Hella-Australia Pty Ltd v Plentium Pty Ltd

[1987] FCA 800

FEDERAL COURT OF AUSTRALIA	1
VICTORIA DISTRICT REGISTRY	1 No. VG58 of 1987
GENERAL DIVISION	1
- AND: PLENTIUM PTY. LIMITED

Respondent

CORAM : Jenkinson J.

- PLACE: Melbourne

DATE : 16 April, 1987

REASONS FOR JUDGMENT

Application for interlocutory injunction.

Each of the applicant and respondent is a company which

sells automotive parts by wholesale. The applicant sells

electrical light and signal equipment for motor vehicles and

boats. Its business is very large and the reputation of its

products is high. The respondent sells motor vehicle parts and accessories, including several dozen items of lighting equipment. The applicant sells hundreds of items of lighting equipment. The applicant sells items of lighting and electrical signal equipment to all of the five principal manufacturers of motor cars in

Australia as well as to others who in the course of carrying on

their manufacturing or repairing businesses incorporate the items

into vehicles. The applicant also sells those items to persons

who sell the items by retail to consumers who in turn incorporate or procure others to incorporate the purchased items into the

consumers' vehicles. The respondent sells to the same description

of buyers. Sellers such as the applicant and the respondent

assign to each of the items they sell an identifying number.

Reference to an item of equipment by those engaged in trade in the

item, and even by some consumers who are not engaged in trade, is

often made by the number of that item. The respondent endorses on

the packaging of a number of the items of automotive lighting

-	equipment which it sells and on advertisements of those items not only the identifying number which it has assigned to the item, but
also the word "replaces" or the words "replaces for", after which
is endorsed a number assigned by the applicant to an item which the applicant sells. In each such a case the two items, that of the respondent on the packaging of which the applicant's number is endorsed and that of the applicant to which that number is assigned, have the same functions. It is the applicant's case that each of these endorsements constitutes a representation by the respondent that the item of equipment which it is offering for
-	sale (a) is of the same quality as the applicant's item, (b) is substantially identical with the applicant's item, (c) is suitable for the purpose or purposes for which the applicant's item is represented by the applicant to be suitable, and (d) may lawfully
be used fo r the purpose or purposes for which the applicant's item is represented to be suitable. The making of these
representations is said by the applicant to c nstitute
Contraventions of sections 52(1), 53(a) and 55 of the Trade Practices Act 1974.

I should hesitate to take the endorsement as amounting

to either of the representations specified in (a) and (b). As to

(c) and (a), the applicant's case is seriously arguable, in my

opinion. The endorsement may give rise, pursuant to statutory provisions such as section 71 of the Trade Practices Act , to an implication of terms, to the general effect specified in (c) and (a), of some contracts of sale of the item. And to the consumers who do not make contracts for the purchase of the item.with the respondent the endorsements may constitute representations to the effects specified in (c) and (d).

As to (a), there is evidence that examples of some five items endorsed as replacing particular items of automotive lighting equipment which the applicant sells did not on testing by

employees of the applicant function in accordance with requirements of function or specifications endorsed by the Australian Transport Advisory Council, and incorporated by reference into the legislation of Victoria and of other states, which imposes those requirements on persons who use motor vehicles

-	on public roads. Some testing of other examples of those items by
a university lecturer in optometry showed compliance with the
performance requirements of those laws, but some of those tests
also showed failures to comply. There was conflicting opinion
evidence as to whether an item of automotive lighting equipment
functioning in use in a motor vehicle in the way those of the tested items which failed to comply with the law had functioned
would constitute a danger on the public roads. The questions
which the contradictory opinions raised are not easily resolved
without much more consideration, and expert assistance, than the

Court could give, and receive, respectively on the hearing of this

interlocutory application. I am not persuaded that ny

substantial impairment of public road safety is being caused by

use of the defective items of automotive lighting equipment

marketed by the respondent. And I am certainly not persuaded that

unrestrained marketing of its products by the respondent will

cause any serious damage to the applicant. On the other hand any

injunctive restraint of the respondent's trade in the items

alleged to be defective would be likely to cause not only calculable loss of sales income but also grave injury to the respondent's reputation in the automotive parts trade. It would be very difficult if not impossible to ascertain the financial loss which such an injury would cause. On balance I think that,

i f the respondent and a director of the respondent, Peter Uve Von

Schassen, will each undertake to keep appropriate records of sales of the five items of equipment between this time and the time when the hearing of the proceeding concludes, the proper course is to refuse interlocutory relief.

fir. Hayes of counsel for the respondent has indicated

the willingness of those two persons to give' those undertakings

and accordingly interlocutory relief will be refused on their

being given. As to costs, it would seem that the appropriate

order would be, would it not, that the respondent's costs of	the
proceedings for interlocutory relief be its costs in the cause.