Cousins v SJS Imports - [2004] VSC 521

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

No. 7849 of 2004

DR DAVID COUSINS	Plaintiff
v
SJS IMPORTS AND ORS	Defendants

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JUDGE:	DODDS-STREETON J.
WHERE HELD:	MELBOURNE
DATE OF HEARING:	1 December 2004
DATE OF JUDGMENT:	15 December 2004
CASE MAY BE CITED AS:	Cousins v SJS Imports
MEDIUM NEUTRAL CITATION:	[2004] VSC 521

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FAIR TRADING ACT 1999 (“the Act”) – Corporate wholesaler supplying toys and other goods in contravention of permanent banning orders and other prescribed safety standards under the Act – Seizure of banned goods by Consumer Affairs Victoria (“Consumer Affairs”) in April 2004 – Directors party to contraventions – Further contraventions and failure fully to cooperate or satisfy requirements of Consumer Affairs – “Cease Trading” injunction pursuant to s.151A of the Act sought by Consumer Affairs – Regime of compliance training, certification and review imposed as condition of continued trade in relevant goods – Relevant considerations – Defendants’ contraventions blatant and extensive – No compliance regime in place or commitment to cooperate – Cost of compliance necessary incident of trade.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr S. Bhojani	Consumer Affairs Victoria
For the Defendants	The Defendants appeared in Person

TABLE OF CONTENTS

Introduction and Background......................................................................................................... 2

Relief Sought...................................................................................................................................... 3

Relevant Legislation and Legal Principles.................................................................................... 5

Evidence in Support of Application............................................................................................. 14

Summary of Facts............................................................................................................................. 24

The Defendants’ Submissions....................................................................................................... 25

Water Yo Yo Balls....................................................................................................................... 25
Protector Riot Gun...................................................................................................................... 26
Power Steel Superannuation Action figurines....................................................................... 26
Electric Shooting Box Lucky Star Toy Gun Set....................................................................... 26
Disposable Cigarette Lighters................................................................................................... 27

Conclusion......................................................................................................................................... 30

HER HONOUR:

Introduction and Background

By amended originating motion filed 31 August 2004, the plaintiff, Dr David Cousins, the Director of Consumer Affairs Victoria (“Consumer Affairs”) pursuant to s.151A of the Fair Trading Act 1999 (“the Act”) seeks to restrain the corporate defendant and its controllers from conducting, or participating in, the business of supplying specified types of toys and other goods unless they observe a number of conditions designed to ensure compliance with all banning orders and prescribed safety standards applicable to such products. The plaintiff also seeks, pursuant to the Supreme Court Act 1986, declarations that the defendants have contravened, or have been knowingly concerned in, contraventions of provisions of the Act.

The first defendant, SJS Imports Pty Ltd (“SJS”) is an importer and wholesale supplier of goods, which are predominantly toys, gifts and homeware products. It commenced business in September 1999. The second defendant, Ms Jen Yung Wang, and the third defendant, Mr Hu Sheng Xie, are husband and wife. Ms Wang was, until her resignation on 23 June 2004, a director of SJS and Mr Xie is currently the managing director of SJS. Both Ms Wang and Mr Xie were at all relevant times directly engaged in the conduct of SJS’s business. It appears that both Ms Wang and Mr Xie remain involved in the conduct of SJS’s business.

At the hearing of the matter on 1 December 2004, the defendants were not…

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.

Continue reading Cousins v SJS Imports

Details

AGLC: Cousins v SJS Imports [2004] VSC 521
Case: [2004] VSC 521
Decision Date: 15 December 2004

CaseChat Overview and Summary

The case of Cousins v SJS Imports involved Consumer Affairs Victoria seeking a "Cease Trading" injunction against SJS Imports and its directors. SJS Imports was a corporate wholesaler involved in the supply of toys and other goods, which were found to be in contravention of permanent banning orders and other prescribed safety standards under the Fair Trading Act 1999. Consumer Affairs Victoria had seized banned goods from SJS Imports in April 2004. The directors of SJS Imports were also party to these contraventions. Despite these actions, the company continued to contravene the Act, failed to fully cooperate with Consumer Affairs, and did not satisfy the requirements imposed by the regulator.

The central legal issue before the court was whether a "Cease Trading" injunction should be granted against SJS Imports and its directors. The court had to consider the nature and extent of the contraventions, the failure to comply with the Act, and the absence of a compliance regime or commitment to cooperate with Consumer Affairs. The court also needed to weigh the cost of compliance against the necessity of enforcing safety standards to protect consumers.

In determining whether to grant the injunction, the court found that the contraventions by SJS Imports were blatant and extensive. The company had no compliance regime in place and did not demonstrate a commitment to cooperate with Consumer Affairs. The court held that the cost of compliance was a necessary incident of trade and that the public interest in enforcing safety standards outweighed the potential hardship to SJS Imports. Accordingly, the court granted the injunction, imposing a regime of compliance training, certification, and review as a condition of continued trade in the relevant goods.

The final orders of the court included the granting of the "Cease Trading" injunction against SJS Imports and its directors. The injunction required SJS Imports to implement a comprehensive compliance regime, including training, certification, and ongoing review. This regime was designed to ensure that SJS Imports would comply with the Fair Trading Act 1999 and the safety standards prescribed thereunder. The injunction also mandated that the directors take active steps to ensure the company's compliance with the Act and cooperate fully with Consumer Affairs.

Orders