Loyalty Pacific P/L v Jewel Food Stores P/L

[1994] FCA 999

I

997

JlpGMENT NO. ....,.,....,,.... I , ,

IN THE FEDERAL COURT OF AUSTRKGIA

VICTORIA DISTRICT REGISTRY	No. VG 426 of 1994
GENERAL DIVISION)
B E T W E E N :

LOY?iLTY PACIFIC PTY LIMITED

Applicant

- and -

JEWEL FOOD STORES PTY LIMITED

Respondent

JUDGE :	Heerey J
DATE:	1 December 1994
PLACE :	Melbourne

EX TEMPORE REASONS FOR JUDGHENT

I have listened carefully to the thorough argument

Mr Harrowell has advanced, but I see no basis for discharging the injunction I made yesterday. As I said in the course of argument, there is no doubt that there is plenty of room for argument as to the benefit of the Fly Buy scheme, and the value in money terms of it to various hypothetical consumers may vary. It may well be that some people are better off buying groceries at a cheaper supermarket like Jewel. But that is not really the point of this case.

There was an advertisement which contained a very specific

claim, namely that according to the Department of Consumer

Affairs in one Fly Buy program you would have to spend around

$17,000 over four years to earn one Melbourne to Sydney return

ticket. The respondent in no way resiles from that assertion.

It has not, for example, urged upon the Court the alternative

of ,an advertisement in the next few days excluding that

offending sentence. More importantly, to my mind, the

respondent has been on notice since well before these

proceedings were commenced that the applicant alleged the

advertisement was misleading and-deceptive. If the

advertisement was prepared on the basis of an actual statement

by the Department of Consumer Affairs to the effect alleged,

then it would have been a very simple matter to produce that

document, and it would have been a complete refutation of the

applicant's claim.

What has happened is that the respondent has produced a large number of press cuttings and the like, but nothing resembling a statement of the kind referred to in the advertisement. On the face of it, and I stress that I am deallng with this on an

interlocutory hearing, and not making any final decision, it

would appear that the advertisement was prepared to convey the

appearance of recording an authoritative statement by the

Department, without any basis at all.

The advertisement was solely concerned with an attack on the applicant's Fly Buy scheme. Therefore the injunction does not have the effect of - as it was put - "knocking Jewel out of the pre-Christmas traden. No doubt Jewel has its ordinary advertising program and that of course is quite unaffected by this injunction.

There was mention of the consumer interest, but I think here

the consumer interest coincides with that of the competing

trader. The consumer is entitled to expect marketing

information and advertising that is accurate, so that choices

that are made are not made as a result of misleading or

deceptive conduct.

Because there is room for almost endless argument as to who are "typical" consumers, and how much they would need to spend to benefit from the Fly Buy Scheme, a statement purporting to come from an authoritative and independent body like the Department of Consumer Affairs would have all the more impact. There is special importance for consumers and competitors alike in the truthfulness of such a statement.

I do not see any significance in the fact that the Federation of Australian Commercial Television Stations (FACTS) has approved the advertisement and declined to revoke its approval. While I accept that FACTS is an independent body and in some circumstances its approval may be relevant, it is clear that its approval in terms is made subject to the Trade

Practices Act. There is no suggestion that FACTS engaged in

an inquiry of the nature which this Court has to in

ascertaining whether the statements made in the advertisement

are factually correct.

So for those reasons I decline to discharge the injunction. I will reserve the costs. In a sense this is in substance really a continuation of yesterday's hearing.

I certify that this and the

preceding 3 (three) pages

are a true copy of the

reasons for judgment of his

Honour Mr Justice Heerey.

Auuearances

Counsel for the applicant:	R Merkel QC with I
Martindale
Solicitor for the applicant:	Dunhill Madden Butler
Counsel for the respondent:	J G F Harrowell
Solicitor for the respondent:	Hunt & Hunt
Date of hearing:	1 December 1994