McCully v Sydney Trains

Case [2021] FCA 562

FEDERAL COURT OF AUSTRALIA

McCully v Sydney Trains [2021] FCA 562  

File number: NSD 507 of 2020
Judgment of: WHITE J
Date of judgment: 27 May 2021
Catchwords: PRACTICE AND PROCEDURE – application for summary dismissal pursuant to s 31A of the Federal Court of Australia Act 1976 (Cth) or r 26.01 of the Federal Court Rules 2011 (Cth) on the basis that there are no reasonable prospects of success – whether the Court has jurisdiction to hear and determine the Applicants’ claims – whether the immunity provided under s 2B of the Competition and Consumer Act 2010 (Cth) applies to the Second Respondent as an employee of the First Respondent – whether the Australian Consumer Law is engaged with respect to the Second Respondent’s conduct in making use of postal, telegraphic or telephonic services – whether the Applicants’ claim for misleading or deceptive conduct is colourable – application dismissed.  
Legislation:

Acts Interpretation Act 1901 (Cth) s 22(1)(a)

Australian Consumer Law ss 18, 50, 236

Competition and Consumer Act 2010 (Cth) ss 2B, 6, 86(1), 131

Competition Policy Reform Act 1995 (Cth) s 81

Federal Court of Australia Act 1976 (Cth) ss 19, 31A

Judiciary Act 1903 (Cth) s 39B

Trade Practices Act 1974 (Cth) ss 51AC, 52

Federal Court Rules 2011 (Cth) r 26.01

Australian Consumer Law (NSW)

Fair Trading Act 1987 (NSW) ss 27‑32

Interpretation Act 1987 (NSW) s 13A
Cases cited:

Agtrack (NT) Pty Ltd v Hatfield [2005] HCA 38; (2005) 223 CLR 251

Ahmed v Harbour Radio Pty Ltd [2009] FCA 1113; (2009) 180 FCR 313

Australian Competition and Consumer Commission v Baxter Healthcare Pty Ltd [2007] HCA 38; (2007) 232 CLR 1

Australian Competition and Consumer Commission v Jutsen (No 3) [2011] FCA 1352; (2011) 206 FCR 264

Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334

Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd [1979] HCA 15; (1979) 145 CLR 107

Bride v The Shire of Katanning [2016] FCA 65

Broken Hill Associated Smelters Pty Ltd v Collector of Imposts (Vic) (1918) 25 CLR 61

Bropho v Western Australia [1990] HCA 24; (1990) 171 CLR 1

Burgundy Royale Investments Pty Ltd v Westpac Banking Corporation (1987) 18 FCR 212

Ejueyitsi v Victorian Legal Admissions Board [2020] FCA 165

JWR Productions Australia Pty Ltd v Duncan‑Watt (No 2) [2020] FCA 236; [2020] 377 ALR 467

Lin v State Rail Authority of NSW [2004] FCAFC 219; (2004) 209 ALR 577

Mason v MWREDC Limited [2011] FCA 1512; (2011) 199 FCR 151

Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355

Rana v Google Inc [2017] FCAFC 156; (2017) 254 FCR 1

Re Telephone Apparatus Manufacturers’ Application [1963] 1 WLR 463

Roberts v Ahern [1904] HCA 17; (1904) 1 CLR 406

Seafolly Pty Ltd v Madden [2012] FCA 1346; (2012) 297 ALR 337

Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd…

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AGLC
McCully v Sydney Trains [2021] FCA 562
Case
[2021] FCA 562
Decision Date

CaseChat Overview and Summary

McCully v Sydney Trains was an application for summary dismissal of proceedings brought by the respondents, Sydney Trains and Mr Blackmore, against the applicants, Mr and Mrs McCully. The respondents sought dismissal on the basis that the applicants' claims had no reasonable prospects of success. The applicants alleged breaches of the Australian Consumer Law (ACL) by the respondents, including misleading and deceptive conduct and unconscionable conduct. The Federal Court of Australia was required to determine whether it had jurisdiction over the claims, whether the immunity provided under section 2B of the Competition and Consumer Act 2010 applied to the second respondent, and whether the ACL was engaged in relation to the second respondent's conduct. The court also had to consider whether the applicants' claim for misleading or deceptive conduct was colourable.

The court found that the respondents' application for summary dismissal failed for several reasons. The court concluded that the respondents had not established that the applicants' claims were without merit. The court held that the immunity provided by section 2B of the Competition and Consumer Act 2010 did not apply to the second respondent because the immunity only applied to corporations, and the second respondent was an individual. The court also found that the ACL was engaged in relation to the second respondent's conduct, as it involved the use of postal, telegraphic, or telephonic services, which included the use of the internet. Furthermore, the court rejected the respondents' argument that the applicants' claim for misleading or deceptive conduct was colourable, as it found that the applicants had made a genuine mistake about the basis upon which the court had jurisdiction.

The Federal Court dismissed the respondents' application for summary dismissal. The court concluded that the respondents had not satisfied the threshold requirement for summary dismissal, as the applicants' claims had reasonable prospects of success. The court also found that it had jurisdiction to hear and determine the applicants' claims. The matter was listed for a case management hearing to proceed with the case. The court noted that costs would be addressed at the hearing.

Orders

Orders of the court

1. The Respondents’ application seeking summary dismissal of the proceedings is dismissed.

2. The matter is listed for a case management hearing on Thursday, 3 June 2021 at 3.30 pm (AEST), with liberty to the parties to appear by videolink.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Much the same reasoning indicates that the third matter relied upon by the respondents does not indicate colourability either. It is much more natural to infer that the applicants had made a genuine mistake about the basis upon which this Court does have jurisdiction. Conclusion In the circumstances, I am not satisfied that the respondents have made good their challenge to this Court’s jurisdiction. That conclusion makes it unnecessary to address this Court’s power to make an order cross‑vesting the proceedings to the Supreme Court of NSW when it has found that it lacks jurisdiction to hear and determine a matter. It is also unnecessary to consider the effect of s 86(1) of the CC Act. The respondents’ application for summary dismissal of the proceedings is dismissed. I will hear from the parties as to costs.

Ratio Decidendi

Legal Principle Established

As was noted by McKerracher J in Bride v Shire of Katanning, s 6 gives the CC Act an extended operation in those cases in which there is a sufficient link to the Constitutional power of the Commonwealth, be it international, interstate, intra‑territory, suppliers to the Commonwealth, or usage of postal, telegraphic or telephonic services – see s 6(2), 6(3) and 6(3A) of the CC Act. It provides (relevantly):6 Extended application of this Act to persons who are not corporations(1)Without prejudice to its effect apart from this section, this Act also has effect as provided by this section.…(3)In addition to the effect that this Act, other than Parts IIIA, VIIA and X, has as provided by another subsection of this section, the provisions of Parts 2‑1, 2‑2, 3‑1 (other than Division 3), 3‑3, 3‑4, 4‑1 (other than Division 3), 4‑3, 4‑4 and 5‑3 of the Australian Consumer Law have, by force of this subsection, the effect they would have if:(a)those provisions (other than sections 33 and 155 of the Australian Consumer Law) were, by express provision, confined in their operation to engaging in conduct to the extent to which the conduct involves the use of postal, telegraphic or telephonic services or takes place in a radio or television broadcast; and(b)a reference in the provisions of Part XI to a corporation included a reference to a person not being a corporation.…(Emphasis added) As is apparent, s 6(3) has the effect of extending the application of specified provisions in the ACL to conduct involving “the use of postal, telegraphic or telephonic services” by a “person” who is not a corporation. These provisions include Pt XI and the ACL (other than Pt 5‑3). The applicants contend that s 6(3) is engaged by reason of Mr Blackmore having sent the letter by email to Abergeldie, it being accepted that the expression “postal, telegraphic or telephonic services” encompasses the use of the internet: Australian Competition and Consumer Commission v Jutsen (No 3) [2011] FCA 1352, (2011) 206 FCR 264 at [100]; Seafolly Pty Ltd v Madden [2012] FCA 1346, (2012) 297 ALR 337 at [78]; Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd (No 2) [2012] VSC 239, (2012) 266 FLR 243 at [392]‑[396]. The respondents submitted that it was not open to the applicants to rely upon s 6(3) in the present case. First, they submitted that there was no specific reference to s 6(3) in the applicants’ pleading. I do not regard this submission as meritorious as the applicants have pleaded the factual elements to attract the operation of s 6(3) if it is otherwise available, and it was not necessary for them to plead expressly the statutory provision: Agtrack (NT) Pty Ltd v Hatfield [2005] HCA 38; (2005) 223 CLR 251 at [38]‑[39]. Next, the respondents submitted that the immunity afforded them by s 2B cannot be abrogated by s 6(3). Counsel relied on two authorities for this submission. The first was Mason v MWREDC Limited [2011] FCA 1512; (2011) 199 FCR 151 in which Greenwood J held that it would not be open to the Court, in exercising the power under s 236 of the ACL, to award damages against officers of the State of Queensland “involved” in a contravention of s 50 of the ACL when, by reason of s 2B, the ACL had no application to that State. His Honour said:[81]… The provisions of the Act (s 2, Schedule 2) which determine whether a person is involved in a contravention of a provision of Schedule 2 and, in particular, Chapter 3 of Schedule 2, are not to be construed in a way that extends the application of the Act to persons acting in their capacity as officers of the State of Queensland as such a construction would defeat the express limitation of the application of the Act contained in s 2B …(Emphasis in the original)