Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc (No 2)

Re: TOBACCO INSTITUTE OF AUSTRALIA LIMITED
And: AUSTRALIAN FEDERATION OF CONSUMER ORGANISATIONS INC.
No. N G217 of 1991
FED No. 105
Number of pages - 22
Trade Practices - Remedies - Practice and Procedure - Appeal
(1993) 14 ATPR 41-222
(1993) 113 ALR 257
(1993) 25 IPR 509
(1993) 41 FCR 89

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Sheppard(1), Foster(2) and Hill(3) JJ.

CATCHWORDS

Trade practices - consumer protection - advertisement dealing with the effects of environmental tobacco smoke found to be misleading and deceptive - question of relief to which respondent (the applicant at first instance) entitled - no claim made other than for injunctive relief - injunctive relief granted by primary Judge set aside - whether applicant should be permitted to amend application to seek declaratory relief.

Remedies - declaratory relief - consumer protection - whether power to grant declaratory relief - whether injunctive relief different from that granted by primary Judge should be substituted therefor.

Practice and Procedure - costs - disposal of costs at first instance and on appeal - whether costs should be ordered on indemnity basis.

Appeal - admission of fresh evidence - whether respondent should be given leave to rely on fresh evidence - finality principle - evidence not evidence in existence at time of trial.

Appeal - statutes - validity or construction - whether appellant should be given leave to argue questions relating to the validity or construction of s.52 of the Trade Practices Act 1974 upon the basis of decisions of the High Court of Australia in Australian Capital Television Pty. Limited v. Commonwealth of Australia (No.2) (1992) 108 ALR 577 and Nationwide News Pty. Limited v. Wills (1992) 108 ALR 681.

Trade Practices Act 1974, ss.52, 80, 82, 87, 163A

Federal Court of Australia Act 1976, ss.21, 23

Australian Capital Television Pty. Limited v. Commonwealth of

Australia (No.2) (1992) 108 ALR 577

Nationwide News Pty. Limited v. Wills (1992) 108 ALR 681.

World Series Cricket Pty. Limited v. Parish (1977) 16 ALR 181

Polgardy v AGC Limited (1981) 52 FLR 240

Westpac Banking Corporation v. Northern Metals Pty. Limited (1989) ATPR case 40-953.

FAI General Insurance Co. Limited v. RAIA Insurance Brokers Limited (1992) 108 ALR 479.

Australian Softwood Forests Pty. Limited v. Attorney-General (NSW); ex rel. Corporate Affairs Commission (1981) 148 CLR 121

Sankey v. Whitlam (1978) 142 CLR 1

Australian Conservation Foundation Inc v. Commonwealth (1980) 146 CLR 493.

Neeta (Epping) Pty. Limited v. Phillips (1974) 131 CLR 286.

ICI Australia Operations Pty. Limited v. Trade Practices Commission (1992) 110 ALR 47

Trade Practices Commission v. Mobil Oil Australia Limited (1984) 4 FCR 296

Forster v. Jododex (1972) 127 CLR 421

HEARING

SYDNEY, 23 December 1992 and 3 February 1993

#DATE 10:3:1993

Counsel for the Appellant: Mr B.S.J. O'Keefe, QC and Mr B.W. Walker

Solicitors for the Appellant: Clayton Utz

Counsel for the Respondent: Mr N.F. Francey

Solicitors for the Respondent: Cashman and Partners

Counsel for the Attorney-General
(Commonwealth) (intervening): Dr G. Griffith, QC,

the Solicitor General for the Commonwealth

Solicitors for the
Attorney-General (Commonwealth): The Australian Government Solicitor

ORDER

THE COURT ORDERS THAT paras. 1 and 2 of the orders made by Morling J. on 15 April 1991 be set aside.

THE COURT ORDERS THAT:-

1. It be declared that para. 3 of the advertisement published by the appellant in or about July 1986 is misleading and deceptive contrary to the provisions of s.52 of the Trade Practices Act 1974.

2. The order made by Morling J. on 15 April 1991 (para.4 of the orders then made) disposing of the costs of the trial be set aside and there be substituted therefor an order that the appellant pay to the respondent three quarters of its costs of the proceedings at first instance.

3. The appeal brought by the appellant be otherwise dismissed.

4. The appellant pay to the respondent one half of its costs of the appeal.

5. The respondent's application made by Notice of Motion filed in Court on 3 February 1993 for leave to lead fresh evidence be dismissed with costs.

6. The appellant's application made on 3 February 1993 for leave to argue a question of law based on the decisions of the High Court in Australian Capital Television Pty. Limited v. Commonwealth of Australia (No. 2) (1992) 108 ALR 577 and Nationwide News Pty. Limited v. Wills (1992) 108 ALR 681 be refused with costs.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

SHEPPARD J. Reasons for judgment were published in this matter on 17 December last. A number of matters were left outstanding. As events have developed, these now are the question whether the Court should give declaratory and/or injunctive relief, an application by the respondent to lead fresh evidence, whether we should give the appellant leave to argue matters relating to the validity or construction of s.52 of the Trade Practices Act 1974 ("the Act") based upon the decisions of the High Court in Australian Capital Television Pty. Limited v. Commonwealth of Australia (No. 2) (1992) 108 ALR 577 and Nationwide News Pty. Limited v. Wills (1992) 108 ALR 681, and the question of costs. I propose to deal first of all with the respondent's application to lead fresh evidence. If the application were granted, it would be necessary to defer the determination of the questions of relief and costs.

Fresh Evidence
2. The principal affidavit relied upon by the respondent in support of its application is that of Mr R.G. Everingham sworn on 29 January 1993. He is the respondent's solicitor. The evidence to which he refers falls into two categories. The first concerns a report said to have been published by the United States Environmental Protection Agency in December 1992. The report is entitled "Respiratory Health, Effects of Passive Smoking: Lung Cancer and Other Disorders". One of the major conclusions reached in the report was that widespread exposure to environmental tobacco smoke in the United States presented a serious and substantial "public health impact".

I would reject the application for leave to lead fresh evidence insofar as it concerns this report. It is but one of a number of reports and studies that have come into existence since the matter was before his Honour and, indeed, since the matter was before us. Leave could not be given to lead fresh evidence without giving the appellant the opportunity of leading evidence of its own. The matter would simply never finish. That matter is not conclusive but it is important.
Of more direct relevance is the fact that the appeal to this Court is a true appeal. We cannot be concerned with material which was not, and could not have been, available to his Honour up to the time he gave his judgment. It was for his Honour to determine on the material before him what injunctive relief, if any, he should grant. It was for us to determine whether or not his Honour's conclusions about that matter were correct. In reaching our conclusion, it was incumbent on us to base our decision on the material which was before his Honour. It would be possible for us to receive fresh evidence provided a proper case was made out for its reception. But such evidence would need to be evidence which, for some reason, was not available to the respondent at the time of the trial but which was in existence at that time. Evidence of investigations and scientific opinions which came into existence well after his Honour's judgment is of no relevance to the determination of the appeal. It is true that counsel for the respondent seeks to use the evidence in order to support his claim for injunctive relief. But it cannot be relevant to that question. The whole matter, including matters relied upon to establish the likelihood of further breaches of s.52 of the Act, must be determined upon evidence which was in existence no later than 15 April 1991 when his Honour's principal orders were made.
The other category of evidence concerns a brochure entitled "Work-Place Smoking" distributed by the appellant in January this year, certain publicity about the brochure in a newspaper, and a radio interview.
The brochure is printed. It purports to give the appellant's perspective on the effect of environmental tobacco smoke. In part it suggests that such smoke is so extensively diluted that it may not even be appropriate to call it smoke. The purpose of the brochure is to persuade employers against imposing restrictions on smoking in work places.
The brochure was distributed after the reasons of this Court were published. There was added to the brochure an addendum to page 25 which purported to deal with the decision of the primary Judge as affected by the reasons of two of the members of this Court.
The reasons for judgment of the members of this Court comprise a public document which is, like any other public document, available for consideration, comment and criticism by members of the public. However, a reading of the passages from the various judgments selected by the author of the addendum to be added to page 25 of the brochure suggest to me that the passages have been chosen selectively and may (I express no concluded opinion because it is unnecessary to do so) have given a distorted impression of what this Court decided. It is one thing to make public comment or criticism of a judgment of a court; it is another if that public comment or criticism be erroneous or misleading even if it be so by reason of what is omitted rather than what is included.
As has been emphasised more than once, this case concerns a matter of high public interest, Australia's public health. The brochure in question has been circulated in the commercial interests of the appellant or its constituents. Its ultimate object is to persuade employers that passive smoking is not a problem and that its effects in the community have been gravely overstated. That is a view which the appellant is entitled to hold and to promote. But it would be a most dangerous course for that promotion to be based at all upon a selection of statements made in lengthy reasons for judgment about the question whether an advertisement published by the same body as prepared the brochure was misleading or deceptive. What I am about to say has little to do with the question whether or not this application for leave to lead fresh evidence should be granted. I simply issue a word of caution concerning the use in commercial promotional material of extracts from judgments of the Court. Not in these proceedings, but perhaps in others, the Court will be astute to see to it that the public will not be misled by statements attributed to it and used out of context. If it emerged that that had occurred, the contempt of court which would be involved would be most serious and the punishment for it appropriate to its seriousness. The parties to this litigation should each understand that that is the case and not treat the reasons for judgment of members of the Court as material which they may use freely for their promotional purposes without understanding the consequences which may ensue if what they say turns out to be misleading or even false.
That having been said, I turn to the publicity about the brochure and the radio interview. The publicity consists of an article which appeared in the Shepparton News of 6 January 1993. The article was entitled "Brave words and bold hopes". It referred to the brochure and quoted from it. The comment towards the end of the article was adverse to the tobacco industry and I can see no basis whatever on which it could be suggested that the existence of the article should lead the Court to give the respondent leave to lead fresh evidence.
The radio interview was an interview on Radio 2UE in Sydney with a Mr Jeremy Mostyn of the appellant. He is its Executive Director. The interview occurred because of a ban on smoking said to have been imposed by 14 shopping centres in Australia. Mr Mostyn's response to questions asked by the interviewer, Mr Olds, was that the thinking behind the ban was based on a false premise. Amongst other things he said that the allegation was that there was a direct link between passive smoking and ill health in non-smokers when all the evidence to date in summary indicated that the connection between ill health in non-smokers and smoke in the atmosphere was inconclusive "at best".
I do not refer to the entirety of the interview but reference was made to a case concerning a person named Shollen. Mr Mostyn said that Ms Shollen was an asthmatic who had been working in a small cramped office which was not air conditioned. A jury had awarded her damages. There was then reference to Foster J.'s judgment in this case and there followed statements emphasising Mr Mostyn's view that there was "no clear, conclusive evidence that passive smoking is injurious to the health of non-smokers."
That statement calls for this comment. It may be true that there is a question whether environmental tobacco smoke is capable of causing asthma in the sense of the underlying condition which makes a number of people in the community asthmatics. But there is no question but that those who are asthmatics may suffer adversely as a result of environmental tobacco smoke. There is no issue about that matter. Counsel for the respondent conceded as much when the matter was in the list on 3 February. I refer to the following interchange between counsel for the appellant and myself:-

"SHEPPARD J.: But on the face of the evidence as it was in 1986 - and I hope I do not forget your injunctions to us about context or time - it would have been common ground that if you had said in an advertisement environmental tobacco smoke does not cause asthmatics to have asthma attacks, the advertisement would have been misleading or deceptive.

MR O'KEEFE: No question of that, your Honour, yes."

It is obvious that if the appellant wishes to be accurate in the statements it makes about this matter, it needs to take great care in spelling out what it means when it refers to the effects of environmental tobacco smoke on asthmatics.
That having been said, I would reject the application to lead fresh evidence insofar as it consists of the brochure, the article in the Shepparton News and the radio interview. Like the United States report already dealt with, these items all came into existence after his Honour's orders. They are of no relevance on this appeal and, apart from that matter, leave to reopen the case would be likely to lead to a further extensive hearing. As has been said, it is time this litigation finished.

Declaratory Relief
16. I will deal with declaratory relief first of all. The matter was listed on 23 December last after the parties had had an opportunity of considering the Court's reasons. The members of the Court had unanimously reached the conclusion that the injunctive relief granted by the learned primary Judge could not stand. An application was made by counsel for the appellant for an order setting aside the orders for injunctive relief made by the primary Judge. We acceded to this application insofar as it related to paras. 1 and 2 of the orders made by the primary Judge on 15 April 1991. We left in place para. 3 of the orders which concerned an article which reported on a study involving 12,000 people. In my earlier reasons I mentioned (p 40) that I did not recall submissions specifically addressed to that paragraph and, accordingly, reached no conclusion on whether the order made in para. 3 should remain. The position has been taken no further in the submissions made by the parties in writing or during the further hearing of the matter which took place on 3 February last. In those circumstances the order made by the primary Judge in para. 3 of his orders ought not to be disturbed.

At the conclusion of my reasons for judgment published on 17 December last I said (p 40) that I would be prepared to entertain an application for the making of an appropriate declaration concerning the falsity of the advertisement which was the subject of the proceedings. I also said that I would be prepared to consider any submissions counsel for the respondent wished to make in support of injunctive relief less extensive in its operation than that granted by his Honour.
An initial objection to the granting of declaratory relief made by the appellant was that this must necessarily involve the respondent in seeking leave to amend its application. Counsel for the appellant emphasised that declaratory relief had never before been sought. All along, that is throughout the hearing at first instance and the hearing of the appeal, the respondent had sought only injunctive relief. References to the transcript before his Honour bear out the appellant's claim that throughout the trial the respondent resisted any suggestion that it should amend its claim for relief to raise any wider case than that made in para. 1(a) of its application and paras. 3, 6 and 8 of its statement of claim. It was submitted that the respondent should be held "to such a deliberate forensic course." Reliance was placed on Water Board v. Moustakas (1988) 77 ALR 193 at 196-8.
It was also submitted that leave to amend should be refused because of substantive defects in the respondent's claimed declarations. It was said that the declarations sought did not, in terms, seek relief with respect to the advertisement itself.
It has to be said that the appellant's submissions make a powerful case for refusing the respondent leave to amend its claim for relief so as to include a claim for declaratory relief. If this were litigation which did not involve as directly as it does the public interest, I would have been reluctant to entertain the application to amend which is before us. But the public interest is very much involved and is, in my opinion, a matter which must be given weight in our determination of whether leave to amend should be granted. Furthermore, the trial of the various issues in the case has aired very fully the dispute between the parties. We have reached clear conclusions on what the outcome of that dispute should be. I do not perceive, notwithstanding the respondent's conduct both of the trial and the appeal, why any substantial injustice or prejudice will be suffered by the appellant if we entertain the claim for declaratory relief. Each of the members of the Court has reached a clear conclusion on the ultimate issue, namely, whether para. 3 of the subject advertisement was misleading or deceptive. Each member of the Court has concluded that it was both misleading and deceptive. To make an appropriate declaration to give effect to this decision is, subject to some other matters which require consideration, but to give formal effect to the Court's conclusions stated in the reasons for judgment of its members.
In all the circumstances, I would therefore not refuse leave to amend on the grounds of objection so far dealt with. But there are other considerations.
When the matter was in the list on 23 December last we asked counsel for the respondent to provide to counsel for the appellant and to the Court a precise minute of the order which was sought. Counsel for the respondent had already prepared such a document. It was marked "1" for identification. It was divided into two parts, the first claiming a number of declarations and the second, a number of injunctions. The first declaration sought was that the advertisement was misleading or deceptive insofar as it stated, "And yet there is little evidence and nothing which proves scientifically that tobacco smoke causes disease in non-smokers." In para. 2 the Court was asked to declare, as and from 1 July 1986:-

"(a) There was much more than a little evidence that environmental tobacco smoke causes attacks of asthma. (Sheppard J. 18.9; Foster J. 32-33).

(b) There was something in the sense of something substantial which proved scientifically that environmental tobacco smoke could cause asthma attacks. (Sheppard J. 19; Foster J. 32- 33).

(c) There was more than a little evidence that passive smoking causes lung cancer in non-smokers. (Hill J.47; Sheppard J. 19; Foster J. 31-32).

(d) There was something in the form of a large body of epidemiological material and opinion (per Sheppard J.) and major scientific reviews (per Foster J.) which prove scientifically that passive smoking causes lung cancer. (Sheppard J. 22-23; Foster J. 32).

(e) There was evidence that passive smoking causes respiratory disease in young children. (Sheppard J. 23; Hill J. 50).

(f) There was more than a little evidence that passive smoking causes otitis media. (Sheppard J. 23; Hill J. 55)."

It is to be observed that the various paragraphs are culled from the judgments of the members of the Court. Counsel for the respondent did not of course intend that the references to the particular judges and the pages of their reasons referred to should remain part of the declarations. The references were given to assist the Court in its consideration of the matter. But the fact that these extracts are taken from the various judgments shows how difficult is the course which the respondent seeks to take. Although each of the members of the Court reached the conclusion that the advertisement was misleading and deceptive, there are not identical reasons for this conclusion. There are substantial differences between the reasons of Hill J. on the one hand and those of Foster J. and myself on the other and, as between Foster J. and myself, there is to be found an unevenness between us in a number of places. In my opinion those considerations are sufficient to warrant the conclusion that it would be quite inappropriate to make declarations in accordance with those sought in the lettered subparagraphs of para. 2 of the document marked "1" for identification. It would therefore be inappropriate to give the respondent leave to amend its claim for relief to claim declarations in these terms and I would refuse leave to amend accordingly.
But those considerations do not touch the declaration sought in para. 1 of the document marked "1" for identification. There is, as counsel for the appellant stressed, a problem about para. 1 because it makes no reference to the context in which the words are used. But an amendment of the claim can overcome this problem and will do no injustice to the appellant. Subject to that matter, I am disposed to think that we should permit an amendment to allow the respondent to claim a declaration along the lines of that propounded in para. 1.
There is, however, a question whether the Court in a case such as this is empowered to grant declaratory relief at all. The submissions made in relation to this matter require reference both to the Act and to the Federal Court of Australia Act 1976 ("the Federal Court Act"). The application with which the learned primary Judge dealt was made pursuant to the provisions of s.80 of the Act. Section 80, which is to be found in Part VI of the Act, enables this Court to grant injunctions in the circumstances which are provided for. Subject to subsecs. (1A) and (1B) (neither of which is relevant here), where, on the application of the Minister, the Trade Practices Commission or any other person, the Court is satisfied that a person has engaged, or is proposing to engage, in conduct that constitutes or would constitute, inter alia, a contravention of a provision of Part V of the Act, the Court may grant an injunction in such terms as the Court determines to be appropriate. Section 52 of the Act is to be found in Part V. It is to be observed that the respondent sued for injunctive relief under this provision because it fell within the words "any other person". It has been held that these words must be given their natural meaning. They are not to be qualified to limit the right to apply for relief to consumers only. I refer to Phelps v. Western Mining Corporation Limited (1978) 33 FLR 327, World Series Cricket Pty. Limited v. Parish (1977) 16 ALR 181 and Glorie v. W.A. Chip and Pulp Co. Pty. Limited (1981) 55 FLR 310. In the World Series Cricket case Bowen C.J. emphasised (p 186) that proceedings under the Act have a special character. In the course of protecting the public interest, the Act enables a party to seek relief from injury to his own interests, but an applicant for an injunction under s.80 need not show that a proprietory interest of his is affected or that he has suffered special damage or, indeed, any damage at all. But it is to be emphasised that s.80 deals only with injunctions; it does not deal with declarations.
Reference needs to be made to some further sections of the Act. Section 82 provides for actions for damages and is not relevant to the present problem. Section 87, which deals with certain other orders which the Court may make, provides in para. 2(a) for declaratory relief but that provision is not of relevance here. Subsection 163A(1) enables a person to institute a proceeding in the Court seeking, in relation to a matter arising under the Act, the making, inter alia, of a declaration in relation to the operation or effect of any provision of the Act other than Divisions 2, 2A and 3 of Part V or in relation to the validity of any act or thing done, proposed to be done or purporting to have been done under the Act. It is plain enough that the present case does not fall within the provisions of s.163A; cf. Polgardy v. AGC Limited (1981) 52 FLR 240 and Westpac Banking Corporation v. Northern Metals Pty. Limited (1989) ATPR, case 40-953.
Counsel for the appellant used the section, along with the provisions of s.80, in support of a submission that there is a manifest intention on the part of the legislature not to permit a person not claiming injunctive relief or damages to sue for a breach of the Act. Otherwise, so they said, a provision would have been included in Part VI expressly permitting a person not affected by a breach of the Act otherwise than in his or her capacity as a member of the public to sue for declaratory relief.
It was suggested that there was good reason for this. If the case were not an appropriate one for injunctive relief or damages, the conferring of a right to sue on members of the public may have a number of undesirable consequences. It would encourage the proliferation of litigation, with a consequent waste of public and private time and money, and it would result in no particular public benefit. Unless there were the need to restrain future illegal conduct or to compensate a person who had suffered damage as a consequence of a breach of the Act, the public would not be advantaged by the litigation.
The Act does not contain the only relevant provisions. Attention needs to be given to ss.21 and 23 of the Federal Court Act. These are as follows:-

"Declarations of right

21.(1) The Court may, in relation to a matter in which it has original jurisdiction, make binding declarations of right, whether or not any consequential relief is or could be claimed.

(2) A suit is not open to objection on the ground that a declaratory order only is sought. Making of order and issue of writs

23. The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, and to issue, or direct the issue of, writs of such kinds, as the Court thinks appropriate."

Counsel for the respondent submitted that, irrespective of the provisions of s.21, the Court had power to make a declaration under s.23. I do not need to consider that question. I have reached the conclusion that the Court in the present case is empowered, if it thinks it appropriate, to make a declaration by reason of the provisions of s.21.
As is said in Declaratory Orders, P.W. Young, 2nd ed., (1984), wherever a public right is infringed, the Attorney-General may act to protect that right by whatever action he considers appropriate, including declaratory proceedings. The proceedings brought by the Attorney-General may be brought ex officio or ex relatione; The Declaratory Judgment, Zamir, (1962), pp 262 et seq. Ramsay v. Aberfoyle Manufacturing Co. (Australia) Pty. Limited (1935) 54 CLR 230 and Cooney v. Ku-ring-gai Municipal Council (1963) 114 CLR 502, although cases about injunctions, provide indications of the nature of public rights which the Attorney-General may sue to enforce. In Australian Softwood Forests Pty. Limited v. Attorney-General for the State of New South Wales; ex relatione Corporate Affairs Commission (1981) 148 CLR 121 declarations (of right) had been described in the New South Wales Court of Appeal ((1979) 2 NSWLR 73) as "little more than prefatory averments to the grant of an injunction". Gibbs C.J. said (p 125) that this statement was incorrect. In that case it was inappropriate to grant an injunction and the High Court restored the declaratory relief which had been granted at first instance by Helsham C.J. in Eq. In Sankey v. Whitlam (1978) 142 CLR 1 Gibbs A.C.J. said (p 23) that the word "right" in the expression "declarations of right" in s.75 of the Supreme Court Act 1970 (NSW), the New South Wales counterpart of s.21 of the Federal Court Act, was used in a sense "that is wide and loose." It included what might more precisely be described as privileges, powers and immunities.
In Zamir (supra) there is a substantial discussion about standing to sue for a declaration of right (pp 247-54). That is the problem which frequently confronts a person other than the Attorney-General in bringing proceedings. Here the respondent was able to sue for injunctive relief because of the express provisions of s.80 of the Act which empowered the Court to entertain such an action, although brought by an ordinary citizen. Section 21 of the Federal Court Act empowers the Court to make a declaration of right in a matter in which it has original jurisdiction. The Court has original jurisdiction because of the provisions of s.80. It is therefore empowered, if it is otherwise appropriate to do so, to make a declaration of right in such a case whether or not the injunctive relief is also granted. The declaration, if made, will be a declaration of right because the right which will be declared will be a public right, namely, the right of the public not to be misled or deceived by factual statements in an advertisement concerning the effects of passive smoking.
The provisions of s.163A need to be considered but I do not read them as providing exhaustively for the circumstances in which the Court may make a declaration at the suit of "a person". The provisions of s.21 of the Federal Court Act are too clear. In this respect I am in respectful agreement with the conclusion reached by Foster J. in FAI General Insurance Co. Limited v. RAIA Insurance Brokers Limited (1992) 108 ALR 479 at pp 507-8.
It should be said that it is not clear what the purpose and ambit of s.163A of the Act were intended to be. A reference to the second reading speech of the Minister who introduced the Bill for the relevant amendment of the Act on 25 March 1976 reveals that one of the perceived problems was that the Commonwealth Industrial Court (in which the Act was then enforced) did not have power to grant declaratory relief. In this respect the Minister said (Hansard for 25 March 1976, p 1012):-

"The Bill fills a gap in the present jurisdiction of the Industrial Court to deal with matters arising under the Trade Practices Act. For these matters, the Industrial Court is to be given the power to make declaratory judgments and to issue prerogative writs in the nature of prohibition, certiorari or mandamus. The difficulties caused by the omission of these powers became apparent early in the operation of the Trade Practices Act. Last year, actions seeking the making of a declaratory order were commenced in a State and a Territory Supreme Court. Those courts, or the High Court, then were the only courts with such jurisdiction. This is incongruous, since otherwise the focus of the Act is upon proceedings in the Industrial Court. The previous Government announced in July last year that it proposed to remedy this defect in the Act, but had not done so before the change of Government. The power of the Industrial Court to make these declaratory orders will not extend to the provisions of Division 2 of Part V of the Act, which imply certain conditions and warranties into consumer transactions. Litigation relying upon these provisions was always intended to take place in courts other than the Industrial Court, and that position will not be altered.

The power to make declaratory orders will complement the existing procedures of the Act providing for clearance of certain restrictive trade practices. It will provide, in some cases, a procedure to obtain more certainty as to the operation of the Act. However, the exercise of the power will always be in the discretion of the court and will, of course, be subject to the restraints imposed by the constitutional requirements of the judicial power of the Commonwealth."

Reference may also be made to paras. 2, 3 and 4 of the Explanatory Memorandum which was circulated at the time the Bill was before Parliament. The Bill was assented to on 31 August 1976. Also passed in 1976 was the Federal Court Act which was assented to on 9 December 1976 some three months after the Trade Practices Amendment Act. Thereafter the Federal Court replaced the Commonwealth Industrial Court as the Court which enforced the Act. Conferred on it were the much wider powers provided for in ss.21 and 23 of the Federal Court Act.
In passing I mention that s.163A of the Act was amended in 1983; see Statute Law (Miscellaneous Provisions) Act (No. 1) 1983. The purpose of the amendment was to exclude from the operation of the section Divisions 2A and 3 of the Act. The amendment is not of consequence for present purposes.
Whilst the historical analysis which I have undertaken is, I think, helpful in understanding why Parliament thought it necessary to enact s.163A, namely, to give the Commonwealth Industrial Court power to make declarations in certain circumstances, the analysis does not explain why the purview of the section is limited in the way that it is. Furthermore, s.163A remained in the Act after the Federal Court was established in December 1976. Nevertheless, it would seem to me to be taking a most restrictive step to limit the circumstances in which declarations may be made by the Court to the circumstances provided for in s.163A when the Court has conferred upon it the extensive powers provided for in both s.21 and s.23. I do not think that a power such as is conferred by these sections should be narrowly construed or denied simply because there is in an Act which confers jurisdiction on the Court a specific power, for example, to give declaratory relief in some specific circumstances. Declarations of right are an important part of a court's armory of remedies and the power to make them ought not be cut down except where the language which Parliament has used is abundantly clear.
It is true that the conclusion I have reached, namely, that the Court has power to make a declaration in a case brought by a person other than the Minister or the Trade Practices Commission for injunctive relief, would enable a member of the public, provided he had an arguable case for an injunction, to make out a case for a declaration notwithstanding that he himself had suffered no damage and that the case was found not to be one appropriate for injunctive relief. But anxiety that that circumstance may lead to a proliferation of applications for declaratory relief by a variety of persons should be allayed because the remedy is a discretionary one and the Court will not grant declaratory relief in hypothetical cases nor in cases where the making of a declaration is of no utility. Furthermore, a consequence of holding that the Court had no power to make a declaration in a case such as this would mean that the Court would have no such power in proceedings brought under s.80 by the Minister or the Commission (it may be noted that, whilst the Minister may institute proceedings under s.163A, the Trade Practices Commission may not; subsecs. (2) and (3)). This does not seem to me to have been the likely intention of Parliament. As in the Softwoods case, it is often useful to be able to make a declaration in a case that does not warrant the granting of injunctive relief. The making of declaratory orders in such cases without the grant of injunctive relief in litigation brought under the general law to enforce public rights is not an uncommon course.
There are some other matters which, in my opinion, provide indirect support for the conclusion to which I have come. It is to be observed that subsecs.80(4) and (5) empower the Court to grant injunctive relief notwithstanding that it does not appear to the Court that the respondent intends to engage again, or to continue to engage, in proscribed conduct. It may also grant injunctive relief whether or not the respondent has previously engaged in conduct of that kind. Furthermore, Lockhart J. in his judgment in ICI Australia Operations Pty. Limited v. Trade Practices Commission (1992) 110 ALR 47 referred (at pp 54-55) with apparent approval to the judgment of Toohey J. (when a judge of this Court) in Trade Practices Commission v. Mobil Oil Australia Limited (1984) 4 FCR 296 where Toohey J. said (at p 300):-

"It is clear therefore that in determining whether to grant an injunction the court is not restricted because the factors mentioned in subs (4) are absent. The question must still be asked - where those factors are absent, what purpose is an injunction intended to serve? The imposition of an injunction may, in an appropriate case, be an additional sanction to a pecuniary penalty. For instance, in the case of a particularly flagrant breach, even though there was no evidence to indicate the offender's intention to continue the offending conduct, it might be appropriate to mark the court's disapproval by an injunction as well as a monetary penalty."

The presence of subsecs. 80(4) and (5) of the Act and the interpretation of those sections by this Court provide an indication of the approach which the Court, in some types of cases, may take. The policy of the Act, concerned as it is with the public interest, enables the Court, in relation to injunctive relief, to take a course that would not be taken in ordinary civil litigation. That policy, in my opinion, extends into the area of declaratory relief and provides support for the view that the Court may, in appropriate cases, exercise its power to grant declaratory relief to mark its disapproval of particular conduct engaged in in contravention of the Act.
Although the respondent here did not seek a declaration at first instance and although its claim was entirely for injunctive relief, the question whether the advertisement was misleading or deceptive was a central issue before the primary Judge and before us on appeal. For the various reasons given by the four judges who have dealt with the matter, the advertisement has been found to be both misleading and deceptive and thus to be in breach of s.52 of the Act. The hearing before his Honour, which was largely occupied with this question, lasted for many months; before this Court, which was principally concerned with the same question, the hearing lasted for three weeks. Whatever counsel for the appellant may now say about the effect of this Court's judgment or the questions which were in issue, the fact is that their client fought the question of misleading or deceptive advertising, contending that a proper result was that the advertisement was not misleading or deceptive and thus not in breach of s.52 of the Act. That proposition has been rejected firmly by each of the judges who has dealt with the matter. That being the case, it would seem quite undesirable to me that, in a matter involving as it does the public interest - really the public health and well-being of the nation - the Court having reached its conclusion should not formally indicate the result of the litigation by an appropriate declaration of right.

In reaching this conclusion I am conscious of the course of the proceedings before his Honour, particularly of the discussions about the relief which the respondents sought and of the omission from that relief of any claim for a declaration. I can understand that those advising the appellant must feel a sense of frustration faced as they now are with an application for a declaration made when the injunctions which the respondent persuaded his Honour to make have been set aside and when there is grave uncertainty as to whether the respondent is entitled to any alternative injunctive relief. If the matter did not involve the public interest or if the appellant had not conducted the case in the way that it did, meeting the respondent's case head on, I may have reached a different conclusion. But those two matters persuade me that the correct course is to make a declaration formally recording the Court's finding on the principal issue which was litigated. The declaration I would propose is that para. 3 of the advertisement published by the appellant on or about 1 July 1986 was misleading and deceptive.

Injunctive Relief
43. The injunctive relief which the respondent now seeks is specified in the document marked "1" for identification earlier mentioned. The injunctive relief claimed is as follows:-

"1. The Appellant by itself, its servants and agents be restrained from engaging in conduct, in trade or commerce, (including making any statement) contrary to the foregoing declarations of the Court or by way of asserting that:

(a) There is only an insignificant amount of material which would tend to establish that tobacco smoke can create a significant risk of illness in non-smokers. (Foster J. 26-27)

(b) There is no significant material which tends to establish that cigarette smoke results in illness in non-smokers. (Foster J. 27)

(c) There is no material which satisfies reputable scientists that there is a significant connection between passive smoking and risk of illness in non-smokers. (Foster J. 31).

2. The Appellant by itself, its servants and agents be restrained from making statements in trade or commerce that the conclusions drawn in the article, 'Relationship of Passive Smoking to Risk of Cancer and Smoking-Association Diseases' by Lee Chamberlain and Alderson were based on statistical detail in a study involving 12,000 people."

Paragraph 2 of what is claimed is in terms the injunctive relief granted by the primary Judge in para. 3 of his orders of 15 April 1991. As earlier said, no submissions have been made by either party in relation to that order and I am not disposed, therefore, to disturb it. It should remain. The critical orders then are those in para. 1. In my opinion these suffer from a number of problems, not the least of which is that they consist only of statements which are to be found in the reasons of one of the members of this Court in a situation where, although each member of the Court reached the conclusion that para. 3 of the advertisement was both misleading and deceptive, there was not unanimity of reasoning amongst us. Furthermore the orders suffer from the contextual problem with which I have dealt in my earlier reasons for judgment. Absolutely nothing has been done to overcome that problem. I have said enough to indicate that in my opinion it would be quite inappropriate for the Court to make orders in terms of those sought in para. 1.
The Court is not constrained by the form of relief which is propounded by the party seeking it. It has a discretion to give different relief if it thinks it appropriate. Since we reserved our decision, I have given further thought to the question of injunctive relief but I have been unable satisfactorily to formulate an appropriate order. It seems to me that the most difficult area for the appellant is that of asthma, not because there is evidence, at least of great consequence, that passive smoking causes people who do not suffer from asthma to become asthmatics. The problem rather is that those who are asthmatics may be adversely - in some cases extremely seriously - affected in their health by environmental tobacco smoke. There is no issue about that between the parties but it means that in any advertisement and other material which are intended to reach the whole spectrum of the community, the appellant will always need to be careful to distinguish between the underlying condition of asthma and the onset of symptoms caused by a stimulant or irritant such as environmental tobacco smoke. But to formulate an injunction to deal with this matter is a most difficult task; it is one in respect of which the respondent's counsel might have been expected to give the Court a good deal of assistance especially as the matter was expressly raised with counsel during the hearing on 3 February last. Having given the matter due consideration, I am not able to devise a satisfactory form of injunction.
Accordingly, I would propose that the Court not substitute any injunctive relief for the orders made by his Honour set aside by this Court on 23 December last. I should perhaps say that I have considered whether or not his Honour's order that the appellant be restrained from republishing the advertisement or material parts of it should be restored, but counsel for the respondent made it clear to us that he did not require that order and had never asked for it. To be considered alongside that circumstance is the fact that the appellant had undertaken to the Trade Practices Commission not to republish the advertisement and had made an open offer at an early stage of the trial to give the Court a similar undertaking.

Appellant's Application for Leave to Argue Fresh Point
47. I have had the opporunity of reading the judgment of Hill J. in relation to this matter and I am in agreement with it. I would only add that I see nothing in the two decisions of the High Court which are relied upon nor in cases decided in the United States (see particularly In re R.M.J. 455 US 191 (1982) especially at p 205) to warrant the conclusion that the constitutional guarantee which the High Court found to exist was such as to confer a right upon a person in trade or commerce to make misleading or deceptive statements particularly of fact. In my opinion the argument to be relied upon could not successfully bring about the invalidity or cut down the meaning of s.52 of the Act to the extent that would be necessary for the appellant to overturn the result of the case.

Furthermore, the conclusion that the Court should not grant injunctive relief leads to a situation in which it is difficult to see what possible occasion there could be for the invocation of the guarantee. After final orders are made, the situation will be one in which an advertisement published over six years ago has been found to be misleading and deceptive. Public discussion of the problems associated with passive smoking may proceed uninhibited by any restraint of the Court. For the future, there may be questions concerning the publication by the appellant (or pehaps by the respondent) of statements, particularly of fact, which may or may not transgress s.52 of the Act or the similar provisions of State legislation. Whether that occurs and what the consequences will be if it does are for another court on another day.
I would refuse leave to argue the matters relied upon by the appellant.

Costs
50. On 15 April 1991 the learned primary Judge dealt with the question of costs. The order for costs which he made was that the appellant pay to the respondent its costs of the proceedings, such costs to be payable on an indemnity basis. Unlike his Honour, we come to the matter having reached the conclusion that no injunctive relief should be granted but that it is appropriate to grant declaratory relief. He, on the other hand, dealt with it as a case in which it was appropriate to grant injunctive relief in the wide terms referred to in our earlier reasons for judgment.

In the submission of counsel for the appellant, the appellant should have the costs of the proceedings below and of the appeal. Alternatively they submit that there should be no order as to the costs of any party to the proceedings below or to the appeal. Those submissions are strongly resisted by counsel for the respondent.
As earlier mentioned, the hearing before his Honour at first instance occupied many months. The principal issue tried by him was whether para. 3 of the advertisement was misleading or deceptive. He found that it was. His conclusion in that regard has not been departed from by this Court but the members of it have indicated that each would have approached the matter differently from his Honour because each would have decided the case with a closer eye on the terms of the advertisement and not engaged in what became a general inquiry into the effects of environmental tobacco smoke in the community. Notwithstanding that difference in approach, it is difficult to take the view that evidence which was led would not have been led if the matter had been approached in the way that it has been approached by the members of this Court. It seems to me that counsel for the appellant welcomed the way in which the case was conducted by the respondent and took up the challenge of meeting it, not in the context of the advertisement, but by engaging in an exercise designed to demonstrate, not only to the Court, but also to the community, that passive smoking was not harmful to the community's health. That was also the way in which the matter was approached on appeal.
In those circumstances the parties have contested the issue which each of them was content to fight. The appellant has lost. The fact that a declaration will now exist in place of the injunctive relief granted by his Honour is not to the point.
It is true that the respondent did not seek declaratory relief at any stage of the proceedings until after the publication of this Court's reasons for judgment. But the orders which are to be made by this Court are the orders which, on the view of the matter taken by this Court, should have been the orders made at first instance. If, as should have occurred, the primary Judge had reached the conclusion that it was inappropriate to grant injunctive relief, it seems likely that the respondent would have applied for an amendment to claim the declaratory relief which we are disposed to grant. His Honour would then have come to the question of costs having himself made a declaration but having given no injunctive relief.
In these circumstances it seems to me that the appropriate order for costs is one which reflects what has in fact occurred. Both at first instance and on appeal the respondent has succeeded in establishing the falsity of the advertisement. It has also succeeded on the question whether or not the advertisement was published in trade or commerce. It has failed on appeal in sustaining the injunctive relief which was granted by the primary Judge. When the question of the costs at first instance is being considered, it is on that basis that the matter must be looked at.
In the result it is my opinion that justice will be done if, in lieu of the orders made by his Honour, there be substituted an order that the appellant pay three quarters of the respondent's costs of the trial and one half of its costs of the appeal. It is inappropriate that those costs be ordered on an indemnity basis.

Conclusion
57. In summary the orders which I would propose, in addition to the order already made on 23 December last setting aside paras. 1 and 2 of his Honour's orders of 15 April 1991, are as follows:-

1. It be declared that para. 3 of the advertisement published by the appellant in or about July 1986 is misleading and deceptive contrary to the provisions of s.52 of the Trade Practices Act 1974.

2. The order made by Morling J. on 15 April 1991 (para. 4 of the orders then made) disposing of the costs of the trial be set aside and there be substituted therefor an order that the appellant pay to the respondent three quarters of its costs of the proceedings at first instance.

3. The appeal brought by the appellant be otherwise dismissed.

4. The appellant pay to the respondent one half its costs of the appeal.

5. The respondent's application made by Notice of Motion filed in Court on 3 February 1993 for leave to lead fresh evidence be dismissed with costs.

6. The appellant's application made on 3 February 1993 for leave to argue a question of law based on the decisions of the High Court in Australian Capital Television Pty. Limited v. Commonwealth of Australia (No. 2) (1992) 108 ALR 577 and Nationwide News Pty. Limited v. Wills (1992) 108 ALR 681 be refused with costs

JUDGE2

FOSTER J. On 17 December 1992, the individual members of the Court published reasons for judgment in this appeal. The combined effect of the individual judgments was a finding by the Court that the impugned paragraph in the advertisement was misleading and deceptive and that the appellant by publishing it had committed a breach of s 52 of the Trade Practices Act 1974 (Cth) (the "Act"). The route by which individual members of the Court arrived at this decision differed the one from the other as appears from the individual reasons for judgment. However, the Court was unanimous in its reasons for holding that the injunctive relief granted by Morling J was inappropriate. Accordingly, those injunctions were dissolved. This left a number of questions outstanding for further argument and decision.

These were, first, an application by the respondent to introduce further evidence, the purpose of which was to provide a foundation for the granting of fresh injunctive relief. Secondly, the appellant sought leave to adduce further argument based upon decisions given by the High Court of Australia subsequent to the conclusion of argument on the appeal, namely the decisions in Australian Capital Television Pty Limited v Commonwealth of Australia (No. 2) (1992) 108 ALR 577 and Nationwide News Pty Limited v Wills (1992) 108 ALR 681. These decisions were said to have a vital bearing upon the construction of s 52 of the Act at least in relation to its application to the advertisement in question. Thirdly, there was to be argued the question whether some new form of injunctive relief should be granted in substitution for the injunctions which had been dissolved or, failing such a grant, whether the respondent might be given leave to amend his application to seek declaratory relief and, if leave were granted, what form such relief should take. Finally, the question of the proper award of costs in respect of the appeal and the hearing below was to be determined.
The Court considered written submissions and heard oral argument on all these matters. I have had the advantage of reading in draft form the reasons for judgment of Sheppard J and Hill J. Their Honours reach the same conclusions in respect of each question by a similar course of reasoning. As I am in agreement with their Honours' reasoning on these questions and as to the ultimate disposal of the appeal, I do not propose to do other than make a few short remarks.
As to the application by the respondent to introduce fresh evidence, I am in full agreement with what Sheppard J has said on this question. I also concur, with respect, in the warnings that his Honour has issued in relation to the selective use by the parties of portions from the judgments in this case. Clearly great care should be exercised in the use of such material, when taken out of context, to ensure that no wrong impression is created as to the effect of the judgments. I appreciate that Morling J permitted the introduction into evidence of scientific material which came into existence after the date of publication of the advertisement. He did so on the basis that the appellant was asserting a right to publish the statements contained in the impugned paragraph, although it had undertaken that it would not seek to republish the advertisement in its entirety. The introduction of the evidence was allowed as being relevant to the question whether the continued publication of the paragraph would constitute a continuing breach of s 52 of the Act. As I understand it, the respondent seeks to introduce the fresh evidence before us in order to support a claim for injunctive relief made on a similar basis. What must be realised, however, is that the grounds upon which the Court has found that the paragraph is misleading and deceptive are, despite the difference in approaches between individual judgments, basically different from the grounds upon which Morling J found that the breach was established. In this Court each judgment, even if in differing ways, relies upon the wording of the advertisement as a whole providing the context in which the meaning of the impugned paragraph is to be determined. The context was an essential element in arriving at the meaning to be attributed to the paragraph for the purpose of its evaluation against the requirements of s 52.
Morling J, because of meanings which he attributed to critical words in the paragraph, found it necessary to embark upon a consideration of and reach a decision as to his acceptance or rejection of particular aspects of the scientific testimony in the case. Because of this, his Honour found it appropriate to consider whether the state of science at the time of his delivering judgment was such as to indicate that a persistence in making the statements in the paragraph would constitute a continuing breach of s 52. Although this course was appropriate, having regard to his Honour's reasons for judgment, it is not appropriate where it is held that the breach of s 52 arises from the publication of the paragraph in the context of the whole advertisement. In circumstances where it is acknowledged that there is to be no republication of the advertisement, the introduction of the contemplated fresh evidence can have no relevance to any issue currently before us.
I also agree that the appellant should not be granted leave to argue a fresh point based upon the recent High Court decisions. I can find nothing in the judgments in those cases which could conceivably support a proposition that legislation which prohibits the making of misleading or deceptive statements in trade or commerce is either invalid as infringing or must necessarily be read down to conform with an implied constitutional guarantee of freedom of speech in the realm of politics.
As to whether this Court should grant injunctive relief, I fully agree that it would be quite impossible for relief to be granted in the form sought by counsel for the respondent. The proposed forms of injunction take no account whatever of the bases upon which the paragraph in the advertisement were held to be in breach of s 52 of the Act. Nor, indeed, do they pay regard to the fact that individual members of the Court arrived at findings of breach for different reasons. In argument the question was canvassed as to whether injunctive relief might be framed having regard to the twin vices of the paragraph, namely that, although it was asserted by the appellant to be no more than a statement of opinion, it could clearly be perceived as a statement of fact, and also that key words and phrases such as "evidence", "proves scientifically" and "cause" were not defined in a manner to prevent misunderstanding. I can conceive the remote possibility that an injunction might be framed prohibiting the making of a statement to the public at large in the terms of the impugned paragraph without appropriate indications that it was merely a statement of opinion and without clear definition of terms. Undoubtedly such an injunction would be difficult to frame. No attempt was made to formulate injunctive relief other than in the terms proposed by the respondent and which are set out in the judgment of Sheppard J. I have come firmly to the view that, in all the circumstances of this case, the Court should not undertake itself the task of formulating injunctive relief. Apart from the very considerable difficulty in arriving at a satisfactory formulation, if such be possible, it would be necessary to allow the appellant to make submissions in respect of that formulation. I agree that this case at first instance and on appeal has already occupied too much time. I agree that no injunctive relief should be granted in substitution for the trial judge's previous injunctions.

I am satisfied, however, for the reasons given by Sheppard J that declaratory relief can and should be given in this case. I agree in the form of order proposed. As would be clear from what I have previously written, I regard the impugned paragraph in the context of the whole advertisement as constituting a very clear infringement of s 52 in circumstances where the danger of infringement should have been quite apparent to the author. Even though declaratory relief was not originally sought by the respondent, it is appropriate that it be now granted as a mark of the Court's disapproval.
On the question of costs I agree with the order proposed by my brethren. I do not wish to add anything to the reasons they have given.

JUDGE3

HILL J. On 17 December 1992 the Court gave judgment in this matter. The Court was unanimous in giving leave for the parties to argue whether the applicant in the proceedings, the respondent in the appeal ("the applicant"), should be permitted to amend its application to claim a declaration that the respondent to the proceedings, the appellant in the present appeal ("the respondent"), had engaged in conduct contravening s.52 of the Trade Practices Act 1974 ("the Act") and as to the form of any declaration that might be granted. The Court was also unanimous in concluding that the injunctive relief granted by Morling J was inappropriate. The injunctions granted were subsequently dissolved. Accordingly, the matter was stood over for further argument as to the form of relief, if any, which the Court should grant to the applicant and as to the question of costs.

Subsequently, the respondent sought leave to argue that s.52, so far as it applied in the present case to the publication by the respondent of the advertisement, the subject of the proceedings, was invalid as infringing the guarantee of free speech implied in the Constitution. The applicant, for its part, sought leave to tender fresh evidence. These applications for leave, and the other matters earlier referred to, have now been argued fully before us. I turn first to deal with the relief which should be granted.

Whether declaratory relief should as a matter of discretion be granted
3. For the respondent, it was argued that it was now too late for the applicant, after the Court's reasons had been delivered, to seek to amend its claim for relief to add a claim for a declaratory order. Accordingly, it was said that the Court, in the exercise of its discretion, should refuse the amendment and decline to grant declaratory relief.

In my view, the applicant should be permitted, albeit at this late stage, to seek declaratory relief. The real issue litigated between the parties was whether the publication of the advertisement containing paragraph three was conduct which was misleading or deceptive or likely to mislead or deceive within the meaning of those words in s.52 of the Act. While the applicant's case sometimes failed to recognise the significance of the context in which the words in paragraph 3 appeared, a significance emphasised by all members of the Court, the applicant in the result succeeded in establishing that, in that context, paragraph 3 did infringe s.52 of the Act. In my view, the applicant is entitled, assuming that the Court has power, to a declaration appropriately framed.
It was submitted that a declaration should not be made effectively declaring that the publication of the advertisement breached s.52 (or for that matter any other declaration), because to do so would be futile. Reference was made, inter alia, to the decision of the High Court in Neeta (Epping) Pty Limited v Phillips (1974) 131 CLR 286. The principle enshrined in that case, which is, of course, well accepted, has no application to the present case. It can not be said, in the relevant sense, to be hypothetical to grant a declaration or to be of no utility. It is, in my view, in the public interest that the Court indicate the result of the case by the making of an order binding at least on the parties. No prejudice can be shown to the respondent in allowing the applicant to amend its claim to relief at this late stage, other than the obvious prejudice that otherwise no relief at all might have been available to the applicant.

Whether the Court has power to grant a declaration that paragraph 3 of the advertisement involved a contravention of s.52
6. For the respondent, it was submitted that the Court had no jurisdiction to grant a declaration on the application of the applicant to the effect that the third paragraph of the advertisement, or any part of that paragraph, constituted a breach of s.52 of the Act. The submission ultimately turns upon the meaning of the words "declarations of right" in s.21 of the Federal Court of Australia Act 1976, as those words are to be understood in the context of that Act.

Section 21 provides:

"(1) The Court may, in relation to a matter in which it has original jurisdiction, make binding declarations of right, whether or not any consequential relief is or could be claimed.

(2) A suit is not open to objection on the ground that a declaratory order only is sought."

Sections 22 and 23 of the same Act provide:

"22. The Court shall, in every matter before the Court, grant, either absolutely or on such terms and conditions as the Court thinks just, all remedies to which any of the parties appears to be entitled in respect of a legal or equitable claim properly brought forward by him in the matter, so that, as far as possible, all matters in controversy between the parties may be completely and finally determined and all multiplicity of proceedings concerning any of those matters avoided.

23. The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, including

interlocutory orders, and to issue, or direct the issue of, writs of such kinds, as the Court thinks appropriate."

Simply put, the submission is that the Court has power only to make declaratory orders declaring, inter se, the rights of the parties to the litigation. An order declaring that conduct of the respondent is misleading and deceptive is not declaratory of the rights of the applicant. If anything, it is a declaration of a wrong committed by the respondent, not of the violation of any right of the applicant.
The applicant's submission that ss.21(2), 22 or 23 confer upon the Court a wider power to grant declaratory relief than is conferred by s.21(1) is, in my view, unsustainable. To the extent that the appropriate form of relief in a particular proceeding is declaratory relief, that relief must, as a matter of interpretation, qualify as being a "binding declaration of right". Otherwise, binding declarations of right could be ordered irrespective of whether or not any consequential relief was sought, but other declaratory relief, which presumably need not be either binding or a declaration of right, might require that consequential relief be sought.
The origin of s.21(1) was s.50 of the Chancery Procedure Act 1852 (UK). That section permitted the grant of a declaration of right without the grant of consequential relief. Prior to the 1852 Act, it had been held that the Court of Chancery had no power to make a declaratory order unless there was a grant of some consequential relief: Fischer v Secretary of State for India (1898-99) LR 26 1A 16 at 28. After s.50 was enacted, it was construed as requiring that there be a right to consequential relief, notwithstanding that such relief was not sought: Rajah Nilmony Singh v Kally Churn Battacharjee (1875) LR 2 IA 83 at 85. In Strimathoo Moothoo Vijia Ragoonadah Ranee Kolandapuree Natchiar v Dorasinga Tever ("Kathama's case") (1875) LR 2 IA 169 at 187), the Privy Council said that the:

"declaratory decree cannot be made unless there be a right to consequential relief capable of being had in the same Court or in certain cases in some other Court."

This position continued until 1883 when the power of the Court to grant declaratory relief was extended by O.XXV, r.5 of the Rules of the Supreme Court 1883 (Eng), when a rule virtually identical to the present section was introduced. A comparable amendment was made, for example, in NSW by s.10 of the Administration of Justice Act 1924 (NSW). As explained by Gibbs J in Forster v Jododex (1972) 127 CLR 421, because New South Wales had not, in 1924, adopted the Judicature Act system, the position in that State was construed as requiring that a court of equity only grant declaratory relief where the proceedings were for equitable relief, or related to equitable rights or titles, although there was some dissent (see at 434). Thus, s.10 of the Administration of Justice Act 1924 was further amended in 1965 to ensure that declaratory relief could be granted, notwithstanding that the suit in which the declaration was sought was not a suit for equitable relief, or a suit which related to equitable rights or titles.
After the 1965 amendment in New South Wales, and a fortiori in jurisdictions which had adopted the Judicature Act system, the relief which could be granted in the Supreme Courts of the States was as wide as that which could be granted in England. Thus, in Salmar Holdings Pty Ltd v Hornsby Shire Council (1971) 1 NSWLR 192 at 202, Mason J.A. (as he then was) said:

"The jurisdictional limitations on the power to grant declaratory relief are, therefore, no more extensive than the limitations applicable to the power to grant declaratory relief exercisable by a court under a judicature system."

The jurisdiction has been said to be a "a very wide one": per Gibbs J in Forster at 435. Indeed, referring to Hanson v Radcliffe Urban District Council (1922) 2 Ch 490 at 507; Barnard v National Dock Labour Board (1953) 2 QB 18 at 41 and Ibeneweka v Egbuna (1964) 1 WLR 219 at 225, his Honour said:

"the power of the Court to make a

declaration, where it is a question of defining the rights of two parties, is almost unlimited; I might say only limited by its own discretion."

The classic test for the exercise of the jurisdiction laid down in Pyx Granite Co Ltd v Ministry of Housing and Local Government (1960) AC 260 required that the person raising the matter of a declaration have a "real interest to raise it" as well as the existence of someone with a "true interest to oppose the declaration sought". This test, like the historical background to which I have made mention, probably assumed that the declaration to be made would indeed be one which would affect the rights of the parties inter se. Ordinary rules of standing would have generally brought about the same result.
The existence of the word "right", in the collocation "declaration of right", was considered by Gibbs A.C.J. in Sankey v Whitlam (1978) 142 CLR 1 at 23, in the context of whether a declaration could be made on the application of an informant in committal proceedings. His Honour, in confirming the existence of power to grant such a declaration, said:

"The word 'right' in the expression 'declarations of right' in s.75 of the Supreme Court Act, 1970 (NSW) and O.26, r.19 is used in a sense that is wide and loose. It includes what might more precisely be described as privileges, powers and immunities. And the power to make a declaration extends to enable a plaintiff to have it declared that he is under no duty or liability to the defendant."

The width of the concept of "right" may be seen from the observation of his Honour (at 24) that a declaration could be made that a charge brought against an accused person was not one known to law. This was because:

"the accused has a 'right' not to be exposed to proceedings that have no legal substance."

It may, however, be observed, that his Honour left open in that case the question whether it would be permissible for a court, for example, to declare particular evidence admissible or not admissible, since in such a case there could be an absence of any "right", irrespective of the width with which the word "right" might be construed. On the other hand, it appears to have been established that the word "right" requires that the matter the subject of the "right" be justiciable: Malone v Metropolitan Police Commissioner (1979) Ch 344.
There can be little doubt that a declaration might be obtained by a regulatory authority that particular conduct is in breach of a statutory provision, whether or not injunctive relief is appropriate: cf Australian Softwood Forests Pty Ltd v Attorney-General (NSW) (Ex rel Corporate Affairs Commission) (1981) 148 CLR 121 at 125. It has never been suggested that no power exists to grant such declaratory relief merely because the consequence of a declaration is to declare the existence of a wrong. The declaration that an offence has been committed is the concomitant of the non-existence of a right. Semantically, it may be said to be the declaration of a negative right. It is appropriate, in my view, to refer to it as a declaration of right.
Some support for my view may perhaps be found in the related area of determining whether an applicant has locus standi to seek relief. In ordinary civil litigation, an applicant for a declaration will need to have a real interest in the subject matter of the litigation, that is to say, in the normal case, both the applicant and respondent will be persons whose rights are affected by the grant of relief. In the context of enforcement of a private wrong, as indeed in the context of a private citizen seeking to prevent a public wrong in respect of which that person has a special interest, as Gibbs J observed in Australian Conservation Foundation Inc v The Commonwealth (1980) 146 CLR 493 at 526, the principles of standing applicable to declarations are the same as those applicable to the grant of injunctive relief.
It may be observed that the claim in the Australian Conservation Foundation Inc case was for a declaration as well as for injunctive relief, and none of the Court suggested that, given standing, declaratory relief would have been unavailable.
As both the Australian Conservation Foundation case and Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 make clear, the requirement that there be an interest greater than that of other members of the public before standing is conferred, is a flexible rule, as the question of what is a sufficient interest will vary according to the subject matter of the litigation. Where, as in the present case, standing is not in issue, there is a concomitant that there be a sufficient interest for the grant of declaratory relief.
In the course of argument, there was some discussion concerning the provisions of s.163A of the Act. So far as that section may be relevant, it provides as follows:

"(1) Subject to this section, a person may institute a proceeding in the Court seeking, in relation to a matter arising under this Act, the making of -

(a) a declaration in relation to the operation or effect of any provision of this Act other than Division 2, 2A or 3 of Part V or in relation to the validity of any act or thing done, proposed to be done or purporting to have been done under this Act; or

(b) an order by way of, or in the nature of, prohibition, certiorari or mandamus, or both such a declaration and such an order, and the Court has jurisdiction to hear and determine the proceeding.

(2) The Minister may institute a proceeding in the Court under this section and may intervene in any proceeding instituted in the Court under this section or in a proceeding instituted in any other court in which a party is seeking the making of a declaration of a kind mentioned in paragraph (1)(a) or an order of a kind mentioned in paragraph (1)(b).

(3) The Commission is not entitled to institute a proceeding in the Court under this section, but may intervene in a proceeding instituted in the Court or in any other court, being a proceeding-

(a) that involves a matter arising under Part IV other than a matter arising under section 48; and

(b) in which a party is seeking the making of a declaration of a kind mentioned in paragraph

(1)(a)."

The mischief to which this section, inserted in its original form into the Act by Act No 88 of 1976, is directed would, but for its historical context, appear somewhat obscure. At the time it was inserted, jurisdiction in respect of matters under the Act was conferred upon the Commonwealth Industrial Court. That Court was not a court of general jurisdiction, and, as the second reading speech of the then Minister for Business and Consumer Affairs, the Honourable Mr John Howard, reveals, the view was taken that there was a gap in the jurisdiction of that court which prevented that court from granting declaratory judgments and issuing prerogative writs, which resulted in proceedings being commenced in the State Courts or in the High Court seeking, inter alia, declarations. This explains the exclusion of Division 2 of Part V of the Act from the provisions of s.163A, since litigation relying upon the implied conditions and warranties dealt with by that Division was intended to be brought in courts other than the Industrial Court.
The language with which s.163A is framed indicates that the intended ambit of its operation was quite narrow. Without attempting to define those limits, it is concerned, inter alia, with matters such as the validity of some act done under the Act, for example, the issue of a notice under s.155 of the Act. What is relevant for present purposes is that the section is not concerned generally with an application for the grant of a declaration whether particular conduct is in contravention of the Act. So much was specifically decided by the Full Court of this Court in Westpac Banking Corporation v Northern Metals Pty Ltd (1989) 11 ATPR 50,407.
As a matter of construction, s.163A must clearly be read as an exclusive code in relation to the field which it covers. For example, it could not be said that within the area covered by s.163A the Trade Practices Commission could, notwithstanding s.163A(3), itself institute proceedings to seek a declaration relying upon some provision of the Federal Court Act or the common law. So to decide would be to negate the prohibition in s.163A(3), notwithstanding that that prohibition is limited to proceedings instituted under that section and not to proceedings instituted under some other legislation. But there is no reason to construe s.163A as providing an exclusive code prescribing those cases where proceedings for a declaration may be instituted arising out of conduct dealt with in the Act.
A similar view was taken of s.163A by Foster J in FAI General Insurance Co Ltd v RAIA Insurance Brokers Ltd (1992) 108 ALR 479 at 507-508, notwithstanding the decision of the High Court in Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150, where it had been held on the legislation as it then stood that the power of the Court to grant injunctions in relation to contraventions of the Act did not extend to situations falling outside s.80 of the Act. I agree, with respect, with his Honour, that s.163A and s.80 are quite distinguishable. The only hesitation I have as to the comments made by his Honour is in the reference to Toohey J in Polgardy v Australian Guarantee Corporation Ltd (1981) 52 FLR 240 which appears at 507 of the report.

It is true that in Polgardy Toohey J said (at 244):

"But a reading of s.163A in its entirety and a consideration of its relationship to the Act suggest strongly that it was not intended to apply to civil litigation under the consumer protection provisions of the Trade Practices Act."

However, the reference to consumer protection provisions in this quotation is probably a reference to the provisions of Division 2 of Part V of the Act, which s.163A(1)(a) excludes from the operation of s.163A, rather than a reference to s.52. But, be that as it may, the actual decision in that case provides some support for the view that, at least in the area in which s.163A has no operation, it does not preclude the bringing of proceedings for declaratory relief, or the grant of a declaration in proceedings otherwise properly before the Court.
It follows, in my view, that the Court does have power to grant to the applicant a declaration expressed in appropriate terms.

The form of an appropriate declaration
31. Counsel for the applicant urged the Court to make declarations in the form set out on page 12 of Sheppard J's Supplementary Reasons for Judgment. The declarations sought reflect a continued inability to understand the basis of this Court's judgment on appeal. A declaration, for example, that environmental tobacco smoke causes attacks of asthma, is not consistent with the judgments of the majority of the Court, for the simple reason that both Sheppard and Foster JJ., who constituted the majority, did not find that as an immutable fact. All their Honours held was that, having regard to the context in which clause three appeared, the words of paragraph three in their application to asthma were misleading and deceptive. The ambiguity is to be found in the word "cause" and it was a different understanding of the meaning of the word in the context in which it appeared which led to my dissent on this issue.

I have considered whether there was some possibility of making declarations which sought to spell out the relevant meaning of the words used, but have found the exercise most difficult and, more significantly, I have reached the conclusion that the making of such a declaration could itself give a false impression of what actually was decided by the Court. In these circumstances, in my view, the appropriate declaration is a declaration that the publication of the advertisement was, as at the date it was published, conduct which was misleading and deceptive and in breach of s.52 of the Act. Such a declaration necessarily requires the reader to refer back to the judgments delivered to see precisely what it was that this Court decided.

Whether injunctive relief should be granted
33. In my view, and for the reasons set out in my judgment on the appeal, injunctive relief is inappropriate in the present case. It is clear that early in the litigation the respondent proffered an undertaking that the advertisement would not be published. That undertaking was rejected by the applicant. There was no risk that publication of the advertisement would be repeated. In that event, it would seem to be unnecessary that injunctive relief be granted, although, of course, the provisions of s.80(5) would authorise, in the discretion of the Court, the making of an injunction restraining a further breach of s.52 of the Act, notwithstanding that it appeared to the Court that the person to whom the injunction was directed had no intention to repeat the breach. In the circumstances of the case, and having regard to the possibility of changing scientific evidence which could ultimately require the conclusion that the conduct did not breach s.52, I would, in the exercise of discretion, not grant an injunction restraining the republication of the advertisement.

The applicant's suggested injunctions, also set out in Sheppard J's Supplementary Reasons for Judgment (p 26), are, in my view, misconceived. They pay no account to the judgments delivered in the appeal. They ignore the difficulties of time and context discussed, and the difficulty of the audience to which the statement is addressed. In my view, they are no more appropriate than the injunctions originally granted and now dissolved and for the reasons I have already given should not be granted.

Whether leave should be granted to argue the validity of s.52
35. I am clearly of the view that leave should not be granted to the respondent to argue the validity of s.52 of the Act.

There is nothing in any of the judgments of their Honours in the recent decisions of Australian Capital Television Pty Ltd v Commonwealth of Australia (No 2) (1992) 108 ALR 577 and Nationwide News Pty Ltd v Wills (1992) 108 ALR 681 which suggests for a moment that a law prohibiting misleading and deceptive conduct could infringe any constitutional protection of free speech.
Put at its highest, the case for the respondents is that a law which would render illegal the expression of an opinion on a contentious matter, notwithstanding that that expression of opinion constituted conduct which was misleading and deceptive, or conduct which was likely to mislead or deceive is, to that extent, invalid. Accepting that in refusing leave, the Court should approach the matter in the same way as the Court would approach an application to strike out a statement of claim as not disclosing a cause of action, I am unable to see that the respondent's case is even arguable.
In Australian Capital Television Pty Ltd, Mason C.J. gave no support for a general guarantee of fundamental rights and freedoms. His Honour's judgment is carefully confined to the issue before the Court of freedom in relation to public affairs (that is to say, matters concerning representative government) and political discussion. And indeed, his Honour expressly confirmed that, even in the area of elections, Parliament may fetter what otherwise would be freedom of communication where there were competing public interests: cf Smith v Oldham (1912) 15 CLR 355 at 358-9.
Likewise, Brennan J restricted his Honour's judgment to such freedom of discussion of political and economic matters as are essential to sustain the system of representative government prescribed in the Constitution. His Honour adopted a test of proportionality, namely, that a law which fetters the freedom of discussion must be proportionate to the interests it is calculated to serve. Nothing in his Honour's judgment would suggest that his Honour would find a lack of proportionality in legislation which prohibited conduct which was misleading and deceptive.
The joint judgment of Deane and Toohey JJ. in the same case also cautioned against assuming that the constitutional implication carried with it an implication of an absolute and uncontrolled license. Their Honours pointed to the need to have regard to the character of the impugned law and whether it is properly to be characterised as a law with respect to what their Honours termed "political communications". While Gaudron J spoke of the notion of a free society possibly entailing freedom of speech, her Honour was careful to qualify her remarks so that legislation not to impair freedom but to secure some other end within power, which is reasonably and appropriately adapted to that end, will be within power. Indeed, her Honour expressly excludes from freedom of speech the dissemination of "false and misleading material" (at 656).
While accepting that the borderline between political communication and communication of matters involving mere commercial interest is, at best, ill defined, it is in my view beyond argument that the guarantee in the Constitution of political speech in no way permits there to be made out an argument that there is to be found in the Constitution an inviolable guarantee of the ability to make misleading and deceptive statements, even where the subject matter is political communication. It follows, in my view, that to allow at this late stage the respondent to argue the question would be an exercise of futility, and would but subject the parties to further costs in what has already been a most costly proceeding. Leave should, accordingly, be refused with costs.

The application to adduce fresh evidence
42. I have read in draft form the judgment of Sheppard J and agree with the comments of his Honour on this matter. In my view, the application should be dismissed with costs.

Costs
43. While there is no doubt that the Court has the power in an appropriate case to make an order that a losing party indemnify the winning party for costs, the present is not such an appropriate case. The mere fact that the subject matter of the litigation may be such as to be of interest to the public, or indeed relate to public health, is no justification. This is particularly so when it is recalled that the real issue in the case was not whether, objectively, there was little evidence about the relationship between environmental tobacco smoke and disease, or indeed, whether environmental tobacco caused disease, but whether the words in paragraph 3, in the context in which they appeared, constituted conduct which was misleading and deceptive.

If the proceedings are viewed as an attempt on the part of the applicant to obtain a declaration that the publication of the advertisement infringed s.52, then it can be said that the applicant has been successful. It has established that contravention. Looked at as an application for injunctive relief restraining not the further publication of the advertisement but the repetition of the language of paragraph 3 out of context, the applicant has been wholly unsuccessful. On the other hand, it was a necessary prerequisite to the obtaining of injunctive relief that a contravention be established and the great majority of the case at first instance was directed towards establishing such a contravention, notwithstanding that no application was made for declaratory relief until after judgment had been delivered.
Another difficulty I feel in framing an appropriate cost order is that it is quite possible that the case was unduly prolonged by being fought on what I believe to have been a false issue, namely, the question whether, as a matter of medical science, the statement in paragraph 3 was true, an issue which failed to address at the outset the meaning which it was alleged paragraph 3 had in its context. In this, both parties appear to have been at fault.
In exercising the Court's discretion to order costs, I take into account as well that even on the way in which the case was fought by the applicant, it failed to establish an association between environmental tobacco smoke and some illnesses. It was, however, largely successful.
In these circumstances, it seems to me that an appropriate cost order would be that the respondent pay three quarters of the costs of the applicant, on a party and party basis of the proceedings before Morling J, and that, in respect of the appeal, including the subsequent argument dealt with in this judgment where the respondent ultimately succeeded in having the injunction granted dissolved, but the applicant obtained declaratory relief, the respondent should pay one half of the costs of the applicant.
Orders Proposed
I agree with the orders proposed by Sheppard J.

[1993] FCA 105

10 MARCH 1993