he

A c t - i n t h l s case, s.50 - or whlch c o n s t l t u t e s

-an a t t e m p t t o d o so, or whlch amounts t o an

involvement m such conduct ( t o paraphrase

s .80(1) (e) t o (j) 1 . Sec t lon 50 r e l e v a n t l y

p r o h i b i t s o n l y t h e a c q u i s i t i o n of shares . Sec t ion

E O ( 1 ) d o e s n o t r e l a t e t o a p p l i c a t i o n s f o r i n j u n c t i o n s

t o r e s t r a i n a person who has contravened a p rov i s ion

of t h e A c t , f o r example s . 5 0 , f rom engaging in

conduc t based upon t he pos i t i on t hus i l l eg i t ima te ly

acqui red .

As M r Pincus Q.C. , sen ior counse l for Har togen ,

c o r r e c t l y p o i n t e d o u t , t h e	matters	t o which	I	r e f e r
involve no automatic	answer to	hxs pr	incipal	submission.
On	the con t r a ry ,	acco rd ing t o h i s	a rgumen t ,	un le s s

t h e r e l e v a n t claims f o r i n j u n c t i o n s made by Brisbane Gas

can be founded i n s.EO(1) they have no foundat lon at

a l l . Thus, for example, so f a r as t h e p r e s e n t

a p p l l c a t i o n f o r i n t e r l o c u t o r y r e l l e f is concerned,

t h e i n t e r i m i n j u n c t i o n s f o r	whlch	s . 8 0 ( 2 )	provide
are	only those granted "pending determinat	lon of	an

appl ica t ion under sub-s . (l)''; i . e . , where what i s

s o u g h t t o be r e s t r a i n e d 1s a b r e a c h o r a n t i c i p a t e d

breach of s.50, o n a p p l x a t l o n b y t h e M i n i s t e r o r

Commission. Likedise, both sub-ss. ( 4 ) and ( 5 ) of

s.80 are r e l a t e d t o xnjunctxons res t ra in ing "conduct

r e f e r r e d t o In sub-s . ( l ) " , and to t h e g r a n t l n g o f

Anjunct ions "unde r sub-s. (1) " o r "under sub-s. ( 2 ) 'I.

No i n j u n c t i o n 1 s sought by Brlsbane Gas i n

t h e s e proceedings under s .80 of the Trade Practices

A c t . I l eave ou t o f accoun t , as p re sen t ly lmmate r i a l ,

paragraph 1 of the Application which seeks an
injunction against IIartogcn by reference to a qulte

separate allegatlon that Martogen is party to a

contract, arrangement	or understandlng in
contravention of s.45 of the Act.	For mmediate

purposes, the substantive relief sought by

Brisbane Gas	1s a declaration that Hartogen's
shares in	O i l Company of Australia No Liabillty
were acquired In	contravention of s.50 of the
Act - an order acknowledged	as belng wlth the
Court's power	- and an order for divestiture under

s.81 of the Act, which expressly provides that

any person may make application for such an order.

In Thomson Australian IIoldlngs Pty Lirnlted

v. The Trade Practlces Commission, supra, the

Commission sought as part of the substantive relief claimed permanent injunctions to restraln the defendant

from givlng effect, or consplrmg to glve effect, to

arrangements and undertakings alleged to contravene s . 4 5 , s.45.3, s.45B.and s.45C of the Trade Practices Act.

Briefly stated, the major question In lssue In the

High Court was as to the extent of this Court's

power to make final orders, or to accept undertakings,

in respect of such clalms for lnjunctlve rellef. The

majoricy of the High Court held that	s.22 and s . 2 3 of the
Federal Court of Australla Act,	1976, do not extend thls

Court's power to grant injunctions "restraining

or relating to contraventions of the Trade Practices

-	Act in situatlons falling outside the boundarles
drawn by s.80 of that Act". (See the Joint judgment
of Glbbs CJ, Stephen, Mason and Nilson JJ at p.618,
first column C). On the same page in the second column,
their Honours said at B:

.

"A final answer to the Commission's

argument on this point is that S.

80 proceeds on the footing that it constitutes the Federal Court's excluslve charter to grant injunctions

restraining, or relating to,

contraventions of the Trade Practices Act."

Both references to in~unctions "restraining or

relating to contravention of the Trade Prectices Act"

seem to involve a convenient abbreviation of the

clrcumstances specified in S .80 (1) (d) to (j) . At D

in the second column on p.618, their Honours sald:

"The inference is	irresistible that
Parliament looked	upon s .80 as

a complete and comprehensive statement
of the circumstances in which

lnjunctions mlght be granted ln respect

of relief sought under the Trade
Practices Act. "	-

- It is, in my opinion, beyond argument that the

quoted statements were made ln dealing with permanent

in]unctions sought by way of substantive relief In the

proceedings. Emphasls is added to that vlew, which 1s

t o my mind clear f rom the l anguage used In the

con tex t In wh ich	it	appears ,	by	the connec t ion
made	on t he	same	page between	t h i s c o u r t ' s

r e l e v a n t j u r i s d i c t i o n a n d i t s power t o g r a n t

p e r m a n e n t s u b s t a n t i v e i n j u n c t i v e r e l i e f . F o r

example, a t the second column P on page 6 1 8 , t h e

fo l lowlng passage appears :

' l . . . t h e r e l e v a n t j u r l s d l c t l o n of t h e

c o u r t i n r e l a t i o n t o t h e g r a n t i n g

of an i n junc t lon 1s l i m i t e d t o

the hea r ing and de t e rmmat lon of

a c t i o n s i n w h i c h a p p l i c a t i o n 1s made

f o r t h e makmq of orders under S . 8 0 (1)

r e s t r a i n i n g a person from engaging

in conduct	of	a	s p e c i f l e d k l n d .	I'
Later ,	the malor i ty	judgment	proceeded	t o deal

w l t h u n d e r t a k i n g s g i v e n i n l l e u o f i n ~ u n c t l o n s , a n d

h e l d t h a t t h e l l m i t a t i o n s whlch a f f e c t t h e c o u r t ' s

j u r i s d i c t l o n a l power t o g r a n t a f i n a l i n j u n c t i o n are

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

A t page 6 1 9 , second column B , a f t e r r c f c r r i n g twice I n

d e a l i n g w i t h s u c h l i m l t a t i o n s t o	a	" f m a l l n j u n c t l o n " ,
t h e m a ~ o r l t y s a i d ;

"No	doubt the Federa l Cour t has	power
to accep t an unde r t ak ing	a t	an
i n t e r l o c u t o r y s t a g e	when	t h e
undertaking	1 s	r e a s o n a b l y r e l a t e d

to t he o rde r ly p rocedure o f ';he

c o u r t 3r t o t h e s u b l e c t matter o f t he

I l t i g a t l o n , a s Deane and Fisher JJ

observed, even though It i s no t In a

form which f a l l s w l t h l n s e c t i o n 8 0 . "

I am satisfied that. the Court also has power in a case such as the present to grant an interlocutory injunction which is reasonably related to the

orderly procedure of the court or the subject

matter of the litigation, even though it is not

in a form which falls within s . 8 0 of the Act.

As was said in the ~oint judgment in ThomDson

Australian Holdings Pty Limited v. The Trade column A, the same prmciples govern the grant

of an injunction and the acceptance of an

undertaklng. There is no present call to pursue

that topic in relatlon to an application for

an interlocutory Injunction pending the trial of
an application for permanent and substantive relief

by way of in~unction. The only substantive relief

relevantly involved in the present proceedings

consists of claims for a declaration that Oil

Company of Australla No Liability shares werc

acquired by the respondents in contravention of

s.50 of the Act 'and	for an order for divestiture
of those shares.

Those clalms are within thls court's

jurisdiction and power. The only interlocutory
in~unctlon asked is clalmed merely incidentally
to that substantlve relisf. Yo contravention of

t h e	A c t	o r	related	conduc t In t he s ense o f
conduc t	dea l t	w l th by	s.80(1) (e) t o	(j) is sought

t o b e r e s t r a l n e d . What i s sought i s t o r e s t r a i n

conduct whlch it is s a i d may, i f engaged i n ,

r ende r nuga to ry any en t i t l emen t i n	t h e	a p p l i c a n t
t	o	the subs t an t ive r e l i e f c l a imed and any g ran t

t o t h e a p p l i c a n t of t h a t r e l i e f .

I am extremely conscious of t h e o b l i g a t i o n

on me t o ac t on t h e dec i s lon o f t he Hlgh Court i n

Thompson	Aust ra l ian Hold lngs P ty L i m i t e d	v.	-	The
Trade	P rac t i ces	Commlssion,	supra,	i f it decldes

t h e present quest lon, and I would be anxlous t o

a p p l y l o y a l l y e v e n r e l e v a n t o b i t e r i f a n y s t a t e m e n t

i n t h a t	case were	p rope r ly	so	c h a r a c t e r i s e d .	However,
I	have conc luded t ha t t he re	i s	nothlng	i n	t h a t

d e c i s l o n w h i c h m a t e r l a l l y a s s l s t s H a r t o g e n on I ts

p r e s e n t p r e l i m i n a r y o b l e c t l o n t o t h e a p p l l c a t i o n I n

t h i s matter for i n t e r l o c u t o r y r e l i e f .

It is n e c e s s a r y t o go back t o s.23 of t h e

Federal Court of A u s t r a l i a A c t 1 9 7 6 , a n a u s i l l a r y

provis	lon which provides:
"The Court has power, I n r e l a t l o n t o m a t t e r s
i n whlch It h a s j u r i s d l c t l o n , t o make o r d e r s
of such k lnds , l nc lud lng i n t e r locu to ry
o r d e r s , a n d t o i s s u e , o r d n e c t t h e l s s u e o f , wrlts of such kinds, as the Cour t t h lnks
app-opriate" .

As was	said by the majorlty ln Thompson Australian
Holdings Pty Limited	v. The Trade Practices Commission,

supra, at p.618, first column E, that provislon

"arms the court wlth power to make all
kinds of orders and to issue all kinds
of wrlts as may be appropriate,but it

does not provlde authority for grantrng

injunction where there 1s otherwise

no case for injunctive rellef."

Their Honours had mentioned in the prevlous sentence that a right to an injunction may exist "under the

general law or by statute".

There has been much modern discusslon of the

operation of the analogues of	s . 2 3 of the Federal
Court Act which are	to be found in the Judicature Acts
of the varlous states and England, particularly	in

connection wlth what are known as "Mareva injunctions".

I need not, and I should not on thls applicatlon for

an interlocutory injunctlon, say any more than that

It is sufficlently arguable to preclude the dismissal

of the application on a prellminary point, that s.23

of the Federal Court of Australla Act empowers

- interlocutory relief, lncldental to an appllcation

for an order for divestiture, whlch 1s necessary to

prevent any judgment for the substantive claim for
divestiture being a mere brutum fulmen.

It is appropriate to emphaslse that Hartogen's

present point was that	no interlocutory injunction
might be granted	and was in no way related to the

form of the interlocutory injunctlon claimed In

paragraph l of the application. Nothing declded

by me up to this point in any way impinges upon

other questions which Hartogen may yet wish to

argue, including the question	of whether the
interlocutory injunctlon asked by paragraph	7

of the application is properly to be considered

merely ancilliary to the substantive claim for

dlvestiture made by paragraph 3 .

Accordingly, I dlsmiss the respondent's

applicatlon to strike out paragraph l of the

Application. It is unnecessary to make any order

with respect to paragraph 5 of the Application of

this point. It may be that it lnvolves different

or additional considerations, although Interlocutory

relief is not necessarily confined to rellef prior
to judgment and in any event,	s.23 of the Federal
Court Act is not expressly conflned	to interlocutory

-

orders.

E,- :: 23 July 1982'