Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 3)

[1979] FCA 143

CATCHWORD S

Trade Practices - Injunction - Pecuniary Penalty - Circumstances

and extent of contravention - effect of understanding on

market - Trade Practices Act ss. 76.80.82.

Procedure - costs - unfettered dlscretion of court or judge - dlscretion to award costs agalnst successful party in exceptional circumstances - conduct of defendant tendlng to bring about litigation - untruthful answers to s.155 notlce - two defendants represented by same counsel and sollcltors - plalntlff's costs increased by joinder of other successful defendants - Federal Court of hustralla Act s.43.

TRADE PRACTICES COMMISSION v NICHOLAS ENTERPRISES PTY. LTD.

SATURNO HOLDINGS PTY. LIMITED

REX FREEHOLD PTY. LIMITED

MORPHETT ARMS HOTEL Pm. LIMITED

LION BUS CO. PTY. LIMITED

MERIT NOMINEES PTY. LIMITED

GENERAL DEVELOPMENT CORPORATION

PTY. LIMITED

AGETT NOMINEES PTY. LIMITED

S.A. No. G3 of 1978

Fisher J.

Adelaide

11 December 1979

IN THE FEDERAL COURT OF AUSTRALIA )

)

SOUTH AUSTRALIA DISTRICT REGISTRY ) No. G3 of 1978

1

GENERAL DIVISION

)

B E T W E E N :

TRADE PRACTICES COMMISSION

- and -

NICHOLAS ENTERPRISES PTY. LIMITED	Flrst Defendant
SATURN0 HOLDINGS PTY. LIMITED	Second Defendant
REX FREEHOLD PTY. LIMITED	Thlrd Defendant
MORPHETT ARMS HOTEL PTY. LIMITED	Fourth Defendant
LION BUS CO. PTY. LIMITED	Flfth Defendant
MERIT NOMINEES PTY. LIMITED	Slxth Defendant
GENERAL DEVELOPMENT CORPORATION PTY.	Seventh Defendant
LIMITED
AGETT NOMINEES PTY. LIMITED	Eighth Defendant
CORAM: Flsher J
11 December 1979

~ h l s matter was called on for argument on 5 November 1979

on the two matters of Pecuniary penalties and restralnlng orders

and on 6 November 1979 for argument on the question of costs.

counsel for the plalntlff sought an injunction against the

Royal Oak and the Morphett Arms restraining them from contravening

8.45 of the Trade Practices Act 1974 ("The Act") in the manner

which has been the subject of these proceedings. He put forward

a draft form of restralnlng order which has been considered by

c o ~ l n s e l f o r t h e Morphett A r m s .

A t t h e commencement o f t h e hea r lng on 5 November 1979

junior counsel f o r t h e Royal Oak sought l e a v e t o wlthdraw from

t h e proceedings on t h e ground t h a t h i s l n s t r u c t l o n s and t h o s e

of h i s l eade r and i n s t r u c t i n g s o l l c l t o r s had been terminated.

The g ran t lng of l e a v e was n o t opposed by counsel f o r t h e p l a l n t l i f

and he withdrew. In consequence I have n o t heard any f u r t h e r

evidence from t h e Royal Oak on t h e ma t t e r of pecunia ry p e n a l t y

nor had any submissions on t h e m a t t e r s of restraining ozde r s ,

pena l ty and c o s t s from t n a t defendant .

counsel f o r t h e Morphett A r m s submitted t h a t it was n o t

appropriate t o g r a n t an i n l u n c t l o n bu t h e had no l n s t r u c t l o n s

t o p r o f f e r an undertaking i n l l e u o f a r e s t r a l n l n g o r d e r . I n

my oplnlon, a f t e r t a k l n g i n t o account h i s submlss lons , lt 1s

proper t o g r a n t an i n j u n c t i o n a g a i n s t bo th t h e Royal Oak and

t h e Morphett A n n s . I cons ide r a p p r o p r i a t e t h e form of injunction

put forward by t h e p l a i n t i f f , w l t h some minor amenclments which

were i n t h e maln d i scussed b e f o r e m e .

On t h e q u e s t l o n of pecuniary penalties, I am d ~ r e c t e d by

3.76 of t h e Act t o determine t h e a p p r o p r i a t e amount i n r e s p e c t

of each a c t o r omlsslon a f t e r havlng r ega rd t o a l l r e l e v a n t

mat te rs lnc lud lng c e r t a l n specl- led ma t t e r s . I n r e s p e c t of each

of them, t h e Royal Oak and t h e Morphett Arms, I have found two

contraventions, namely a r r l v i n g a t the r e l e v a n t unders tandlny

and g iv lng e f f e c t t o t h a t understanding. However, t h e p l a l n t l f f

d l d not seek t h e award of a s e p a r a t e p e n a l t y i n r e spec t of each

of these contraventlons, and in my opinlon thls is a proper

attitude in that the contraventlons arise out of the same

conduct. In thls case s.76(3) of the Act has relevance.

The speclfic matters to whlch my attention is directed by

s.76 can be paraphrased as follows:

(a) the nature and extent of the contravenlng act and the loss or damage in consequence of that act.

(b) the c~rcunstances in which the act took place.

(c) whether the person contravenlng has been found to have engaged in any simllar conduct.

In respect of matters (a) and (b), I have before me the very

considerable evldene In the proceedings, together with addltlonal

evidence tendered by the Morphett Arms. As to (c) there is no

suggestion that either of the defendants has been found to have

engaged in any similar conduct.

counsel for the Morphett Arms put further evidence before

me for the purpose of establishing the unprofltablllty of selling

packaged beer at 15 to the dozen and the relatively small proflt

margin on a sale of 14 to the dozen. Two witnesses were put

forward on thls point, namely Mr. Palmer, to whose activities extensive reference was made in the main proceedings, and Mr.

Calman,an experienced retaller of llquor. I accept their evldence

but I am not persuaded that, In the words of counsel, "no very

slgniflcant penalty is called for".

submissions, based both on the evldence in the proceedings and the additional evidence, were made on behalf of the Morphett Arms

on the appropriate penalty. Rellance was placed on the fact that lt was a suburban hotel and that it could not be sald to have had

a substantial proportion of the market. It was contended that the

clrcurnstances of the contraventlon establish that its conduct was

not dlctated by predatory motlvatlons or by a deslre to make an

unfair profit at the expense of the publlc. Moreover I was remlnded

that the Morphett Arms did not engage in the practlce of advertlslng

and in particular in advertising ltself as a dlscounter of

packaged beer. Taking lnto account these matters and the mlnlmal

proflt margin. ~t was submitted that the appropriate penalty was at the lower end of the scale. Support for thls contention was

sought from the fact that at the tln~e when the contraventlon occurr-

ed a nun-her of other hotels reduced thelr dlscount to the same

extent.

In respect of the Royal Oak I do not have the benefit of

any evldence or submissions dlrected speclflcally to the matter

of penalty. In my oplnlon, cruclal matters here are that the

Royal Oak was "the market leader" and the largest dlscounter, which fact was extensively advertised. It took the initlatlve in

propounding the relevant understandlng and it had, as the largest

dlscounter, the most to gain from an adoptlon by others of that

understandlng. It was obviously actlng very much in its own

lnterest in taking that inltiatlve and had much more to galn from

the carrying Into effect of t h ~	understandlng than had the Morphett
Arms.

Agalnst the matters relled upon by counsc?l for the Morphett

Arms I have to conslder the obvlous seriousness wlth whlc5 the

legislature vlews contraventlons of the Act in that it has imposed

a maxlmum penalty on corporatlons of $ 2 5 0 , 0 0 0 . The penalty wh~ch

I impose must be such as to deter other persons, corporate or

otherwise, in the commercial world from enterlng Into arrangements

or understandings whlch lessen cornpetltlon, though the fact that

these proceedings have been extensively publlclzed in the daily

press wlll doubtless asslst in deterring others from lnfrlnglng

the Act. Addltlonally, I must bear in mind that a director of each

of the defendants attempted to persuade other retailers to loin

in the understandlng and thereby to preserve the competltlve

posltlons of the defendant companies.

Although I have declded that a slgnlficant penalty 1s

approprlate, I am lncllned to accept the submission of counsel

for the Morphett Arms that the contraventlons warrant penalties

at the lower end of the scale. Evldence was before the court

to the effect that in the relevant market there were at the tlme

526 liquor outlets, of varylng sizes. The relevant understanding

was proved to have exlsted between two of them, one a market leader the market generally, particularly in the llght of the news ltem

and the other a suburban hotel wlth basically a local clientele.

In the Advertlser newspaper. It 1s easy to envlsage other

understandings which would be much more pernicious in character

and more detrimental to the publlc interest.

In my oplnlon an appropriate pecuniary penalty in the case

of the Morphett Arms is $ 5 , 0 0 0 and in the case of the Royal Oak

is $ 8 , 0 0 0 .

The ques t ion of t h e a p p r o p r i a t e o r d e r s f o r c o s t s r a i s e s i n

t h e c i rcumstances of t h e m a t t e r a number o f d l f f l c u l t l e s . These

d l f f i c u l t l e s a r e accen tua ted and t h e lmpact of my o r d e r s becomes

more apparent when i t i s apprec i a t ed t h a t t h e h e a r l n q of t h e a c t l o n

extended over some 23 s i t t i n g days. Counsel f o r a l l parties o t h e r

than t h e Royal Oak and t h e Norwood made l eng thy submlss lcns on what

each contended should be t h e a p p r o p r i a t e o r d e r s , and t h e r e was

l i t t l e common ground o t h e r t han i n r e s p e c t of t h e c o s t s of t h e

Norwood. Counsel f o r t h e plaintiff conceded t h a t t h e r e was no

answer t o t h e submission of t h e Norwood t h a t it should have i t s

c o s t s of t h e proceedlngs . T h i s must be so i n vlew of t h e l a t t e r ' s

contention a t t h e beglnnlng of t h e h e a r l n g t h a t t h e r e should be a

s e p a r a t e t r l a l of t h e plaintiff's c l a m t o t h e e f f e c t t-hat i t

reached an understanding wl th t h e Royal Oak a t the Norwood lunch

on 2 December 1977.

The c o n f l l c t l n g c la lms can be summarised a s fo l lows .

The p l a l n t i f f concedes t h e r l g h t of t h e Norwood t o c o s t s , c l a lms

c o s t s a g a l n s t t h e unsuccess fu l defendant , t h e Royal Oak, c l a lms

c o s t s a g a i n s t t h e s u c c e s s f u l defendants t h e Old Llon o r a l t e r n a t -

l v e l y c la lms t h a t t h e r e should i n r e s p e c t o f t h e s e defendants be

no o rde r a s t o c o s t s , concedes i t s obligation t o pay c o s t s t o t h e

Rex bu t l i rn l ted t o one h a l f o f i t s c o s t s , and c la ims c o s t s

a g a l n s t t h e Morphett Arms. I n r e s p c c t of i t s c l a m t o c o s t s

a g a l n s t t h e Royal Oak and t h e Mor-phett Arms, t h e p l a l n t l f f ' s

con ten t ion i s t h a t i t should have i t s c o s t s of t h e proceedlngs

aga lns t t h e s e two defendants , whlch defendants should be ~ o i n t l y

and s e v e r a l l y l l a b l e f o r t h e c o s t s awarded a g a l n s t them. The

p l a l n t i f f does not c la im a g a i n s t t h e unsuccess fu l defeqdants t h e

c o s t s awarded a g a i n s t i t i n favour of t h e succes s fu l defendants

o r t h a t t h e c o s t s o f t h e s u c c e s s f u l defendants should be p a l d by

t h o s e who were unsuccess fu l and t h u s I am n o t asked t o make

o r d e r s commonly desc r ibed a s "Bullock" o r "Sanderson" o rde r s .

A s t o t h e defendants , I have no submission on c o s t s from

t h e defendant t h e Royal Oak and a conceded c la lm f o r c o s t s by

t h e Norwood. The Old Llon defendants contend t h a t a s succes s fu l

defendants they should no t be ordered t o pay t h e c o s t s of t h e

unsuccess fu l plaintiff bu t r a t h e r t h a t t h e l a t t e r should pay t h e l r

f u l l c o s t s . The Morphett A r m s con ten t ion was t h a t i t should o n l y

be ordered t o pay a s p e c i f i e d p o r t l o n of t h e plaintiff's c o s t s ,

o r alternatively, i f i t and t h e Royal Oak had t o b e a r t h e whole

o r a s u b s t a n t i a l p a r t of t h e plaintiff's c o s t s , i t s o b l l g a t l o n

should be l i m i t e d t o one h a l f of such c o s t s 1.e. a s e p a r a t e

obligation f o r h a l f r a t h e r t han a j o l n t o b l l g a t l o n i n r e s p e c t of

t h e whole. Counsel f o r t h e MOL-phett A r m s suggested t h a t t h e

liability of t h e Morphett A r m s t o pay c o s t s should have set o f f

a g a l n s t i t t h e Rex ' s e n t i t l e m e n t t o c o s t s , and t h a t i n any event

I should have r ega rd t o t h e amount of t l m e lnvolved i n h e a r l n g

t h e Morphett A r m s ' case .

There a r e no p r o v l s l o n s i n t h e A c t which touch upon t h e

ques t lon of c o s t s , and t h u s s .43 of t h e Federa l Court of A u s t r a l i a

Act has a p p l l c a t l o n . I t i s i n t h e fo l lowing terms:

"(1) The c o u r t o r a judge *as l u r l s d i c t l o n t o award

c o s t s i n a l l proceedlngs be fo re t h e c o u r t ( ~ n c l u d l r i g

proceedlngs d l s m ~ s s e d f o r want o f j u r l s d l c t l o n )

o t h e r t han proceedlngs i n r e s p e c t of whlch any o t h e r

Act p rov ldes t h a t c o s t s s h a l l no t be awarded.

( 2 ) Except a s provlded by any o t h e r Act , t h e award of

c o s t s i s i n t h e d l s c r e t l o n of t h e c o u r t of judge."

In these terms s.43 is in pari materla wlth s.40 of the

Supreme Court Act and Order 65 rule 1 of the Rules of the Supreme thls unfettered discretion in Cretazzo v Lombardl (1975) 13 S.A.S.R.

4 at p.11, a decislon of the Full Csurt of the Supreme Court

of South Australia. He also in the passage which I clte referred

to two other matters whlch are relevant to the lssues before me,

namely the rlght to order a successful party to pay its unsuccessful

opponent's costs and the right to deprlve a successful party of

his costs on partlcular issues. The relevant passage is as follows:

"Order 65, rule 1 provldes generally that all costs shall be in the discretion of the court or judge, sbblect to a

proviso Irrelevant for the present purpose. Time and again

attempts have been made to fcttcr that general dlscretlon

by the lmposltlon of ludge-made rules. Time and agaln

those fetters have been released by appellate courts. I

thlnk the guldlng principle stlll stands as IC: left ths

House of Lords in the famous case of Donald Campbell & CO v Pollak Q9271 A.C.732, that the general discretion is absolute and unfettered, except that it must be exercised

judicially, not arbltrarlly or caprlclously, and that i t

cannot be exercised on grounds unconnected wlth the lltigatlon

I should mentlon, however, two more partlcular questions which have been speclflcaliy dealt wlth.

The flrst is that there was once an ldea that a successful

party, though he might be deprlved of hls costs, could

not be ordered to pay hls opponent's costs. As a matter

of fact, the so-called rule never applled to successful

plalntlffs. There was a tlmc, however, when it did apply

to wholly successful defendants: - S v Y - (1881) 18 Ch.

D.76. It has now been held, however, that the rule when it

exlsted was founded on the practlce of the old Court of

Chancery and that its existence d~sappeared in England

after the enactment of s.5 of the Suprene Court of Judlcattirc

Act 1890: Knlqht v Cllfton 11973 Ch.700 per Russell L.J.

at pp. 709-710. The South Australian counterpart u f that

sectlon is s.40 of the Su;~reme Court Act 1935-1974, whlch for the present purpose 2s in lntllstlngulshable terms and whlch reads:

'Subject to the express provlslons of thls Act, and to the rules of court, and to the express provlslons of any other Act whenever passed, the costs of and Incldental to all

proceedings in the court, lncludlng the admlnlstratlon of

estates and trusts, shall be in the dlscretlon of the court

or judge, and the court or judge shall have full power to

determine by whom and to what extent such costs a;-e to be

pald. '

It follows, therefore, that there is now lurlsdlctlon to order a successful party, even a wholly successful party and whether plaintiff or defendanf to pay his opponent's

costs in part or in whole. Of course, lt by no means

follows that it would be a judlclal exercise of the

dlscretlon to do so and it may well be that in many cases

lt would not, slnce there must be some reason for departing

from the settled practlce whereby the successful party

recelves hls costs from his opponent: sec Donald Campbell

-

& CO v Pollak c922 A.C.732, per Vlscount Cave L.C. at p.812.

The next matter is this. A successful party who has falled

on certaln lssues may well not only be deprlved of hls own

costs of those issues, but ordered in addltion to pay 111s

opponent's costs of them, and in thls context 'issue' does

not mean a precise lssue in the technical pleadlng sense,

but any dlsputed questlon of Eact or, In my vlew, of law:

Foster v Farquhar 68933 1 Q.B. 564, per Bowen L.J. as he

then was, at p.570. In fact in that case the plaintiff, who

succeeded to a substantial extent, was deprived of 111s costs

and ordered to pay the defendant's costs in relation tc

certaln speclfic dlsputed items of special damage on wlllch

he failed. Moreover it has been held by the House of Lords

that the support of an extravagant claim by fraudulent acts

or evldence may be good cause for deprivinq a successful

plaintiff of his costs: Huxley v west ond don Extension

Rallway Company (1889) 14 App.Cas 26."

The flrst matter for conslderatlon 1s the plaintiff's clalm to have its costs or a portlon thereof pald by the successful

defendants the Old Llon. Counsel based this sllbmission on the

untruthful answers of Tremaine to the s.155 notlce which, he sald. by the Old Llon of lssues upon whlch it falled unduly protracted

made reasonable the bringing of proccedings against the Old Lion.

the proceedlngs. In these clrcumstances, he argued, the

unsuccessful plalntlff was entltled to the whole or portion of

its costs from the successful cld Llon defendants. He was

however unable to draw to my attention any authority in support

In my oplnion, although I have, ln accordance wlth the

reasoning of Bray C.J., in Cretazzo v Lombardl supra, jurisdlctlon

in my discretlon to award such costs, it is a discretlon whlch I

should exerclse only in the most exceptional circumstances. I refer to the discussion on the polnt in the reasons ~f Russell L.J. and Sachs L.J., in Knlqht v Cllfton &g74 2 All E.R. 370 at

pp.386 and 390 respectively. In my oplnlon those of the

circumstances of the lltigatlon whlch here mlght be considered

as exceptional (and which I dlscuss in greater detall hereafter)

may have relevance to the clalm of the Old Llon to the whole of

its costs, but they are not such as to lustlfy awardlng costs in

favour of the unsuccessful plaintiff.

The next contest arlses in consequence of the Old Llon's clalm agalnst the plalntlff for the whole of its costs and the

plaintiff's contention that thosdefendantsshould recelve elther

no costs or merely a relatively small portlon thereof.

Counsel for the plalntlff relied on the decision of Lord

Justice Atkln (as he then was) In Rltter v Godfrey Q9203 2 K.6.47 as establishing the three grounds upon which it was approprlate to deny a successful defendant the whole or part of his costs.

I refer in particular to the following passage in the reasons of

that judge at p.60 of Rltter v Godfrey supra.

"In the case of a wholly successful defendant, in my oplnlon,

the judge must glve the defendant his costs unless there

1s evidence that the defendant has

(1) brouqht about the litigation, or

(2) has done something ccnnccted wlth the instltutlon

or conduct of the s ~ i t calculated to occasion

unnecessary lltlgatlon or expense, or

(3) has done some wrongful act in the course of the

transaction of whlch the plalntlff complains."

I would also refer to Forbes v Samuel p913 3 K.B.706

especially at p.739,Sutcllffe v Smlth (1886) 2 T.L.R.881, Jennlnqs

v Zllahl-Klss and Others (1972) 2 S.A.S.R. 493 (a declslon of

Bray C.J.) and the ultlmat~ paragraph of the above extract frcm

the reasons of Bray C.J., In Cretazzo v Lombardl supra. The

general rule as stated by Lord Justlce Atkln was applled by the

Supreme Court of New South Wales In Sunday Tlmes Newspaper CO

- Ltd. v McIntosh (1933) 33 S.R. N.S.W. 371 at p.377.

The clrcumstances connected with the lltlgatlon upon whlch

the plalntlff relies and whlch in my vlew are relevant to the

exerclse of my dlscretlon in respect of the Old Llon defendants

can be referred to brlefly as they are recounted at length in

my earller reasons. Prior to the commencement of proceedlngs

but in relatlon to the subject matter thereof the defendant's

employee TL-emalne made an untruthful statement in answering a

notlce under s.155. He acknowledged the untruth in the wltness

box but gave an explanation of the untruth and gave a Further

answer nelther of whlch explanation or further answer 1 accepted. where a defendant makes a mls-statement in clrcumstances where he is under an obllgatlon to be truthful, whlch mis-sta~ement renders an actlon agalnst hlm reasonable, there is good cause to

deprlve hlm of hls costs. In my oplnlon, the mls-statencnt was

not so slgnlficant as to warrant dcprlvlny the Old Lion cctlrely

of its costs, for the plalntlff dld not rely exclusively on the

statement as justifying proceedlngs. However, the mls-statement

and the unsatisfactory nature of the witness's evldence arc very

relevant to the proportion of the Old Llon's costs that I should

allow.

Forbes v Samuel supra, and a v Patman and Fotherinqham Ltd

G954 2 All E.R. 497 are authorltles for the proposltlon that

~f a considerable portlon of the trlal is taken up in determining

lssues upon whlch a defendant fails, it is a proper exercise of

discretion to reduce the costs allowed that defendant. Bray C.J.

InCretazzov Lombardl supra, at p.14 was of opinlon that it was proper to split costs in accordance with the success of the partles on various dlsputed questions of fact and law, and this view was shared on the facts of that case by Zelling and Jacobs

JJ., the other members of the Full Court. In JennlnqsvZllahl-

Klss and Others supra, Bray C.J. allowed a successful defendant

portion only of its costs. In thls matter the Old Lion ralsed,

perfectly properly, a substantial number of lssues upon whlch it

failed. I refer in particular, but not necessarily exhaustively,

to the Issues of no case to answer, the effectiveness of servlce

of the orlginal s.155 notlce and whether it was bound by the

response of Tremalne (which latter issues were agltated both at

the time of the submission of no case to answer and in flnal

addresses). These Issues, although perfectly properly raised,

were issues upon whlch the Old Lion failed and they dld protract

the hearlng.

In my opinion, after taking lnto account the matters referred

to in the precedinq two paragraphs, it is appropriate that the

plaintiff be ordered to pay to the Old Llon one thlrd of its taxed

costs.

The Rex along mth the other defendants submitted no case to answer and I found in favour of the Rex. That defendant is

obviously entltled to its costs against the plaintiff. Notwith-

standlng the submission of its counsel, who was also counsel fact that it was represented by the same solicitors and the same counsel as the Morphett Arms is important. Counsel for the plaintlff supported his submlsslon that the Rex should recave only one half of its costs by reference to Beaurnont v Senior & Bull p9031 1 K.B. 282 and Elllnqsen v Det Skandlnavlske Companl and Others kg19 2 K.B. 567. In my oplnion, to apply the

for the Morphett Arms,that I conslder these two defendants

together and in effect set off the Rex's entitlement agalnst

the Morphett Arms' obllgatlon, in my vlew I should respect thelr

separate corporate existence, However, in determlnlng whether the

reasoning of these authorities 1s to achleve a just result, and

the order should be that the Rex recelve one half of its costs.

Further difficulties arlse in respect of the clalm for costs

by the plalntlff agalnst the Royal Oak and the Morphett Arms.

Counsel for the plaintiff contended that his cllent should have

~ t s full costs against the two dcfendants. There was no submlsslon

by the Royal Oak. Counsel for the Morphett Anns firstly argued

that the costs of the plaintlff should be less than its full costs

belng reduced to reflect the tlme taken in presenting its

unsuccessful claim agalnst the Norwood arlslng out of the Norwood

lunch. Reference was also made to the plaintiff's unsuccessful

submlsslon that as a matter of law mutual obllqatlons were not

essential to an understandlng. In my oplnion, nelther of these

matters warrants any reduction in the plaintiff's costs. The

greater part of the evldence in respect of the Norwood lunch had,

because it lnvolved the actlvltles of Farrah, relevance to the

ultlmate flnding of an understandlng, a relevance of the same

nature as Palmer's actlvlties in vlsitlng Rlchards and Rltchle.

As to the plalntlff's unsuccessful sub~nisslon on the point of

law, in the circumstance that it was necessary to conslder

exhaustively in law the scope of the concept of an understandlng.

it dld not take such an amount of tune as to warrant reduclng the

plazntlff's costs.

However, counsel also argued that the proportlon of the plalntlff's costs whlch his client and the Royal Oak, elther lolntly or separately, should pay should be reduced to reflect

the tlme taken and costs Incurred by the joining of the Old Lion. Wlth thls submlsslon I am prepared tc; agree. Where a successful

plaintiff's costs are lncreased by the joinder of other defendants

and the allegations agalnst them, the unsuccessful d-?fendants

should not have to shoulder the lncreased burden: Mt.Ga&ier

CO-operative Milllnq Soclety Ltd v Wllllams ,&g23 S.A.S.R. ld5.

Thls principle is not appllcable in thls case as far as the case agalnst the Norwood 1s concerned, for the reasons set oct abcve. But it is appllcable in thls lnstance because the case aga~nst the Old Llon can be seen as disengaged at least to a substantial

extent from the case against the Royal Oak and the Morphett Arms. costs whlch the Royal Oak and the Morphett Arms bear should be reduced by one quarter.

Counsel for the Morphett Arms' next contention, namely that

there should be separate orders for the plalntiff's costs

doubtless was founded upon his concern that the absence of the

Royal Oak and its counsel lndlcated that for some reason that

defendant might not be in a posltion to meet its share of the

plalntlff's costs. There was no evldence to support hls concern,

but it was understandable as this was a posslble explanation of the withdrawal of lnstructlons of the Royal Oak's counsel and sollcltors. The Morphett Arms' contention was that a

designated proportion of the plaintiff's costs should be ordered

to be pald by each of them, the Morphett Arms and the Royal Oak;

In other words that each be severally l~able for a specifled

portlon of the plaintiff's costs as ordered,and not jointly

llable to the plalntlff for the whole of those costs. During

argument I was attracted to what appeared at that staqe to be

the justice of this argument. However counsel was not able to

refer to authorlty to support hls submission nor to any reported

case in which such an order was made. My researches have been

equally unsuccessful. Upon more mature conslderatlon of the sub-

mlsslon I am of oplnlon that I should not accept it. The

plaintiff as the successful party is prlma facie entltled by way

of lndernnlty to its costs of the action, and if one of the

unsuccessful defendants is unable or unwilling to meet its share

of the obligation, the misfortune should be that of its "partner

in crlme" and not of the plalntlff. In so far as I have been

able to find any authorlty, it is in favour of the contrary

proposltlon to that propounded by counsel on behalf of the

Morphett Arms. I refer to Dansk Rekylrlffel Syndlkat Aktleselskab

v Snell @ 9 0 g 2 Ch.127 at p.130 where an order was made against

defendants jointly in clrcumstanccs where one became bankrupt

durlng the proceedings. In my opinion the conventional order

that the two defendants pay the plaintiff's costs should stand.

I have coilsldered t h e f u r t h e r p r o p o s l t l o n t h a t a s between

I t s e l f and t h e Royal Oak, t h e Morphctt A r m s ' l l a b l l l t y t o c o n t r l b &

should be f o r a l e s s e r proportion t h a t t h e Royal Oak. A b a s l s f o r

t h i s submlsslon was a revlew of t h e a c t u a l amount of t l m e t h a t t h e

c o u r t was engaged i n cons lde r lng exclusively t h e Morphett A r m s '

c a s e and t h e f a c t t h a t by arrangement i t s counse l was no t p r e s e n t

on t h e l a s t two days of hea r lng of c o u n s e l ' s addresses . However

welght must be a t t a c h e d t o t h e f a c t t h a t a number of subrnlssions,

l eng thy and o the rwl se ,o f o t h e r counse l were adopted by counse l

f o r t h e Morphett A r m s . Moreover even though it was n o t represen ted

be fo re t h e c o u r t on t h e f i n a l days of t h e hea r lng it was v l t a l l y

interested i n t h e arguments, p a r t i c u l a r l y t h o s e of counse l f o r t h e

Royal Oak. I f h l s submlsslons had bceri accep ted , no t on ly would

h l s c l l e n t have succeeded, bu t t h c p l a l n t l f f ' s clalrn a g a l n s t t h e

Morphett A r m s would p e r f o r c e have had t o be dlsmlssed. F l n a l l y ,

on t h e m a t t e r of calculating t h e amount of t lme t h e c o u r t was

concerned i n exclusive c o n s l d e r a t ~ o n of t h c Morphett A r m s ' c a s e ,

~t must be borne i n mlnd t h a t , a t l e a s t by v l r t u e of t h e f a c t

t h a t i t c a l l e d no witnesses, l e s s t l m e was spen t i n cons lde r lng

t h e c a s e of t h e Royal Oak.

I t i s my opln ion t h a t t h e defendants t h e Royal Oak and t h e

Morphett Arms should pay t o t h e p l a l n t l f f t h r e e q u a r t e r s of i t s

c o s t s of t h e proceedlngs . t h e same t o be taxed i f no t agreed.

The plaintiff f o r i t s p a r t should pay t o t h e defendant Norwood

~ t s c o s t s , t o t h e defendant t h e Rex one h a l f of i t s c o s t s , and

t o t h e Old Llon defendants one t h l r d of t h e l r c o s t s of t h e

proceedlngs ,	i n each	l n s t a n c e t h e c o s t s t o be	taxed	l f no t
aqreed.

On 21 December 1978 I made an order dlsmisslng the

submlsslons of all defendants other than the Rex of no case to

answer, Thereafter the Rex remained before the court merely

for the purpose of maklng submissions at the conclus~on of the

proceedings in respect of its costs. It is appropriate that 1

now formally dismlss the claim of the plalntlff against the

Rex.

The orders of the court are as follows:

I.	Holdlngs Pty. Llmlted, the defendant Rex Freehold Pty. Limlted and the defendants Lion Bus Co. Pty. Limited, Merlt Nominees	The plaintiff's clalms agalnst the defendant Saturno and Agett Nominees Pty. Limlted are dismissed.
2.	respect of its claim that the defendants Nicholas Enterprzses
That ludgment be entered in favour of the plaintiff in contravened s.45 (2)(a)(11) and s.45 (2)(b)(11) of the Trade Practices Act 1974.
3.	the defendant Morphett Arms Hotel Pty. Limited and each of them be restrained from maklng a contract or arrangement or arrivlng at an understanding wlth each other or any other retaller of 740 mlllilltre bottles of beer 'nrhlch has the purpose or has or is llkely to have the effect of flxlng, controlllng or malntalning or providing for the flxlng. controlllng or malntalning of the prlce for or a dlscount That the defendant Nlcholas Enterprises Pty. Llmlted and 740 millllltre bottles of beer,

That t h e defendant Nicholas E n t e r p r l s e s Pty. Llmlted pay

a pecunia ry p e n a l t y of $8,000 t o t h e Commonwealth.

That t h e defendant Morphett A r m s Pty . Llrnlted pay a

pecunla ry p e n a l t y o f $5,000 t o t h e Commonwealth.

That each of t h e las tment loned two defendants pay t h e

amount of i t s pecunlary p e n a l t y t o t h e D i s t r l c t Registrar

of t h l s c o u r t w i th in 21 days of t h l s d a t e .

That t h e plaintiff pay t o t h e defendant Saturno Holdlngs

Pty. Llnnted i t s taxed c o s t s of t h e s e proceedlngs.

That t h e p l a l n t l f f pay t o t h e defendant R e x Freehold Pty.

Llmlted one h a l f of i t s taxed c o s t s of t h e s e proceedings .

That t h e p l a l n t l f f pay t o t h e defendants Llon Bus Co. Pty.

L iml ted , M e r l t Nomlnees Pty. Llrnlted, General Development

Corporation Pty. Limlted and Aget t Nomlnees Pty . Llrnlted

one t h l r d of t h e l r taxed c o s t s of t h e s e proceedings.

That t h e defendants Nlcholas E n t e r p r l s e s Pty. Llrnlted

and Morphett A r m s Hotel Pty. Llmlted pay t o t h e p l a l n t l f f

t h r e e q u a r t e r s of i t s taxed c o s t s of t h e s e proceedlngs.

That t h e r e be l l b e r t y t o a l l p a r t l e s t o apply t o such e x t e n t

as i s necessary t o work o u t t h e t e l m s of t h e s e o r d e r s .