Doolan v Bayer Australia Ltd
[2012] FMCA 833
•31 July 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| DOOLAN v BAYER AUSTRALIA LTD & ANOR | [2012] FMCA 833 |
| CONSUMER LAW – Misleading or deceptive conduct – Competition and Consumer Act 2010 (Cth) – nature of contraceptives – promotional material – whether the product was an abortion pill – held that it was not – relied upon Therapeutic Goods Administration classification – no basis for complaint – application dismissed. |
| Competition and Consumer Act 2010 (Cth), ss.18, 20, 21, 29, 33, 46, 54, 55, 56, 86, 151, 155, 163, 223, 224, 246(2), 247 Federal Magistrates Act 1999 (Cth), s.17A(2) Federal Magistrates Court Rules 2001 (Cth), r.13.10 Judiciary Act1903 (Cth), s.68 Therapeutic Goods Act 1989 (Cth), ss.9A, 9E, 52D(2)(b) |
| Kowalski v MMAL Staff Superannuation Fund Pty Ltd (2009) 259 ALR 319 Spencer v Commonwealth of Australia (2010) 241 CLR 118 White Industries Aust Ltd v Commissioner of Taxation (2007) 240 ALR 792 |
| Applicant: | DOOLAN |
| First Respondent: | BAYER AUSTRALIA LTD |
| Second Respondent: | TERRY WHITE MARKET CHEMISTS - BURPENGARY |
| File Number: | BRG 431 of 2012 |
| Judgment of: | Burnett FM |
| Hearing date: | 31 July 2012 |
| Date of Last Submission: | 31 July 2012 |
| Delivered at: | Brisbane |
| Delivered on: | 31 July 2012 |
REPRESENTATION
| The applicant appeared on his own behalf |
| Counsel for the First Respondent: | Mr P. McCafferty |
| Solicitors for the First Respondent: | McCullough Robertson |
| Solicitors for the Second Respondent: | Macrossans Lawyers |
ORDERS
That the application filed 21 May 2012 be dismissed.
That the applicant pay the First and Second Respondents’ costs to be assessed on the standard basis.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE |
BRG 431 of 2012
| DOOLAN |
Applicant
And
| BAYER AUSTRALIA LTD |
First Respondent
| TERRY WHITE MARKET CHEMSITS - BURPENGARY |
Second Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
The application today is one brought by the first respondent and the second respondent. They each seek relief which broadly can be summarised in these terms: that the proceeding be dismissed under r.13.10 of the Federal Magistrates Court Rules 2001 (Cth) and/or under s.17A(2) of the Federal Magistrates Act 1999 (Cth), on the basis that the applicant has no reasonable prospect of successfully prosecuting the proceeding or that the proceeding is frivolous or vexatious, or the proceeding is an abuse of the Court’s process.
In broad terms, the claim by Mr Doolan is one founded on allegations of contraventions of the Competition and Consumer Act 2010 (Cth) (CCA). He seeks relief which is particularised in the principal application. Therein, he seeks the following final orders:
a)That the court fine the respondents, that is, Bayer and Terry White Market Chemists, under s.155 Schedule 2 of the CCA (the “Australian Consumer Law” (ACL));
b)That it makes the respondents pay pecuniary penalties under s.224 of Schedule 2 of the CCA;
c)That it seeks from the regulator, the making of such orders as are necessary in a s.223, s.246(2) and s.247 of Schedule 2 of the CCA; and
d)That any further or other orders that the court may deem necessary, and five, that it reimburse the applicant his costs.
The grounds of the application are, perhaps, somewhat more elucidating. They are in these terms:
a)That information produced by the first respondent and supplied by the second respondent about the nature and effects of the products is inconsistent and factually incorrect. Of no significance, it claims that the product is not an abortion pill. It also states that the products work by stopping the fertilised egg from attaching itself to the womb lining. The information about the products and the products are also being supplied in a deceptive way;
b)That the respondents have engaged in misleading conduct as to the nature of goods, in breach of s.33 and s.155 Schedule 2 of the CCA;
c)That the respondents have engaged in unconscionable conduct, in breach of s.20 and s.21 of Schedule 2 of the CCA;
d)That the respondents have engaged in misleading or deceptive conduct, in breach of s.18 of Schedule 2 of the CCA;
e)That the respondents have engaged in false and misleading representations, in breach of s.29 and s.151 of Schedule 2 of the CCA;
f)That the respondents have breached the guarantee as to acceptable quality, given by s.54 of Schedule 2 of the CCA;
g)That the respondents have breached the guarantee as to fitness for any disclosed purpose given by s.55 of Schedule 2 of the CCA; and
h)That the respondents have breached the guarantee relating to the supply of goods by description given by s.56 of Schedule 2 of the CCA.
Mr Doolan’s claims are discursive and appear to be driven by somewhat emotive arguments concerning the nature of contraception and the contraceptives manufactured by the first respondent and sold, inter alia, by the second respondent.
The claims particularly relate to two products, the first being ‘Postinor’ and the second being ‘Levonelle.’ These are drugs commonly known as the ‘morning after pill.’
The first respondent, Bayer, whose parent company is based in Germany, distributes these particular products in Australia. They are sold in most pharmacies over the counter, including the pharmacy of the second respondent. Because of their classification as over the counter medicines, they are not considered a prescription medicine. They have each been assessed by the Therapeutic Goods Administration (TGA) and are subject to and accord with the provisions of the Therapeutic Goods Act 1989 (Cth) (TG Act). Following the assessment, the products were first registered with the TGA on 16 January 2008.
In accordance with s.9A and s.9E of the TG Act, they were entered on the Australian Register of Therapeutic Goods, and remain on the register. They are described on the register as emergency contraceptives and as being available for sale over the counter.
The register records that the products contain various ingredients including, among other things, 1.5 milligrams of levonorgestrel, a synthetic progestogen. Section 52D(2)(b) of the TG Act allows the secretary of the National Drugs and Poisons Schedule Committee to prepare a document, including schedules to the poisons standard, containing the names and descriptions of standard substances or classes of substances in substitution for the current poisons standard.
It seems that, in accordance with s.52D(2)(b), levonorgestrel has been classified for the purposes of the Poisons Standard 2011 as a “post-coital contraception,” and is not considered by the TG Act to be an abortifacient or, in other words, an abortion drug. Now, the fact that levonorgestrel is a contraceptive is recorded in the minutes of two meetings of the National Drugs and Poisons Schedule Committee, which have been exhibited in the material.
They record minutes of meetings on 17 and 19 June 2003, and 14 and 16 October 2003, which can be best summarised by observing that it was the committee’s view that a pharmacist would not be involved in procuring a miscarriage if that person was supplying an agent not deemed to be an abortifacient. Levenorgestrel is not an abortifacient.
Having regard to that material, it seems that the drugs are contraceptives and, therefore, the applicant’s claim implicitly seeks to challenge the TGA’s classification.
In particular, Mr Doolan, when pressed to specify his complaint, took me to the point of sale material which he contended gave rise to the principal source of his action for misleading and deceptive conduct. It is a document annexed to his affidavit and it is one which was produced to him upon the occasion that he attended a pharmacy operated by the second respondent. The documents are point of sale material produced by the first respondent and distributed by the second respondent and, in that context, were obtained by the applicant, Mr Doolan.
When he was asked to take me to particular parts of that document which were in conflict with the material produced by Bayer, contained in consumer medicine information produced by the company which is entitled “Product Information” and found in the affidavit of Timothy Stephen Charles filed 12 June 2012 (and is noted as having been approved by the TGA in respect of both Levonelle and Postinor), he was unable to do so.
I took some time and some effort, I believe, in attempting to permit Mr Doolan to identify those parts or those points of difference which might give rise to contentions of misleading and/or deceptive conduct on the part of either the first or second respondents by reference to those materials but, as I have noted, none could be illustrated.
Furthermore, I have considered the documents myself, through the course of this morning, and can find nothing in the material which would suggest that the document which was provided to Mr Doolan at the point of sale bears any material difference to either of the documents which have been produced by the first respondent, either on its own behalf and/or as approved by the TGA.
The real point advanced by Mr Doolan in this application concerns the semantic argument as to what the term ‘pregnancy’ means and when it commences. That is, whether it commences at a point of conception or at some other time. It is on that basis that it is contended that the drugs which are produced by the applicant are not contraceptives but are, in fact, abortion drugs – that being the point which gives rise to Mr Doolan’s contention that the drugs are misleading and/or deceptive, or that the promotion and distribution of the drugs in the manner in which they are is misleading or deceptive.
In response to the application, both Bayer and Terry White Market Chemists maintain that Mr Doolan’s assertion that the drugs are abortifacients and not contraceptives is one which is fundamentally misconceived and distinctly at odds with the classification of both products given by the TGA, which is Australia’s regulatory authority for therapeutic goods and is also responsible for the classification of the goods’ main ingredient, levonorgestrel, as a contraceptive under the Poisons Standard.
As I have earlier noted, the argument which is advanced on the part of Mr Doolan is really one which is rather more philosophical or moral. It is not a matter which bears upon the outcome of this application, which ultimately comes back to a question of whether or not the manner in which the drugs have been marketed by the first respondent and sold by the second respondent can be used to support a claim of any contravention of the CCA. When one considers the issue in that light, it can be seen that no such basis exists. Furthermore, both Bayer and Terry White Market Chemists contend that, notwithstanding those arguments, the application should fail in remedy because the court does not have jurisdiction to entertain the application in the manner in which it is presently advanced.
In summary, the complaint is that the principal relief sought by Mr Doolan is for the imposition of penalties following contraventions of the Act, and that the Court has no jurisdiction in respect of those matters. In broad terms, that is correct. The contravention contended for is a breach of s.155 of Schedule 2 of the CCA. It provides that a person commits an offence if the person in trade or commerce engages in conduct that is liable to mislead the public as to the nature of manufacturing processes, the characteristics of the goods, their quality and/or their suitability for their purpose. The penalty provided if a person is a body corporate is $1.1 million; ss.(2) provides that the offence is a strict viability offence.
This Court’s jurisdiction is limited by s.86 of the CCA, which provides that jurisdiction is conferred upon this Court in any matter arising under s.46 or Part IVB, in respect of which a civil penalty is instituted by a person other than the Minister, but provides a clear limit on this Court’s jurisdiction to deal with matters that pertain to the imposition of penalties, and so much is reinforced by s.163, which is expressed in these terms. It states:
“Prosecutions
(1)Prosecutions for offences against this Act may be brought in any court having jurisdiction in the matter;
(2)In so far as this section has effect as a law of the Commonwealth, the Federal Court has jurisdiction in any matter in respect of which a criminal proceeding is instituted for an offence to which subsection (1) applies, and that jurisdiction is exclusive of the jurisdiction of any other court other than …”
The proceeding then goes on to list a number of other courts and those with jurisdiction afforded by operation of s.68 of the Judiciary Act1903 (Cth). In summary, the Federal Magistrates Court is not one of the courts authorised by reference to subsections (a) to (c). It follows that the Court has no jurisdiction in respect of the imposition of penalties pursuant to s.155 of Schedule 2 of the CCA and, accordingly, the relief sought in paragraphs (1) and (2) is incompetent and the application, insofar as it concerns those two paragraphs, must fail.
The second point that is made in respect of jurisdiction concerns the relief sought in paragraph (3). That calls upon the Court to seek from the regulator the making of orders that are necessary. Again, that is not an appropriate form of relief. They are matters which the regulator is to prosecute, not the Court of its own motion. Nor indeed does the applicant have standing to prosecute such a complaint, even if there were a basis for it, which there is not. The regulator is to be invited to take action and the applicant must encourage the regulator to take appropriate action. It follows that this ground also fails.
Ground 4 is in the nature of plenary relief. It is not, of course, the Court’s function to embark upon a process of saving the applicant from his own failure to identify relief which he seeks. While I have afforded him an opportunity to provide me with some basic schematic of what other relief he might seek, he was unable to do so, but for completeness I will address the matters that are included in the grounds of application that might otherwise give rise to a ground for civil action and be under Schedule 2. Broadly, those matters fall into the categories of misleading and/or deceptive conduct and unconscionable conduct.
For reasons which I have earlier outlined, nothing which the applicant has been able to point to in the course of this debate has identified any basis for the allegation that the first respondent, in manufacturing and distributing the product, and/or the second respondent, in its sale of the product, have engaged in any conduct which could be objectively considered misleading or deceptive.
I am conscious of the moral arguments advanced by Mr Doolan, but ultimately the matter is one to be assessed objectively, having regard to objective standards. These drugs have been assessed by the TGA. That Administration has examined the science behind the drugs and has determined that the drugs are contraceptives and that they are not abortifacients, and it follows that there is no misleading or deceptive conduct occasioned by that. The issue of misleading and deceptive conduct infects the complaints that are raised in paragraphs 1, 2, 4, and 5 of the grounds of application.
The second matter advanced concerns unconscionable conduct. Again, the facts of this case, as evidenced in this instance, do not demonstrate any unconscionable conduct on the part of either of the respondents, irrespective of whether the conduct could be regarded as unconscionable generally, in terms of the common law or otherwise. No question of unconscionability arises and it follows that paragraph 3 fails.
The remaining paragraphs, numbered 5, 6, 7 and 8, relate to product sale by description and/or fitness for purpose, as well as what might be described as the common sale of goods arguments. Again, having regard to the material which is before me, it would seem that there is no basis for those applications and, accordingly, those grounds also fail.
In having made those observations, I should hasten to add that I have had regard to the general principles which apply when considering applications of this kind. They extend not only to a cursory consideration of the facts, but whether or not the facts put at their best, as I have accepted them in this case, result in a claim which has no reasonable prospect of success. In my view, this claim is one which does not overcome this hurdle.[1]
[1]On this point, see generally the observations of the High Court in Spencer v Commonwealth of Australia (2010) 241 CLR 118 and also White Industries Aust Ltd v Commissioner of Taxation (2007) 240 ALR 792, which rather affects the other authorities referred to, including Kowalski v MMAL Staff Superannuation Fund Pty Ltd (2009) 259 ALR 319.
It follows, in my view, that the application is one which has no real prospects, even putting aside the question of jurisdiction as such, that even if I were to dismiss the paragraphs I have identified that can be dismissed, having regard to the jurisdictional argument, there is no real prospect there is no serious issue with argument in respect of the balance of the claim, even on a civil basis under the CCA, and it follows that the application should be dismissed in its entirety.
In this application, the application in the case, the respondents in the principal application have been successful. There is no reason why the usual order, that is costs to follow the event, would not apply in this instance. I note Mr Doolan’s complaint that he is impecunious, but that is not a matter for the question of costs. Ultimately, the application was, in my view, one which was doomed to fail and, indeed, Mr Doolan is lucky that he is not subject to an application for indemnity costs.
I certify that the preceding twenty-nine (29) paragraphs are a true copy of the reasons for judgment of Burnett FM
Date: 12 September 2012
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