Epitoma Pty Ltd v Australasian Meat Industry Employees Union
[1984] FCA 216
•27 JULY 1984
Re: EPITOMA PTY. LIMITED
And: THE AUSTRALASIAN MEAT INDUSTRY EMPLOYEES UNION'; JACK O'TOOLE; DICK
ANNEAR and NELSON WILLIAMS
No. G232 of 1984
Trade Practices - Injunctions
3 FCR 55
COURT
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Sheppard(1), Morling(1) and Beaumont(1) JJ.
CATCHWORDS
Trade Practices - Trade Practices Act, 1974, s. 45D(14) - Application for interlocutory injunction - Principles applicable - "serious question to be tried" - Balance of convenience.
Trade Practices - Secondary boycott - Acting in concert - Duress - Application for interlocutory injunction - Principles applicable - Serious question to be tried - Difficult questions of law - Balance of convenience - Trade Practices Act 1974 (Cth), s. 45D(1A).
Injunctions - Interlocutory - Principles applicable - Serious question to be tried - Balance of convenience - Trade Practices Act 1974 (Cth), s. 45D.
HEADNOTE
Held: (1) It is not sufficient for the purposes of establishing upon an interlocutory hearing that parties had engaged in conduct "in concert" as required by s. 45D (3) of the Trade Practices Act 1974 (Cth) for the conduct to have been engaged in by one of the parties under duress.
R. v. Lowrey & King (No. 2) (1972) VR 560; R. v. Matusevich & Thompson (1976) VR 470; R. v. Harding (1976) 129; R. v. Evans (No. 1) (1976) VR 517; Barton v. Armstrong (1976) AC 104, referred to.
(2) The concept of acting in concert in s. 45D(3) appears to require a consensual element.
The King and the Attorney-General of the Commonwealth v. Associated Northern Collieries Pty Ltd (1911) 14 CLR 387, applied.
(3) The decision in Wribass Pty Ltd v. Swallow (1979) 38 FLR 92 to the effect that the concept of the purpose for which conduct is engaged in does not extend beyond the achievement of the goal which that conduct was capable of achieving was sufficient to raise a serious question to be tried and the determination of whether the decision was correct is inappropriate at the interlocutory level.
(4) Semble the fact that the applicant company was not registered as a foreign company under the Companies Code of the Northern Territory at the time of the application for interlocutory relief is not relevant to the question of whether relief should be granted.
(5) Observations concerning the balance of convenience and in particular the weight to be attached to the pursuit by the respondent of its "industrial objectives".
(6) Observations concerning the form of the interlocutory injunction restraining in explicit terms, a particular activity.
HEARING
Sydney, 1984, July 19, 20, 27. #DATE 27:7:1984
APPEAL.
Appeal from judgment and orders of Gray J.
I. Barker Q.C. and N.C. Hutley, for the applicant.
K.R. Handley Q.C. and M.O. Tubbs, for the respondent.
Cur. adv. vult.
Solicitors for the appellant: Steven Jaques Stone James.
Solicitor for the respondent: Morris May.
G.F.V.
ORDER
1. That the appeal be allowed.
2. That the order dated 16 July 1984 dismissing the application for interlocutory relief be set aside.
3. That, in lieu of the order set aside, until the final determination of this proceeding or further order, whichever should first occur, the respondents and each of them be restrained by themselves, their servants and agents from imposing, giving effect to or enforcing any ban on the provision by any person of goods or services to the appellant at the Point Stuart Abattoir where any such ban has the purpose and would have or be likely to have the effect of preventing or hindering the appellant from:-
(a) carrying out works of construction, maintenance or repair at the said abattoir; or
(b) from slaughtering stock at the said abattoir; or
(c) from selling such slaughtered stock and by-products.
4. That the final hearing of the proceeding be expedited.
5. That the first and second respondents pay the costs of the appellant of this appeal.
6. That the costs of the application for interlocutory relief be otherwise reserved.
7. That the operation of order 3 be suspended for 7 days from this date.
8. That liberty be reserved to any respondent to apply, on such notice as a judge shall allow, to discharge or vary order 3.
9. That a directions hearing be fixed for Wednesday, 1 August 1984 at 9.30 a.m. in Sydney.
Appeal allowed.
JUDGE1
This is an appeal from a decision of a judge of the Court refusing to grant the appellant interlocutory relief in proceedings brought by it alleging a contravention of s. 45D(1A) of the Trade Practices Act 1974. By that provision, subject to certain statutory defences, a person shall not, in concert with another person, engage in conduct for the purpose, and having or likely to have the effect, of preventing or substantially hindering a third person (not being an employer of the first-mentioned person) from engaging in trade or commerce, inter alia, between Australia and places outside Australia or within a Territory.
The proceedings are brought by the appellant, which is in the process of establishing an abattoir in the Northern Territory, against the first respondent, a trade union of employees in the meat industry, and certain of its officers; the second, third and fourth respondents are respectively the Federal Secretary, Federal President and Queensland Secretary of the first respondent.
The primary facts, as found by his Honour, are as follows. The appellant is a company, incorporated in New South Wales. Since the hearing at first instance, it has become registered in the Northern Territory. In May 1984 it agreed to purchase a property in the Territory, known as the Point Stuart Abattoir, for a price of $1.25 million. Completion of the agreement has been delayed. The appellant purchased the property with the intention of operating it as an abattoir for the slaughter of buffalo and cattle destined for export. In May 1984, pursuant to the contract for sale, the appellant entered into possession of the property for the purpose of carrying out works designed to upgrade it. Certain works, costing approximately $750,000, have been carried out since May 1984 with a view to satisfying standards imposed by the Australian Government and by the European Economic Community. These works are not yet completed. They have been carried out, to some extent at least, by employees of the appellant who had previously been employed at the abattoir by its former operator, a company now in receivership. These employees, although employed in the construction works, were also retained by the appellant with a view to their subsequent engagement in the operation of the abattoir.
The appellant intended to commence production, on a limited basis, in June 1984 and to go into full production as soon as possible thereafter. Because of climate conditions, it is possible to operate the abattoir only until the commencement of the wet season, which is expected in December. The appellant has undertaken negotiations for the supply of buffalo and cattle for slaughter at the abattoir. It has committed itself to purchase between 28,000 and 30,000 head of stock for processing at the abattoir with a view to exporting the meat to, inter alia, West Germany. Unless the appellant is able to complete the work involved in up-grading the abattoir in the near future, there is real risk that it will lose the right to sell a proportion of its output to countries within the European Economic Community.
Before the appellant took possession of the abattoir after agreeing to purchase it, its managing director, Mr. Benjamin, had a discussion with Mr. Finn, who is a member of the first respondent and who was the works delegate at the abattoir when it was operated by the company now in receivership. Mr. Benjamin informed Mr. Finn that the applicant intended to operate the abattoir under a contract system. The essence of the proposed system was that a company would be formed in which each of the appellant's employees who were to operate the abattoir would hold shares. Those employees would cease to be employed by the appellant, and become employed by the proposed company. The appellant would pay to the proposed company monies calculated upon the number of beef slaughtered on a particular day, at rates which varied between labourers, boners and slicers, and slaughtermen. The company would then make payments to the employees.
It was said that such an arrangement would have benefits for both the employees and the appellant. From the point of view of the employees, the advantage claimed for the scheme was that payments of remuneration to them could be spread over an entire year, instead of being paid in larger amounts during a limited season. Although this would not involve any reduction in overall liability to income tax, it was said that less group tax would be deducted. From the point of view of the appellant, the advantage of the proposed arrangement was that certain costs of employing labour, which would otherwise have been borne by it, would be transferred to the contracting company.
The respondent union opposes the proposed contract system. It is that opposition which has led to the industrial unrest which has given rise to the present proceedings. There is evidence that many of the employees who would work at the abattoir would not be unhappy to work under the proposed contract system. On the other hand, it is obvious that the adoption of the system might well erode some of the protection afforded to employees when their working conditions and rates of pay are regulated by awards or determinations made by industrial tribunals. It appears that the first respondent is pursuing, in the Australian Conciliation and Arbitration Commission, arbitration by award of an industrial dispute between it and a number of meat producers in the Northern Territory. The appellant is not a party to that dispute.
It is unnecessary to refer to all that has passed between the parties arising out of the proposal to introduce the contract system. It is sufficient to say that, although there have been some negotiations between them, no agreement has been reached. The employees at the abattoir have been dismissed. They occupy accommodation at Point Stuart owned by the appellant. They have been requested to vacate that accommodation by the appellant but have refused to do so. Orders have been made by the Supreme Court of the Northern Territory requiring the former employees to vacate the accommodation which they continue to occupy.
Some of the officers of the first respondent have held discussions with certain members of the union who were formerly employed at the abattoir. The first respondent, by one or more of its officers, has given a direction to the men that they are not allowed to work at the abattoir until negotiations have been completed with the appellant and that, if they do work, their union tickets will be in jeopardy and they will not get a job anywhere in Australia. At least one employee has announced that he was intending to work, and that others have said that they wish to work, but feel themselves unable to do so. Other former employees feel themselves unable to do so. Other former employees have said that they are not prepared to return to work. Threats have been made that anyone who works at the abattoir will be "black-banned" at all abattoirs in Australia, and will be the subject of assaults. It should be noted that this evidence is, to some extent, hearsay and thus admissible on an interlocutory hearing and the conclusions expressed above are not final.
The respondents having placed a "black-ban" on the abattoirs, the appellant is unable to complete its construction, to procure its inspection by the authorities or to operate it. As a consequence of the respondents' ban, and an associated picket line, employees of Petromart Pty Limited, a distributor of fuel, refuse to deliver fuel to the abattoir.
The learned trial judge found, on the above facts and on the other material which was before him, that the applicant had made out a prima facie case that the respondents were acting in breach of s. 45D(1A) of the Trade Practices Act in that they, in concert, engaged in conduct for the purpose, and having or likely to have the effect of, preventing or substantially hindering the applicant from engaging in trade or commerce between. Australia and places outside Australia and within the Northern Territory.
Having reached this conclusion, his Honour then considered whether sub-paragraphs (i) and (ii) of s. 45D(3)(b) of the Trade Practices Act were applicable to the facts of the case. He reached the conclusion that the respondents stood "a good chance at the trial of the proceeding of making out a defence under sub-section (3)(b)" and that the consequence of this was that the appellant had "failed to establish a prima facie case for relief". He also said that, even if he was wrong in this conclusion, he would have been disposed to refuse an interim injunction for discretionary reasons.
As has been said, the appellant has appealed from the trial judge's decision to refuse it interim relief. Further, upon the hearing of the appeal, the first and second respondents gave notice of their intention to contend that the learned judge's finding that the applicant had made out a prima facie case under s. 45D(1A) was erroneous.
It is true, as the respondents submit, that an appeal from the refusal of an interlocutory injunction involves a matter of practice and procedure; and an appellate court is especially reluctant to interfere with the exercise by a judge at first instance of such a discretionary power (see Adam P. Brown Male Fashions Pty Limited v. Philip Morris Inc. (1981) 55 A.L.J.R. 548 at p. 550). But the appellate court will interfere where an error of principle has occurred and failure to correct such an error would work an injustice (see A.P.M. Investments Pty Limited v. Trade Practices Commission (1983) 49 A.L.R. 475 at p. 487).
In an application for an interlocutory injunction, the court must enquire first whether there is a serious question to be tried (see The Australian Coarse Grain Pool Pty Limited v. The Barley Marketing Board of Queensland (1982) 57 A.L.J.R. 425; Tableland Peanuts Pty Limited v. The Peanut Marketing Board (1984) 58 A.L.J.R. 283 per Brennan J. at p. 284). In the Barley Case, Gibbs C.J. said (at p. 425) that he inclined to the view taken by the House of Lords in American Cyanamid v. Ethicon Limited (1975) A.C. 396 rather than to some of those expressed obiter in Beecham Group Limited v. Bristol Laboratories Pty Limited (1968) 118 C.L.R. 618. It would seem that the Chief Justice had in mind the following statement of principle in the opinion of Lord Diplock, concurred in by the other members of the House, in American Cyanamid (at p. 407):-
"The use of such expressions as 'a probability,' 'a prima facie case,' or 'a strong prima facie case' in the context of the exercise of a discretionary power to grant an interlocutory injunction leads to confusion as to the object sought to be achieved by this form of temporary relief. The Court no doubt must be satisfied that the claim is not frivolous or vexatious; in other words, "that there is a serious question to be tried."
Lord Diplock went on (at p. 407) to explain the practical considerations underlying this approach:
"It is no part of the court's function at this stage of the litigation to try to resolve conflicts of evidence on affidavit as to facts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature considerations. These are matters to be dealt with at the trial. One of the reasons for the introduction of the practice of requiring an undertaking as to damages upon the grant of an interlocutory injunction was that "it aided the court in doing that which was its great object, viz. abstaining from expressing any opinion upon the merits of the case until the hearing": Wakefield v. Duke of Buccleugh (1865) 12 L.T. 628, 629. So unless the material available to the court at the hearing of the application for an interlocutory injunction fails to disclose that the plaintiff has any real prospect of succeeding in his claim for a permanent injunction at the trial, the court should go on to consider whether the balance of convenience lies in favour of granting or refusing the interlocutory relief that is sought."
(cf. Dimbleby & Sons Limited v. National Union of Journalists (1984) 1 W.L.R. 427; Appleton Papers Inc. v. Tomasetti Paper Pty Limited (1983) 3 N.S.W.L.R. 208 at pp. 214-5).
As has been said, although the learned judge found that a prima facie case was established that the respondents, in concert, had engaged in conduct of the kind prescribed by s. 45D(1A), the first and second respondents now submit that his Honour erred in that conclusion. Two arguments are advanced: one is factual; the other concerns the construction of s. 45D(1A).
First, these respondents say that there is no evidence that the "ultimate" purpose of the ban imposed by the respondents is the preventing or the substantial hindering of the appellant from engaging in overseas trade or in trade within the Territory; that there is no evidence that any of the respondents was aware of the appellant's trading plans; that, in this area, there is no scope for the ordinary presumption that a person is presumed to intend the natural consequences of his acts; so that the relevant enquiry here, they say, is as to the "subjective" purpose of the respondents in order to ascertain their "real" object (see Industrial Enterprises Pty Limited v. The Federated Storemen and Packers Union of Australia (1979) 2 A.T.P.R. 17,970 at p. 17,993; Tillmanns Butcheries Pty Limited v. Australasian Meat Industry Employees' Union (1979) 42 F.L.R. 331 at p. 349; Transport Workers' Union of Australia (New South Wales Branch) v. Leon Laidely Pty Limited (1980) 43 F.L.R. 168 at pp. 171, 179-80). And, the respondents argue, there is no evidence that the respondents had any purpose beyond stopping the reconstruction and operation of the abattoir. In other words, they say, there is no evidence that the respondents' purpose extended into the realm of the appellant's trade.
In our view, no case has been made out for disturbing his Honour's finding of fact on this score. By s. 4F(b) of the Act, a person shall be deemed to engage in conduct for a particular purpose if (i) he engaged in conduct that included that purpose; and (ii) that purpose is a "substantial" purpose. In the present case, no evidence was called by the respondents on the issue and it was at least open to the learned judge to make a factual finding adverse to them on this point. Certainly, we can perceive no error of principle and no injustice to the respondents such as to warrant interference by an appellate court at the interlocutory stage. From the point of view of the appellant, at its lowest, the evidence raises a serious question to be tried.
The respondents' second basis for challenging his Honour's finding of a prima facie case under s. 45D(1A) raises a question of construction. The argument seeks to avoid the literal meaning of s. 45D(1A) by resort to a "purposive" construction. In essence, the respondents fasten upon the excepted relationship specified in the provision ". . . a third person (not being an employer of the first-mentioned person) . . ." as an indication that the section is aimed at what are, in truth, secondary boycotts; thus, the argument runs, if the appellant were right, depending upon who is selected, however arbitrarily, as the first and second persons in s. 45D(1A), it would be possible to rotate personalities in a way which would avoid the intended operation of the provision. In short, the respondents say that a nonsensical result would occur if the section meant that if, on the one hand. A conspires with B, there would be no contravention, whereas, on the other, if B conspires with A, a contravention would be committed. Reliance was placed upon the reasoning in Cooper Brookes (Wollongong) Pty Limited v. Federal Commissioner of Taxation (1981) 147 C.L.R. 297 at pp. 320-1 to support the contention that a literal construction of a statute will be departed from if the result would be capricious and irrational.
Accepting, as we do, the decision and the reasoning in Cooper Brookes, we are not persuaded that the construction contended for by the appellant is capricious and irrational, quite apart from the impact of s. 45D(6). At all events, it is both unnecessary and inappropriate that we express any concluded view on this question in an interlocutory appeal. Once it is conceded that it was, at the very least, arguable that a literal construction should prevail it inevitably follows that there is a serious question to be tried on this issue. To borrow the language of Lord Diplock in Dimbleby, supra, it is "no part of the Court's function on an application for an interlocutory injunction to decide difficult questions of law which call for detailed argument and mature consideration" (at p. 436).
We think that his Honour was right in holding that a prima facie case was established under s. 45D(1A).
However, as has been indicated, having regard to s. 45D(3), his Honour ultimately concluded that the appellant failed to establish "a prima facie case that is likely to succeed at the trial." So far as presently material, by s. 45D(3)(b), a person shall not be taken to contravene s. 45D(1A) in the case of conduct engaged in by the following persons in concert with each other (and not in concert with any other person)-
(i) an organization of employees; and
(ii) an employee or two or more employees who are employed by the one employer.
The dominant purpose for which the conduct is engaged in must be substantially related to the remuneration, conditions of employment, hours of work or working conditions of the employee or of any of the employees referred to in (ii) above.
His Honour found that the appellant's employees acted in concert with the respondents with the dominant purpose specified in s. 45D(3).
In our view, with respect, the learned judge erred in so finding. Given the evidence, already mentioned, that complaints were made by various employees of threats in respect of their future employment and otherwise, with all respect to his Honour, we think that, at the very least, a serious question arises whether it was proper to regard such conduct as having been engaged in "in concert" as required by s. 45D(3).
His Honour was prepared to accept that, before two persons act in concert, there must be agreement between them. However, the learned judge thought that a useful analogy for present purposes could be found in the criminal law. He said (at p. 25 of his reasons):-
"The concept of acting in concert is more familiar in the criminal law than in civil cases, and the necessity for an agreement is recognized in the criminal law. See R. v. Lowery and King (No. 2)
(1972) V.R. 560 at page 561 and R. v. Matusevich and Thompson
(1976) V.R. 470 at pages 477-8. As was said in the last-mentioned case, however, the question whether an agreement exists for this purpose is not to be answered by reference to the formal requirements of a binding contract. The Full Court of the Supreme Court of Victoria in that case held that it was possible for one person to act in concert with another, even if that other is insane. There are authorities in the criminal law in which it has been held that the existence of facts amounting to the defence of duress in the criminal law does not prevent a jury from reaching the verdict that the person subject to the duress acted in concert with another. See R. v. Harding (1976) V.R. 129, and R. v. Evans and Gardiner (No. 1) (1976) V.R. 517, especially at page 520, where Lush J. dealt with the distinction between a person who says "Being compelled, I agreed" and a person who says, "I did not agree"."
In our view, none of the authorities relied on by his Honour supports the conclusion that a party acting under duress of the kind here found, for the purposes of this interlocutory hearing, to have been exerted, could be said to be acting in concert with others for the purposes of s. 45D(3)(b). We will deal with each case in turn.
Lowery and King (No. 2) establishes that under the doctrine of acting in concert to commit a crime:-
". . . although the understanding or arrangement must not have been called off before the commission of the crime, the mere facts that while it is being committed one of the persons acting in concert feels qualms or wishes he had not got himself involved or wishes that it were possible to stop the proceedings and still get off Scot free, will not amount to a calling off of the undertaking or arrangement" (at p. 561).
In our opinion, the reference, in this passage, to the calling off of the antecedent agreement, if anything, assists the appellant in its argument.
In Matusevich, the Full Court said (at p. 480):
"While we think that the principle is clear, the question whether in a particular case the sane and the insane man were acting in concert requires of course an examination of the evidence. The nature of the insanity may preclude the insane man from being capable of the assent which is necessary for the two men to be acting in concert. That would not mean that the sane man would not be guilty in respect of his own participation in the events which caused the death and the concept of innocent agency might well apply to make him liable for the acts of the insane man. But in such a case, the matter could not be put on the basis of acting in concert."
Again, if anything, the reasoning assists the appellant.
In Harding, it was held that in respect of murder as a principal, whether in the first or second degree, performance of the act under duress is not a sufficient answer in law. The case is concerned with the special rules of the criminal law in this area and is not, we think, a useful guide to the construction of s. 45D(3)(b).
Finally, in Evans and Gardiner (No. 1), apart from difficulties in reconciling Harding with Lynch v. Director of Public Prosecutions (1975) A.C. 653, Lush J. accepted (at pp. 519-20) that although, upon a charge of murder, it was not open to explain away facts from which participation in a plan might be inferred by reference to coercion or duress, nonetheless the facts put forward as constituting duress were to be regarded as relevant to the formation of an agreement that the two accused should act together. Again, if anything, this reasoning tends to assist the appellant.
The learned judge found a further analogy in the civil law, saying (at p. 26):-
"Even in the area of contracts, duress renders an agreement voidable at the option of the party who entered into it under duress, but does not render it void ab initio. See Barton v. Armstrong (1976) A.C. 105, especially at pages 118-9. In that case, the Privy Council, by majority, tendered advice that a declaration should be made that the deeds in question were executed under duress and were void; the reasoning in the passage to which I have referred makes it clear that such a declaration was based upon election by the party subject to the duress to avoid the deeds."
Since the relief sought in that suit was equitable, no question could arise of the deed being void, as distinct from voidable, in any strict sense (cf. Winthrop Investments Limited v. Winns Limited (1975) 2 N.S.W.L.R. 666 at p. 689). However, it is not clear to us what comfort could be gained by the respondents from the circumstance that, absent proceedings on his part, Mr. Barton would have been obliged to perform his obligations under the deed: on any view, since the intervention of a court of equity was necessary in order to grant the plaintiff the relief he sought, the transaction was voidable in that sense at his instance (see Calvin v. Carr (1980) A.C. 574 at pp. 589-90).
In our opinion, neither the decision nor the reasoning in Barton v. Armstrong can provide any useful analogy for present purposes. There it was held that the equitable rule enabling a contract entered into as a result of fraudulent misrepresentation to be set aside applied in cases of duress, so that if the defendant's threats were a contributing factor to the plaintiff's entering into the deed, the court would set aside the deed although the plaintiff might well have entered into the transaction out of commercial necessity even if the defendant had made no threats to induce him to do so. Here, the question, which is one of statutory construction only, is whether, given the pressure put upon the employees, it can still be said that they were "acting in concert" with the respondents. In our view, the questions are quite distinct, both in content and in principle.
So far as we are aware, there is no authority squarely in point. However, such authority that does exist in the general area indicates that the community of purpose suggested by the notion of acting in concert requires a consensual element which is lacking in the present case (see The King and The Attorney-General of the Commonwealth v. Associated Northern Collieries Pty Limited (1911) 14 C.L.R. 387 per Isaacs J. at p. 400).
Again, it is both unnecessary and inappropriate, at the interlocutory stage, to express any concluded view on the question which is one of mixed law and fact. The point need only be stated to demonstrate that it raises a serious question to be tried.
The appellant advances a further reason why s. 45D(3)(b) is inapplicable in the present case. It says that sub-para. (iii) does not apply here because the "dominant purpose" for which the conduct is engaged in is not "substantially related to" the remuneration of the employees or the other matters previously mentioned. His Honour rejected the argument, holding that this ingredient of the statutory defence was made out as a matter of fact and law.
The appellant submits that the proper conclusion, in all the circumstances, is that the dominant purpose of the imposition of the ban by the respondents was the shutting down of the appellant's business. The appellant sought to support its argument, before the learned judge and before us, by reference to the reasoning of Smithers J. in Wribass Pty Limited v. Swallow (1979) 38 F.L.R. 92 at pp. 102-5, especially the following passage (at p. 103):
"It appears to me that in the context of s. 45D the concept of the purpose for which the actual conduct was engaged in does not extend beyond the achievement of the goal which that conduct was capable of achieving. In relation to the conduct which prevented supplies of meat reaching the plaintiff that particular conduct could achieve nothing more than the cessation of Saturday morning trading in fresh meat by the plaintiff. That was the dominant purpose of the actual conduct. The wider and ultimate purpose of maintaining the work-free Saturday morning was the goal which it was hoped and intended would be promoted by achieving the purpose for which the actual conduct was engaged in."
His Honour disagreed with this approach for reasons he then gave. As we see it, again a question of mixed fact and law arises which it is inappropriate to determine at the interlocutory level. Again, it is sufficient to state the competing positions of the parties to indicate that, here also, there is a serious question to be tried. We would add that we ourselves would not express any view, in an interlocutory judgment, as to whether the approach taken by Smithers, J. should be preferred to that of trial judge. But we do differ from the learned judge in that, in our view, this aspect of the case did reveal a serious question to be tried.
In our view, the first main inquiry should be resolved favourably to the appellant.
We turn now to the second main inquiry, the balance of convenience. As has been said, the learned trial judge concluded that, because the respondents stood "a good chance" at the trial of making out a defence under s. 45D(3)(b), the appellant had "failed to establish a prima facie case for relief." It was not necessary, therefore, for his Honour to consider the balance of convenience. Nonetheless, the learned trial judge did express some views on the point and on related discretionary matters. In summary, whilst accepting the considerable economic loss being suffered by the appellant by reason of the boycott, his Honour was inclined to take into account the "industrial objectives" of the union. Strictly speaking, the learned judge appeared to express no view on the question where the balance of convenience lay in the instant case; rather, his Honour appeared to be much influenced, in his decision to refuse interim relief, by what he perceived to be the futility of granting any injunction, at least one framed with an exception in respect of s. 45D(3) conduct built into it.
A secondary aspect, going also to discretion, was a difficulty his Honour felt the appellant faced in obtaining temporary accommodation for construction workers at the site. However, we would not understand that his Honour regarded this as an insurmountable problem; nor could it be such.
Finally, his Honour concluded that the fact that the appellant was not then registered in the Territory as a foreign company under the Companies Code (although it now is), was a further discretionary reason why interim relief should be denied. The relevance of the lack of registration is by no means obvious to us, at least in the case of an Australian trading corporation. In any event, in practical terms, this question is no longer of any significance to the parties since, at worst, the appellant could at any time hereafter renew its application for an interim injunction now that it is registered in the Territory under the Code.
Since, in our view, these matters of discretion could not of themselves be fatal to the application for interim relief, we need consider them no further and instead, revert to the question of the balance of convenience.
In our opinion, in an application for an interim injunction, a distinction should be drawn between considerations which could constitute a discretionary defence and considerations which go to the balance of convenience as such. The former may give rise to a claim for final relief, and thus, may bear upon the first inquiry to be made, whether there is a serious question to be tried. On the other hand, the balance of convenience, concerned as it is, with an evaluation of the relative positions of the parties, in terms of their "convenience", cannot bear upon the substantive issue whether there is a serious question to be tried.
The notion of the balance of convenience was described by Lord Diplock in American Cyanamid in terms which, we think, are pertinent to the present case (at p. 408):-
"If the defendant is enjoined temporarily from doing something that he has not done before, the only effect of the interlocutory injunction in the event of his succeeding at the trial is to postpone the date at which he is able to embark upon a course of action which has not previously found it necessary to undertake; whereas to interrupt him in the conduct of an established enterprise would cause much greater inconvenience to him since he would have to start again to establish it in the event of his succeeding at the trial."
Although at the time of the application for interim relief the appellant had not long commenced business, the undisputed facts are that it had committed itself, financially and otherwise, to a course which the respondents' ban had interrupted in a way which threatens the appellant's whole enterprise, embryonic though it may be. By contrast, the respondents were not, prior to this dispute arising, committed to any course of action which might be interfered with in the event that they were to be enjoined.
It is not apparent whether the learned judge did carry out an evaluation of the prejudice, if any, flowing to either side if interim relief were granted. If he did, it is difficult to see what weight, in any relative sense, the learned judge felt should be attributed to the union's pursuit of its "industrial objectives." The position, as we see it, is that the learned judge was in all probability expressing no conclusion on the issue of the balance of convenience; rather, he seemed to be directing his mind to the different question whether the discretionary defences alluded to provided any answer to the appellant's claim.
In our view, the balance of convenience in a case such as this must favour the grant of temporary injunctive relief. The appellant's business is, to say the least of it, being interrupted, perhaps irrevocably damaged, by the conduct of the respondents. On the other hand, it is not easy to see how any damage would be suffered by the respondents or by other parties if an interim injunction went, especially if the usual undertaking as to damages were extended to any other person who may suffer damage or loss as a result of the restraint.
It follows, in our opinion, that the learned judge erred in principle in failing to weigh up the relative claims of the parties on the balance of convenience in the way that consideration should have been dealt with. Ordinarily, an appellate Court would be loath to interfere in such a discretionary area. But, in the present case, an error of principle has been demonstrated. In our view, in the absence of any suggestion of prejudice on behalf of the respondents (and none emerged, even in the appeal), the balance of convenience fell all one way. To decline relief on that ground was, we think, wrong in principle; and any finding so based should, in our view, be set aside.
A serious question for trial having been demonstrated, it follows that, subject to the imposition upon the appellant of appropriate conditions, to which we will come later, an interim injunction should be granted.
We turn next to the form of such injunction. As has been said, his Honour was of the view that interim relief of any kind should be refused upon the discretionary grounds that it is possible that a defence under s. 45D(3)(b) may be available. In Tillmans Butcheries (supra), an injunction was granted which, in its terms, excluded conduct which could be justified by reference to s. 45D(3). But that order was a perpetual injunction and no doubt the Court wished to frame its order so as to cater for the future possibility that certain conduct might be protected under s. 45D(3). In the case of an interim injunction which, as in the present case, may subsist for a matter of weeks only, very different considerations apply. In our view, it is desirable that an interlocutory injunction restrain, in explicit terms, a particular activity so that the parties can be under no misapprehension as to what is intended, rather than be framed in terms which reflect the general language of the statute, in this case, s. 45D(1A) (see Victorian Egg Marketing Board v. Parkwood Eggs Pty Limited (1978) 33 F.L.R. 294 at p. 316); and it is only when the prohibition is framed in such a general way that the need arises to exclude conduct such as that protected by s. 45D(3)(b), should such conduct occur. Given an interim restraint of the limited and specific kind we think is appropriate, the futility which troubled the learned judge should not arise.
In our view, interim relief should only be granted to the appellant upon its submitting to a number of conditions: first, that the usual undertaking as to damages be extended to any person, whether a party or not, who may be adversely affected by the order; secondly, that the appellant co-operate in the expedition of the final hearing; and finally that it not participate, at this stage, in any employment scheme involving the interposition of a corporate structure of the kind described at p. 4 of these reasons.
Subject to appropriate undertakings on behalf of the appellant, we propose to make the following orders:
UPON the appellant giving the following undertakings to the Court:
(a) that it will pay to any party and to any other person adversely affected by order 3 such compensation, if any, as the Court thinks just, in such manner as the Court orders;
(b) that it will use its best endeavours to expedite the final hearing of this proceeding;
(c) that, until the determination of the proceedings or further order, it will not be a party to, or otherwise be involved in, the making or carrying into effect of any agreement or arrangement providing for a contract with a proposed company of the kind described at p. 4 of the Reasons for Judgment herein, provided that nothing in this undertaking will prevent the appellant from reverting to its former contract system, that is, contracting directly with its employees for their services but without the interposition of a corporate structure of the kind described at p. 4 of the Reasons for Judgment;
ORDER
That the appeal be allowed.
That the order dated 16 July 1984 dismissing the application for interlocutory relief be set aside.
That, in lieu of the order set aside, until the final determination of this proceeding or further order, whichever should first occur, the respondents and each of them be restrained by themselves, their servants and agents from imposing, giving effect to or enforcing any ban on the provision by any person of goods or services to the appellant at the Point Stuart Abattoir where any such ban has the purpose and would have or be likely to have the effect of preventing or hindering the appellant from:-
(a) carrying out works of construction, maintenance or repair at the said abattoir; or
(b) from slaughtering stock at the said abattoir; or
(c) from selling such slaughtered stock and by-products.<
That the final hearing of the proceeding be expedited.
That the first and second respondents pay the costs of the appellant of this appeal.
That the costs of the application for interlocutory relief be otherwise reserved.
That the operation of order 3 be suspended for 7 days from this date.
That liberty be reserved to any respondent to apply, on such notice as a judge shall allow, to discharge or vary order 3.
That a directions hearing be fixed for Wednesday, 1 August 1984 at 9.30 a.m. in Sydney.
We propose to order the suspension of the injunction and to reserve liberty to the respondents to apply having regard to the circumstances that some of the respondents have not yet been served, that some of the respondents reside a considerable distance from Sydney and that the events in question occurred in a remote part of the Northern Territory.
We have fixed a directions hearing on 1 August. We expect that, by that date, the appellant will have administered interrogatories, if any, and will have sought discovery, if it wishes, against the first respondent. We also expect that a final hearing date will then be fixed, to commence in the third week of August.
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