L. Grollo & Co Pty Ltd v Permacon Floors Pty Ltd

[1977] FCA 24

IN THE FEDERAL COURT	)
) No. VG 2 9 of 1977

OF AUSTRALIA 1

B E T W E E N :

L. GROLLO & CO. PTY. LTD. - Plaintlff

and

PERMACON FLOORS PTY. LTD. RAYMOND W1LLIN.I

PLANT SHIRLEY LWRGARET PLANT R.W. PLANT

PTY. LTD. GIOVANNI ATTISTA SCANU and	Defendants
ANDREW LAWSON

ORDER

JUDGE MAKING ORDER: Northrop J. In Chambers

DATE OF ORDER: 18th May 1977

Melbourne MADE: WHERE

m

m	IT IS ORDERED THAT:
1. The statement of claim endorsed on the wrlt be struck

out and that the plalntiff's action	be dismissed with
costs to be taxed.

2 . That the summons dated 5th May, 1377 taken out by the

plaintiff be dlsmissed with costs to be taxed.

3 .	That the matters were proper for	the attendance of
Counsel in Chambers.

. I N THE FEDERAL COURT )

1 No. VG 29 o f 1 9 7 7

OF AUSTRALIA	1
B E T W E E N :

L. GROLLO L CO. PTY. LTD. P l a l n t l f f

and

PERMACON FLOORS PTY. LTD. RAYMOND WILLIAM

PLAKT SHIRLEY MARGAXET-LAXT R.W. PLANT

PTY. LTD. G I O V A N N I ATTISTA SCANU and Defendants

ANDREW LAWSON

JUDGMENT NORTHROP 3 . I N CHAMBERS 18TH MAY 1 9 7 7

On 29th J u l y , 1 9 7 6 , t h e p l a i n t l f f ( h e r e i n a f t e r c a l l e d

"Grollo") commenced proceedings by w r l t of summons a g a l n s t t h e

de fendan t s I n t h e A u s t r a l i a n I n d u s t r l a l C o u r t . P u r s u a n t t o

Sec t ion 3 , Federa l Court of Aus t r a l i a (Consequen t l a l P rov l s lons )

A c t 1976, the proceedings were t r a n s f e r r e d t o the Fede ra l Cour t

of A u s t r a l i a on 1st February, 1 9 7 7 . The p r o c e e d l n g s a r e t o b e

conducted I n accordance wi th the R u l e s o f t h e Hlgh Court; s . 3 8 ,

Federa l Cour t of A u s t r a l i a A c t 1 9 7 6 , Order 2 r.1, Federa l Cour t

o f A u s t r a l l a Rules and Regs. 78L and 78P of t h e C o n c l h a t i o n a n d

Arb i t r a t lon Regu la t lons .

Th i s i s t h e r e t u r n o f a summons t aken o u t by t h e f l r s t

fou r de fendan t s s eek lng o rde r s t ha t pa rag raphs 1 5 t o 4 1 l n c l u s i v e

of the s ta tement of c la lm endorsed on the w r l t be s t ruck ou t on

t h e g r o u n d s t h a t t h e same are unnecessary or scanda lous o r t end to

p r e j u d i c e , e m b a r r a s s , o r d e l a y t h e f a l r t r l a l of t h e a c t l o n o r

a l t e r n a t i v e l y , on t h e g r o u n d s t h a t t h e same do no t d l sc lose a

reasonable cause o f a c t l o n , a n d f u r t h e r or I n t h e a l t e r n a t l v e ,

Y t h a t a l l f u r t h e r p r o c e e d i n g s I n t h e a c t l o n b e s t a y e d . Heard

c o n c u r r e n t l y w l t h t h a t s m o n s was a n a p p l l c a t i o n on s m o n s by

I Grollo t h a t It have leave t o ~ o l n the Master Bul lders Assoc la t lon

of Victorla ( h e r e i n a f t e r c a l l e d t h e "M.E.3.V.") and the Australian

I n s t i t u t e of B u i l d i n g ( h e r e m a f t e r c a l l s d t h e " R . I . B . " ) a s

d e f e n d a n t s t o t h e w r i t and t o amend the s t a t emen t o f c l a lm

Y

endorsed on the w r i t by s u b s t i t u t i n g t h e r e f o r a new statement of

claim. A t t h e h e a r i n g , Mr. Heerey of Counse l appeared for t h e

f i r s t f o u r d e f e n d a n t s a n d Mr. Hercules, S o l l c l t o r , a p p e a r e d f o r

1 Grol lo .

. / 2 . .

- 2 -

The o t h e r two defendants d id not appear .

I n s u p p o r t o f t h e summons t aken ou t by h l s c l i e n t s ,

M r . E e e r e y r e l i e d upon t h e High Court R u l e s 0.20 r . 2 9 , s t r l k i n g

o u t pleadings and 0.26 r .18 , s t r i k l n g o u t p l e a d l n g s w h e r e no

reasonable cause o f ac t ion d i sc losed . Reference may be made a l s o

t o 0.63 r . 2 , s tay of proceedings on the ground of abuse of process .

The p r i n c l p l e s t o b e a p p l i e d t o a p p l l c a t l o n s o f t h i s

k ind are s t a t e d by Barwlck , C . J . i n General Steel I n d u s t r i e s I n c .

v Comnissloner for Rallways (N.S.W.) and o the r s ( 1 9 6 9 ) 112 C . L . 3 .

125, a t pages 128 to 1 3 0 and I q u o t e t h e following e x t r a c t s :-

"The p l a i n t l f f r ~ . g h t l y p o l n t s o u t t h a t t h e j u r l s d l c t l o n

summarily t o t e r m l n a t e a n a c t i o n i s t o b e s p a r i n g l y

employed and 1s n o t t o be used except i n a c l e a r c a s e

where the Court 1 s s a t i s f l e d t h a t It h a s t h e r e q u l s l t e

m a t e r i a l a n d t h e n e c e s s a r y a s s i s t a n c e f r o m t h e p a r t l e s

to reach a d e f l n i t e and c e r t a l n c o n c l u s i o n . I have

examlned the case law on t h e s u b ~ e c t , t o some of whlch

I was r e f e r r e d i n argument and t o whlch I append a l l s c

o f r e f e r e n c e s . ...... I t is s u f f i c i e n t f o r me t o s a y

t h a t t h e s e c a s e s u n i f o r m l y a d h e r e t o t h e vlew t h a t t h e

p l a i n t i f f o u g h t n o t t o b e d e n l e d access to the cus tomary

t r i b u n a l w h l c h d e a l s w i t h a c t i o n s of the k lnd he b r lngs ,

u n l e s s h l s l a c k o f a cause o f ac t lon - i f t h a t b e t h e

ground on which t h e c o u r t i s i n v l t e d , a s I n t h l s c a s e ,

t o exercise Its powers of summary dlsmlssal - 1s c l e a r l y

demonstrated. The t es t t o be app l l ed has been va r lous ly

expressed; "so obv ious ly un tenab le tha t it cannot

poss ib ly succeed" ; "mani fes t ly g roundless" ; "so m a n l f e s t l y

f a u l t y t h a t It does not admlt of argument"; "dlscloses

a case which the Court 1s s a t l s f l e d c a n n o t s u c c e e d " ;

"unde r no poss lb i l i t y can the re be a good cause of

act ion"; "be man l fe s t t ha t t o a l low them" ( the p l ead lngs )

" to s t a n d would Involve usless expense". ......

Dixon J. (as he then was) sums up a number of a u t h o r l t r e s

i n Dey v Vlctorian Rallways Commlssloners ( 1 9 4 9 ) 78 C . L . R .

62 where he says a t p.91: "A c a s e m u s t b e v e r y c l e a r

i n d e e d t o j u s t l f y t h e summary l n t e r v e n t i o n o f t h e c o u r t

t o p reven t a p l a l n t l f f s u b m l t t i n g h l s case f o r

de t e rmina t lon In the appo in ted manner by t h e c o u r t w l t h

or wi thout a J u r y . The f a c t t h a t a t r a n s a c t l o n i s

i n t r i c a t e may n o t d l s e n t l t l e t h e c o u r t t o examlne a

cause of a c t i o n a l l e g e d t o grow o u t o f It f o r t h e

purpose o f see ing whether the p roceedlng amounts to an

abuse o f p rocess o r 1 s vexa t lous . B u t once it appears

t h a t t h e r e 1s a r e a l q u e s t l o n t o be l istennlned whether

o f f a c t o r law and t h a t t h e r l g h t s o f t h e p a r t i e s d e p e n d

upon It, then It 1 s n o t compe ten t fo r t he cour t t o d l smls s

t h e a c t l o n as f r ivo lous and vexat ious and an abuse of

process ." Although I can agree wlth Latham C . J . l n t h e

same case when he sa id tha t t he de fendan t shou ld be saved

from the vexat lon of t h e c o n t l n u a n c e o f u s e l e s s a n d f u t i l e

. / 3 . . .

- 3 -

proceedings at p.84, in my opinion great care must be

1 exerclsed to ensure that under the gulse of achlevlng

expeditious flnality a plalntlff 1 s not lmproperly

deprived of hls opportunity for the trial of hls case

by the appolnted trlbunal. On the other hand, I do not

think that the exerclse of the ]urlsdlctlon should be

reserved for those cases where argument 1s unnecessFry

to evoke the futllity of the plalntlff's clalm.

Argument, perhaps even of an extenslve klnd, may be

necessary to demonstrate that the case of the plaintlff

is so clearly untenable that It cannot posslbly succeed."

See also Heldt v Chrysler Australla Llmlted a declslon of the

Australian Industrial Court glven on 22nd November, 1976.

In the present case, I express no oplnlon on the nature

or extent of any lnherent power the Federal Court of Australla

may have to prevent an abuse of its process, see R.V. Forbes

ex parte Bevan (1972) 127 C.L.R. 1.

The statement of clalm endorsed on the wrlt is confused,

I verbose and difflcult to follow. It fails to comply wlth the

High Court Rule 0.21 r.2 in that It does not allege the facts

upon which it is claimed that the matter 1s one wlthln the

origlnal jurisdlctlon of the Federal Court. Thls has made

difficult the task	of identlfylng the causes,of actlon contained
in it.

Paragraphs 1 to 12 deal wlth formal matters. They allege

that the first defendant (herelnafter called "Permacon") 1 s a

company incorporated in Victorla, the second and thud defendants

are dlrectors of Permacon, the fourth and flfth defendants are

shareholders of Permacon and the slxth defendant (herelnafter

called "the Arbltrator") 1s an arbltrator nomlnated by the Presldent

of the M.B.A.V. Paragraph 7 alleges that the second, thlrd and

i

fifth defendants, and the Arbltrator are corporations for the

purposes of the Trade Practlces Act 1974. No such allegatlon 1s

! -

made against Permacon. Paragraph 8 alleges that Grollo is a

builder and is and at all materlal times was a structural concrete

contractor. Paragraphs 9 and 12 allege that the M.B.A.V. 1s an

i

organlsation registered under the Conciliatlon and Arbltratlon Act

1904 and, together wlth other assoclations ln other Australlan

States and Territorles, forms part of the Master Bullders

Federatlon of Australla Inc. Paragraphs 10 and 11 pllege that

./4..

- 4 -

Grollo is not and never has been a member of the M.B.A.V. and

that Permacon is and was at all material tlmes a member of the

M.B.A.V. At the hearlng of the summons an Affldavit was tendered

on behalf of Permacon stating that at the tlme of the maklng of

the Agreement hereinafter referred to (23rd October, 1974) the

issue of the wrlt of summons and at the present tlme Permacon

was not and is not a member of the M.B.A.V. Mr. Hercules dld not

accept this claim and so an issue of fact arlses. Having regard

to the nature of the proceedings before me, I make no finding on

this issue but proceed on the basis of the allegatlon contained	in
the statement of clalm.

a

There is no paragraph 13 to the statement of clalm but

paragraph 14 alleges that Permacon held ltself out at all materlal

e	times to be a specialist in "hard wearing, heavy duty concrete floors". At the hearlng Mr. Hercules clalmed that this allegation
formed the basls for a clalm under s.52, Trade Practices Act, but
this is not adverted to In the statement of clalm.

Paragraph 15 alleges that on 23rd October, 1974 GrJllo and

Permacon entered into a written agreement (hereinafter called "the

a	Agreement"). At the hearlng before me the partles tendered and
relied upon the terms contllned In the Agreement. The Agreement
1s called a sub-contract document and is on a form complled by the
a	Exchange and Contracts Committees of the M.B.A.V. It is marked
"Copyright". The form of the Agreement 1s one In common use and 1s
drawn to deal with the sltuatlon where a builder has entered into
a head contract and then sub-contracts part of the work to be
carried out by the builder under the head contract to the sub-
contractor. In the present case, Grollo is the bullder and Permacon
is the sub-contractor. The recitals to the Agreement state that
Grollo has entered into a bulldlng contract with a proprletor to
build certain works ldentlfled by reference to the head contract
and has requested Permacon, as sub-contractor, to carry out and
complete In accordance with the provlslons of the head contract,
certain works described in the Agreement as :-

"provide trowel hands to finlsh concrete wharehouse floors

and partplace and screed concrete. if required, 'lace

sand, polythene and mesh to ground slabs.

2

Sand	@ 20 cents /K
Polythene	@ 10 " / "
Mesh	@ 25 " / I' ./S..

- 5 -

Tender documents to be attached as part of this document."

The sub-contract sum as stated ln the Agreement 1s as follows :-

"plrce and finish concrete to warehouse slab at $1.55

per m2. Place and screed concrete at 90 cents per m*. "

Under the "rise and fall" clause of the Agreement, the method

of adjustment is stated as follows :-

"firm to December 24th then any rises in wages there-

0 after to apply to unfinlshed work."

The Agreement contains all the normal clauses to be

a found in a contract of thls type Including Clause 3 8 relatlng

to arbltration. Under thls clause, Permacon had the beneflt of any remedy at arbitration that Grollo had under the head contract and Grollo was required to do all thlngs necessary to give effect

to the rights of Permacon. Further the clause provided that If

any dlspute or dlfference arose between Grollo and Permacon as

to certain ldentified matters, that dlspute or difference would

a be submitted to arbitration by a named person, or If that person

refused to arbitrate, to the President of the M . B . A . V . or his

nominee, that the award made by the Arbitrator was to be flnal

and that neither party was entltled to commence or malntaln any

action upon the dispute or difference until the matter had been

referred to and determlned by the Arbitrator.

Paragraph 16 alleges that Grollo engaged Permacon to do

the work the sub~ect of the Agreement slnce the method to be used

was new to Grollo and Permacon "was alleged and held ltself out

to be the expert in the fleld".

Paragraphs 17 to 21 describe the Agreement and refer In

detall to a number of the terms and condltlons contalned in it

including the arbltration clause, allege Permacon worked on the

project but falled to complete the work and that the work was

badly performed whereby Grollo suffered loss and damage.

Paragraphs 22 to 26 allege facts purporting to be the basis

for a claim for damages under Division 2 f Part V of the

./6.. .

- 6 -

Trade Practices Act but at the hearing Mr. Hercules conceded

that Grollo was not a consumer wlthin the meaning of that word

as used in that Division and therefore these paragraphs disclose

no cause of action against the defendants or any of them - see

s . 4 ( 3 ) and ( 4 ) Trade Practices Act.

Paragraphs 27 to 29 allege facts whlch purport to be the

basis for a claim for damages and or in-junctions agalnst the flrst

five defendants based on a common law conspiracy to do acts contrary

to unspecified provlsions of the Trade Practlces Act. At the hearing these provisions were ldentifled as Sectlons 4 5 and 4 6 of

the Act and possibly Sections 5 2 and 5 3 of the Act. NO particulars

are given as to when these alleged facts occurred or when the

alleged consplracy took place. Partlculars glven lnclLtde the use

of telephones as a method by which the consplracy was conducted and

allege also that as a result of this conspiracy, Permacon gave

notices of dispute under Clause 38 of the Agreement and that the

Presldent of the M.B.A.V. had nominated the Arbltrator to arbltrate

on the matters in dlspute.

Paragraphs 30 and 3 1 refer to a letter dated 23rd June,

1976 from the Arbitrator to Grollo and Permacon statlng that the

Arbitrator had agreed to arbitrate and setting out the condltions

under which he would so act including a statement that hls fees

would be in accordance with the scale of charges approved by the

A.I.B., namely not less than $ 3 5 per hour plus all out-of-pocket

expenses and that the prellminary hearing before hlm would commence

on 2nd July, 1976.

Paragraphs 32 to 35 claim that Grollo 1s not prepared to

accept the declsion of the Arbitrator as "flnal and bindlng" and 1s

not agreeable to pay the fees charged by him, that Clause 38 of

the Agreement ousts the jurisdictlon f the Federal Court, that

Permacon will be at an advantage because it is a member of the

M.B.A.V. while Grollo is not (bias) and that Clause 38 1s a

violation of unspeclfied provlsions of the Trade Practlces Act In

that it purports to glve powers to the President of the M.B.A.V.

over Grollo which is not a member of that Assoclation.

Paragraph 36 alleges the absence of any clearancc or

authorisation under the provisions of the Trade Practlces Act

. / l . . .

- 7 -

obtained by Permacon for or in respect of the Agreement.

Paragraph 37 alleges a contract or consplracy between

the Arbitrator and the A.I.B. and its members to "vlolate" the

Trade Practices Act in relation to price fixing.

Paragraphs 38 to 40 refer to appllcatlons for clearances

and authorisations made by the M.B.A.V. then pendlng before the

Trade Practlces Commission but allege that those proceedlngs do

not permit or allow the conduct alleged agalnst 'the defendants.

Paragraph 41 clalms a return of moneys, totalllng

$19,468.50, pald by	Grollo to Permacon under the terms	of the
Agreement.

The specific claims made by Grollo are obscure. They

include the seeking of declaratlons that the defendants have

violated various unspecifled provlslons of the Trade Practices Act

and should be restrained from further breaches, orders restralnlng

the Arbltrator from proceedlng wlth the hearlng

of the arbitratlon

and that he be dlsquallfled from hearing the arbitratlon, and orders

declaring that Grollo is not indebted to Permacon and that Permacon

l.

I	Se directed to re-pay the $19,468.50 to Grollo, an order that the
I	I
Agreement, or an unspecified part of it, be declared vold or
illegal or that Grollo be at liberty to rely upon the condltlons and warranties contalned in the Trade Practices Act, a declaration that Grollo be at llberty to proceed, in an appropriate Court, to
recover from Permacon such amount as Permacon owes to It wlthout
first obtalnlng an award from the Arbitrator, that the clearances
and authorities do not authorise the "aforesaid vlolatlons" of the
Trade Practlces Act, that Clause - 38 of the Agreement is void and
of no effect and orders varylng the terms of the Agreement in such
manner as the Court considers just and equitable.

Under Section 19 Federal Court of Australla Act 1976,

the Federal Court has such original jurlsdiction as 1s ve ted in

it by laws made by the Parliament, being jurisdictlon In respect

of matters arisiI!g under laws made by the Parliament. Sectlon 86

i Trade Practlccs Act 1974 1s as follows :-

./E.. .

- 8 -

" 8 6 . Jurisdlction is corLferred on the Court to hear

and determlne actions, prosecutions and other

proceedings under this Part and that jurlsdictlon is

exclusive of the jurisdiction f any other court,

other than the ~urisdiction of the High Court under

section 75 of the Constitution."

i

i

I	In that Act, "Court" is deflned as meaning the Federal
!

!	Court of Australia.	Part VI of the Trade Practlces Act is headed
I

l "Enforcement and Remedles". Section 8 2 provides that a person who

suffers loss or damage by an act of another person that was done

!

i	amount of the loss or damage by action against that other person.
in contraventlon of a provision of Part IV or V may recover the
I*	Sectlon 80 empowers the Court, on the appllcatlon of any person,
l
i	to grant an in~unctlon restralnmg a person from engaging in conduct
that constitutes or would constitute a number of specifled matters
including :-

"(a) a contravention of a provision of Part IV or V

(j) consplring with others to contravene such a

i	1	provision.	"
4
!

i	Section 8 7 provldes that where in a proceeding lnstltuted under
l
Part VI the Court finds that there has been a contraventlon of a
i @	provision of Part IV or V, the Court, in addition to granting an
1	l ; *	injunction or orderlng the payment of damages, may make such
ancilliary orders of a type speclfled to redress ~ n ~ u r y caused
:	by the conduct to whlch the proceedlng relates.
:

1 For present purposes, reference may be made to Sectlons 4 5

i and 4 6 as contained in Part IV of the Act and Sectlons 52 and 53

as contained In Dlvision 1 of Part V of the Act. It is sufficient

i	to quote Sectlon	4 5 ( 2 )	:-
i	l

"45. ( 2 ) A corporatlon shall not -

(a)	make a contract or arrangement, or enter into
an understandlng, in restraint of trade or

commerce; or

(b) glve effect to a contract, arrangement or

understandlng to the extent that it 1s in

restraint of trade or commerce, whether the

contract or arrangement was Fade or the

understanding was entered tnto before or

after the commencement of this sub-section."

Other provlslons of Section 4 5 exclude certain types of contracts,

arrangements or understandings from the prohibition contamed in

!

Section 4 5 ( 2 ) . Sectlon 4 6 of the Act prohlblts certaln conduct by

a corporation In relation to monopollsatlon. Sectlon 5 2 ( 1 )

provides : -

" 5 2 . ( l ) A corporatlon shall not, in trade or commerce,

engage in conduct that 1s misleading or deceptlve."

Section 5 3 prohlblts a corporation, In trade or commerce,

from making specified types of false representatlons. Reference

should be made also t Section 79 contained in Part VI of the Act.

See also R.V. Australian Industrlal Court ex parte C.L.M. Holdlngs

i

Pty. Ltd., a decision of the Hlgh Court delivered on 10th February,

1977.

Durlng the course of the hearlng Mr. Hercules made

:

submissions to the effect that provided an indlvldual person made

use of postal, telegraphlc or telephonlc services, that lndlvidual

!	would be a corporation for the purposes of the conduct proscribed
!
!	by Sections 4 5 , 4 6 , 5 2 and 5 3 of the Trade Practices Act. Those
i .	submisslons were made desplte the provlslons f Sectlon 6 ( 3 ) of the
Act and despite the views expressed in ex parte C.L.M. Holdings Pty.
!	Ltd. - (supra) and Strlckland v Rocla Concrete Pipes Llmlted (1971)
:	1 2 4 C.L.R. 4 6 8 . In my opinion these submlssions, even If accepted,
are of no assistance to Grollo In these applicatlons and I do not
I	express any vlew on thelr validlty. Likewlse the evldence submltted
on behalf of Grollo relatlng to the delay of the lrst four
defendants In the making of their appllcation and the events
occurrlng immedlately prlor to the lssue of their summons, are not relevant to the issues presently before me.

The immedlate issues between Grollo and Permacon arlse

from a normal bulldlng contract contalnlng the normal terms and conditions. A s is not uncommon under buildlng contracts, allegatlons

of bad workmanshlp are made by Grollo and Permacon clams payment

for work done. Grollo seeks redress for the bad workmanship. Under

the terms of the Agreement these matters must, as a condltion

precedent to actlon being taken in Courts of law, be determlned ny

the Arbitrator, generally see paragraphs 15 to 21 of the statement

of claim. These are matters which frequently come before the Common

./10.. -

- 10 -

Law Courts and the legal	principles to be applied are clear.
The normal issues relate	to questions of fact only, All the terms

of the Agreement between Grollo and Permacon are clearly stated in

the Agreement including the rates to be charged for the work done

by Permacon. There 1s no basis for saying that of themselves these

paragraphs raise matters which come within the jurisdlctlon of the

Federal Court.

It is important to note the chronologlcal order of events.

The Trade Practices Act 1974 was assented to on 24th August, 1974

and Sections 1 and 2 came into operation on that day. Apart from

Sections 55, 45(1) and (21, 47(1) and 49 (l), sublect to certain

exceptions, the other sections of the Act came into operation

1st October, 1974, Sectlon 2(3), (4) and (5). Sections 45(1) and

(2), 47 (1) and 49(1) came into operatlon on 1st February, 1975

while Section 55 came lnto operation on 27th September, 1975. The

Agreement between Grollo and Permacon was entered into on

23rd October, 1974.

It is difflcult to know what cause of actlon is claimed

on the basis of the facts contained in paragraphs 14 and 16 of the

statement of claim. Nowhere is there any allegatlon that Permacon

is or was not a speclalist in "hard wearlng, heavy duty concrete

floors" nor was not an "expert In the fleld of the method of

concretlng and finishing the concrete floors" the sub~ect of the

Agreement. Nowhere is there an allegatlon that Permacon engaged In conduct that was misleading or deceptlve wlthin the meanlng of Sectlon 52 of the Trade Practlces Act. In any event, any such conduct would have had to be engaged In by Permacon between 1st and 23rd October, 1974. There is certainly no suggestion that Permacon was engaged in any such conduct at the time of the Issue of the writ.

NO submission was put to me which dlsclosed any cause of action

within the jurisdiction of the Federal Court.

It is difflcult to ascertain the baels of any clam based

upon the conspiracy allegations contalned 1 1 1 paragraphs 27 to 29

of the statement of claim. They do not appear to be dlrected to the validity of the Agreement entered into between Grollo and Permacon. They do not relate to future conduct by the Y.B.A.V. and its members.

Section 82, Trade Practlces Act confers no ~ur~sdictlon on the

Federal Court to award damages for conspiracy. Under Section 80,

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conduct constltuting conspiracy with others to contravene a

provision of Part IV or V of the Act may ~ustlfy the grantlng of

an injunction to restrain further such conduct. Thls 1 not belng claimed here. In any event, the M.B.A.V. 1 s not a party to these proceedings.

The matters referred to In paragraphs 30 to 35 of the

statement of claim do not come wlthln any cause of actlon created

by the Trade Practlces Act and coming withln the ~urisdiction of

the Federal Court. They relate to matters that frequently come

before the Common Law Courts which have clearly stated the prlnclples

of law to be applied. The Federal Court has no ~urlsdlctlon over

matters whlch it 1s alleged the defendants are attempting to oust.

Llkewlse the allegatlons relatlng to clearances and authorlsations

and contained In paragraphs 36, 38, 39 and 40 of the statement of

claim have no relevance to any matters ralsed which are withln the

! ,

~urlsdlctlon of the Federal Court.

Paragraph 37 of the statement of claim does not raise any

issue be:ween Grollo and the first four defendants. Insofar as it

-I

? relates to the fees to be charged by the Arbitrator that cannot

affect the valldlty of the Agreement between Grollo and Permacon.

Finally, paragraph 41 of the statement of clalm does not raise any

matter wlthln the jurisdictlon f the Federal Court.

It follows therefore that, in my opinlon, the statement

of claim does not dlsclose any reasonable cause of action wlthln

the jurisdictlon of the Federal Court and 1s frlvolous or vexatlous.

Before considerlng what order should be made, It is

I necessary to conslder the applicatlon by Grollo to add the two

defendants and to amend the statement of clalm by substitutlng a

proposed new statement of clalm. Thls application is made under

Hlgh Court Rules 0.16 r.4 and 0.29 rr.1 and 2. It remalns true

however that under the proposed statement of claim the maln lssue

between Grollo and Permacon remalns the same namely their rlghts

and obligatlons under the Agreement of 23rd October, 1974.

By adding the two proposed defecdants, namely the M . B . A . V .

and the A.I.B., Grollo is attempti-ng to wise11 any cause of action it mlght have against he present defendants to Include claims for

. /12. . .

orders directed to the propcsed defendants and dlrected to many

of the activities of those two assoclations. In my opinlon, it 1 s

not appropriate that those two associatlons be ~olned to proceedlngs

!

in which the statement of claim discloses no cause of actlon agalnst

the defendants to that actlon and where the Issues proposed to be

raised extend far beyond the limited matters affecting the rlghts

and obligations arising from the Agreement between Grollo and

Permacon. I therefore refuse that part of the appllcatlon	by Grollo
to add the two proposed defendants.

It is not necessary to consider in detail the terms of

: e the proposed statement of clalm. It contains allegatlons against

each of M.B.A.V. and A.I.B. Paragraphs 17 to 23 purport to found

a cause of action based upon Section 52 Trade Practlces Act but

m	again in relation to the Agreement of 23rd October, 1974. Paragraphs
I
2 4 and 25 allege the conspiracy while paragraphs 26 to 35 allege
facts which may be relevant generally to a cause of ctlon agalnst
the associations based on Sections 45 and 46 Trade Practlces Act
rather than agalnst Permacon and, in particular, relate to future
conduct. Paragraphs 36 to 40 relate to the arbitration and
allegations of oustlng the jurlsdlction f the Federal Court whlle

a	Arbltrator. Paragraphs 41 to 58 relate to allegations of conspiracy
paragraphs 59 and 60 relate to allegatlons of bias agalnst the
to flx prices and again relate to future conduct. Havlng regard to
my flndlng that the present statement of clam does not dlsclose a
a	reasonahls cause of actlon against the exlstlng defendants and 1
frivolous and vexatious, having regard to my refusal to glve leave
to Grollo to add the M.B.A.V. and the A.I.B. as defendants and
having regard to the form of the proposed statement of clalm framed
as It is on the basis of two added defendants and thelr future
conduct, I refuse leave to the plalntlff to amend its statement of
clalm by substituting for it the proposed statement of claim.
Finally, It is necessary to conslder what order should be made on the summons issued by the flrst four defendants. On
the findings already made, under High Court Rules 0.26 r.18, I
strike out the whole of the plaintiff's statement of claim. Under
the same rule there is power to order that the actlon be dlsmlssed.
I have already exprcssed the vlew that the IFsues between Grollo and
Permacon are ones which frequently arlse in the Common Law Courts.
I am conscious of the fact that Grollo, In attempting to flnd

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causes of action against Permacon based upon the Trade Practices Act,	-
is seekmg to avold its obligation freely entered into on 23rd October, 1974,and in particular to avoid the submisslon f

!	the matters In dispute between itself and Permacon to the Arbitrator and, subject to common law, to abide the result of that submisslon.
The argunents addressed to me in support of the ~urlsdlction of the
Federal Court and based on the statement of claim are, in my opinion,
manifestly groundless. To allow the proceedings to continue would, in my opinion, involve useless expense. In all the clrcumstances,
I am of the oplnion that the proper course is to d mlss the
plalntlff's actlon agalnst all defendants.
ORDERS

On the summons issued on behalf of the flrst four

defendants, I strike out the whole of the plaintlff's statement

of claim and dismiss the plaintlff's actlon with costs to be taxed.

The summons lssued on behalf	of the plalntiff is	dismissed with
costs to be taxed.
I certify for Counsel.