Global Spill Control Pty Ltd v Spill Station Australia Pty Ltd - [2019] WASC 141

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   GLOBAL SPILL CONTROL PTY LTD -v- SPILL STATION AUSTRALIA PTY LTD [2019] WASC 141
CORAM:   SMITH J
HEARD:   11 APRIL 2019
DELIVERED          :   11 APRIL 2019
PUBLISHED           :   2 MAY 2019
FILE NO/S:   CIV 1432 of 2019
BETWEEN:   GLOBAL SPILL CONTROL PTY LTD
Plaintiff
AND
SPILL STATION AUSTRALIA PTY LTD
First Defendant
NATHAN CARTWRIGHT
Second Defendant
AUSSPILL ASSOCIATION LTD
Fourth Defendant

Catchwords:

Injunction - Application for interim interlocutory injunction - Prohibitory and mandatory injunctive orders sought - Expressions customarily used in injunctive orders considered - Whether damages an adequate remedy considered - Whether public interest in publication of mandatory notice.

Legislation:

Nil

Result:

Interim interlocutory injunction granted in part
Mandatory elements of injunction not granted

Representation:

Counsel:

Plaintiff	:	Mr W C J Zappia
First Defendant	:	Mr K M McNally
Second Defendant	:	Ms K M McNally
Fourth Defendant	:	Mr C Breheny

Solicitors:

Plaintiff	:	Minter Ellison
First Defendant	:	McNally & Co
Second Defendant	:	McNally & Co
Fourth Defendant	:	Kott Gunning

Case(s) referred to in decision(s):

Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57
Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618
Commodore Business Machines Pty Ltd v Trade Practices Commission (1990) 92 ALR 563
National Bank Australia Limited v Joyce [2012] WASC 224
Twinside Pty Ltd v Venetian Nominees Pty Ltd [2008] WASC 110
Wellard Land Holdings (WA) Pty Ltd v Barker Mortgages Pty Ltd [2018] WASC 27

SMITH J:

This decision was delivered extemporaneously, on 11 April 2019, and has been edited from the transcript to correct matters of grammar and in infelicity of expression. Authorities and references have been footnoted.

Introduction

The plaintiff owns and operates a business manufacturing and selling (as a retailer and wholesaler) chemical spill control products for use in Australia.
The first defendant, Spill Station Australia Pty Ltd, is a competitor of the plaintiff. The second defendant, Nathan Cartwright, is the managing director of the first defendant and the deputy chairman of the fourth defendant.
The fourth defendant, Ausspill Association Ltd, is an organisation formed to advocate for the spill control industry, and promote spill control manufacturers, retailers, wholesalers and importers to the government, the public, and the environmental protection industry.
On 12 March 2019, the plaintiff filed a writ of summons and a chamber summons seeking interim interlocutory relief.
On 13 March 2019, the court made interlocutory orders restraining the defendants from making certain statements. These orders were varied on 20 March 2019. The interlocutory orders made on 20 March 2019 extended the interlocutory orders restraining the defendants until the hearing of the chamber summons, on 11 April 2019.

Interlocutory orders sought by the plaintiff until trial of the action

At the hearing on 11 April 2019, the plaintiff sought the following interlocutory orders against the first, second, and fourth defendants:[1]
[1] Plaintiff's amended minute of proposed orders, filed 8 April 2019; the expressions underlined are the expressions that the first and second defendants took issue with; the notice referred to in the proposed orders is annexed as Annexure A to these reasons.
1.Until trial or further order, the first, second and fourth defendants be restrained from making oral statements publishing, republishing, distributing, redistributing, or directing or procuring any person to publish, republish, distribute or redistribute, any further materials that contain representations that:
(a)AusSpill Association Ltd is the voice of the Spill Control Industry;
(b)AusSpill Association Ltd has been chosen by the majority of the manufacturers, wholesalers and retailers of spill kits in Australia to represent their interests to Australian government and bureaucrats, consumers and all sectors of Australian industry.
(c)there is a specific:
(i)Australian Standard;
(ii)Australian Industry Standard; or
(iii)Industry Standard,
for spill kits manufactured and sold in Australia;
(d)that anyone other than AusSpill Association Ltd and its members have adopted and agreed to be bound by the terms of the document currently published on the AusSpill Association Ltd website and titled ASCS 2695;
(e)ASCIS 2695 or any modified or renamed version of that document is:
(i)an Australian Standard;
(ii)an Australian Industry Standard; or
(iii) an Industry Standard,
for spill kits manufactured and sold in Australia;
(f)ASCIS 2695 or any modified or renamed version of that document is in any way a mandatory standard binding on manufacturers or those who supply or distribute spill kits for use in Australia who are not members of the AusSpill Association Ltd;
(g)spill kits manufactured in, or supplied or distributed for use in Australia that do not contain a compliance mark from the AusSpill Association Ltd indicating that they comply with ASCIS 2695 are either unlawful, of a lower quality than spill kits that carry the mark, or are unsafe;
(h)ASCIS 2695 or any modified or renamed version of that document has been adopted as a standard by the majority of the manufacturers, wholesalers and alternatively or retailers of spill kit products in Australia;
(i)Spill kits intended for use in Australia promoted and marketed for sale by Spill Station Australia Pty Ltd comply with the applicable:
(i)Australian Standard;
(ii)Australian Industry Standard; or
(iii)Industry Standard,
for spill kits manufactured and sold in Australia.
(j)AusSpill Association Ltd has been appointed by at least a majority of the manufacturers, wholesalers and alternatively or retailers of spill kit products manufactured or sold for use in Australia to ensure compliance with the applicable:
(i)Australian Standard;
(ii)Australian Industry Standard; or
(iii)Industry Standard,
for spill kits manufactured and sold in Australia,
or making representations to like or similar effect.
2.Until trial or further order, the first, second and fourth defendants be restrained from using the word 'standard' to describe the document 'ASCS AusSpill Association standard for Spill Response Kits' being the document formerly titled 'ASCIS 2695 Australian Spill Control Industry Standard for Spill Response Kits' or from using the acronym 'ASCS', 'ACIS' or 'AS' to describe that document without clearly distinguishing that document from:
(a)standards (known as Australian Standards) produced by Standards Australia or organisations accredited by Standards Australia to develop such standards;
(b)a standard that has been approved by an independent standards body;
(c)a standard that is an industry standard; and
(d)a standard that is required to be complied with by law.
3.Within 24 hours of this order the first, second and fourth defendants take all necessary steps to procure the removal of the following from websites owned or controlled by them:
(a)the article titled 'Australian Industry Standard for Spill Kits Released', authored by Nathan Cartwright, which appears at BIL32, at page 154, and BIL43, at page 184, of the affidavit of Bradley Ian Lowson sworn 12 March 2019;
(b)the article titled 'Spill Station Launches Compliant Spill Kits' which appears at BIL48, at page 190 of the affidavit of Bradley Ian Lowson sworn 12 March 2019 (Lowson Affidavit);
(c)the term 'Industry Standard' on the page of the Ausspill website which appears at BIL13A, at page 48, of the Lowson Affidavit;
(d)any statements on the websites of the first, second and fourth defendants that say 'The Voice of The Spill Control Industry';
(e)the words 'industry standard', located on the fourth defendant's website, which appears at BIL23, on page 140 of the Lowson Affidavit;
(f)the words:
(i)'Australian Industry Standard AS2695';
(ii)'ASCIS2695'; and
(iii) 'ASCIS2695 is the precursor to the introduction of and (sic) Australian Standard…'
located on the first defendant's website, which appears at BIL25, on pages 142 to 144 of the Lowson Affidavit;
(g)the words:
(i)'Australian Industry Standard'; and
(ii)'ASCIS 2695',
located on the first defendant's website, which appears at BIL27, on page 145 of the Lowson Affidavit;
(h)the words:
(i)'standard'
(ii)'Industry Standard';
(iii)ASCIS2695; and
(iv)'If you invest in a spill kit without the Ausspill Mark of Compliance you may find out that you have ended up with a prefilled garbage bin'
located on the first defendant's website, which appears at BIL28, on page 146 of the Lowson Affidavit;
(i)any statements on the websites of the first, second and fourth defendants that say words to the effect that the fourth defendant is the Voice of The Spill Control Industry;
(j)removal from the websites of the first and second defendants to references to ASCIS 2695 where it is described as:
(i)an Australian Industry Standard;
(ii)an Australian Standard;
(iii)an Industry Standard; or
(iv)standard.
(k)any articles substantially similar in content to those listed at 3(a) and 3(b).
4.The first defendant incorporate a copy of the notice attached as Attachment A to these orders into the next edition of its respective electronic newsletters.
5.Within 3 business days of this order, each of the first and fourth defendants publish the notice attached to these orders as Attachment A prominently on their respective websites listed below and that notice shall remain on the websites for a period of not less than 30 days:
6.Within 5 days of complying with orders 3, 4 and 5 each of the first and fourth defendants file an affidavit deposing to the steps they took to comply with the orders that apply to them.

Issues in dispute

The first, second, and fourth defendants, agreed for the purposes of this interlocutory application only, the court could make further interlocutory orders on the basis that the plaintiff had made out a prima facie case (for interim relief).
The first and second defendants, however, took issue with the form of the orders sought by the plaintiff in proposed orders [1], [2] and [3]. In particular, the first and second defendants opposed the orders being made in the form sought by the plaintiff by the inclusion of the underlined expressions in the opening paragraph of [1], and the underlined words in [1(j)], [2], [3(i)] and [3(j)].
The grounds upon which the first and second defendants objected to the underlined expressions in the proposed orders was that if the expressions were used, the injunctive orders would not be orders capable of enforcement.
The first, second, and fourth defendants objected to the mandatory form of orders sought in [4], [5] and [6] on grounds that the distribution of the proposed notice is likely to cause the defendants irreparable damage.

Objections to the expressions used in proposed orders [1] and [3]

The first and second defendants' objections to the underlined expressions in proposed orders [1] and [3] are rejected.
In Commodore Business Machines Pty Ltd v Trade Practices Commission,[2] the Full Court observed expressions, such as 'or any similar manner', 'in connection with', 'were identical or connected with any business', or 'from representing or holding out to the like effect', are expressions customarily used to enjoin conduct of a similar character or to the like effect of that conduct.[3]
[2] Commodore Business Machines Pty Ltd v Trade Practices Commission (1990) 92 ALR 563.
[3] Commodore Business Machines Pty Ltd v Trade Practices Commission (1990) 92 ALR 563, 575 (Gummow, Foster & Mill JJ).
Their Honours in Commodore Business Machines, pointed out that such words are often used in cases to ensure that not only the letter of an interim injunction will be complied with, but also the spirit of the injunction.
Having regard to the terms of the orders proposed by the plaintiff, I am not satisfied that there will be any real difficulty for the first and second defendants complying with proposed orders [1], [2] and [3].

Proposed orders [4], [5] and [6] - balance of convenience - should mandatory orders be made?

I do not intend to make proposed orders [4], [5] and [6].
First of all, it is an established principle that a plaintiff must show sufficient likelihood of success to justify the status quo being preserved until trial.
How strong the probability of success that a plaintiff must show depends upon the rights asserted by the plaintiff and the practical consequences that might flow from the orders the plaintiff seeks.[4]
[4] Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57, 82 (Gummow & Hayne JJ); see also Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618, 622 (Kitto, Taylor, Menzies & Owen JJ).
It is accepted by the defendants that the plaintiff has made out a prima facie case.
Edelman J pointed out in National Bank Australia Limited v Joyce:[5]
Although the purpose of interlocutory injunction is often said to be to preserve the status quo until the hearing of the main action and although the status quo is the situation immediately before the issue of the writ seeking the permanent injunction, it has also been emphasised that the status quo can be disturbed by an interlocutory injunction and 'that the truth of the matter is that no real principles can be laid down.'
[5] National Bank Australia Limited v Joyce [2012] WASC 224 [88] applying the principle enunciated by M Leeming, R Meagher, D Heydon, Equity Doctrines and Remedies (4^th ed, 2002) 774-775.
At the time of instituting the proceedings in this matter, the status quo was that the publications and statements complained of by the plaintiff had been published by the defendants to the first defendant's clients, and to members of the public generally. In these circumstances, the effect of the notice sought by the plaintiff would not necessarily restore the status quo. However, perhaps it could be said that if the notice as proposed by the plaintiff is published the effect could restore the status quo of the plaintiff prior to November 2018, which was prior to the time the publications and statements were made.
Where a plaintiff seeks a mandatory injunction, the court must examine the form of the mandatory injunction sought which may seek to do more than to establish the status quo. The court in these circumstances must look at the nature of the injunction sought by the plaintiff and the practical consequences of the orders sought. [6]
[6] Twinside Pty Ltd v Venetian Nominees Pty Ltd [2008] WASC 110 [12] (Beech J); see also Wellard Land Holdings (WA) Pty Ltd v Barker Mortgages Pty Ltd [2018] WASC 27 [9] (Chaney J).
The question raised in this matter, is would the publishing of a notice in the form sought by the plaintiff cause prejudice to the defendants (even if anonymised, as the plaintiff says is possible) (although, I have some doubts whether that is in fact possible)).
This court is yet to determine whether the publications and statements complained of by the plaintiff are, in fact, misleading or deceptive. The point put on behalf of the defendants is that to publish a notice in the form sought by the plaintiff could create such an apprehension.
The notice is sought to be published to restore the plaintiff's status quo, (that is, for the plaintiff to be put back to the position prior to November 2018). However, if the plaintiff's action is, ultimately, unsuccessful the publication of the notice could possibly affect the first and second defendants' business and the business of the members of the fourth defendant.
The plaintiff complains that if the notice is not published, the public will be misled. The plaintiff points out that the first and/or the second defendant sent, by email, to all of the first defendant's clients, an article written by the second defendant on the industry search website, on 21 February 2019, that contained a link to the fourth defendant's website. This email is said to be misleading and deceptive.
However, I have already made the point that the court is yet to determine whether this article (among other statements complained of) is misleading and deceptive.
Further, the plaintiff concedes that the fourth defendant has modified all relevant documents on its website to comply with the interim interlocutory orders made by the court on 13 and 30 March 2019, so that if a client, or potential client, of the plaintiff views one of the emails, and they click on a link, they will be taken to a website that contains information that complies with the orders of the court.
I accept the plaintiff's submission that it is in the public interest that members of the public not be misled or deceived by statements of a seller, either sent to the seller's customers or placed on a seller's website or a manufacturer's website, or on the website of an association of sellers or manufacturers. However, as the first and second defendants' counsel points out, this is not a case where the statements or representations complained of raise an issue going to the safety of the public or, indeed, to the safety of consumers of products made by the plaintiff, and the first and second defendants.
As counsel for the first and second defendants also points out, there is no direct evidence before the court that the plaintiff has, in fact, lost customers or potential customers as a result of the representations and publications the subject of the plaintiff's case. However, I accept the plaintiff's submission that there is a real prospect that it may have done so.
Balancing the interests of the plaintiff and the interests of the first, second, and fourth defendants and, in particular, any prejudice that might be suffered by them, I have had regard to the possibility of damage to the defendants' reputation and their business, balanced against any damage to the plaintiff's business if the members of the public are not aware that the plaintiff has instituted proceedings claiming that statements and representations made about 'industry standards' for spill kits in Australia are misleading and deceptive.
I am not satisfied that damages would be an adequate remedy for any of the parties. Any assessment of whether the plaintiff has lost business because of emails that have been sent and documents published on the website between 27 November 2018 and when orders were made by the court on 13 March 2019 and 30 March 2019, is not known. It is not suggested that any of the defendants have breached the orders made by the court on those dates. Further, it is clear that the fourth defendant has made changes to its website, at least by 1 April 2019, to comply with the orders of the court.
Any assessment of damages, resulting from the effect of the statements and representations is, as counsel for the plaintiff points out, an issue that goes to causation and is an issue which is relevant to all parties. It would be very difficult and, perhaps, impossible to establish causation between any loss of business from customers or potential customers, by any of the parties. In particular, the defendants would find it difficult to establish causation between any loss of business with existing customers, or potential customers, and the effect of the contents of a notice which simply refers to the fact of these proceedings and the matters pleaded by the plaintiff. Yet, as counsel for the defendants say, the reading of the notice could result in a perception that 'where there is smoke there is fire'.

In any event, if the plaintiff is successful in this action it will be open to the plaintiff, as pleaded in the amended statement of claim, that the first, second and fourth defendants publish a corrective statement, in a form either to be determined by the court, or as agreed by the parties.
For these reasons, I made the orders as proposed by the plaintiff in its amended minute as proposed in orders [1], [2] and [3]. Following a concession made by counsel for the plaintiff, I made the following additional order:
4.Nothing in order 3(i) or in any other of these orders prohibit the first, second and fourth defendants from publishing the phrase 'A Voice for The Spill Control Industry'.

ANNEXURE

Attachment A

1.On 12 March 2019, Global Spill commenced proceedings in the Supreme Court of Western Australia alleging, amongst other things, that Spill Station Australia Pty Ltd (Spill Station), Ausspill Association Limited (Ausspill) and Mr Nathan Cartwright, through the publication of certain materials online (by email and on various websites), had engaged in misleading or deceptive conduct in contravention of the Australian Consumer Law.
2Global Spill alleged that certain statements contained in the materials had the effect of representing that a document published by Ausspill, and described as ASCIS 2695, is:
a.an Australian Standard;
b.an Australian Industry Standard; or
c.an Industry Standard,

for spill kits sold and/or manufactured in Australia (Publications).
3.Each of Spill Station, Ausspill and Mr Cartwright dispute that any of the Publications are misleading or deceiving.
4.At the time of commencing proceedings, Global Spill also sought urgent injunctive relief requiring the Publications be removed and the defendants be restrained from making any further statements to the effect of, or conveying the impression that, there were in existence standards of the kind described above.
5.On 13 March 2019, the Supreme Court of Western Australia made the attached interim orders in favour of Global Spill (First Orders). In essence, the First Orders placed temporary restraints on AusSpill, Spill Station and Mr Cartwright from, amongst other things, making any further statements to the effect of, or which conveyed the impression of, those matters identified in paragraph 1 above.
6.On 20 March 2019, the Supreme Court of Western Australia made further orders, effectively extending the restraints imposed by the First Orders but in slightly narrower terms until 11 April 2019. (Second Orders).
7.On 11 April 2019, the Court extended the restraints (again slightly modifying the form of the restraints) until trial. The Court also made additional orders which, amongst other things, required the defendants to publish this notice (Third Orders).
8.In making the First, Second or Third Orders, the Court did not determine whether any of the Publications were misleading or deceiving. That will be determined at trial, the dates for which have not been set.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
EH
Research Associate/Orderly to the Honourable Justice Smith
2 MAY 2019