Fat-Sel Pty Limited v Brambles Holdings Ltd Summary

(NOTE: This judgment relates predominantly to its

own facts and

is not of sufficient general interest to justify

circulatim).

CATCHWORDS

TRADE PRACTICES - C l a m of deceptlve or misleading conduct

Application to amend Statement

of Claim - Amended Statement of

Claim containing claims in contract

- Whether contract claims

within jurisdiction of Court	- Whether certain s.52 claims made
bona fide.

Trade Practices Act

1974

Fencott v Muller (1983) 57 A.L.J.R. 317 applled.

N.S.W. G.16 of 1985

FAT-SEL PTY LIMITED V BRAMBLES HOLDINGS LIMITED

Wilcox J.

Sydney

1 May 19P5

IN THE F’EDERAL COURT OF AUSTRALIA

)

NEW SOUTH WLES DISTRICT REGISTRY

)	No. 16 of 1985

)

GENERAL

DIVISION

BETPEEN:

FAT-SEL PTY LIMITED

Applxant

m: BRAMBLES HOLDINGS LIMITED

Respondent

MINUTES OF ORDERS

W:	WILCOX J.
U:	1 MA2 1985
W:	SYDNEY

TYE COURT ORDERS THAT:

The applicant be granted leave to flle

an amended

Statement if Claim in accordance wlch the draft document sxght Eo be flled ln court thls day but

subject to the amendments

required to give effect to

the rulings contained in the Reasons for Judgment	of
1 May 1985.

2 .

2 . The costs of the motion be costs in the principal

proceedings.

MOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

) )

NEW SOUTH WALES DISTRICT REGISTRY )

No. 16 of 1985

GENERAL DIVISION

.:l

BETWEEN:

FAT-SEL PTY LIMITED

- -

Bppllcant

BRAMBLES HOLDINGS

LIMITED

Respondent

W: WILCOX J.

DATE:

1 MAY 1985

PLACE: . SYDNEY

EXTEMPORE REASONS FOR JUDGMENT

This matter came before ne last Friday pursuant to

a notice of motion filed on behalf of the respondent, dated

:.i

25 March 1985, seeking to strike out the statement

of claim

or to stay the proceedings. In between the date of fillng

that notice of motion and last Frlday,

an amendment to the

stacement of claim had been made and debate proceeded upon

the hsls of the amended statement

of claim.

In the result I gave leave to the applicant to

bring in a further amended statement

of claim today. Thls

h a s been produced and

an application has been made to flle

2 .

the amended statement of

claim in court. Mr. Robberds

’

objected to the document

being filed in court because

-- --_

said that in a number of

respects it disclosed claims

which

were not within the jurisdiction of the Court or were

otherwise objectionable. It has been convenlent to hear

argument upon the substance of the matters sought to be

raised in dealing with

Mr Robberds’ objection.

The first matter objected to by

Mr Robberds

relates to the terms of paragraph

27 of the draft. Nith

respect to the draftsman

of this paragraph, I have found It

difficult to understand what was intended.

The draft whlch

was brought in claimed that the mlsleading conduct of the

respondent induced the applicant to enter

lnto a deed of

option and that it had thereby suffered

loss and damage in

that the respondent failed to supply the quantities

grease, trap waste and concentrate which

It represented

would be supplied. The representation refers not to

anything contained in the deed

of optlon but

to the

antecedent negotiatlons between the parties whlch wer? sald

to constltute s.52 conduct. Under those clrcumstances it

seemed to me that the reference to the deed of option was

irrelevant and potentially misleading

as to what was

intended.

The matter has been clarified during

submissions

and the form

which the applicant

now presses would have the

wording after the inltial clause	in paragraph 27 read m
thls way:

3 .

"The applicant has suffered

loss and damage

that the respondent

has failed to supply the

W t i t i e s of grease, trap waste and concentrate which it represented would be supplied."

I think that in that modified form the claim souqht to be made is intelligible.

Mr Robberds objects that there is

a more

fundamental problem about clause

27 in that it claims

prospective damirges-for

loss of the profits which the

applicant believed it would earn had the representatlons

been true. L think that the question that has been raised

by that submission and which, indeed, was consldered by

Beaumont J. in respect of an earlier application in respect

of this natter, raises a question

f some importance in

regard to the law

of damages under the Trade Practices Act.

There may well be considerable difficulty

in the basis

relied upon by the applicant, but

I do not feel that the law

is so clear that I should take a course which would prevent

the applicant even litigatlnq the question whether

or not it

is entitled, assuming that lt succeeds

In the action Itself,

to recover damages assessed upon that basis. That is a matter which wlll no doubt ultlmatrly be determhed either

by a Full Court of thls Court

or in the High Caurt, and It

would seem to me incorrect to prevent the appllcant brlnglng

the claim. I say that without offerlng any

n e w about the

ultimate result of such a claim.

I am therefore mlnded

permit an amendment which takes

In clause 27 in the

form

to whlch

I have referred.

It is possible to deal together with clauses

28.

29, 30 and 39.

In relation to those clauses an objection is

made by

Mr Robberds that the claims which they make

are

claims in contract

and fall outside the jurisdiction

- of this

Court. Whether or not the clalms are within jurisdiction

depends upon whether there is

a common sub-stratum of facts,

to use the terminology

of the members of the High Court in

Fencott v Muller (1983) 57 A.L.J.R.

317.

With some regret, because the result is

inconvenient, I come to the conclusion that there

1s not the

necessary common sub-stratum of facts and that the claim

sought to be made

in these paragraphs of the statement of

claim are outside the jurisdiction of the Court.

The essence

of the claim made by the applicant,

which attracts the

jurisdiction of the Court, is certain conduct

of the

respondent which is said to be deceptive or misleading and

therefore in contravention of s . 5 2 of the Trade Practices

A&.

The--conduct consists

primarily of representatlons made

in the course

of negotiatlons prior to the execution on

September 1 9 E 1 of a deed of option between the parties.

The applicant also complains that following that

date there were further representatlons which in effect

reaffirmed the earlier representations and that

i has

suffered loss as a result of relying upon the truth

of the

representations of the respondent. Such a claim is one

clearly within the jurisdiction of the Court

and, of course,

I make no comment as to the extent to which it might be well

founded in point	of fact. That matter has not been
considered.

However, the claims which are referrsd

to in

paragraphs 28, 29, 30 and 39 are claims for breaches

of the

deed of option. They are claims which, if they

are well

founded, would exist because

of the existence of the deed of

optlon and irrespective of

any misleadlng or deceptive

conduct by the respondent in relation to the execution

the deed

of option.

They are simply claims for breach of

contract.

The juridical basis of the claims is

qulte

different. It is true-that there would be some overlap

the evidence if those claims were prosecuted separately from

the 3.52 clalms but I do not think that	hat is the test
prescrlbed by Fencott v Muller.

Mr Moore on behalf of the respondent

has submitted

that the claim for damages would be similar.

I am not

convinced that that

is necessarily so but even If it be

true, or that the same evidence would be led

in respect of

damages under the s.52 claim as under the claim for breach of contract, I do not thlnk that his provides the necessary common sub-stratum of facts. The essence of a common

sub-stratum of facts, as I understand what has been said by

6 .

the High Court, is that the applicant must

have a single

complaint, notwithstanding that this be expressd in terms of

different legal causes of action. For example,

s.52 conduct

and fraud,. relating to

he,same chain

of events, is

something which in lay terms might be regarded as

a single

complaint bringing the applicant to court-, or

a slngle

matter within the meaning of

5 . 7 6 of the Constitution.

In this case there

are really two complaints.

'Firstly, that the respondent contravened

s.52 because of its

misleading or deceptive conduct and therefore caused the

applicant to act in various ways to Its detriment and suffer

loss.

Secondly, that having caused the deed of option to

come into existence it then breached its obligations under

that deed. Quite obviously one could have had

breach of

contract without misleading conduct and one could have

had

misleading conduct without the deed of option. They are

really separate matters although they happen to involve the

same parties and, to same extent, the same evldence.

I think-that it is quite clear that the contract

claims do not answer the necessary test and that they may

not be litigated in these proceedings. I therefore propose

not to allow the filing of

sn amended statement of claim

whlch contains the material alleged in paragraphs

28, 2 9 , 30

or 39 of the current draft. Paragraph

40 refers partly to

those paragraphs and partly

to other paragraphs and it will

have to be recast to be limited to what remains.

The other matter between the parties relates

to the

question whether

or not the claim by the applicant that

there were representations made to

it, being s.52 conduct,

after the date of the deed should be allowed to

be made. Mr

-4

Robberds contends those allegations are not made bona fide

but solely to attract the jurisdiction of the court.

He has

drawn my attention to what was said by Mr Moore on two

previous occasions before Beaumont

J., the passages being

set out at pp. 112 and 168 of the transcript. At that tlme Mr Moore made the statement that his client's case was that

the representations were made

by the respondent, as he put

it, "to get hold of our technology".

The matter has been clarified today to the extent

j	I	that	Mr	Moore	says	that	his client does not allege that the
.1

representations were made

wlth a dellberate interlLion to

extract from the applicant confidentlal Information

as to

- 1

I I

its

technology,

but

Moore

dbes

maintain

the

allegation

' j q

that as a result of the representations, which

he says are

deceptive or misleading, the technology whlch was otherwise

confidential was made available and that the respondent

:?j

- 7	misused	confidential	that	information.
A	-7

I think it is fairly clear that the Court has

.?l	jurisdiction	to	deal	with	such	a claim	if	it flows	from a
A
*

+	breach of s.52.	The only real point is whether	or not the
:&l

clam of representations reaffirming earlier representations

after the date of the deed of option is made bona fide.

think that the passages

in the transcript support the view

that Mr Moore primarily had in mind, and perhaps

at that

time, solely had in mind, representations made before the deed of option. However, it is fair to say that he amended

statement of claim, which was filed on

15 April and which

. I

was

discussed

last

Friday, dld

include

specific

allegations

as to representations made after the deed, toqether with

.:	-	~	allegations that they were made	in breach of 5.52, and that
'.

the confidential information was supplied and mlsused.

I .'I

thlnk it

is also fair

to say that at the time that draft was

filed the jurisdictional questlons	which have since been
debated had not loomed so large.

I am not persuaded of the lack

of bona fides by the

applicant in alleging representations after the date of

option, nor indeed do

I see that the applicant would have

much to gain in terms of jurlsdictlon from making such a

clam.

If representations were made and with the

consequence alleged

prior to the date

of the deed, then

there is clearly jurisdiction to award the applicant

whatever relief is justified. The only basls upon

whlch the

post deed representations would be critical would be if the

back to and affirm the earlier representations, it seems

- .

-1

unlikely

that

the

applicant

would

succeed

on the

post

deed representations if it falled

on the pre deed

representations. However that may be,

I think that there is

no basis for imputing to the applicant

a lack of bona fldes

in bringing the claim and

I propose tu allow the clauses

which contain that	claim and which are clauses	31 to 35 of
the current draft.

I think it is highly desirable that this matter

proceed to trial at the appolnted date

in June before

Beaumont J. as arranged, and that It is approprlate that the

applicant now bring in and file

a further amended claim

which will be along the lines

of that proffered today but

with the amendments that flow from this decision.

That

should be filed not later than

4 p.m. on Friday.

In respect of the costs of the application

I will

hear what counsel have to sag. My view is that there

ha3

been some success

on each side and

that what has transpired

might reasonably be regarded

as part and parcel of the

general contest between them, in which case

I would be

inclined to think costs would be slmply costs in the

princlpal case, but

I will hear either counsel if they wish

to contend otherwise.

10.

I certify that the nine

(91

preceding pages are

a true copy of

,the	Reasons for Judgment herein of

his Honour

Mr. Justice Wilcox.

Associate: 7taU&LqW&c

Date

1 May 1985

Counsel for the Applicant:

Mr A G Moore

..	with Mr D Warren

Solicitor for the Applicant:

Messrs N G Cassim & Co.

Counsel for

the Respondent:

Mr L P Robberds Q . C .

with Mr S D Aobb

Solicitor for the respondent:	Messrs Stephen Jacques Stone
& Janes
Dates of hearing:	18 and 26 April 1985
1 May 1985

Fat-Sel Pty Limited v Brambles Holdings Ltd

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established