Phelps, Robert E Western Mining Corp Ltd

[1977] FCA 81

G No. 70 of 1977

Between	Rohert E. Phelps	-	(&-mlj cent)
P.nd
(Resyondents)

Reasons for Ju6grnen-b:	Franki J.
Delivered	8 Novmber 1977

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The appli-ant seeks injunctiocs un4er s.80 of the Trade

P r sc t i ces Act 137/t-1.977 ( the Act) r e s t r a i n h g t h e r e s p o n d e n t s

ind iv idua l ly o r c o l l e c t i v e l y from advertking in a manner coni-rary ’

t o ss.52 and 55 o f t h e ht.

These sections read as fol1o::s:-

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Sect ion 52.(1) A corpora t ion sha l l no t , iu? t r a d e o r commerce,

engage i n conduct t h a t , i s misleadmg or decept ive o r i s l i k e l y

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mislead to o r deceive. I

(2) Nothing i n the succeeding provis ions of t h i s

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Divis ion s h a l l be taken as I i v i t i n g by i n p l i c a t i o n t h e p n e r e l i t y ’

of sub-section (1).

Sect ion 55. P, person ?hall n o t , i n t r a d e OT commerce, enrage

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i n conduct that i s l i a b l e t o mislead the Fubl ic as t o t h e

nature , the manufactur ing process , the character is t ics , the

s u i t a b i l i t y f o r t h e i r purpose o r t he quan t i ty of any goods.

Thi? natter first caqe before me on an appl icat ion f o r

directions ,vhen Yenior Counsel for the respondents askec! t h a t

the Court deter3ine four questions before the heari.np o€ t h e

matter. The apnl ica t lon vas put ,on behal f of the respondents.

upon t h e basis that a g rea t dea l of time vould be sprit i n

d e t e n i n i n z Whether o r no t ce r t a in adve r t i s ing , 7:rhich the zF?lir ,ant

a l leced was cont ra ry to the provis ions of -s.52 and 5 5 , ~ a s

e i t h e r Ilmisleading o r deceptive o r l i k e l y t o rnislead o r deceive,”

within the w a n i n g o f these words i n s.52(1), o r ” l i a b l e t o

mislead” within the meaning o f these words i n S. 55.

The matter had been coqmenced, i n compliance with the

Rules, by a n o r d e r n i s i t o show cause, but I considered t h a t it

was an appropr la te case to order that a statement o f claim and a

statement of defence be fi led a d this procedure was no t opposed

by t h e p a r t i e s .

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A statement o f claim VES f i l e d and it al.h?ged t h a t

cer ta in advert is ing concerning wanjum had been Tlbl1?hefi bv

what WRS described as th? l lAustral lan Uranium ProOucers Foruw”

c .

and t h z t this adver t i s ing was i n s u b s t a n c e t h e a d v e r t i s k g of

the respondents. The appl icant was desc r ibed in the s t a t emen t

of clairn as being the organiser of a body d l e d t h e C a m p a i g ~

Against Nuclear Fower, Queensland. ' It was a l leged that much o f

the adver t i s ing had been and was misleading o r deceptive o r

l l i k e l y t o m i s l e a d o r deceiTre. P a r t i c u l a r s were given o f a number

of d e t a i l s i n which it was said that the adve r t i s ing had been

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i o r was misleading o r deceptive o r l i k e l y t o mislead o r deceive.

The statement of c h i n a l s o a l l e g e 6 tha t c e r t a i n p a r t s of t h e

adver t i s ing had been and were misleeding o r deceptive o r l i k e l y

t o mislead or deceive because of what might broadly be c a l l e d

t h e manner of p r e s e n t a t i o n . I n p n c t i o n s were s o u g h t t o r e s t r a i n

adver t i s ing i n breach o f ss.52 m d 55 of t h e Act.

After pleaf ihgs had been f i led the quest ion of whether

ce r t a in i s sues shou ld be de t e r9 ined p r io r t o the hea r ing of the

matter was argued before me. It was common ground that t h e

hear ing would be lengthy and a per iod o f no t less t han th ree weeks

was thought by Senior. Counsel f o r both The q p l i c a n t and

respondents to be required. Senior Counsel f o r the respondents

a rgued thz t a considerable amount of - tme would be saved i f

cer ta in pre l iminary ques t ions were determined either by demurrer

o r o therv ise and the respondents ?:ere successfu l .

I t seemed common ground tha t both the appl icant an6

respond-ents vould c a l l o v e r s e a s e x p e r t s t o d e a l with the ques t ion

of whether the advert isenents were misleading o r deceptive or

l i ke ly to mis l ead o r deceive and t h e t cross-examination o f these

exper-ts vould be required. Senior Counsel f o r t h e a@ic?.nt

opposed the d iv i s ion of the hear ing i n any way and declined t o

attempt	t o a g r e e m y f a c t s .
In the s ta tement of defence the respondents had

demurred t o the whole o f the s ta temcnt	o f clairn on t h e gromfls
that: -

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(2) The conduct compleined o f vrac not done i n t r z d e o r

-- cowerce ;

(b) the appl icent has no locus s t and i t o s u e f o r t h e

r e l i e f sough t ;

(C) on the fects a l leged the condnct conplained o f -ras

n o t aimed 2.t o r disseminated t o consumez-rs: and

(6) on the facts al leged the conduct complained of vas

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incapable of misleading o r deceiving consumers.

L l te$nat ive ly ,	S-enior Counsel	for	the respondents pr=?secl
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f o r a qethod t o be s d o p t d ?-hereby the f o l l ~ ~ i n g _uestim. ~ o u l i i

be ansvererl before the hemins:-

1) Y P F t h e ?ne@ y-e~:rztinn end/or pvbl!.cstion of

th? eduertisemonts co-ylained o f 4onc i n -rrar?!c v

commerce vr5th.i.n t h e meaning of s.52 of the Track.

Prac t ices Ixt 1974?

. 2) Does m a7pl ica t ion f o r i n j u n c t i o n l i e i-n respec t of

conduct a l leeedly infr ingin5 tbe provis iom of s.52

of the Trade Pract ices Act a t the slit oC t h e

appl icant?

Quest ions 5	and	L	asked	si.nil?r q u e s t i o n s i n r e l 2 t i o n t o	2.55
of the Act.

I t i s convenient to consider quest ion 2 2nd t h e iFcl1e

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raisecl in parsgraph l3(b) of the demurrer first. These 1 s ~ 1 - e ~

a r e s u b s t m t i a l l y t h e s a z e and b a s i c s l l y .??pear t o r a i s e t h e

quest ion nf vrhether o r ncrt t he qq? l i czn t f2lls within t he

descr ip t ion I I - . ~"ny other person" aspepring i.n 5.80. It l.'??

sought to hevs t h i s iszue argued as a dequrrer Imfier t h e

provisions of Or?er 26 Rule 5 of the High Court Rules before the

hearing. The only fact admit ted in the s ta tement of defence

which apy?rrs t o be relel rant to t h i s ISWP i s 31 c7t the a;.pljcant

vas and j s a t 211 material t imes 2 repident of Austral ia .

Although it might a?year t h a t 81.1 f x t s necessary t o d o a l 4 t h

t h i s qwsl- lon on dcmvrrer 1:oul.d be bcfcrc the Court in t h r

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pleadings, I am by no neans sa t i s f i ed tha t i s s u e s a s t o t h e

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sa fe ty of urenium mining an3 the handl ing of urar.ium, which Rre

c l e a r l y i n i s s u e , i n r e l a t i o n t o t h e C u e s t i o n of whether the

adver t i s ing is n is leading or decept ive, may n o t b. r e l e v a n t i n

r e l a t i o n t o the s tanding of the appl icant to apply f o r t h e r e l i e f L

sought if t h e words ! 'any other ?erson" are subject to any

qual. if ication a t a l l . Senior Coucse l for the-appl icant oppcseci

t he i s sue r a i sed i n parsgraph l3(b) o€ the s ta tement o f claim

being deternined before the hear ing on the bas i s t he t i f , i n t e r

a l i a , any appeal vas taken the hearing of the matter would be

delayed. I am n o t s a t i s f i e ? t h a t I should d i rec t that the i s sue

raised under paragraph U(b) of the s ta tement o f defence be

determined before the main hearing.

The next i s sue ra i sed vas that under paragraph l3(c) m d

(d) of the statement of defence, on the f ac t s a l l eg"d , t he

conduct coqplained of vas (a ) no t a iaed a t o r disseminated to

I	consumers	and	(b)	vas	incapable of	misleading	01- deceivbng
consumers.

The f i r s t q u e s t i o n t h i s r a i s e s i s ??hether ss.52 o r 55

are concerned only with consumers. Senior Coumsel f o r t h e

respondents argued tha t no f a c t s were required f o r these p o i n t s

t o be argued by vag of demurrer since he said the text of t h e

advertisements ?'a.= before the Court i n the plee.dings, the

l e g i s l a t l o n was fo r t he p ro tec t ion of consuvers, and there "Tere

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no consumers o f nuclear energy in Austral ia . Senior Counsel

f o r t he app l i can t i nd ica t ed tha t it was not common ground that

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the re ve re no consumers of nuclear energy i n A u s t r a l i a and I

see no reason why I should make any assumptions on th i s ques t ion .

I n any event the poin ts ra i sed do-not appear to me necessar i ly

t o be decisive of any relevant issue, because even i f it be

e s t a b l i s h e d t h a t t h e conduct. complained o f was not aimed a t o r

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disseminated to consumers o r t he t srithout considering vhether

.-- it was mislpading or decept ive, j t ':'as jncapable o f a i s le?r ' jnc

o r deceiving consumers, the question would s t i l l a r i s e v h e t h e r

o r no t ss.52 and 55 rrere only concerned with conduct tThich "'as

misleading	o r	deceptive	o r	l i k e l y t o m i s l e a d o r d e c e i v e
consumers.

I note t ha t these issues under paragraph 13(c) an6 (d)

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do not appear to haw a r i s e n i n any of t he fou r ques t io r? s to

which I have re fer red previous ly .

I do not cons ider t,k?at it would be appropr iz te to permi t

t h e i s s u e s r a i s e d i n p e r a g r a ? h E ( c ) and ( d ) t o be determine?

p r i o r t o t h e heai-ing if f o r no othnr reason, becam? determinat ion

ir? thc respondents fmour	vyould no t be	conclusive o f the
l i t i g a t i o n .

I pass nor' t o t h e l as t questlol?, namely, thclt r a i s e d i n

paragraph ?.z(a) of the statement of defence being the

a l l ega t ion tha t t he conduc t complained was no t done i n trar'? o r

commerce. Th i s appears t o be t h e same ques-tlon a s is ra i sef i i n

quest ions 1 and 5 of the quest ions t o vhich I have previously

re fer red . I was asked by Senior Counsel f o r the respondents to

determine these questions ,apparently undo? the p rcv l s ions of

O r d e r 36 r u l e 6 of the High Court Rules,vhich permit one o r rnore

quest lons o r i s sues of f a c t t o be t r i ed be fo re the o thers .

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' / Apart from it appear ing tha t the i ssue ra i sed unr?er this hesdlng

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j i s a t l e a s t a mixed quest ion of fact and law and not purely a

! ques t ion o f f ac t , t he words of s.52(1) a r e l l e . . a corpora t ion

s h a l l n o t , I n t r a d e o r commerce, engage i n conduct which is

misleading o r deceptive o r is l i k e l y t o mls ld o r deceive."

It i s c e r t a i n l y an open quest ion whether there is a d i f fe rence

between a co rpora t lon , i n t r ade o r commerce engaging i n conexct

and the question of whether o r no t any adver t i s ing i s !Idone j E

trade o r commerce. In any event it was common ground that

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evidence Trould be necessary before the pmts ar is ing under

paragraph l3 (a ) Could be determined. .

It is c l e a r t h a t . a n appSicc?.tion t o have one i s s u e i n

an ac t ion t r i ed be fo re ano the r shodd no t be g ran ted l i gh t ly .

Since a n order f o r t h e s e p a r a t e t r i a l o f separa te i ssues is a

departure f r o m t he bene f i c i a l ob jec t o f t h e l a w t h a t . a l l d i s p u t e s

should be t r ied toge ther , genera l ly speeking , such an order

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should only be made in except ional c i rcumstances or on spec iz l

grounds ( ee generally Piercv v. (1880) 1.5 Ch.D. 475;

Coven v. Pevne 1974 1 V.L.R. 98b a t 939, Wilkshlre 8. Anor v.

-- Commonl,~alth of -Australia (1976) 9 A.L.R. 325.).

This i s not an exceptional case as vzs C e r l Zei?s CtiPtunv

v. Herbert Smith & Co. & Ors. 1969 l Ch. 93. I a lso cons idr r

t h a t some of t h e i s s u e s , f o r example, those raised in the

par t icu lars to the s ta te rcent of c la im, numbered 2.3g 24, 25,

could m11 be co~nmon to the de t e rmina t ion of the question wish? .

under paragraph l3(a) and the issue of whether the advert is ing

r e f e r r e d t o j n t h o s e p a r t i c u l a r s is Tis leading or decepti-re,

Th i s l a s t cons ide ra t ion i s of some importance.(See G. l - I i w ? v

e( Co. Ltd. v. Terr i to r l r Tr rkr?r i?es P tv . L t d . 1.966 V.R. 312)

Another fac tor vh ich poin ts towards the des i rab i l i ty

of determming a l l t h e i s s u 2 s a t t h e h e a r i n g i-5 t h a t t h i s

l i t i g a t i o n ? r i s e s u n d e r p r o v i s i o n s i n an Act which has no t been

the eubject of much j u d i c i z l i n t e r p r e t a t i o n . S e v e r a l d i f f i c v l t

questions of la?? may e r i s ? f o r the pro?er de te rn ina t lon of vhlch

a l l re levant f a c t s on vhi.ch a p a r t y re l ies shoul6 be before

the Court . (see generally Richards v. Noum 1967 1 Q.B. 67P).

I an therefore of the oFininn tha t I should refuse the I.

reques t of the respondents t o o r d e r any issue arising under the

d e m u r r e r t e n d e r e $ i n p a r e g q h 13 of the st?tenlent of d?fence,

o r o therwis? , to b? determined before the hearing o f the vnt tpr .

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