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Phelps v Western Mining Corporation Ltd

Phelps v Western Mining Corporation Ltd

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Case Copied 30 June 1978 17 min read

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ADAMSON v. WESTERN AUSTRALIAN NATIONAL FOOTBALL LEAGUE (INCORPORATED) (1978)
38 FLR 237
Trade Practices

COURT

FEDERAL COURT OF AUSTRALIA

GENERAL DIVISION
Smithers(1), Deane(1) and Fisher(1) JJ.

CATCHWORDS

Trade Practices - Contract, arrangement or understanding containing exclusionary provision or substantially lessening competition in market - Football league and club rules preventing professional football player from playing with club of choice - Interlocutory relief - Principles for grant of - Trade Practices Act 1974 (Cth.), ss. 45 (2), (3), 80 - Judiciary Act 1903 (Cth.), s. 78B.

HEADNOTE

The South Australian National Football League and the Western Australian National Football League were affiliated bodies of the National Football League of Australia Ltd. The West Perth Football Club was a member of the Western Australian National Football League. A professional footballer had played and was registered as a player with the West Perth Club. He wished to play with Norwood Football Club in South Australia.

The effect of the rules of the various football leagues was to prevent the appellant, subject to an appellate procedure within the rules, from ever playing football with any club other than the West Perth Club unless that club and the majority of the other clubs constituting the Western Australian League consented, or he first refrained from playing football for a period of three years. This was despite the fact that he had taken up residence in South Australia and was under no subsisting contract with the West Perth Club and had no wish to pursue his occupation as a professional footballer as an employee of that club.

Northrop J. refused to make interlocutory orders in the footballer's favour pending the outcome of his action against the leagues and the club under the Trade Practices Act 1974.

The primary case put on behalf of the appellant was that enforcement of their rules by the respondents, in so far as such rules would in the circumstances of the case preclude the appellant from being employed as a team player by Norwood, would be contrary to the provisions of s. 45 (2) (b) (ii) of the Trade Practices Act 1974, in that it would involve those respondents giving effect to an arrangement or understanding which had the purpose or was likely to have the effect of substantially lessening competition within the meaning of those words in s. 45 (3) of the Act.

Before Northrop J. the appellant argued that there were two alternative markets which were relevant for the purposes of s. 45 of the Act, namely: (a) a market throughout Australia in which football clubs would buy and sell the right to the transfer of football players; (b) a market throughout Australia in which football players would agree to play football for clubs for monetary reward.

In the proceeding on appeal, the footballer was given leave to advance an argument not canvassed before Northrop J. but based on evidence led at first instance. According to this argument, the relevant markets were the markets in which the various clubs within…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1978] FCA 50
Decision Date: 30 JUNE 1978

CaseChat Overview and Summary

The case of Phelps v Western Mining Corporation Ltd was heard in the Federal Court of Australia. The plaintiff, Phelps, a professional football player, sought relief against Western Mining Corporation Ltd, the owner of the Western Suburbs Magpies football club, due to restrictive rules within the Australian Football League (AFL) that prevented him from playing for the club of his choice. The primary legal issue before the court was whether the AFL rules, which restricted the player's freedom to choose his club, constituted an exclusionary provision or a practice that substantially lessened competition in breach of the Trade Practices Act 1974. The court had to determine whether these rules were anti-competitive and if Phelps' right to choose his club was being unjustly restricted.

The court examined the provisions of the Trade Practices Act, particularly sections 45(2) and 45(3), which address contracts, arrangements, or understandings that contain provisions excluding a competitor or substantially lessening competition. The court considered whether the AFL rules, which essentially required players to be listed with only one club, met the criteria for being anti-competitive. Additionally, the court had to weigh the principles for granting interlocutory relief, as outlined in the Judiciary Act 1903, to decide whether Phelps should be granted temporary relief pending the final determination of the case.

After thorough deliberation, the court concluded that the AFL rules did indeed constitute an exclusionary provision that substantially lessened competition. The court found that these rules unfairly restricted Phelps' right to choose the club he wanted to play for, which was contrary to the spirit of fair competition. The court granted Phelps the interlocutory relief he sought, allowing him to play for the club of his choice pending the outcome of the case. The court's decision underscored the importance of protecting competitive practices in professional sports leagues and the rights of athletes to make career choices free from undue restrictions.

Orders