Chevron Transport Corporation v Seamans Union of Australia

[1983] FCA 199

Re: CHEVRON TRANSPORT CORPORATION
And: SEAMEN'S UNION OF AUSTRALIA; MERCHANT SERVICES GUILD OF AUSTRALIA; FRANK
BULL; L.J. SYMES (MALE) (1983) 77 FLR 434
No. G230 of 1983
Trade Practices

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Beaumont J.(1)

CATCHWORDS

Trade Practices - Secondary boycott - Concerted conduct hindering or preventing departure of vessel - Application for interlocutory injunctions to restrain respondents from imposing, giving effect to or enforcing an alleged ban on the supply of pilotage and tug boat services - consideration of elements constituting breach of s.45D(1)(a) - Whether conduct engaged in for purpose of causing substantial loss or damage - Consideration of discretionary defences.

Trade Practices Act 1974 (Cth.) s.45D

Trade Practices - Restrictive trade practices - Hindering or preventing the supply of goods or services for purpose of causing business loss - Relevant purposes - Act done in relation to remuneration of employees - Trade Practices Act 1974 (Cth), s 45D (1).

HEADNOTE

Representatives of the International Transport Federation in an endeavour to get the applicants to comply with the current collective agreement applicable to crew working a ship enlisted the aid of the Merchant Services Guild and the Seamens Union of Australia to place industrial bans on the departure of the applicants' oil tanker Carla A Hills from Gladstone, Queensland. The applicant sought an interim injunction, alleging breach of the Trade Practices Act 1974, s 45D.

Held: (1) As as result of the definition of "purpose" in s 4F, a person shall be deemed to have engaged in conduct for a particular purpose if (a) the person engaged in the conduct for purposes that included that purpose and (b) that purpose was a substantial purpose.

Tillmann's Butcheries Pty Ltd v Australasian Meat Industries Employees' Union (1979) 42 FLR 331, applied.

(2) Further, the "purpose" referred to in s 45D(1) is the operative subjective purpose of those engaging in the relevant conduct in concert.

Tillmann's Butcheries Pty Ltd v Australasian Meat Industries Employees' Union (1979) 42 FLR 331, applied.

(3) The applicant had established a prima facie case within s 45D(1) that the respondents intended the natural consequences of their action in imposing the bans and those consequences were the occasioning of significant loss to the applicant.

(4) Since there was no evidence that the applicants carried on business in any of the States or Territories of the Commonwealth there was no illegality in the applicant failing to register its business name.

Nauru Local Government Council v Australian Shipping Officers' Association (1978) 34 FLR 281, distinguished.

(5) The failure of the applicants to join the employees concerned did not prevent the grant of injunctive relief from being effective.

Nauru Local Government Council v. Australian Shipping Officers' Association (1978) 34 FLR 281, explained.

HEARING

Sydney, 1983, August 16, 17. #DATE 17:8:1983

APPLICATION

Application for an interlocutory injunction to restrain breach of the Trade Practices Act 1974 (Cth), s 45D(1).

W H Nicholas QC and J C Campbell, for the applicant.

W G McNally, for the first and third respondents.

S C Rothman, for the second and fourth respondents.

Cur adv vult

Solicitors for the applicant: Ebsworth & Ebsworth.

Solicitors for the respondent: W. G. McNally & Co.

BAG

ORDER

1. Upon the applicant giving the usual undertaking as to damages, order, until further order, that the respondents, their servants and agents be restrained from imposing, giving effect to or enforcing any ban on the supply of the services described in para. 1 of the application filed herein, such order to take effect on and from 12 noon on 18 August 1983.

2. Reserve to each respondent liberty to apply to discharge the aforesaid injunction upon giving twelve hours' notice of its or his intention to do so.

3. Fix 12 noon on 19 August 1983 for a further directions hearing.

4. Costs of this application to be costs in the proceedings save that the costs of the preliminary objection on the question of the standing of the applicant are reserved.

Orders accordingly

JUDGE1

This is an application for interlocutory injunctions restraining an alleged secondary boycott said to be in breach of s.45D of the Trade Practices Act, 1974 ("the Act"). The specific relief now sought is an interim injunction restraining the respondents from imposing, giving effect to or enforcing an alleged ban on the supply of pilotage and tug boat services for the departure of the M.V. "Carla A. Hills" in the Port of Gladstone, Queensland.

The vessel the subject of the present dispute is owned and operated by the applicant, a corporation incorporated in Liberia and a subsidiary of a Delaware corporation. The vessel is registered in Monrovia, Liberia.

The "Carla A. Hills" arrived in Gladstone from San Francisco on 11 August, 1983 and commenced to discharge its cargo of oil at 1006 hours on that date. The master of the ship at the time, Captain B.T. Berg, in an affidavit read in this application, deposed to a conversation that day with Mr. Frank Bull, one of the respondents, as follows:

"4. At approximately 1220 hours a person whom I now know to be Frank Bull came to my office on board the 'Carla A. Hills' and said to me: 'I'm Frank Bull. I represent the International Transport Federation ('ITF'). I have heard that you have trouble on board the ship.' I said: 'That is news to me for if there was trouble I would be the first to know about it. What gives you the idea, have you been called by someone from the ship?' He said words to the effect: 'No, I don't know a single soul on board the ship and I have not been called by anyone from it. I have received a phone call from Sydney and they told me 'Carla A. Hills' had trouble on board and that I should investigate the matter.' He said: 'Can I see the vessel's Blue Certificate?' (Meaning the ITF Certificate.) I said: 'Have you any identification?' He looked through a bag he had with him and said: 'Who is your agent?' I said: 'It's Dalgety.' He said: 'Check with him, he knows who I am.' He then said: 'If you don't have the Blue Certificate or ITF Agreement on board then you had better get your agents working on it because you are not leaving the port without it.' He said: 'A change of money must take place and all of this will require time. I'm not coming on board to give orders but if you don't get started the vessel will be delayed because I intend to go fishing tomorrow. I have a couple of days off and I'm coming on board in my free time gratis and I'm not going to be wasting my valuable free time on you.' I said: 'What do you mean, I have not heard of a Blue Certificate much less seen one and what do you mean by a change of money. He said: 'The Blue Certificate certified the vessel's compliance with Seamen's rights and if the vessel had less wages than dictated by the ITF then the difference had to be paid before sailing for the past year.' I said: 'All the crew is well paid and quite satisfied with their wages which had never been up for dispute ever.' He said: 'Okay you show me the pay sheets so that it can be settled otherwise your ship will be delayed in port 24-36 hours at least because I intend to go fishing.' I said: 'I am not authorised to show you anything and it is against company policy to get involved with any outside parties concerning crew matters. I will immediately call the company's fleet manager and advise the ship will be held back if no agreement is established before the ship was ready to sail. I will also get the agent down to the ship as soon as possible.' He said: 'I will call the agent myself and come back later in the afternoon.' He left at about 1235 hours.

5. Mr. Bull returned at 1500 hours to my office. Mr. Bull then said: 'I want to see the crew's pay sheets and if there is no discrepancy or if the wages are those dictated by the ITF then the vessel would be free to sail, otherwise the vessel will be held back.' I said: 'I'm awaiting a call back from the home office in San Francisco. I have advised the top management of the situation.' He said: 'I don't mind waiting because I have plenty of time.'

6. At that time a call came through to the ship from the home office in San Francisco and I left my office to go to the radio room. I then returned to my office and advised Mr. Bull that the company had not changed its policy and would not discuss crew matters with outside parties. I said: 'The company has a valued crew contract with the crew's organisation in Korea which the crew was satisfied with and had never caused any disputes.' I also said: 'Chevron's wages are more than competitive with other companies with Korean crew. Chevron vessels have been routinely visiting Australian ports for years and have never had any disputes before Gladstone.'"

Mr. Michael William Ironmonger, a shipping officer employed by Dalgety Australia Limited, the shipping agent of the applicant, deposed to a number of conversations on 11 and 12 August, 1983 in his affidavit as follows:

"11. On that day at 1620 hours I spoke to the duty pilot at the Department of Harbours and Marine, Bill Ginty and said words to the effect: 'Do you know anything about a Merchant Service Guild ban on the handling of the 'Carla A. Hills'. He replied in words to the effect: 'Fred Ross (the president of the second respondent) has visited our office and a request has been received from the Guild not to handle the vessel.' The conversation then ended. From my own knowledge I know that the pilots at Gladstone and the crew who man the pilots' cutters are members of the Merchant Service Guild. . . .

16. At approximately 0950 hours (on 12 August, 1983) I telephoned Mike Hanson, the Gladstone Harbour Master and said to him words to the effect: 'Are we right for a pilot for the 'Carla A. Hills' tonight?' He said: 'The pilots have received a request from the Merchant Service Guild not to attend the vessel. If the tugs turn to you'll have a pilot, if the tugs don't turn to you won't have a pilot.' The conversation then ended. . . .

18. As sailing was arranged for 2000 hours I went to the vessel at about 1915 hours. At approximately 1930 hours Captain Hanson (then master of the vessel) said to me: 'I have had advice over the VHF from the pilot that neither the tugs nor the pilot would be attending for sailing at 2000 hours.'

19. At 1950 hours I telephoned Noel Pepper, the Manager of Howard Smith Industries at Gladstone and said: 'Can you give us any further details of the tug problem.' He said words to the effect: 'The Seamen's Union of Australia advised us at 1530 hours today that there is an indefinite ban on the handling of the 'Carla A. Hills' until the ITF problems are resolved.' . . .

22. At 1740 hours (on 12 August, 1983) I spoke to Mr. Pepper and said: 'Have you had any word from the Union (meaning the Seamen's Union of Australia) regarding the tugs for the 'Carla A. Hills'?' He said words to the effect: 'No, I've no word at this stage, I'll check it out and come back to you?' At about 1806 hours Mr. Pepper telephoned me and said words to the effect: 'No tugs will attend the 'Carla A. Hills' since the ban still applies and I have been advised that the SUA (Seamen's Union of Australia) will not attend until the ITF problems on board are resolved.'"

On 11 August, 1983, Mr. Ironmonger spoke with the third respondent, Mr. Symes, the I.T.F. inspector in Sydney. Later on that day, Dalgety Australia Limited received a telex from Mr. Symes requiring the entry by the shipowner into an agreement with I.T.F. to the effect that the wages and employment conditions of all seafarers serving on board the vessel should be governed by the terms of the current I.T.F. collective agreement. Payment of I.T.F. contract fees totalling US$299.00 per seaman was also required.

None of the deponents who swore affidavits on behalf of the applicant was cross-examined.

The bans on the movement of the vessel are still in force. "Carla A. Hills" is still lying alongside the wharf at Gladstone. There is unchallenged evidence that the delay in its departure will occasion considerable financial loss to the applicant. In addition to fixed costs of US$5,000 per day, there are variable costs, mainly fuel, of US$2,000 per day. The applicant also claims special damage by reason of the delay. The vessel is committed to load about 200,000 barrels of oil at Singapore on 23 August, 1983 for shipment to Hong Kong. The transit from Gladstone to Singapore takes about ten days at full steam. Unless the "Carla A. Hills" can make Singapore by 23 August, the applicant will be forced to substitute another vessel by charter at a net cost of about US$88,000.

The applicant submits that the evidence indicates a contravention of s.45D(1)(a) of the Act by reason of the concerted action in imposing the bans referred to. The applicant says that the facts of the case show a common plan of action on the part of the first and second respondents, each a federal registered organisation of employees, and the two personal respondents.

The material part of s.45D(1)(a) upon which the applicant relies requires proof of a number of elements before breach of the section can be established:
(1) there must be a person in concert with another person engaging in conduct;
(2) their conduct must hinder or prevent the supply of goods or services by a third person to a corporation;
(3) the conduct must be engaged in for the purpose of causing substantial loss or damage to the business of the corporation;
(4) the conduct must be such that it would have or be likely to have the effect of causing substantial loss or damage to the business of the corporation (see Tillmans Butcheries Pty. Ltd. v. Australasian Meat Industries Employees' Union (1979) 27 A.L.R. 367 at p.370 per Bowen, C.J.)

In the present case, I am satisfied, on the evidence to which I have referred, that elements (1), (2) and (4) are, prima facie, established in the present case. However, the respondents argue that, although the defence in s45D(3) was not available here because of the role of the I.T.F., nonetheless element (3) was not established.

In this connection, the respondents argue that the purpose of the action taken by the respondents was to improve the conditions of employment of the seamen manning the vessel and not to cause damage to the applicant (see Sorrell v. Smith (1925) A.C. 700 at p.715; Nauru Local Government Council v. Australian Shipping Officers Association (1978) 34 F.L.R. 281 at p.291). In my opinion, authorities dealing with the position at common law in this area are of limited assistance in the application of s.45D(1) because of the special definition of "purpose" in s.4F of the Act. Under that definition, a person shall be deemed to have engaged in conduct for a particular purpose if (a) the person engaged in the conduct for purposes that included that purpose and (b) that purpose was a substantial purpose (see Tillmans' case, above at p.374 per Bowen, C.J.) Further, the "purpose" referred to in s.45D(1) is the operative subjective purpose of those engaging in the relevant conduct in concert (Tillmans' case, above at p.383 per Deane, J.).

In the present case, however altruistic the original motives of the respondents may have been, I am satisfied that the applicant has established a prima facie case that the respondents intended the natural consequences of their action in imposing the bans and that those consequences were the occasioning of significant financial loss to the applicant. In my opinion, that loss could fairly be characterised as substantial in the case of a large oil tanker. Even if one accepts that the ultimate objective of the respondents may have been the improvement of the working conditions of the seamen, the applicant has made out a prima facie case that the means to that end chosen by the respondent was the imposition of bans which were designed to harm the applicant. The applicant has thus established a prima facie case of a contravention of s.45D(1).

The second respondent raises two further defences of a discretionary nature. First, it alleges a lack of clean hands on the part of the applicant. It argues that illegality exists by reason of the applicant's alleged failure to register its business name, presumably in the State of Queensland. Reliance is placed upon the Nauru case, above at p.290). There, however, the decision in this respect was based upon a finding of fact by Northrop, J. (at p.285) that the plaintiff carried on business at premises in Melbourne. In the present case, there is no suggestion that the applicant carries on business in any of the States or Territories of the Commonwealth. Thus, no illegality exists.

Secondly, the second respondent points to the absence from the proceedings of the employees of Howard Smith Industries Pty. Limited who man the tug boats. It says that, in their absence, the proceedings are futile. Again, reliance is placed upon the Nauru case at p.293. In my opinion, Northrop, J. did not there decide that, as a general rule, the absence from the proceedings of the employees concerned will always be available as a discretionary defence to proceedings under s.45D(1). Clearly, each case must be decided in the light of its own circumstances. In the present case, I am satisfied that the applicant has demonstrated, prima facie at least, that the grant of injunctive relief against the respondents now joined will be effective to bring about the lifting of the bans currently imposed. It is true that such relief may not be tantamount to a decree for the specific performance of services to be rendered by those manning the tug boats. However, this is not, of itself, a reason why the Court should not intervene in order to secure the lifting of the bans. Absent the bans, it is only reasonable to assume that the tug boat and pilot services will be provided in the ordinary course of operations.

As I indicated yesterday, I propose to grant an interim injunction. In order to give the respondents time to consider their position in the light of the speed with which the proceedings were understandably brought forward, I propose to suspend the operation of the injunction until noon tomorrow. I propose also to reserve to the respondents liberty to apply on short notice to discharge the injunction. I propose to hold a directions hearing next Friday when I will give further directions. I will then deal with any application by the respondents for security for costs and for security for the undertaking as to damages, if necessary.

I propose to make the orders in the schedule already distributed to the parties and appended to these reasons.

THE SCHEDULE

I propose to make the following orders:
1. Upon the applicant giving the usual undertaking as to damages, order, until further order, that the respondents, their servants and agents be restrained from imposing, giving effect to or enforcing any ban on the supply of the services described in para.1 of the application filed herein, such order to take effect on and from 12 noon on 18 August, 1983.
2. Reserve to each respondent liberty to apply to discharge the aforesaid injunction upon giving twelve hours' notice of its or his intention to do so.
3. Fix 12 noon on 19 August, 1983 for a further directions hearing.
4. Costs of this application to be costs in the proceedings save that the costs of the preliminary objection on the question of the standing of the applicant are reserved.