N.V. Philips Gloeilampenfabrieken & Anor v Mirabella International Pty Limited

[1994] HCATrans 333

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.,.

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S134 of 1993

a e t w e e n -

NY PHILIPS GLOEILAMPENFABRIEKEN

LIMITED and PHILIPS LIGHTING PTY

Applicants

and

MIRABELLA INTERNATIONAL PTY

LIMITED

Respondent

Application for special leave

to appeal

MASON CJ

DEANE J

McHUGH J

Philips 1 13/5/94

TRANSCRIPT OP PROCEEDINGS

AT SYDNEY ON FRIDAY, 13 MAY 1994, AT 9.30 AM

Copyright in the High Court of Australia

MR R.J. ELLICOTT, OC: Your Honours, I appear with

QR J.McL. EMMERSON. oc and MR D.E.J. RYAN for the

appellants. (instructed by Sly & Weigall)

MR D.K. CATTERNS, OC:  May it please the Court, I appear

with my learned friend, MS A.C. BENNETT. for the

respondent. (instructed by Williams Niblett)

MASON CJ:	Mr Ellicott.
MR ELLICOTT:	Your Honours, it is our submission that this

is a clear case for the grant of special leave.	It
is a very important discrete question of law.	It

raises a question of public importance. This case

is an appropriate vehicle, because it involves just

a question of law and does not involve any complex

questions of fact.

MASON CJ: What is the precise question of law as you see

it?

MR ELLICOTT:  The precise question of law is as to the

meaning of the words "manner of manufacture" in

section 18(l)(a) of the Patents Act.

MASON CJ:  Do you contend that the meaning of that

expression is less in content than "manner of new

manufacture" under the 1952 Act?

MR ELLICOTT: Yes, we do, and we say that the Parliament

purposely took out the word "new" - - -

MASON CJ: Yes, I follow that, but I was going to ask you

next, is there disagreement between the majority

and the minority in the Federal Court on that

point?

MR ELLICOTT:	No, but the - - -
MASON CJ:	They are united against you on that point?
MR ELLICOTT: Yes, but the majority, as we read their

judgment, tend to be saying that you can, on the

question of newness, you are more or less at large,

whereas His Honour Mr Justice Burchett was saying

you look at the face of the specification. An

analysis of the judgments - and I will have to take

Your Honours to them very quickly later - will show caught up in this question of newness or, as they that both the majority and Mr Justice Burchett were

would put it, the new use of an old substance or

analogous user, which were traditionally matters of

inventive step. To·some degree, the question of

new manufacture also involved, of course, the

question of novelty.

Philips 13/5/94

But the whole history of the patent law has been, if I can go back to 1623 very quickly, was

to - - -

MASON CJ: Just before you do that, can I indicate to you

the question that is in my mind, so that you can

develop your argument with a view to eliminating

this doubt that I have, that the judgments really

turn on a difference as to the characterization of

the invention.

MR ELLICOTT:  Your Honour, with respect they do not, because

in the end what they are referring to is not the

character of the invention which related
traditionally in patent law to the issue of whether

there was indeed an invention capable of industrial

application or whether it was a useful art as
distinct from the fine art; that was the question

of the character of the invention. That was the

question of manner of manufacture. It is quite

clear that in the early part of this century the

court started to make it absolutely clear that

there were two questions - they came up usually in

jurisdictional cases before registrars - was there

a manner of manufacture, that was the first

question, and the second question was, was the

manner of manufacture new? That was the question -

that division is made clear in a judgment of

Stafford Cripps and it was picked up in Microcell

and it is picked up in Terrell.

So the two questions are quite distinct. The

question of manner of manufacture always related to the question, is this claimed invention a manner of

manufacture in the sense that it relates to

industrial application, and that is the issue that

the Parliament was concerned about.

In our summary we have set out what was stated

at page 4, paragraph 8:

An "invention" is defined in Schedule l by

reference to the expression "manner of new	manufacture" in section 6 ••••• The requirement
in paragraph 18(l)(a) that an invention, in
order to be patentable, must be a "manner of
manufacture" -

so they have dropped out "new" -

that the invention must belong to the useful

involves a long line of UK and Australian

arts rather than the fine arts. The

Government accepted the Industrial Property

Advisory Committee's recommendation that this

flexible threshold test of patentability be

Philips 3 13/5/94

retained in preference to adopting a more

inflexible codified definition.

So what the Parliament was saying, we have

deliberately adopted "manner of manufacture" and it

means little more than that the invention must

belong to the useful arts et cetera.

That is the question, the old question, of

whether it had industrial application; whether it

was, for instance, whether a computer programme was

a manner of manufacture; whether an agricultural

process was a manner of manufacture or whether

methods for treating the human body was a manner of
manufacture. In section 18(2):

Human beings, and the biological processes for

their generation, are not patentable

inventions.

That is about manner of manufacture in that sense.

McHUGH J:	But on any view of it there is some confusion in the Parliament because in the definition of
"invention" they.refer to "new". They define invention as "a manner of new manufacture".

MR ELLICOTT: That is right, but that is why - - -

McHUGH J: I know what your argument is, your argument says,

well, "new" does not really mean anything there; it

is really picked up in 18(l)(b).

MR ELLICOTT: 

It does mean something in the meaning of

"invention", but what the statute does is to do
precisely what parliaments have done, if I may say

so, since 1623. They have gradually taken that
definition and they have refined it out. That is

to say they have taken out questions of novelty and

obviousness. In the 1952 Act you still had a

ground which said, "Is it an invention within

disappears in the 1990 Act. section 6 of the Statute of Novelties?" That

So they have the categorization of manner of

manufacture, which raises the matter I have been
addressing. You have got novelty and then
inventive step, and they went the further important

step of defining the prior art base. Now, that is logical, and that is the important reform that was

brought in. The effect of the - - -

MASON CJ: But the effect is to narrow the concept of

newness, using newness in a sense that covered all

the things that could be embraced previously. That

is what you are saying.

Philips 4 13/5/94

MR ELLICOTT:  No, but narrowing it out of manner of

manufacture, it is not in there any longer - - -

MASON CJ: That is right.

MR ELLICOTT:  But everything that could come within the

concept of new in "new manufacture" falls within

novelty and inventive step. There is nothing

dramatic about the change; it is simply the

Parliament - - -

MASON CJ: Has moved one concept from one category to

another or confined it to one category.

MR ELLICOTT:  Confined it to one category and, more

importantly, defined "prior art base" in a way in

which it had never been defined before, it had

never been defined in the statute. It had been

left to the cases to define it. And the important

thing is that if we are left with the Full Court
decision, and this is where it gets to the
administration of justice, you are going to have
people asserting invalidity on the basis of a lack
of newness under "manner of manufacture" and they

are going to assert it again under inventive step

or novelty and, at the same time, the court is

going to be faced with a different question under

novelty and inventive step. We have got the prior

art base under section 7, that is so carefully

defined, and the question then arises, "What can

you look at under manner of manufacture?" So that

every case is going to have two concepts of prior

art to have to be looked at.

Now that, surely, would be very odd, as I

think Mr Justice Burchett said, and it would be

very strange that the court should leave it in that

situation.

McHUGH J:  It is not strange if you approach it in the way

Justice Burchett did. He says that.under the

concept of new manufacture you simply ask yourself,

"Is it clear on the face of the specification that

it involves no inventive step?" If you answer that

yes, that is the end of the day.	But if it is
arguable, then you go to 18(l)(b).	Now what is the
matter with that?

MR ELLICOTT:  What is wrong with it is that, first of all,

it denies the change from manner of new manufacture

to manner of manufacture. It ignores the

explanatory memorandum and what they said it meant.

I mean, you could not get a clearer explanatory memorandum.

McHUGH J: They did not say what they meant. They refer to

paragraph 18(l)(a) in the explanatory memorandum.

13/5/94

Philips	5
MR ELLICOTT:	Yes, that is right, and that is what we are

defining here.

McHUGH J: The problem lies in the definition of

"invention".

MR ELLICOTT: With respect, Your Honour, no, because

section 18 is a definition of a patentable

invention and it says it is an invention - and you
do not read in the definition of invention into

those words - - -

. MCHUGH J:  Why not?

MR ELLICOTT: Because that would be circuitous. You might

as well just say, why bother to define it, and	forget about the rest of the provision. It is
obviously - - -

McHUGH J: What purpose does the definition play then,

Mr Ellicott?

MR ELLICOTT&

The purpose of the definition "patentable

invention" is simply to isolate out of the
definition of "invention" all the matters that are
in there anyhow7 that is to say manner of
manufacture, novelty and inventive step. They are

all there.

McHUGH J: 

But my question was directed at what is the

purpose of the definition of "invention" in the

schedule?

MR ELLICOTT:  The purpose of the definition of "invention"

is simply because this is a Patents Act and it is

dealing with inventions. But it is not a

definition that is to stand on top of, if I may

call it such, the definition of "patentable

invention". The ground upon which you can attack

the validity of a patent is that it is not a

patentable invention. What is a patentable

invention? Section 18(1) tells you what it is and

subsection (2) is very careful to tell you what

cannot be patentable inventions •

McHUGH Js But, Kr Ellicott, how likely is this problem to

arise - - -

MR ELLICOTT& It is going to come up in every case

involving, and has started to come up, I am told.

Counsel will inevitably raise the question under

(a), is it a manner of new manufacture, and they

will then say that the courts, free of any

definition under section 7 of what is the prior art

base that is considered. Your Honour asked me what.

is wrong with what Mr Justice Burchett says.

Obviously I have indicated what we say is wrong

Philips 13/5/94

with it, but even if it was right, it is not the

same view that the majority has, and the court has	left the question at large, uninstructed, and
therefore ultimately that question has to be .
resolved, the meaning of "manner of manufacture" in
this Act. And this is the best vehicle this Court
could possibly have in which to deal with it. You could not, I would say with respect, think of a
better vehicle because the question of law is
isolated and the Court does not have to go into the
intricacies of facts, and if it is decided our way,
that is the end of it; if it is decided the other
way - - -

McHUGH J:  We will get a cross appeal, will we not? We will

get the section 40 point.

MR ELLICOTT:	I would say this with very great respect, is this Court going to see in those questions of
public importance. The questions of fact have been
dealt with below and Your Honours have said that the Federal Court is the ultimate court in patent matters, subject to special questions like this.
And this is a special question. It is highly
unlikely that this Court is going to give special
leave, but Your Honours have got the capacity to
deal with that when it comes up.

McHUGH J: You lost, did you not, because it was held that

this was a use of a known material, a phosphor in

the manufacture of a known article, namely these

low pressure lamps, for a purpose for which its

known properties made that material suitable.

MR ELLICOTT:  That is right, and that is the very question

that was determined under the question of

"inventive step" in the Hicrocell case. I do not

have to take time to take Your Honours to it. But

if Your Honours read Hicrocell, and I assume

Your Honours have, because we referred to it in our argument, in Hicrocell the two questions were very

well defined and the question of newness related to
inventive step.	Why do you need a duplicity in the

section, and in the administration of the patents

law, when the Parliament goes to the trouble of so

carefully defining it and says in the paragraph

that that is what it means. You cannot, we would

say, find a clearer case.

Can I take Your Honours, as I have limited

time - I do not want to get the red light.

MASON CJ: No, but if you cease saying you have got limited

time you might have more time.

MR ELLICOTT:  That is my way of getting more time,

Your Honours.

Philips	13/5/94
McHUGH J:	Oh ~o, we are very strict here, Mr Ellicott.

This is one point we are always unanimous on.

MR ELLICOTT:  We have to work out how to get through

Your Honours' armoury on this question.

MASON CJ: As a senior counsel, a leader of the Bar, it is

important that you set an example.

MR ELLICOTT:  I am, Your Honour, that is why I am referring to that yellow light.

Would Your Honours go to page 150.

Your Honour asked me what was the majority dealing

with.	Now, at the top of 151, having said that: the appellants that there was a substantial	I reject the argument advanced on behalf of
and deliberate change introduced -

he says:

I turn to the important question whether an inventive idea or step is disclosed in the

specification in suit which his Honour

answered unfavourably to the appellants.

So the question is not about the character of the

invention, not whether it is a manner of

manufacture, but whether it is a manner of new

manufacture. One can go right through it, through

the judgment - - -

MASON CJ: There is an element of confusion, is there not,

if you look at the second sentence of the next

paragraph.

MR ELLICOTT:

Likewise, the requirement that a patentable

invention be a manner of new manufacture is

inherently distinct from the requirements of

novelty, lack of obviousness -

Yea, and that is a confusion which leaves the legal mind somewhat in turmoil because, having spoken

about an inventive idea or step, he then proceeds,

with respect, to say it is different from inventive

step. And that is not logical. There are other

passages, 153, lines 3 to 31, where they quote what

was said below, but it is all about something that

"had long been known", at line 151 was "so well-

known"1 "A mere skilled technician" at line 211

line 25, "Thia inherent characteristic of phosphors

was well-known"1 "it-was known"1 it is all	·
permeated with questions about newness or inventive
step, and that is what they are dealing with.

Philips 8 13/5/94

The only other way of looking at it is what

Mr Justice Burchett said but even he, when he dealt

with the issue at 169 and 170, he leaps into the

same question. He points out the difficulties and

then he leaps into the question, the very same

question, after he has dealt with Microcell, so

Your Honours, in both respects what has happened is

that both the majority and in the single decision

by Mr Justice Burchett, there is a failure to

excise the question of inventive step, and that is

a very substantial question, it affects the

administration of justice, and it is one which we

would submit this Court should readily entertain.

If the Court pleases.

MASON CJ: Thank you, Mr Ellicott. Mr Catterns.

MR CATTERNS:  May it please the Court. Your Honours, in our

submission it is clear that there was no intention

to change the law. The question of whether

something is a manner of manufacture, namely it

possesses the characteristics of the type of thing

that patents have been granted for, has always been

part of the law._ The cases our friends refer to

make that clear. The explanatory memorandum makes

it clear. The definition of "invention" makes it

clear. Your Honours, the question of whether any

amount of newness remains in the concept just

simply does not arise because the rationale of

His Honour Mr Justice Wilcox and of the majority is

that this is not the type of thing for which we

grant patents. That is clear at page 156,

Your Honours, line 6:

Essentially what the patentee claims in the patent in suit is a lamp that has two

basic characteristics, namely, short term

depreciation which is related to efficiency of

light and electronegativity which is a

function of -

the formula of the phosphors.

McHUGH J:  But that is because they applied the tests under

the old law, is it not, and you lost on the issue

of "inventive step", did you not?

MR CATTERNS:  Yes, Your Honour - we did not lose on it, we

did not press it.

MASON CJ: You did not take it.

MR CATTERNS1 We did not press it because we could not prove

common general knowledge.

McHUGH J: Yes. But having regard to the terms of

section 7 and lS(l)(b), it would be extraordinary

Philips 9 13/5/94

if the old law on new manufacture was still part of

the law, of this statute. When you look at

section 7 and when you look at 18(1)(b) it is very

difficult to think that Parliament could really

have intended to bring in the old learning before

this Act.

MR CATTERNS:  Although that is precisely what the

explanatory memorandum says, Your Honour. I know

how far we can and cannot push those, but the term

is intended, as the explanatory memorandum says, to

invoke a long line of cases saying what manner of

manufacture is, in particular, obviously, NRDC and

Microcell.

And, Your Honours, whether or not there is a

change, and whether Mlcrocell still applies, new

use of a known.thing for which its known properties

make it suitable, whether or not there has been a
change to get rid of that contrary to the
explanatory memorandum might be an interesting
point in some other case, but here the ratio of the

majority just is not that. They say, merely to say I claim a table that bears load and floats on water

or any other physical property, all tables

possessing those characteristics, that is just not	a patentable thing. And that is what His Honour
Mr Justice Wilcox did too at page 154.

McHUGH J: I appreciate that, but on the other hand

Justice Burchett, even though he applied the law

which Mr Ellicott would say was wrong, nevertheless

held that it was a patentable invention.

MR CATTERNS:  Yes, Your Honour. He held as a matter of

fact, on the construction of the given claim based

on the assertions in the patent, that it was

inventive to find these characteristics, to

identify short-term depreciation and

electronegativity of less than 1.4. It is

His Honour, with respect, who confuses obviousness

and what constitutes invention because he holds

that to specify the characteristic of 5 per cent

depreciation is inventive. That may be so if
obviou•n••• were in issue, but the issue is whether

merely specifying that the light does not go dim

after 15 minutes, which is all it is, merely to say

it would be desirable to have that, and that it

lasts a long time because it resists mercury, which

is the 1.4, that is just not the kind of thing that is patentable. And that is why, Your Honours, we

submit that it does not arise because the ratio

here - this is a case about the construction of
claim 1, in particular, and is claim 1 merely the

specification of desiderata? If so, that is not

patentable.

Philips 10 13/5/94

McHUGH J: But if you apply section 18 literally without

recourse to the definition of invention in the

schedule then you lose, do you not?

MR CATTERNS:  No, Your Honour, no, because it has always

been the law that you keep separate the question of

manner of manufacture and novelty. we do not

disagree with our friends for a moment on that.

They are different questions, always have been.	we
have got a copy of Terrell from the 60s which
says - - -

MASON CJ: But what about manner of new manufacture and

novelty or obviousness?

MR CATTERNS:  Your Honour, when the law said manner of new

manufacture the courts always, and the texts

always, split that up into two as the NRDC case

did. Is it a manner of manufacture? Is it novel?

So the question, is it a manner of manufacture, meaning a kind of manufacture, as distinct from a

game of cards or the fine arts, has always been in

the patent law, it still is exactly the same

question. The court held, all three justices, that there is no change in that.

So what we submit is that what

Justice Lockhart did in the majority judgment is he	focussed on the question, is this the kind of thing
that is patentable? No, because it is mere
desiderata.

MASON CJ:  Is that consistent with the passage that

commences at line 19 on page 156 and goes over to

the end of the first paragraph on page 157?

MR CATTERNS:  Your Honour, that is a, with respect,

gratuitous piece of decoration at the end of

His Honour's reasons, having come to His Honour's

conclusion.

McHUGH J: It does reflect his thinking, does it not, the

thinking that drives his judgment?

MR CA'rl'ERNS1 Your Honours, I do not defend the words, for

example, in lines 2 to 4 at the top of page 157,

because that really is tending to confuse

obviousness and the question of manner of

manufacture1 I accept that. But, Your Honours, in

the passage Your Honour the Chief Justice referred

my friend to earlier at 151, line 7, the second

sentence that Your Honour the Chief Justice

referred to, His Honour clearly states that they

must be kept separate and at the bottom of 155,

line 23, in criticizing our learned friends,

His Honour then again stresses the necessity of

keeping the distinction clear.

Philips 11 13/5/94

But in the passage that deals with

His Honour's ratio, I submit that there is no

question of eliding it.

MASON CJ: Can we come to that where His Honour

characterizes the invention.

MR CATTERNS:  Yes, Your Honour.

MASON CJ: Can you direct our attention to that?

MR CATTERNS: At the bottom of page 154, line 30, through to

page 156.

McHUGH J: But that is the old law, is it not?

MR CATTERNS:  Your Honour, there is reference to Microcell

there. That is the new use of a new product,

et cetera. But then His Honour goes on, line 3 on

the next page:

I accept the correctness of the

submission of counsel for the respondent that

what the patentee has done in this case is to

choose two desirable characteristics ....• and

to claim lamps using all phosphors, present

and future, possessing those characteristics.

Your Honours, that has nothing to do with newness.

That is just saying this is not the kind of thing that is patentable. Then there is the discussion

of the evidence of Dr Verhaar.

McHUGH J: When you say this is not the kind of thing that

is patentable, you yourself are departing from the

language of section 18 and section 7, are you not?

MR CATTERNS:  I am using the language of the High Court in

the NRDC case.

MCHUGH J: That ia the whole point of the argument against

you, is it not?

MR CA'l"l'ERNS1 No, Your Honour, not as I understand it. Our

friends say, in paragraph 4 of their written

submissions, after breaking it up into manner of

manufacture and is the manufacture a new
manufacture:

The first of these questions is concerned with the character of what is claimed -

In other words, is it the kind of thing that is patentable. our friends refer to NRDC where the

Full High Court says that. There has always been

an additional question to novelty.

Philipa 12 13/5/94

MCHUGH J: I accept that.

DEANE J: I do not quite follow. Which of (a), (b) and (c)

of section 18(1) do you say that question arises under?

MR CATTERNS: (a).

DEANE J: So "manner of manufacture".

MR CATTERNS:  Yes, Your Honour. For example, a patent for a

game of playing cards or a. patent for the idea of
decorating your room with roses is not the kind of

thing that is patentable.

DEANE J:  It is easier if you say "is not a manner of

manufacture", because otherwise you just take it	into the problem of, "Is novel in (b)(i) the same
as new in manner of new manufacture?"

MR CATTERNS: Yes, Your Honour. But I submit that what the

court has held is that merely to specify desirable

characteristics of a particular article, namely the

fluorescent light, namely that it maintains its

brightness to within 5 per cent and is long lasting

because it resists mercury, merely to specify those

characteristics is not to invent a manner of

manufacture.

MASON CJ:  It may lack an inventive step but it is not a manner of manufacture in any event.

MR CATTERNS: That is right, Your Honour, it is a separate

question. We submit that Justice Wilcox in the

passage quoted at page 154 where His Honour says,

line 15:

it is not an invention, or a manner of new

manufacture, for someone to specify the

criteria required to be met, in the

manufacture of a known product ••.•• to achieve

MASON CJ: The trouble is they keep on using the expression vendibility.

"manner of new manufacture" which surrounds what

they say with doubt.

MR CATTERNS: Yes, Your Honour, but I have made my

submission that it has always been the law that

there are two separate questions, and I submit that

His Honour and Mr Justice Lockhart satisfactorily

kept them apart and what His Honour is looking at
in 154 to 156 is that question. Your Honours, I

think I was at 155, line 16:

13/5/94

Philips 13

I accept the correctness of counsel for the respondent's submission that the patentee has

essentially "formulated requirements" -

line 21:

I agree with his Honour's finding that this is not an invention.

At 156 there is again the passage I have referred

Your Honours to.

So we submit that is clearly the ratio of the majority approving His Honour Mr Justice Wilcox, that it is not a manner of manufacture - - -

MASON CJ:	So your submission is if that be the ratio of the decision, then even if Mr Ellicott's interpretation
of the 1990 Act were to prevail, he still would
fail in the appeal.
MR CATTERNS:	Yes, Your Honour, precisely. And because it

does not arise here, the foundation of the

majority's reasoning does not depend on any change	or there not being a change between the old law and
the present law.

McHUGH J:  But in the very passage that you refer to at 154

there is a quote from NRDC where the Court talks

of:

'Unless invention is found in some new method

of using the material or some new adaptation
of it so as to serve the new purpose, no valid

patent can be granted'.

Can that really stand with section 18 and

section 7?

MR CATTERNS1 I submit yes, Your Honour, because -

McHUGH J:  In the sense of new and so on being at large.

MR CA'l'TERNS: Yes, Your Honour. But I submit that really

The first is the formulation of requirements point	there were two bases for the majority's reasoning.
which newness does not figure in. The second is
the Hlcrocell point and there and in other places the Hlcrocell point is relied upon. But I submit
that, as it were, the principal ratio, and certainly a sufficient ratio is the non- patentability of merely formulating requirements.

Incidentally, there is no disagreement among

the three justices, as Your Honour pointed out, I

think, about the applicability of Hlcrocell.

Philips 14 13/5/94

McHUGH J: Well, the four of them, is it not?

MR CATTERNS:  Yes, the four of them. So there is no error in the modern applicability of Microcell. It is

clear that the legislature did intend to invoke the

old cases but, perhaps more importantly, it does

not arise because this kind of thing is not a

manner of manufacture.

McHUGH J: But the argument that is put against you is not

that they intend to apply the old cases but they
intend to apply the old concepts, but in relation

to one of them they defined it, whereas previously it had been left at large. Now you are seeking to

use the old concept undefined as well as the new

concept as defined.

MR CATTERNS: But, Your Honour, 18(1) does have the introductory words:

a patentable invention is an invention -

invoking the dictionary, which is manner of new

manufacture - - ~

McHUGH J:	I know, that is surprising.
DEANE J:	But that does not take you anywhere because the

definition includes alleged invention.

MR CATTERNS:  Yes, Your Honour, but the cases make it clear the Hicrocell case - - - that alleged invention is just - that is clear in

DEANE J: But if you use alleged invention in an

epexegetical context, such as in 18(1), you go

straight to (a), (b), (c) and (d) as a definition.

MR CATTERNS:  Testing the truth of the allegation, yea,

Your Honour.	I do not disagree with that, with
respect.

DEANE J: Which means you get nothing at all from the use of

invention in the introductory words once you move

it as an alleged invention into this context.

MR CATTERNS: Yes, Your Honour. But the key point is that

the question of manner of manufacture - the

distinct question of is this a manner of

manufacture has always been the law.

DEANE J: I was not indicating any disagreement with the

main thrust of your argument.	It was just on the
construction.

MR CATTERNS:  Of dragging the.definition into 18(1), yes,

Your Honour. we do submit that the law has always

Philips 15 13/5/94

been that manner of manufacture and novelty are

separate questions.

The Statute of Monopolies said that patents could be granted to any manner of new manufactures

which others shall not use, in other words, which

is novel. There has always been that distinction.

I submit that the court below did not commit the

error of importing into the question of manner of

manufacture the distinct concepts of novelty and

obviousness. Justice Lockhart clearly states that

he should not and His Honour, I submit, did not.

The principal ratio is clearly, we submit, the non-

patentability of a wish list of desiderata, because

that is not a manner of manufacture.

We agree that the Hicrocell point is also

all agree that Hicrocell is still authority and we	relied upon but four justices of the Federal Court
submit that that was the intention. May it please
the Court.

MASON CJ:	Mr Catterns, you have not responded to the question that arose during Mr Ellicott's address,
namely that if we were to grant special leave, this
is inviting an appeal only on a simple discrete
question.  Do you want to respond on that or do you
accept what Mr Ellicott has put?
MR CATTERNS:	No, Your Honour, we would seek leave to cross appeal on the question of novelty and fair basis.
There are two articles, in particular, referred to
by Justice Lockhart on novelty which we submit
genuinely do anticipate this patent, and we would
want to seek leave to argue that they do.

MASON CJ: Without conveying the slightest indication as to

what the Court might do with this application, what

in terms of time would the resolution of those two

issues, novelty and fair basis, take in terms of

argument in this Court?

MR CA'l"l'ERNSa Your Honour, I think the appeal took three

days and I think -

MASON CJ: 

We expect people to be more succinct here.

MR CATTERNS: 

The legal principles of novelty will not be in

issue in particular, but there is some fairly
complicated technical articles that one has to go
to and the patent itself is lengthy and technical,

so one has to go through those.

McHUGH J: Plus the evidence.

MR CATTERNS: Yes.

Philips 16 13/5/94

DEANE J: I have not followed through. What did the Full

Court do in relation to those questions?

MR CATTERNS:  We lost, Your Honour. They held that the

articles did not anticipate the patent.

MASON CJ: You say it took three days in argument in the

Full Court of the Federal Court. What is your estimate here, for those three issues?

MR CATTERNS:  In light of what Your Honour said, two days;

in light of our trying to be briefer in the High

Court.

MASON CJ:  We would probably direct comprehensive written

submissions in this case so that we could look at

it before the case came on for hearing. But again,

I am not indicating a view about the disposition of

this matter.

MR CATTERNS:  I do not want to make arguments in terrorem,

Your Honour. I think we could do it in two days.

MASON CJ: No, I appreciate that.

MR CATTERNS:  We would not finish in one, but we could do it

in two, I think, Your Honour.

DEANE J:  But if you do not want to challenge the law on

novelty, but in effect simply be involved in the

facts, if we were to grant leave and if we were

apparently without opposition to uphold

Mr Ellicott's construction of section 18, why would

not we simply, having upheld that, send it back to

the Federal Court for them to work out whether it
affected their decision. Now, if we were to do

that, there would be little prospect of us getting

involved in a cross appeal that wanted us to go

into examinations of fact, would there?

MR CATTERNSa I submit that that points up why special leave should be refused. Sorry to have to take another

go at it. Because my submission is, Your Honours,

that the Federal Court would say, with respect,

yea, we knew that already and we still hold that

picking desiderata is not a manner of manufacture.

McHUGH J: 

But why should you get special leave to cross

appeal, because are there not concurrent findings
of fact against you on the issues of novelty and

utility?

MR CATTERNS: 

As a matter of justice, Your Honour, because

if Your Honours are holding that the error on

manner of manufacture is to import newness into it,

and it should be rigidly kept out of it, there is

something wrong here, we submit, in specifying

Philips 17 13/5/94

these characteristics of a known device and if

Your Honours do hold that, then that pushes the focus back to the question of novelty. And, as my

learned friend says, also the question of fair

basis, of whether that claim is fairly based on the

specification.

Your Honours, when I say there is no legal question on novelty, we all agreed what the test

is, that the prior art must, for practical

purposes, disclose the invention claimed. So no

doubt we would be submitt·ing to the Court that the

way Their Honours approached it was not right. But

I think the basic legal principles are agreed. May

it please the Court.

MASON CJ: Thank you, Mr Catterns. Mr Ellicott. It does seem you have got a very strong argument on this

question of interpretation as to manner of manufacture as distinct from manner of new
manufacture. Let us assume you succeed on that.

Is not the real difficulty, from your point of

view, that you will ultimately lose in any event,

on the footing that the characterization of the

invention accepted in the Full Court by the

majority and by Mr Justice Wilcox at first instance	falls within manner of manufacture as distinct from
manner of new manufacture?

MR ELLICOTT:	No, Your Honour.
MASON CJ:	Could you just explain why you give that answer

and why that answer is correct.

MR ELLICOTT:  Because there are two distinct questions: one

is manner of manufacture and the other is, if it is

a manner of manufacture, is it new? Once the Court

agrees with the view that we are putting, that manner of manufacture is only referring to the

industrial applicability - I use that in the broad

sense, Your Honours follow what I mean - of the

alleged invention, that i• the end of the question

of manner of manufacture. In this case - - -

DEANE J: But then one come• to the question, is it novel

and is the manner of manufacture novel and involve

an inventive step.

MR ELLICOTT:  Yes. We have been through that below in

section 18(l)(b). We have been through that and

all issues in relation to novelty that could
possibly have been taken into account - there is no

dispute as to law as to novelty. The only dispute arose out of the transitional provisions, but they

are not in issue here. All the questions as to

novelty were debated and all the subject-matter that was the subject of this manner of new

Philips 18 13/5/94

manufacture was adverted to in relation to novelty.

That is found against them.

DEANE J: But is that not the problem with your approach? r

follow all the way your argument that invention in

the commencement of 18(1) has no practical

significance, but it seems to me that a possible

problem with your argument is that having reached

(a), (b) and (c) you take manner of manufacture,

novel, inventive step and isolate them from one

another instead of combining - - -

MR ELLICOTT: Yes, that is what Parliament said.

DEANE J: No, instead of combining the three concepts.

Because it is the manner of manufacture that must be novel and must involve an inventive step.

MR ELLICOTT: Yes. But you come to consider that under the

question of novelty and inventive step.

DEANE J:  That only gets you somewhere if you can point to a

real difference.

MR ELLICOTT: Yes, well there is a real difference. Let me

just quote an old - - -

DEANE J: While I am barraging you, can I just ask you a	final question. Can I take you to page 154. Would
you disagree with the last sentence in the quotation in the middle of that page as applicable
to the combined effect of the requirement of manner
of manufacture, novel and inventive step in
section 18(1)?
MR ELLICOTT:	That is an issue that goes to inventive step.

That is not a question that goes to manner of

manufacture. Your Honour, can I just -

DEANE J: The answer is you would agree that the combined

effect of l8(l)(a) and (b) is that that last

sentence remains completely good law.

MR ELLICOTT: 

But only as a description of the end result of

applying the whole of the section. But in applying
the section - and this is the point in the court's

consideration - point l is the manner of

manufacture, point 2 is it novel, does it involve
an inventive step? They are the three quite

discrete questions under this Act. Manner of new

manufacture under the old provisions raised the

question of subject-matter generally. Now, it does
not any more.

DEANE J: But cannot I get a simple answer. What if that

last sentence in that quote is not satisfied? Is

Philips 19 13/5/94

there any way you would get through 18(l)(a) and (b)?

MR ELLICOTT: Your Honour, if we satisfy the criteria of newness in lB(l)(b), then we are all right. In

other words, obviousness is not in issue; inventive step is not in issue. That was conceded below. rt

does not come into question. What the court has

been dealing with is something that was conceded

and therefore there is no difficulty for us, if we

succeed on our point.

DEANE J: Can I just persist with my question. What if the	effect of this case was a finding: yes, there is a
new purpose which is identified and which was
desired to be served but there is no new method of
using the materials and no new adaptation. Can you get through 18(1)(a) and (b)?
MR ELLICOTT:	Yes, for the simple reason that those issues

have been either found in our favour or conceded.

This is the point, Your Honour, that - - -

DEANE J: I follow, but as I read the judgments, the last sentence of that quota has been found against you.

MR ELLICOTT: With respect, what Their Honours were doing

was allowing my friends to argue the question of

inventive step under the heading of manner of

manufacture, and in fact the respondent had already

conceded inventive step. Having done that, that

was the end of it, and they could not bring it up

anywhere else. This is the whole thrust of our

argument here, to make it clear to Your Honours

that what they were doing - that is Their Honours -

they were looking at a question which was a

question of inventive step. Your Honour, can I

just read this quickly.

MASON CJ: Before you do, it seems to me that your argument

is very much based on a sentence in the explanatory

memorandum which appears in paragraph 8 of your

outline where it is said:

It means little more than that the invention

must belong to'tha useful arts rather than the

fine arts -

speaking of manner of manufacture. Now, I must say

my impression of the old law - and it is by no
means an accurate impression - was that manner of
manufacture meant a little more than that or

somewhat more than that. Now, is what you are

going to read out directed to that issue?

Philips 20 13/5/94

MR ELLICOTT:  Absolutely and it is the old law and it comes

out of the mouth of somebody who was respected in

patent law, Sir Stafford Cripps.

MASON CJ: What does he say?

MR ELLICOTT:

In my view there are in reality two distinct questions to be determined, first, "Is there a manner of manufacture?"; second, "Is the

manufacture a new manufacture?"

As to the first of these, the inherent

Officer is unlimited, that is to say, they	jurisdiction of the Comptroller and Law
any relevant matter in deciding the question have jurisdiction to take into consideration
whether the invention alleged to be described
in the specification is a manner of
manufacture, and by manner of manufacture I
understand a manner of adapting natural
materials by the hands of man or by man-made
devices or machinery. It is not, of course,
sufficient that some manner of manufacture is
described in the specification nor that it is
mentioned in the claim; that which is alleged
in the specification and claimed to be the
invention must itself be a manner of
manufacture.

There is another paragraph I will not read, but he

goes on:

In determining the second question, whether

the manufacture is a new manufacture, the

Comptroller and Law Officer have not an

consider the matters referred to in the Act,	unlimited jurisdiction but must primarily
that is, the question of prior publication and
prior claiming, and they must decide upon the consideration of the prior documents whether
the invention claimed ia wholly or partially
documents in the light of the Statute and case anticipated or preclaimed by virtue of those law applicable to anticipation and prior
claiming. It has, however, never been contended that either the Comptroller or the
Law Officer is bound to accept an application or grant a patent where there is admittedly no
invention in the sense of an inventive step,
for in such a case the admission itself would
disentitle the applicant to argue that there
was even an "alleged invention" disclosed. In such a case, therefore, the Comptroller and
Law Officer would be bound to refuse the

Philips 21 13/5/94

application or grant on the footing that no

manner of new manufacture was disclosed.

So there are two discrete questions.

Mr Justice Burchett tried to wrestle with that and

pick up that last bit and treat it as if you could

look at the face of the specification and say it
was not a manner of manufacture but, in doing that,

he added the word - he forgot that in the

distinction that was drawn in the cases, that word

"new" was in there. The same proposition is picked
up at page 246 in the Hicrocell case. There is a

reference to - I have been reading from Compagnies

Reunies Des Glaces and that is referred to at

page 246 in Hicrocell. The same point, he said:

should be clear on its face that the	It must be enough to warrant rejection that it
specification discloses no inventive step.

Then there is a reference.

The specification in the present case

does not, in our opinion, disclose a

patentable invention. It seems to us to fall

within a class of case to which reference is

made in Terrell on Patents, 8th ed.(1934),

pp.213,214. The passage and the authorities

cited for it are not to be found in the 9th

edition (1951), but that is obviously because

the relevant provisions of the English Act of

1949 are entirely different ••.•• The passage

reads:	"As has already been stated, the
Comptroller has jurisdiction, both on	application and opposition, to consider
whether the invention is a 'manner of new
manufacture' within ••••• In the exercise of
this jurisdiction, applications have invariably been refused where the invention is
merely for a new use of 'and old and-well-
known substance by itself, without saying
more' -

Now, that is a question of inventive step, that is a question of obviousness, and manner of new

manufacture, before the registrars - that question

could involve the question of obviousness or

inventive step to that limited extent, and why?

Because prior to the 1990 Act - or some of the amendments under the 1952 Act - and under the Act

that Sir Stafford Cripps was considering, the

registrar could not consider inventive step or

obviousness. He was precluded from doing that but

they said, nevertheless, he can go this far because

he can consider whether it is an invention and they

concentrated on the word "new•.

Philips 22 13/5/94

So, Your Honours, there are two discrete

questions, and on the question whether my friend is

entitled to leave, I would submit that it is most

unlikely that Your Honours, in the circumstances,

are going to give him special leave. So be it, if

Your Honours do, Your Honours will be confronted with a case that is probably going to go one or two

days. That is the situation.

So far as the particular invention here is

concerned, Your Honours have the claims at page 120

and, clearly, it is for a manner of manufacture on

its face in the sense that I have been addressing

Your Honours here earlier today.

So for those reasons, Your Honours, we would

say this is a clear case, with very great respect,

for special leave to appeal, if ever there was one.

MASON CJ: Thank you, Mr Ellicott. The Court will give its

decision at 2 o'clock or shortly thereafter. I

have to give a decision at 2 o'clock. It will take

a few minutes to deal with that, and we will have

our decision down in this case immediately after

that.

AT 10.28 AM THE MATTER WAS ADJOURNED

UNTIL LATER THE SAME DAY

UPON RESUMING AT 2.03 PM:

MASON CJ: There will be a grant of special leave in this

matter.

AT 2.03 PM THE MATTER WAS ADJOURNED SINE DIE 13/5/94

Philips 23