Trade Practices Commission v T.N.T.

I N THE FEDERAL COURT OF

AUSTRALIA

NEW SOUTH

WALES

DISTRICT

REGISTRY

No.

G . 4 4

1978

GENE=	DIVISION	)
Between :

COMMISSION

P l a i n t i f f

TRADE PRACTICES

-and-

T.N.T. INANAGEMENT PTY. LIMITED

F i r s t Defendant

BRAMBLES HOLDINGS

LIMITED

Second

Defendant

MAYNE NICXLESS

LIMITED

Third Defendant

YOUNGS

TRANSPORT

PTY.

LIMITED

Fourth Defendant

ANSETT

RANSPORT

INDUSTRIES

(OPERATIONS) PTY. LIMITED

Fif th Defendant

EXPRESS

FREIGHT

PTY.

LIMITED

Sixth Defendant

ASSOCIATED STEAMSHIPS PTY.	LIMITED	Seventh Defendant
IPEC HOLDINGS LIMITED	Eighth Defendant

INTERSTATE PARCEL

EXPRESS

CO.

PTY.

LIMITED

Ninth Defendant

ORDER

JUDGE MAKING ORDER:	Franki J.
DATE OF ORDER:	2 4 June 1983
WHERE MADE:	Sydney
THE COURT ORDERS THAT:

A l l these

app l i ca t ions

a re d i smis sed excep t

i n so

f a r as

they

relate

t o

the ques t ion of

interrogatories.

A l l parties

have

l i b e r t y

t o apply

i n relation

t o i n t e r r o g a t o r i e s .

The costs of the

Trade

Practices Commission i n these

app l i ca t ions

be pa id by the appl icants

i n

the fo l lowing propor t ions :

first,

f i f t h and seventh defendants, between

them

ten-fourteenths

th i rd

defendant

- two

fou r t een ths ;

s ix th de fendan t

-one - fou r t een t

e igh th and

ninth defendants, between

them

one-fourteenth.

I N THE FEDERAL COUR'I' OF AUSTRALIA

)

NEW SOUTH WALES DISTRICT

REGISTRY

)

N o .

G . 4 4

1978

GENERAL	D I V I S I O N	)
B e t w e e n :

TRADE PRACTICES

COMMISSION

P l a i n t l f f

-and-

T.N.T.

MANAGEMENT

PTY.

LIMITED

Firs t

D e f e n d a n t

BRAMBLES HOLDINGS LIMITED

Second

Defendant

MAYNE NICKLESS

LIMITED

Third Defendant

YOUNGS TRANSPORT PTY.

LIMITED

Fourth

Defendant

ANSETT

RANSPORT

INDUSTRIES

(OPERATIONS)

PTY.

LIMITED

F i f t h

D e f e n d a n t

EXPRESS

FREIGHT

PTY.

LIMITED

S i x t h

Defendant

ASSOCIATED

STEAMSHIPS

PTY.

LIMITED

Seventh Defendant

I P E C HOLDINGS

LIMITED

E i g h t h Defendant

INTERSTATE

PARCEL

EXPRESS

CO.

PTY.

LIMITED	Nin th	D e f e n d a n t
Sydney
24 June 1983

REASONS FOR JUDGMENT

FRANK1 J.

T h l s is yet another

j u d g m e n t

i n matter

G . 4 4

1978

wherein

the

T r a d e

Practices

C o m m i s s l o n

( " the

C o m m i s s i o n " )

L .

plaintiff.

I consider that it is more important to deliver my

judgment orally today than to reserve it until I have prepared a

longer and more detailed judgment. The first, fifth and seventh

defendants in that action are seeking orders which are, In

substance, that:

(1)

the proceedings brought by the Commission against the

first, fifth and seventh defendants be dismlssed for

want of prosecution pursuant to order

rule

20 ( 2 ) (a)

of the High Court Rules:

( 2 )

the proceedings against those defendants be struck out

upon general principles of law:

( 3 ) alternatively, that the proceedings against those

defendants be permanently stayed.

The application is supported by a short affidavit of Mr J.R.

King, a partner in the firm of solicitors acting for those three

applicants, and another affidavit by him of one hundred pages

with a great number of annexures. Similar applications have been

made

the sixth defendant in the main proceedings, Express

Freight Pty. Limited, and by the eighth and ninth defendants,

Ipec Holdings Limited and Interstate Parcel Express

Co.

Pty.

Limited. In general, the sixth, eighth and ninth defendants

sought to rely largely on the affidavits of Mr King. The thlrd

defendant, Mayne Nickless Limited, supported an application by an

affidavit sworn by Mr H. Keller, a partner In the firm of

solicitors acting for that defendant. It sought similar orders

o r , alternatively, an order that certain additional

interrogatories be answered. The eighth and ninth defendants

also sought orders in relation to certain additional

mterrogatories.

On 20 June 1983 I gave judgment in an application by the

first, fifth and seventh defendants concerning discovery and I

refused that application which sought orders that further

affidavits of discovery be filed and for inspection of documents.

June 1983 the Full Court of this Court gave

judgment in two appeals, one by the first, fifth and seventh

defendants and the other by Brambles Holdings Limited, the second

defendant, which did not take part in the proceedings now before

me. The Full Court's judgment was in an appeal from judgments I

had delivered on

18 and 27 April 1983.

The first appeal by the first, fifth and seventh

defendants was, in effect, settled by an agreement that the

hearing date of the trial should be postponed from

17 May to 15

June 1983 and the Commission was ordered to pay the appellants'

costs of the appeal. In that appeal the question

of discovery

had been an issue. Seventeen volumes of additional materlal had

been discovered in 1983 and they were dealt with in a further

affidavit of discovery of

MS W.P. Hannon of 31 March 1983. This

additional material was dealt with in the appeal on the basls that it was agreed that the appeal in respect to it would not proceed but the rights of the appellants to approach the Court

would be reserved.

The second defendant had appealed also against my

judgments of 18 and

27 April 1983. It was not a party to the

agreement reached by the first, fifth and seventh defendants and

the Commission, but it pursued its appeal on the question of

discovery and to have the proceedings dismissed or stayed on

grounds associated with failure to make proper discovery. It was

unsuccessful in this regard and it was ordered to pay two-thirds

of the costs

of the Commission of the appeal. In that appeal the

second defendant argued that the action against

should be

struck out, inter alia, under order 32 rule 20

(2) a).

In the proceedings before me in which

I gave judgment on

and

April 1983 the second defendant sought to have the

proceedlngs struck out on grounds which lncluded delay in

discovery. All the defendants now before me were allowed to make

such submissions as they wished. Junior counsel then appeared

for the first, fifth and seventh defendants and I recorded in	my
judgment of 27 April 1983 that no defendant, other than the
second, had sought to make any submissions on the question	of
striking out the proceedings.

In the Full Court McGregor and Sheppard

JJ.

delivered

5 .

separate judgments and Smithers J. agreed with the reasons for

judgment of each of the other members

of the Court and with the

orders proposed by Sheppard

J. in relation to costs. I direct

attention to what Sheppard J., wlth whom as	I have said Smithers
J. agreed, said at pp.27-29.

It is clear that the view taken by the Full Court was

that, although the conduct of the Commission was open to

criticism, it was not of a kind which would have justifled the

dismissal of the action and it seems clear that the F u l l Court

was of the view that the Commission had not engaged in any wilful

misconduct in regard

to discovery. It is important

to bear in

mind that,

far as the evidence goes,

it is clear that all

discovery was made equally to each of the defendants now before

me.

In the judgment

I gave on 20 June 1983, one day before

commenced this matter,

I held that no further order for discovery

inspection

was

warranted.

The

first,

fifth

and

seventh

defendants sought to get a

hearmg date of 21 June 1983 for the

application now before me about 14 June 1983 but the

100 page

affidavit was not filed until

June 1983. The matter was

mentioned when I was hearlng the application by the same

defendants in which I gave judgment on 20 June 1983. I consider

that it was better to hear this appllcation after I had reached

conclusion whether or not there should be any further discovery

or inspection.

I therelore commenced

the consideration of these

applications against the background that

on 8 June 1983 the Full

Court had held that as

at 3 May 1983, when the appeal commenced

before it, or, at least when the application was before me in April 1983, the conduct of the Commission in relation to discovery, whilst open to criticism, was not such as to warrant

dismissal and that

I had decided on 20 June 1983 that no further

discovery or	inspection had been shown to be justified at that
later date.

I have approached this application upon the basis that

was not prepared	to have re-argued matters that had already been
determined.

The main allegations advanced by the first, fifth and

seventh defendants are:

(a)	There had been a deliberate and inordinate delay in relation to answering interrogatories and givlng discovery but that this delay was not caused by any

ulterior motive.

(b) Notices under section

155 of the Trade Practices Act

1974 ("the Act") had been deliberately given knowing

that this would cause delay.

of documents In

relation to

dlscovery because of an error in deciding

what documents had to be discovered but not for any

ulterior motive.

(d)	There had been a misuse of confidential transcript.

Since 4 May 1983 relevant matters which have occurred

are the discovery on

27 May 1983 of a further 173 pages

material, the discovery

of a further

40 pages on 2 June 1983, the

proceedings before the Full Court and before me, and in

particular those in which

I gave judgment on

20 June 1983.

After senior counsel for the first, fifth and seventh

defendants had completed his submissions in chief, senior counsel

for the third defendant submitted that the Court had power to

dismiss the matter against

defendant and ought

to do

conditionally upon a defendant giving a suitable undertaking to

the Court. He also said that the third defendant was prepared to

bear its own costs to date and to give an undertaking on a flnal

basis. A suggested form of undertaking was "not to refuse to

deal with brokers simply because they are brokers, and not to

deal with any proposal whether it comes from a broker or not,

otherwise than on its commercial merits". Subsequently to this

offer being made, all other defendants before me, which did not

include the second defendant, offered similar undertakings and to

bear their

own costs to date. The Commisslon did not accept

these proposals but presented detailed arguments on the relevant

law. It submitted that order 32 rule 20(2) (a) was not available

as a punishment for delay in answering interrogatories or in

giving discovery but provided the machinery whereby answers could

be obtained or discovery given, and in default, the actlon could

be dismissed.

I was referred to

Husband's of Marchwood Ltd. v.

Drummond Walker Developments Ltd. (1975) 2 A.E.R. 30 at p.32. In my opinion that case is authority for the proposition that the rule under consideration is designed to secure compliance with

the rules relating to discovery and not to punish a party for

past failure to comply.

Senior counsel for the first, fifth

and seventh

defendants referred me to Danvillier

v. Myers C18831 English W.N.

58. However, I consider that case only deals with a situation

where there is a wilful withholding of documents at the time

the hearing of the initial application to strike out. Because of

my findings of fact, I do not think It is necessary to reach a

firm conclusion on this questlon but, if it were necessary	o to
do, I would accept the arguments of the Commission.

I am

not satisfied that there has been any deliberate

and inordinate delay in relation to answering interrogatories and

giving discovery. In my opinion the way the Trade Practices

Commission has conducted discovery In this matter justifies it

being described now as having been conducted in

a way which was

not only open to criticism, as was said by Sheppard

J. in t :he

Full

Court

upon

the

facts

then

available.

Because

the

discovery of further documents after those under consideration by

the Full Court, I consider the Commission' S conduct in relation

to discovery is little short of very reprehensible. However, it

was not, in my opinion, deliberate and ultimately it is perfectly

clear that the Commission took extreme steps to ensure, as best

it could, that no documents, which should have been discovered,

remained undiscovered.

In considering the question

f delay, it is necessary to

consider not only the length of the period which has elapsed

since the alleged course of action accrued but a number

of other

factors. I

am not attracted by the submission that one should

balance the interests of

the Commission against the interests of

the defendants. The Commission is a public body charged with

particular functions under the Act, which is an Act intended by

Parliament to provide advantages for members of the public. In

addition, it is seeking a penalty and the question

the

Commission's costs

of the proceedings to date arises.

It was submltted by the first, fifth and seventh defendants that the delay was substantially the fault

the

Commission and that

the tests provided in Birkett

v. James (1978)

A.C. 297 at p.318 had been satisfied. It was submitted that

the

delay of some two years from the time of the alleged agreements

upon which the action was based until the date when the statement

10.

of clalm was filed was the fault of the Commission. This delay,

in my opinion, was due to an investigation of the matter during

that period when, for much of that time, litigation was

proceeding between Tradestock Pty. Ltd. and defendants, who were

broadly the same as the defendants in this action.

Thereafter, the only two factors of any significance in

relation to delay which could be said to have been caused by the

Commission arose out of the issue of notices under S .l55 of the

Act and its conduct in relation to the providing of discovery.

Apart from these factors, the delay was almost entirely caused by

the resolute determination

of the defendants, or one or other of

them, to make various interlocutory applications which

were,

almost without exception, singularly unsuccessful. In addition,

one appeal by special leave

the High Court was made by a

person upon whom a subpoena had been served and who was closely

associated with the defendants. Another application for special

leave to appeal was unsuccessful. The notices which were issued

under s.155 were the subject of a judgment by me on 27

October

1980.

found that the evidence given by the Chairman of

the

Commission established that the notices were issued upon the

suggestion and the advice of senior counsel then briefed by the

Commission and which were settled by senior counsel.

Some delay and certainly some embarrassment to

the

defendants has been caused by the very unsatisfactory way in which the Commission conducted discovery. However, the actual

11.

delay occasioned by this conduct has been comparatively short.

was referred to the tests which I have mentioned in Blrkett v. James and also to several other cases which, it was suggested, might qualify the views expressed in that case. I have examined these cases, in particular Stollznow v. Calvert (1980) 2

N.S.W.L.R. 749 and the judgment of the trial Judge in that case reported as No. 11.033 in the Practlce Decisions to be found in Ritchie Supreme Court Procedure N.S.W. I consider that any delay caused by the Commission has been clearly Insufficient to be a

significant factor in this application. This is particularly so when it is compared with the time lost through the desire of various defendants to have determined interlocutory applications

both at the level of

a trial Judge and also

on appeal. It is

thus unnecessary for me to further examine Birkett	v.	James,
supra, and any later cases of a similar nature.

An attempt was also made to establish that the Commission had wrongly made use

of certain evidence given in the

case of Tradestock Pty. Ltd. v. T.N.T. (Management) Pty. Ltd.

(1978) 1 A.T.P.R.

No. 40-056, which was said to

be subject to

orders under ss.17 and 52 of the Federal Court of Australia Act.

It was not suggested that the Commission had received this

material in a way which involved "a deliberate course of

contemptuous conduct" on its part but that it had used this

material in an unfair way and this was an abuse of process.

There is insufficlent evidence before me to enable me to conslder

whether whatever might have taken place in relation

thls

_ .

12.

!	allegation is relevant to these current applicatlons now before me.

In my opinion it is clear that a litigant is entitled to

have his case determined by a Court if he

wishes. The

Commission is opposing these applications.

I consider that there

is no evidence which would justify my striklng out the actlon

staying it because of

the

undertakings which have now been

publicly offered.

So far as the evidence before me shows, they

were not offered in any formal manner in this matter, if at

all,

until the second day of the hearing of these applications which

are now before me.

I consider that the applications to dismiss the proceedings under what might be called the general principles

law also fail. I also see no reason

why the proceedings, fixed

to commence on Tuesday, 28 June 1983, should be stayed.

The Commission has agreed to answer in a reasonable time

such of the interrogatories as are proper and arise out

discovery since 1981. Provided all proper interrogatories are interrogatories are proper today.

answered within a reasonable time all the applicants who have

sought to administer further interrogatories accept that this

factor would not prevent the hearing commencing on 28 June 1983.

13.

I dismiss all applications now before me except

in so

far as they relate to the question of interrogatories. I will permit submissions on the questlon of costs and on the procedure

to deal

with

the answers to the

further interrogatories which

have been sought.

c e r t l f y t h a t t h l s

and the -&,-duec/2

preceding pages are a true

copy

the

Reasons for Judgment herein of h l s Honour

Mr	Just lce Frankl .

[1983] FCA 158

24 Jun 1983