Trade Practices Commission v Santos Ltd - [1993] FCA 750

JUDGMENT No. ........ .......

750 1 9 3

.-m

.m.e-el-u*

IN THE FEDERAL COURT OF AUSTRALIA )

VICTORIA DISTRICT REGISTRY

)

No. VG 377 of 1992

1

GENERAL DIVISION 1
B E T W E E N :

TRADE PRACTICES COMMISSION

Applicant

SANTOS LIMITED

First Respondent
SAGASCO HOLDINGS LIMI!rED

Second Respondent

JUDGE : Heerey J
m: 11 October 1993
PLACE : Melbourne
MINUTE OF ORDER

The Courts orders that: of the trial the following question be determined:
"Does s.50(1) of the Trade P r a c t i c e s Act 1974 apply to the proposed acquisition alleged in par 16 of the amended statement of claim and admitted in par 16 of the amended defence of Santos as if the amendments

NOTE : Settlement and entry of orders is dealt with in

Order 36 of the Federal Court Rules
made by the Trade P r a c t i c e s L e g i s l a t i o n Amendment
Act 1992 had not been made?"
IN THE FEDERAL COURT OF AUSTRALIA )
1

VICTORIA DISTRICT REGISTRY 1 No. VG 377 of 1992
1
GENERAL DIVISION )
B E T W E E N :
TRADE PRACTICES COMMISSION

Applicant

SANTOS LIMITED

Flrst Respondent

SAGASCO HOLDINGS LIMITED

Second Respondent

JUDGE : Heerey J
m: 11 October 1 9 9 3
PLACE : Melbourne
RULING

On 7 October I ruled that the question whether this case is governed by the old or new form of s.50 of the T r a d e P r a c t i c e s Act 1974 should be determined at an early stage.
There has now been argument as to the form which that

determination should take. The competing contentions will be stated in a little more detail in the course of these reasons.

For the moment it is sufficient to say that the TPC and Sagasco put forward a series of questions which they say will have to be declded upon evidence adduced for the purpose, prefaced by further discovery. Santos on the other hand says that the question can and should be determined on the pleadings and without discovery or evidence.

These competing contentions need to be considered in the light of the history of the case thus far.

On 1 September 1992 Santos lodged with the ASC a Part A Statement in respect of an offer for all the fully paid ordinary shares in Sagasco at $2.70 per share, conditional on 56 per cent acceptance and also on the South Australian
I
I Government Financing Authority accepting the offer in relation
: to all of its shares. I shall refer to this proposal as "the Part A offer".
On 16 September the TPC advised Santos that it had "formed the view that the proposed acquisition is likely to contravene s.50 of the T r a d e P r a c t i c e s Act 1 9 7…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [1993] FCA 750
Decision Date: 11 Oct 1993

CaseChat Overview and Summary

In the Federal Court of Australia, the Trade Practices Commission (TPC) brought a case against Santos Limited and Sagasco Holdings Limited, seeking to determine the legality of a proposed acquisition under the Trade Practices Act 1974. The TPC alleged that Santos' acquisition of shares in Sagasco would substantially lessen competition and sought injunctive relief and a declaration of unlawfulness. Santos, on the other hand, intended to proceed with its acquisition plans if the TPC's application for a permanent injunction failed. The legal issue centred on whether section 50(1) of the Trade Practices Act applied to Santos' proposed acquisition, particularly in light of amendments introduced by the Trade Practices Legislation Amendment Act 1992, which altered the criteria for unlawful acquisitions.

The court considered whether the question of applicability should be determined through evidence and discovery or if it could be resolved based on the pleadings alone. The TPC and Sagasco argued for a determination through evidence, while Santos contended for a resolution based on the pleadings. The court concluded that the existence of a proposed acquisition was admitted by Santos, and no substantial injustice would be caused by determining the issue on the pleadings without further discovery or evidence. The court thus ordered that the question be determined at a specified time during the trial, asking whether section 50(1) of the Trade Practices Act applied to Santos' proposed acquisition as if the 1992 amendments had not been made.

The court's decision was based on the admission by Santos of its intention to acquire shares in Sagasco, as detailed in the pleadings. The court found that the commercial realities and the forensic context of the case supported the view that the existence of a proposed acquisition was no longer in dispute. Therefore, the court ruled that no further evidence or discovery was necessary to resolve the issue, and it would be determined based on the pleadings.

Orders