Wallis v Downard-Pickford (North Queensland) Pty Ltd

[1993] HCATrans 187

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry No BS of 1993

Brisbane

B e t w e e n -

KENNETH GEORGE WALLIS

Appellant

and

DOWNARD-PICKFORD (NORTH

QUEENSLAND) PTY LTD

Respondent

DEANE J

DAWSON J

TOOHEY J

GAUDRON J

MCHUGH J

TRANSCRIPT OF PROCEEDINGS

Wallis(2) 1 1/7/93

AT BRISBANE ON THURSDAY, 1 JULY 1993, AT 10.08 AM

Copyright in the High Court of Australia

MR P.A. KEANE, QC:  May it please the Court, I appear with

my learned friend, MS A.I. PHILIPPIDES, for the

appellant. (instructed by Murrell Stephenson)

MR J.D.M. MUIR. QC:  If the Court pleases, I appear with my

learned friend, MR J. SULLIVAN, for the respondent.

(instructed by W.T. Purcell Chadwick & Skelly)

MR A.W. STREET:  May it please the Court, I appear on

behalf of the Attorney-General for New South

Wales, under section 78A, and we seek to intervene.

(instructed by H.K. Roberts, Crown Solicitor for

New South Wales)

DEANE J: Yes, Mr Keane.

MR KEANE:  Thank you, Your Honour. May we hand up copies of

our outline of submissions.

DEANE J: Yes, Mr Keane.

MR KEANE:  Thank you, Your Honour. Your Honours, in one of

those moments of insight that should not happen

when one is on one's feet, I see from paragraph 2

of our outline that we have demoted·Lords Reid and

Diplock in the hierarchy, and for that we apologize

to Their Lordships.

If we may ask Your Honours to go to the statement of agreed facts in the record, at page 5,

Your Honours will see from paragraph 2 that the

respondent was a trading corporation within the

meaning of the Trade Practices Act and a carrier

for the purpose of the Carriage of Goods by Land

(Carriers Liabilities) Act, Queensland, 1967.

Your Honours will see that a contract was entered

into by the respondent and the Commissioner for

Police for the transport of the appellant's goods

from Ayr to Dalby, that contract was for the
benefit of the appellant, the appellant accepted

the benefit of the contract, the Commissioner

entered into the contract in the exercise of his

discretion to confer a benefit upon the appellant,

who was a policeman, as a result of the
Commissioner for Police's decision to transfer him.

we draw Your Honours' attention to paragraph 7 on page 6 and to paragraphs 10 and 11, in which it

appears that, for the purpose of these proceedings,

it was accepted as a fact that the respondent had

failed to use due care and skill in effecting the contract of carriage, and the issue in the appeal

is whether the provisions of section 6 of the

Queensland Act, which provides for a limitation on

the carrier's liability for breach of its

contractual obligations, can prevent the appellant

Wallis(2) 2 1/7/93

from recovering the full amount of the loss

suffered as a result of that breach of warranty,

implied as it is, we would submit, by section 74(1)

of the Trade Practices Act.

Your Honours, by the respondent's notice of

contention, it is contended that section 74(1) does
not operate in this case to imply the warranty by
reason of the terms of section 74(3).

DEANE J: But that means, does it, that 10 is directed to an

implied term under the principles of contract law?

MR KEANE:	An implied term imposed, we would submit, by the operation of section 74(1), which operates as a
contractual provision.
DEANE J:	I follow that, but is it not an agreed term? rs

not 10 agreed?

MR KEANE:  Yes, 10 is an agreed fact.

DEANE J: Well, if it is contended against you that the case

falls within 74(3), 10 must be read as implied by

principles of contract law, must it not?

MR KEANE:  Your Honour, our submission is that contention

made in the notice of contention is incorrect.

DEANE J:  I follow that, but I am trying to understand what

10 means as an agreed fact.

MR KEANE:  Your Honour, it means that it is accepted that

there was a failure on the part of the respondent to use due care and skill, that being the content

of the obligation imposed by section 74(1), as a

result of which the goods were damaged.

DEANE J: That is not what 10 says, though, is it? 10 says

that there was a breach of a duty implied by the

contract.

MR KEANE:	And, Your Honour, I think we have to accept that the case comes here on the footing that we do
accept that we have to show that the term was
implied and that, in so far as that is there as a
statement of agreed fact, it is not a statement of
an agreed view as to the law.

DEANE J: Well, unless it is an agreed fact that if

section 74 is not applicable there was, none the

less, an implied term under ordinary contract

principle which, prima facie, one would expect.

MR KEANE: Well, except that it was excluded by the

operation of the Queensland Act and possibly even

by the provisions of the contract, Your Honour.

Wallis(2) 1/7/93

DEANE J: Well, the damages were limited.

MR KEANE: 

By the Queensland Act.

DEANE J: 

I did not understand that there was anything that would exclude an implied term requiring reasonable

care and skill.

MR KEANE: 

Your Honour, may I say that our position is - and

I take it that it is common ground - that if
section 74 does not operate, then there is no other
basis on which the appellant would be entitled to

hold the respondent liable.

DEANE J: So you would get nothing, instead of $200.

MR KEANE:  No, we would get $200.

DEANE J: Well, in that case you have to have an implied

term from somewhere.

MR KEANE: Well, that is so, Your Honour, but it would be an

implied term that would be amenable to being cut

down by the Queensland Act.

DEANE J:  It would be the ordinary implied term in the

contract, to use reasonable care and skill in

carrying.

MR KEANE:  Yes.

TOOHEY J: The difficulty seems to have arisen because,

forensically, the matter has been handled by way of

summons for declaratory relief. Is there in fact

an action on foot?

MR KEANE:  No, Your Honour. The matter was commenced by way

of originating summons, as Your Honour says, for

declaratory relief, and the parties proceeded upon

this agreed statement of facts.

DEANE J: But it seems to have been common ground that the

issue is the 1000, whatever it was, or $200.

MR KEANE:	Yes, Your Honour.
DEANE J:	Now, if that is so, underlying it, 10 must reflect

common ground that, at worst from your point of view, there was an implied term in the contract unaided by section 74.

MR KEANE:  Yes, Your Honour, and that would be because of

the State Act in any event, because of the

provisions of section 9. Your Honours, if we could take Your Honours to the provisions of the relevant

legislation, that can usefully be done by taking

Your Honours to the summary that is provided in the

Wallis(2) 4 1/7/93

record in the judgment of the Court of Appeal at

page 64. Your Honours, at page 64 the terms of

sections 68 and 74 of the Trade Practices Act are

relevantly set out, then the relevant provisions of
the Carriage of Goods by Land Act are set out.

Your Honours will see, at the bottom of the page,

that section 5 provides that:

The liability of a carrier for loss of or

injury to goods entrusted to him under a

contract of carriage or as incidental to the

carriage by land of a passenger for reward

shall be upon the bases prescribed by this Act

and not otherwise.

And then, section 9, which is on page 65, deems

there to be implied in every contract the

provisions of section 5 and section 6(1) and (3).

So I think that answers the question of Your Honour

the Presiding Judge, or addresses the problem

Your Honour was raising, because under this Act, that is the State Act, in any event, that provision

as to the bases of liability in respect of

contracts of carriage required by section 5 would

be implied by section 9 so as to pick up the terms

of section 6.

DEANE J: There may well be some provision - I have not

looked at the Act beyond what is set out - but what

is set out works on the assumption that there is a

duty of care to be drawn from somewhere else, and

it proceeds to limit damages, which brings us right
back to the first thing I asked you, and that is:

Trade applied in accordance with ordinary contractual

is the basis of 10 that, quite apart from the

principles?

MR KEANE:  Yes, Your Honour.

DEANE J: The answer is, as you see it, yes.

MR KEANE:  Yes.

DEANE J: And I see nods on the other side.

MR MUIR:  We do not dissent from that, Your Honour.

TOOHEY J: And does it follow then, Mr Keane, that if a

person's goods were damaged in cartage, and chose

to sue in negligence, that the Carriage of Goods by

Land (Carriers' Liabilities) Act would still

operate?

MR KEANE:  It would, Your Honour, if the contract occurred

by virtue of a contract of car~iage.

Wallis(2)

1/7/93

TOOHEY J: 

You are approaching the matter, are you, on the

footing that the (Carriers' Liabilities) Act
applies to a contract of carriage whether the cause

of action is founded in contract or in tort?

MR KEANE:  Or in tort. Your Honours, we should mention the

provisions of sections 68 and 74, which are at

page 64 of the book. I draw Your Honours'

attention briefly to section 68 which is directed

to preventing the operation of any contractual

term:

that purports to exclude, restrict or modify

or has the effect of excluding, restricting or

modifying:

(a) the application of all or any of the provisions of this Division;

and then, particularly -

(c) any liability of the corporation for

breach of a condition or warranty implied

by such a provision.

And then section 74 itselft

In every contract for the supply by a corporation in the course of a business of

services to a consumer there is an implied

warranty that the services will be rendered
with due care and skill -

and 74(3) -

A reference in this section to services does

not include a reference to services that are,

or are to be, provided, granted or conferred

under:

(a)	a contract for or in relation to the
profession or occupation carried on or
transportation or storage of goods for the purposes of a business, trade,
engaged in by the person for whom the
goods are transported.

Your Honours, the learned primary judge,

Mr Justice Cooper, concluded that section 6 of the

Carriage of Goods by Land (Carriers' Liabilities)

Act was not effective to limit the carrier's

liability, holding that it was inconsistent, for

the purposes of section 119 of the Constitution,

with sections 68 and 74 of the Trade Practices Act

and Your Honours will find His Honour's reasons at

the record, page 49 line 30, and in the short

passage over the page.

Wallis(2) 6 1/7/93

Your Honours, the Court of Appeal concluded to

the contrary, and Their Honours' reasons relevantly

commence at page 67 of the record. From line 15

Your Honours will see that the approach of the

court was to focus attention upon section 6, which operates not by way of a term of a contract but as

a statutory declaration of the extent of liability,

and held that section 68(1)(c) has nothing to say

in respect of section 6 of the Queensland Act.

Your Honours, that discussion continues to

page 68, where there is reference, at lines 25 to

35, to the statutory scheme for the limitation of

liability of carriers erected under the State Act,

and then Their Honours go on to say:

The result is thats 68 of the Trade

Practices Act which concerns itself solely

with avoiding contractual terms of a certain

character will not touch the restriction on

liability which flows from the independent

statutory operation of s 6 of the Carriage of

Goods by Land (Carriers' Liabilities) Act. It

is impossible to disregard the precisely

chosen words which appear at the commencement

of s 68, "any term of a contract". This leads

to the conclusion that that section is

concerned exclusively with contractual terms.

The further section relied on by the

respondent was s 74 of the Trade Practices Act

but that section assists the respondent only

to the point of ensuring that in its
application to the facts of the present case
there will be in operation an implied

warranty that the carrier's services will be

rendered with due care and skill. This much

is not in contest in the present proceedings,

it being conceded that there occurred a breach

of an applicable duty to use due care and

skill. Section 74 does not concern itself

with the quantum of damages which can be

which it introduces. Ifs 74(1) stood alone recovered for breach of the implied warranty

it would appear to invite the possibility of

the parties regulating the matter for

themselves or even contracting out altogether.

Your Honours, can we emphasize Their Honours' view

that section 74 does not concern itself with the

quantum of damages which can be recovered for a

breach of the implied warranty. Their Honours then

went on to say:

It is the earlier provision, s 68(1), inapplicable in the present case, which excludes generally the possibility of

Wallis(2) 1/7/93

contractual attempts to limit liability for

breach of warranty such as is implied by

s 74(1). The existence of s 68 in the same

Division of the Act ass 74(1) provides an

indication of the limited ground which the

latter provision is intended to cover and

shows that it is not concerned with the extent

of the liability for breach of the warranty

which it introduces or with questions of

quantum. The draftsman of the Act was content

to leave those matters to be regulated in

other ways. It is not possible to read

s 74(1) as though, considered alone, it had an

effect along these lines - in every contract for the supply by a corporation etc there is

an implied warranty that the services will be rendered with due care and skill and for ·

breach of that warranty the corporation will
be liable to the consumer for the full measure

of damages which represents the amount of his

loss.

And then Their Honours say:

The result of this analysis is that it

should be concluded that there is no

inconsistency betweens 6 of the Carriage of

Goods by Land (Carriers' Liabilities) Act

relied upon by the appellant and ss 68 and 74

of the Trade Practices Act.

Then Their Honours refer to the cases which pose

the relevant tests.

Your Honours, it is our submission that one

can see that the Court of Appeal approached the
question of inconsistency on the footing that

section 68 of the Trade Practices Act operates to

avoid only terms of contracts:

that purports to exclude, restrict or

modify ..•.. any liability of the corporation

for breach of a condition or warranty implied

by -

section 74, and that this limited operation for

section 68 itself confirmed or provided support for

a view that a statutory limitation on liability

such as that prescribed in the Carriage of Goods

Act is not inconsistent with the liability created

by section 74, and that particularly appears in the

passage at 69 line 30 to 70 line 15.

TOOHEY J:  Do you argue with the first step in that

exercise, namely the view that section 68 is

concerned exclusively with contractual terms?

Wallis(2)	1/7/93
MR KEANE:	We do not argue with that, no, Your Honour.
TOOHEY J:	You accept that.
MR KEANE:	Yes.

TOOHEY J: But it is the next step that you take issue with?

MR KEANE:  It is, Your Honour, and indeed we rather take

some support or some comfort from the terms of

section 68(1)(c) which, in our submission, serves

to undermine Their Honours' conclusion that

section 74 is not concerned with the extent of

liability, because section 68(l)(c) itself assumes

a liability of a particular extent and, we would

submit, a liability of the extent which one finds in contract, the obligation implied by section 74

being one which is contractual in nature though, of

course, deriving its force from statute.

Your Honours, if we may put our submission

broadly, it is section 6 of the Carriage of Goods Act, by virtue of the limitation on the carrier's

liability, and the necessary correlative limitation

on the rights of the consumer is inconsistent with

the obligations and rights created by

section 74(1). So that we would submit this is a

case of direct collision.

McHUGH J:  It is hard to reconcile that with a case like

Ansett Transport Industries v Wardley, is it not?

MR KEANE:  Your Honour, we would submit that this is a case

where the right created by the Trade Practices Act

is, to use the language in Wardley, absolute, and

then one looks at the State Act and it impairs the

effect of that right.

McHUGH J: Supposing the Queensland legislation said that no

contract for carriage of goods was enforceable

unless it was in writing and signed by the person

to be charged, would that detract from rights

created by section 74?

MR KEANE:  Your Honour, it would, in our submission.

MCHUGH J: And you would say also, I suppose, that if there

was a requirement for a statutory notice to be

given within six months of the occurrence of damage, or otherwise, you lose your right of

action.

MR KEANE:  Your Honour, that may be in a different category

because that may then be a question of a procedural

limitation on rights as opposed to something which

strikes at the substance of those rights.

Wallis(2) 9 1/7/93

McHUGH J: Well, supposing Queensland altered the law

concerning general damages recoverable for trespass

to goods generally.

MR KEANE:  Your Honour, once one puts it in that way one

really, with respect, raises the point which, in

our submission, is in issue, and that is that

section 74(1) necessarily imports a contractual

measure of damages, well understood, being that

quantum of damages necessary to put the consumer in

the position he would have been in had the promise

been kept.

McHUGH J: But there is no Commonwealth common law, is

there, and these Commonwealth statutory provisions

are going to operate in the State context?

MR KEANE: Well, Your Honour, they operate in a State

context and they contain within themselves
provisions which reflect the view that the rights
which they create are to be of a particular nature

and the incidence of those rights are well known, and a State statute which affects to reduce those

rights by limiting their effect collides.

Your Honours, can we take Your Honours to

paragraph 1 of our outline of submissions.

Your Honours, in paragraph 1 we have set out a passage from the judgment of Mr Justice Brennan, when His Honour was on the Federal Court, in Arturi v Zupps. His Honour was there speaking of the

condition implied by section 71 of the Act, but we

apprehend that that makes no difference.

Your Honours, what His Honour has said is that

these implied warranties:

takes effect by imposing an obligation upon

one of the contracting parties as though the

parties had embodied the obligation in their

contract -

and - by describing the obligation -

in section 71 -

as an implied condition -

as an implied warranty in section 74, it -

defines the nature of the obligation. It is

an obligation which takes effect by a legal

fiction -

but -

Wallis(2) 10 1/7/93

A breach of the obligation [is a breach of] an

obligation imposed by the contract itself.

But nevertheless, a breach of obligation put into the contract by Commonwealth Law.

Your Honours, Arturi v Zupps - Your Honours

have, I think, a bundle of authorities which have

been provided. Your Honours, these authorities are

organized alphabetically, so that if one wanted to

find the decision of Justice Toohey in Polgardy v

Australian Guarantee Corp, one would go to the tab

PQ. And in Polgardy, for example - we will not

take Your Honours to all the references we have

referred to under Arturi in paragraph 1, but if one

goes to Polgardy, one sees that Your Honour

Justice Toohey, at 392, in the last two paragraphs,

has set out that passage from the judgment of

His Honour Justice Brennan and expressed your

concurrence with it.
We will not take Your Honours yet to the decision in Zaravinos; we will take Your Honours to

that later. That is a decision of

Mr Justice Lockhart in which His Honour has agreed·

with the statement of Justice Brennan. Hjertum v
Ahern is a decision of Mr Justice Wilcox, where His

Honour has agreed with that decision; and Ev

Australian Red Cross Society is a judgment of Mr

Justice Wilcox where he has expressed a similar

view in his own terms.

Your Honours, we then submit, in paragraph 2,

that a breach of the obligation created bys 74 is

a breach of what is a contractual obligation and

which necessarily gives rise to a contractual

liability, and we refer Your Honours to the

statements in the House of Lords in Moschiv Lep Air

and, in particular, to the last sentence in a

passage of the judgment from Lord Reid, which we

have set out there, that:

This secondary obligation is just as much an

obligation arising from the contract as are

the primary obligations it replaces -

that secondary obligation being an -

obligation to pay to the other party a sum of

money to compensate him for the loss he has

sustained as a result of the -

breach.

DEANE J: What if the State Act said that any carrier who

breaches an implied duty to use due skill and care

shall be liable for double damages?

Wallis(2) 11 1/7/93

MR KEANE: Well, in that case, Your Honour, section 75(3) of the Act would preserve the consumer's rights - that

is 75(3) of the Trade Practices Act:

Except as expressly provided by this Part,

nothing in this Part shall be taken to limit,

restrict or otherwise affect any right or

remedy a person would have had if this Part

had not been enacted.

And 75(1) as well, Your Honour, and in relation to

75(1) may we say again that it is our submission

that this is a case not of covering the field, not

a case where the Commonwealth Act effects to cover

the field, but rather it is a case where, in

relation to the particular provision, there is a

direct collision. So that to summarize our answer
to Your Honour the Presiding Judge, the answer

would be that the consumer would have the benefit

of that generous provision.

mention that the propositions which we extracted Your Honours, if we may go on then to just

from Moschi v Lep Air have been referred to in

Australia as authoritative; in Citicorp v Hendry,

we will not take Your Honours to that, but we can

tell that it is a decision of Mr Justice Clark,

where he accepts the propositions as authoritative;

Nangus v Charles Donovan is a decision of the Full

Court in the Supreme Court of Victoria, and Womboin

v Savannah Island Trading Pty Ltd is a decision of

Mr Justice Rogers in New South Wales. Your

Honours, these cases are all in the bundle, but we do not think it necessary to take Your Honours to

them now.

And Moschi v Lep Air is referred to in the decision of this Court in Sunbird Plaza v

Maloney and, once again, we do not apprehend it

necessary to take Your Honours to it. There was

some discussion in Sunbird Plaza as to a difference

of views as to the effect of the obligations under a contract of guarantee between - a divergence of	views between His Honour the present Chief Justice
and the English courts in relation to the effect of a contract of guarantee, but not in relation to
this point; the point about the secondary
obligation being as much a part of the contract - that is to say, the secondary obligation to pay
damages being as much a part of the contract as the
primary obligation.

Your Honours, if we can go then to paragraph 3

of our outline, section 68(1)(c), in our

submission, reflects an appreciation on the part of

the draftsman that section 74(1) creates a

contractual liability and a correlative contractual

Wallis(2) 12 1/7/93

right that sounds in damages, albeit that it is

concerned with the rights of parties by contract to

limit that liability. It is there because it

assumes such a liability derives from 74(1).

DAWSON J:  On the other hand it would be unnecessary in

section 68, if your argument were correct, because

you cannot contractually modify the statute, in any

event.

MR KEANE:  It would be necessary, generally, in relation to

the rights of parties to a whole gamut of

contracts, other than just carriage of goods - it

would be necessary to show that parties cannot

contract out of the obligations imposed by the

statute. We would submit that it was not necessary

for section 68 to say that neither shall any State

law have effect to limit or restrict that

liability, because section 109 does that work.

DAWSON J: But I was thinking in particular of (c); (c)

would be unnecessary, in this case anyway.

MR KEANE:  Unless the parties had effected to so limit the

liability; familiar cases, Your Honour, of

limitations on the rights that appear in the
contract, limitations on quantum of recoverability,

in a whole gamut of consumer-type contracts.

DEANE J:  You have to rely on 68(l)(c) anyway in this case,

do you not, to get rid of the contractual

limitation in the standard terms and conditions?

MR KEANE: That is true, Your Honour.

DAWSON J: But all I am pointing out at the moment is that

when you contrast (b) and (c), the legislation

seems to draw a distinction between the exercise of

the right and the limitation of liability, which is

a distinction you say does not exist.

MR KEANE:  Your Honour, with respect, a provision, whether

it be of a contract or of a statute, which has the

effect of restricting a liability of the

corporation for breach would be - I am sorry, I

will put it the other way. A provision of a

contract which says that the corporation shall be

liable only to the extent of $200 per consignment

or $20 per package would be a provision which

restricts the liability of the corporation for

breach.

DAWSON J: It would also be a provision, on your argument,

which modifies the exercise of a right conferred by

the provision.

MR KEANE: Quite, Your Honour, because - - -

Wallis(2) 13 1/7/93

DAWSON J: That is why I am saying that on your argument,

(c) is not necessary in this case.

MR KEANE:  We say, Your Honour, that the liability which you

cannot restrict is necessarily the other side of

the coin of the right that 74 creates.

DAWSON J: There may be nothing in it. All I am pointing

out to you is that whoever drafted the legislation

drew a distinction between an exercise of the right

and a restriction of liability.

MR KEANE:  He did, Your Honour, and we would submit that by

creating the warranty and then putting an embargo

on restricting the liability, the draftsman of the
legislation has indeed got the whole coin; he has
got the liability and the right, the two sides of

the one coin.

McHUGH J: But the difficulty I have with your argument is

this, the effect of section 74 is to create a

primary contractual obligation on the carrier.

When that is broken, a secondary obligation arises

on the part of the carrier, a secondary obligation
which arises by way of contract to pay a sum of

money. It is in relation to that secondary

obligation that the State Act operates. So its
effect is indirect. It does not affect the direct

or primary obligation imposed by it.

MR KEANE:	But it does affect it in substance, Your Honour, and it affects in substance the secondary
obligation which flows, as much a part·of the contract and directly imposed into the contract by
the federal Act as the original obligation itself.

McHUGH J: Yes, but the secondary obligation arises from the

agreement between the parties. It does not arise

from a Commonwealth law.

MR KEANE:  Your Honour, in our submission, it does arise

from the Commonwealth law not by the agreement of

the parties; it arises because the Commonwealth law

intrudes into their agreement a warranty that

itself necessarily has with it - - -

McHUGH J: Yes, I understand how you put it, but it just	seems to me at the moment that the Commonwealth
only imposes a primary contractual obligation on
the parties, and the Commonwealth enactment is then
spent. The secondary obligation to pay the sum of
money arises from the contract between the parties, and it is only on that secondary obligation that
the State Act operates.
MR KEANE:	Your Honour, in relation to that, could we invite

Your Honour to consider that there are provisions

Wallis(2) 14 1/7/93

of the Act, for example section 73, which in terms
states that the consumer may recover the loss
suffered by reason of the breach. That is the

loss; not such loss as someone else might permit,

but the loss. That, Your Honour, occurs in 73

explicitly - and we will take Your Honours to these

in a moment - but there is also provision in

section 74B in the other provisions of Division 2A

which also make express provision for the recovery
of the loss suffered by the consumer in the

circumstances.

Your Honours, those provisions are necessary

in those cases because those are cases where a

special statutory liability is created absent a

relevant contractual nexus between the consumer and

the supplier or, in the case of section 73, the

financier of hire purchase transactions and so

forth. So that those provisions make express

statement, express provision for recovery of the

loss suffered. It would be an extraordinary thing,

in our respectful submission, if a provision such

as section 74, which operates upon the reality

rather than the fiction of a contract and imposes a

contractual warranty but does not go on to state

the measure of recovery, were to be construed as
being less valuable and more vulnerable to
diminution than the statutory causes of action that

are created where there is no contractual nexus.

Can we take Your Honours to those provisions

briefly. Your Honours will find them under the

label T. Your Honours will find, first of all

under that tab, the provisions in relation to the

definition of "consumers". We will take

Your Honours to those later in dealing with the

notice of contention. If we can take Your Honours

through to the provisions of Division 2 and take

Your Honours directly to section 73.

Sections 73(1)(a) and (b) postulate a situation where there is a supply to a financier with a view to the on-supply to the consumer or the provision

of finance by a financier to a consumer with a view

to supply to the consumer by the supplier of goods

or services, and then goes on to say:

and the consumer suffers loss or damage as a

result of -

inter alia -

a breach of a condition that is implied in the

contract by virtue of section 70, 71 or 72 or

of a warranty that is implied in the contract

by virtue of section 74, the supplier and the

linked credit provider are, subject to this

section, jointly and severally liable to the

Wallis(2) 15 1/7/93

consumer for the amount of the loss or damage,

and the consumer may recover that amount by

action in accordance with this section in a

court of competent jurisdiction.

Your Honours, that is to create a liability where

none would otherwise exist because of the absence

of a contractual nexus and to do so in terms where

the extent of the obligation and the extent of the

remedy is to recover the amount of the loss or

damage suffered as a result of the breach.

Your Honours, that type of provision is

exactly the sort of provision that is made in

Division 2A. By way of example, could we refer

Your Honours to section 74B which is at page 108 of the excerpt we have given Your Honours.

Section 74B(l) provides:

Where:

(a) a corporation, in trade or commerce,

supplies goods manufactured by the corporation
to another person who acquires the goods for

re-supply -

Then if we can ask Your Honours to step over the

other conditions down to subparagraph (e) -

(e) the consumer or a person who acquires the

goods from, or derives title to the goods

through or under, the consumer suffers loss or

damage by reason that the goods are not

reasonable fit for that purpose;

the corporation is liable to compensate the

consumer ..•.. for the loss or damage - and then it makes the provision for the recovery of

that loss and damage in a court of competent

jurisdiction. Your Honours, the subsequent

sections in Division 2A make similar provision on

the basis of this fresh statutory species of

product liability.

Can we refer Your Honours now to the of Mr Justice Lockhart in Zaravinos which	decision
Your Honours will find under the tab XYZ.	In the
judgment at 198, the first full paragraph	of text,
His Honour says:

I turn toss 74B, 74D and 74G of the

Trade Practices Act.

He describes that division - that is Division 2A -

as a revolutionary code of products liability. In

the next paragraph he goes on to say that:

Wallis(2) 16 1/7/93

Division 2A does not apply where there is a

contract between the manufacturer and a

consumer.

We would invite Your Honours to read the balance of

that paragraph.

So that, Your Honours, we would submit that

the scheme of the part is, in those cases where

there is no real contract, to create a special

liability and to state its measure. We would

submit that section 68(l)(c) reflects an acceptance

of the view that those sections which do create

real contractual obligations in real contracts

should have the same measure of liability.

DAWSON J:	How could you otherwise frame a provision which imposed liability where there was no contract save
by reference to the recoverability of loss or
damage?
MR KEANE:	Your Honour, you could not if you were creating rights that were to really matter.
DAWSON J:	So that is the explanation for the form there.

On the other hand, it would be very easy to say

that you implied a term into the contract and that

there would be liability for breach of that term.

You could say so if you wanted to.

MR KEANE: Section 68(l)(c), Your Honour, in our submission, certainly reflects the view that there is liability

for breach of the term. It would be a - - -

DAWSON J: Full liability.

MR KEANE: Yes, in our submiss~on, because it denies the

possibility of restricting that liability. It

denies it in respect of contracts, true it is.

DAWSON J: A term of a contract, yes.

MR KEANE:  It denies it in respect of contracts, but it is

predicated upon the existence of what otherwise

would be a full liability.

DAWSON J: Of course, it would be a full liability in the

absence of a term of the contract or in the absence

of a statutory provision.

MR KEANE:  Quite, and in so far as a statute effects to

alter, impair or detract from that full liability,

that statute collides with section 74.

DAWSON J: It would on a "covering the field" test, but the

question is: does it otherwise?

Wallis(2) 17 1/7/93

MR KEANE:  Your Honours, in paragraph 4 of our outline we

have referred to section 75 in which subsection (1)

was taken in Reg v The Credit Tribunal; ex parte

GMAC to indicate an intention not to cover the

field in the general sense. But if we could invite

Your Honours to look at that decision, which is

under R in our bundle, in the judgment of

Mr Justice Mason, as His Honour then was, with whom

Chief Justice Barwick, Justices Gibbs, Stephen and

Jacobs agreed, at pages 563 to 564. In the last

full paragraph of text on page 563, His Honour is

there referring to the effect of section 75 as an

indication of an intention not to cover the field.

Then on page 565, in the first full paragraph

of text, His Honour then goes on to consider the case of direct inconsistency, and he rejects the submission that there was direct inconsistency in

that case, but accepts, in our submission, that

section 75 cannot operate to exclude the

possibility of direct inconsistency. The question
then is whether this is a case of direct

inconsistency. In paragraph 5 of our outline, we

have referred to what we submit is the test. We

have referred to the terms of the test as framed in
Victoria v The Commonwealth - we do not ask

Your Honours to look at that - we have extracted

the test:

When a State law, if valid, would alter,

impair or detract from the operation of a law

of the Commonwealth Parliament -

and we then refer to Ansett Transport v Wardley.

Your Honours, our references there are wrong. The

reference to the judgment of the Chief Justice	should be at 243 point 5, and the reference to 251
is the judgment of Mr Justice Stephen.
Your Honours, can we hand up an extract from the judgment of the Court in Dao v Australian Postal Commission, (1986-87) 162 CLR 319, and refer
Your Honours to the passage at page 335 where, in
the first full paragraph of text on that page,
about point 4:

The relevant principle was discussed by Mason J, as his Honour then was, in Ansett

Transport Industries (Operations) Pty Ltd v wardley, in a passage which was later quoted

Dawson JJ in Commercial Radio Coffs Harbour	in the joint judgment of Wilson, Deane and
Ltd v Fuller.

Then they set out the passage:

"If, according to the true construction of the

Commonwealth law, the right is absolute, then

Wallis(2) 18 1/7/93

it inevitably follows that the right is

intended to prevail to the exclusion of any

other law. A State law which takes away the

right is inconsistent because it is in

conflict with the absolute right and because

the Commonwealth law relevantly occupies the

field -

Direct collision because it is in conflict, and because the Commonwealth law in respect of that matter, that is to say, what the rights and duties

and parties in that relation should be, occupies

the field; not generally in respect of that matter.

And, Your Honours, we submit that section 6 of the

State Act, if effective, necessarily alters,

impairs or detracts from the liability for breach

of the warranty.

In paragraph 6 we have referred to Penn

Elastic Co Ltd v Sadliers Transport Co, and those references, Your Honours, we have made because in

that case Mr Justice Stephen found it quite

natural, as a matter of ordinary language, to refer

to the effect of section 6 of the Act as one

limiting liability, and that is what it does,

Your Honours; it limits liability. ·one can say it

is about quantum, but it really is about the extent

of liability.

Your Honours, it is our submission that the

critical inconsistency is not as is reflected in

the judgment of the Court of Appeal and the

passages we have set out between section 6 of the

Carriage of Goods Act and section 68(1), but rather

between section 6 and section 74. We have already

made the submission that there was no need for the

legislature to strike down State legislation having

that effect, as there was a need to have section 68

to deal with the attempts by parties to bargain

away their rights.

Your Honours, that is what we wish to say in relation to the matters raised in our notice of

appeal. May we go on then to deal with the notice

of contention.

DEANE J: Yes, Mr Keane.

MR KEANE:  Your Honours will find the notice of contention

at page 85 of the record. Your Honours, that

notice of contention relies upon the provisions of

section 74(3). It is our submission that that

exclusion is not applicable. Your Honours, the

exclusion is relevantly in relation to contracts

relating to transportation of goods for the

purposes of the occupation of the person for whom

the goods are transported and, may we mention at

Wallis(2) 19 1/7/93

this stage, not, it may be noticed, the consumer,

party to the contract of supply contemplated

in 74(1).

We have taken Your Honours to the statement of

agreed facts. We should take Your Honours to the

order form, which is at page 9 of the record.

Your Honours will see that it is an official order and requires, or says:

Please perform for Commissioner of Police.

And the services are:

Pack and transport furniture and personal

effects of Sgt 2/c K.G. Wallis 2695 on

transfer from Ayr to Dalby.

Your Honours, section 74(3) would not seem to be

attracted, in this case, by the existence of any
"business, trade, profession"; "occupation" seems

to be the only likely peg on which to hang its operation. Your Honours, we have referred, in

paragraph 3 of our submissions, in respect of the

notice of contention, to what is probably a fairly

mundane observation, that occupation means the

trade or calling by which a person ordinarily seeks
to get his livelihood.

In paragraph 4, we make the submission that the exclusions are intended to refer to contracts

for the transportation of goods, and we have said,

as part of the business; we could say equally as

well, as part of the occupation of the person for

whom the goods are transported. The sort of case,
we would submit, that is in contemplation is that

of, for example, the travelling salesman.

But the transportation of a policeman's

furniture and personal effects is not, in our

respectful submission, as a matter of ordinary

language, apt to be described as being, "the

transportation for the purposes of his occupation

as a police officer". The transportation of

furniture is no part of his occupation, or his

duties.

We have referred Your Honours to the decision

in Lunney v The Commissioner for Taxation, which is
in the bundle under tab L, after Luckin v Hamlyn,

which is the case we have referred to in

paragraph 3, and the reason we have given

Your Honours Lunney's case is really for the

citation, evidently with approval, we would submit,

by Justices Williams, Kitto and Taylor, at 499 to

500 of the decision of the Court of Appeal in

Newsom v Robertson. Newsom v Robertson was, of

Wallis(2) 20 1/7/93

course, a case decided under United Kingdom

legislation in terms somewhat different from the

Income Tax Assessment Act, but relevantly the question was, as appears from page 499 in the first

full paragraph of text on that page, in the first

sentence:

whether railway fares which had been paid by a

professional man in respect of journeys

between his home and his professional chambers

constituted "money wholly and exclusively laid

out or expended for the purposes of his

profession".

And, Your Honours, we would emphasize the

conclusion, or the rejection of that argument, that

appears about seven or eight lines down:

None of the members of the latter court -

that is to say, the Court of Appeal -

were prepared to assent to the proposition

that the taxpayer's journeys were for the

"purpose" of his profession~ in the language

of Romer LJ "The object of the journeys, both

morning and evening, is not to enable a man to

do his work but to live away from it".

And similarly, over the page, at 500, at about

point 3, Your Honours:

The cost of travelling to and fro was then

obviously not incurred for the purpose of

their trade or profession - - -

DEANE J: Are you not, to some extent, pushing against an

open door here. If you look at it in terms of a

particular police officer, the arguments in favour

of what you are saying are obviously enough,

otherwise everyone who carries on business and

changes towns is going to have his furniture

carried for the purpose of his business. But what

if your argument that the person for whom the goods

are transported is not the Commissioner is not

accepted? What do you say then?

MR KEANE:  Your Honour, if the argument that the person for

whom the goods were transported is the

Commissioner, then - - -

DEANE J: Which seems to be the view that the Court of

Appeal thought there was some force in.

MR KEANE:  Yes, Your Honour. If that is the correct way to

look at it, we would submit, as we do in

paragraphs 6, 7 and 8 -

Wallis(2) 21 1/7/93

DEANE J: Well, I have taken you again, but - - -

MR KEANE:  No, Your Honour. Your Honour, Mr Justice Cooper

dealt with this question at pages 46, commencing at

line 38 and concluding at 47, line 2.

Your Honours, we submit that it is, at the least, a

clumsy and ungainly use of language to speak of the

making of the arrangement for the transport of his

furniture and personal effects, as being for the

purposes of the Commissioner's occupation. It is,

in our respectful submission, as Mr Justice Cooper

points out, part of his office to deploy police

officers for public purposes. The Commissioner

does not make a contract for himself or, indeed,

for anything to do with his occupation as a police

officer; he makes it as a State functionary for a

public purpose. We have referred Your Honours to
the decision of the Committee of Fruit Marketing v

Australian Postal Commission, and can we take

passages which make the point - - -Your Honours very briefly to just a couple of

DAWSON J:  I do not understand that restriction. After all,

his occupation exists entirely for public purposes.

MR KEANE: Well, Your Honour, his occupation.is probably

police officer, his office is a public office. But

if one is to speak of the Commissioner of Police's

occupation, it is police officer, one would think.

DAWSON J:  But when you talk of the purposes of the occupation, they are public purposes.

MR KEANE: Well, Your Honour, as to that, the definition -

we make a submission in paragraph 8 which relies

upon the circumstance that the original definition

of "consumer" in the Trade Practices Act excluded

from the definition of "consumer" a person who

acquired services for a public purpose, and that

that is so appears in the bit we have extracted at

the beginning of tab Tin our bundle, Your Honours.

Your Honours will see it is the third page into

tab T under the heading "Amendments" and then the

learned annotator sets out that:

Prior to the amendments made by Act No 81 of

1977 the definition of the term "consumer" was

contained ins 4(3) which provided - and then relevantly, Your Honours, in (b):

a person who acquires services shall be taken

to be a consumer of services if the services

are of a kind ordinarily acquired for private

use or consumption and the person does not

acquire the services for the purposes of, or

Wallis(2) 22 1/7/93

in the course of, a profession, business,

trade or occupation or for a public purpose.

Now, Your Honours, when that alteration was taken

out nothing was done to section 74(3) - nothing has

been done to section 74(3) in relation to - or to

suggest that performance of services pursuant to a

contract for public purposes is to be excluded from

the benefit of the 74(1) warranty.

There is no exclusion of a contract made for public purposes. The draftsman at the Parliament

has previously adverted to the very matter of
limiting the availability of the warranty by

reference to purposes which include all those

stated in 74(3), but not public purposes. They

have amended the Act to broaden the definition of

"consumer" and they have not amended the Act to

broaden the exclusion in section 74(3) by reference

to "public purposes".

DAWSON J:  I would have thought it was unnecessary.

MR KEANE: Well, Your Honour, I suppose that is a

possibility but, with respect, in our respectful

submission a little unlikely, having regard to the

fact that the draftsman had adverted to that

particular list of matters as being the trigger, or

the linchpin, as it were, of the applicability or

non-applicability of, inter alia, the provisions of

Division 2.

Your Honours, we were going to take you to

that decision of The Committee of Direction of

Fruit Marketing - that is in our tab. Your Honours have to turn past a number of other items to get to

it. It follows in tab C after the excerpt from

Commercial Radio Coffs Harbour v Fuller,

Your Honours. If we could ask Your Honours to go

to page 541 in the joint judgment of Justices Mason

and Wilson, and if we could ask Your Honours to

look firstly in the left-hand column, letter F, and

can we try to put this in context, Your Honours, by	saying that the case really concerned the question
whether The Committee of Direction of Fruit
Marketing was performing a governmental function, a function of the Crown. And having said that, if we
can then draw Your Honours' attention to page 541 in the right-hand column, between letters A and B:

The purpose of the Act is to organize the

marketing of fruit.

And the point to which we take Your Honours to the

case for is:

Wallis(2) 23 1/7/93

That is as capable of being a governmental

purpose as the maintenance of law and order,

and the administration of justice.

And we refer Your Honours as well to page 536 in

the judgment of Chief Justice Barwick. In the right-hand column, below the letter E:

The purpose for which those powers are

conferred is to perform a function which under
modern conditions is widely regarded as the
proper function of a State, namely, to control

the marketing of an important commodity -

and so forth. Then, the last sentence on that

page:

Even if it is right to say that the powers are

intended to be exercised in the interests of
the industry, that does not mean that they are

not intended to be exercised in the public

interest, for it is in the public interest -

and so forth. The next sentence, where His Honour

concludes by his reference to:

the interests of the community and not for

individual profit or gain.

And it is our submission that, if it be correct to

regard the Commissioner as the person for whom the

services were performed, rather than the person

whose goods were actually carried as the person for

whom the services were performed, then we would

submit that the Commissioner does not make the

contract for his own benefit, and he makes it as a

State functionary and it really has got nothing to

do with his occupation as a policeman, rather it is

the performance of the functions of State that

attach to his office as Commissioner. And as to

that, Your Honours, can we, without necessarily

taking Your Honours to them, just simply tell

Your Honours, that in the bundle there is an

excerpt from the Police Act which was then

applicable, which in section 6 provides that the

Commissioner is responsible for the superintendence

of the police force of the State; the police rules,

rule 33, which provides to similar effect and

provides that the Commissioner may issue general

instructions in respect of the superintendence of

the police force; and to tell Your Honours that at

page 17 of the record those instructions in

relation to transfers are contained, and to simply

mention to Your Honours that at page 17 of the

record the provision for transfers of police

generally, provides that:

Wallis(2) 1/7/93

transfers of members of the Police Force may

be made on account of promotions, filling of

gazetted vacancies, misconduct and

unsuitability, and for other causes, but in

all cases the guiding consideration is the
advantage of the Service, in view of which all

other interests are wholly disregarded.

So that, true it is, the Commissioner is performing

functions of his office; they are functions of

State, in our submission, and it is an

inappropriate use of language to speak of the

contracts which he makes as being made for the

purposes of his occupation. Your Honours, unless
you have something to raise with us, those are our

submissions.

DEANE J: Thank you, Mr Keane. Yes, Mr Muir.

MR MUIR:  Thank you, Your Honour. Your Honours, might I

hand up eight copies of the outline of submissions.

DEANE J: ·Mr Muir, reading this just to get the setting, am

I correct that it is common ground that there was

an implied term in the contract and that there are

only two issues between the parties:· the first is,
whether the Trade Practices Act applies at all in

view of the provisions of section 74(3), and the

second is whether, if it does apply, it operates to

preclude the application of section 6 in the

Carriage of Goods Act.

MR MUIR:  Yes, Your Honour, with a possible gloss as to the

application of section 75(3), because we contend

that it in itself is an answer to the appellant's

submissions.

DEANE J: Thank you.

MR MUIR:  Your Honours, if I could refer to paragraph 1 of

our outline, I do not intend to take Your Honours

to Yamashita. Might I briefly mention though, why

we have referred to the judgment of His Honour

Mr Justice Stephen in Penn Elastic. It is simply

to explain the background against which section 74
was enacted, namely the existing background of
legislation which included, inter alia, the

carriage of goods legislation in the various States, and in particular Queensland, and at

page 31 of Penn Elastic, His Honour gives a general

explanation of the origins of that legislation and

why it was thought to be necessary.

Your Honours, I did not intend to read at

length from that passage, but merely to state that

His Honour explained that a need was perceived,

both here and in the United Kingdom, to limit the

Wallis(2) 25 1/7/93

liability of carriers, because in the absence of

some limit on the liability, they might unbeknownst

to them incur liability in amounts quite out of

proportion to the charges made for their carriage.

And arbitrary limits on liability were imposed and if those limits were to be exceeded, it was thought

desirable that carriers be appraised of the value
of the goods and there be an opportunity for an

increased rate of hire to be negotiated.

Your Honours, the section 68 point is self-

explanatory. In paragraph 3 we deal with the

covering the field test and that does not appear to

be an issue. Our learned friend Mr Keane referred

Your Honours to the judgment of Mr Justice Mason,

as he then was, in The Queen v The Credit Tribunal;

Ex Parte General Motors Acceptance Corporation.

Your Honours, for the sake of completeness, might I

refer to the judgment of His Honour

Mr Justice Murphy at pages 565, going over to 566.

Your Honours, I might mention that all other

members of the Court agreed with the reasons given

by Mr Justice Mason. Mr Justice Murphy did not

disagree in the result. What he says at

page 565/566, is somewhat similar in effect. In a

brief passage he says:

Section 75 of the Act -

he does not limit it to section 75(1) -

where they directly collide with the provisions of the Act.

expresses the intent that State laws on the

subjects dealt with in "Part V - Consumer

And that, Your Honours will recall, is somewhat

similar with the observations of Mr Justice Mason

at page 564 at about point 2:

None the less, there is to be gathered from

the sub-section a very clear expression of

intention that the Trade Practices Act is not

an exhaustive enactment on the topics with

which it deals and that it is not intended to

operate to the exclusion of State laws on
those topics.

Your Honours, our learned friends in their

outline, in paragraph 5, refer to a test of

inconsistency which is extracted from Victoria and

the Commonwealth. It is necessary though, in order

to determine the applicability of that test or any other test that might be applied, to determine the

meaning and the scope of the statutory provision

that is under consideration. It is necessary to

Wallis(2) 26 1/7/93

look at section 74 in its statutory context and

that context, of course, includes section 68,

section 73(1), ~ection 74B to 74H inclusive and,

of course, section 75.

Your Honours, in our outline in paragraph 7,

we refer to "no absolute right being conferred".

We might also pick up the language in Dao v

Australian Postal Commission in the passage to

which Your Honours were referred at page 335 and

add that neither was the right provided for by

section 74 comprehensive. Your Honours, if I can

deal firstly with section 68.	We have largely said
what we want to say about it in paragraph 7.	we

refer Your Honours to the judgment of the Court of

Appeal at pages 69 and 70 of the record, and I

think our learned friend has already taken you to

that passage and I will not read it out again.	The
Court of Appeal pointed out that the fact that
section 68(1) is limited to the prevention of
contracting out tends to demonstrate that the
legislature, although concerned to prevent
contracting out, was not concerned to otherwise prescribe or limit the extent and liability for
breach of warranty or to prevent other statutory
regulation of that matter.
If I could then go to paragraph 8 of our submissions and pick up what the Court of Appeal
said in the record at the foot of page 69 going
over to 70:

It is not possible to read section 74(1) as

though, considered alone, it had an effect

along these lines - in every contract for the

supply by a corporation, et cetera, there is

an implied warranty that the services will be

rendered with due care and skill and for the

breach of that warranty the corporation will
be liable to the consumer for the full measure

of damages which represents the amount of his

loss.

Support for that approach, we submit, can be gained

by reference to the other statutory provisions we

have mentioned in paragraph 8, namely 73(1) and 74B

and onwards. In paragraph 8 of our written

submissions we contrast 74(1) with 74B(l) to 74H(l)

inclusive and, of course, as Your Honours have

seen, each of those provisions provides, in effect,
that the corporation must compensate persons for

loss and damage actually suffered in prescribed

circumstances. 73(1) is more useful, we submit,

for present purposes, because it applies, amongst

other things, to breaches of warranty implied by

virtue of section 74, but only in a limited range

of cases, namely those cases in which there is a

Wallis(2) 27 1/7/93

linked credit provider as defined elsewhere in

section 73.

In that case it is provided that the supplier

and the linked credit provider are, subject to the

section, jointly and severally liable to the

consumer for the amount of the loss and damage and

the consumer may recover that amount.

Section 73(2) deals with certain other

circumstances in which the supplier is liable, but
the credit provider is not. Section 74(1), of

course, by way of contrast, is completely silent on

the question of damages. It must be read, we

submit, in the light of the provisions to which

reference has just been made, namely 74B,

et cetera, which do make express provision in

relation to damages and, of course, in the light of

section 75, which makes plain that which is perhaps

implicit, as Your Honour Justice McHugh observed

earlier on, that the provisions are enacted against

a background of State laws. Section 75(1), of

course, goes further and expressly provides that

the provisions of the Part are not intended to

exclude or limit the concurrent operation of any

law of a State or Territory.

Your Honours, section 75(3) supplements the

submissions that we have just made, but it also, as

we submitted before, provides an answer to the

appellant's submissions in itself. If I could

refer Your Honours to paragraph 10 of our

submissions. What we have done is essentially, in

paragraph 10, we have looked at that part of 75(3)

which concerns the limitation restrictions on
remedies of a person, and in paragraph 11 we have
focused on the limitation or restriction on rights.

The point we make in paragraph 10 is that it is

clear that if it had not been for the enactment of

Part v, assuming its general application, the

appellant would have been caught by section 6(1),

so that his remedy would have been to recover
damages limited to $200.	The application of

subsection (3), we submit, necessarily means that the substance of that remedy, namely the right on

the part of the appellant to recover $200, must

remain, and must remain unaffected. That remedy,

on the part of the appellant, would be otherwise
affected, to pick up the language of

subsection (3), if the appellant is now to be

treated by operation of section 74 as having a

right to unrestricted damages.

Your Honours, we submit that - our learned friends have not addressed precisely on this point,

but one possible argument that we foreshadow is

that it might be urged on Your·Honours that the

language of subsection (3) ought be read down, so

Wallis(2) 28 1/7/93

that the words "otherwise affect" are perhaps

limited by operation of the words that go before.

Your Honours, we submit that there can be no

grounds for any limitation of the broad words

"otherwise affect" in subsection (3), and for that

reason we included in our list of cases and in the

bundle of cases that Your Honours have, the case of

Crowe v Graham, (1969) 21 CLR 375, which is just

ahead of tab D, Your Honours, in the bundle. If I

could refer Your Honours to the second sheet of

that, at the foot of page 376 there is set out

section 16(d) of the Obscene and Indecent

Publications Act and Your Honours will see there that it provides for a penalty, and the matters

which are prescribed are listed at some length and

in the second column at the foot of page 376, they

end in the words, on about the fifth line of the

words quoted:

or otherwise publishes any indecent or obscene

picture or printed or written matter -

One of the parties sought to limit the extent of the scope of that language and that was dealt with

by Justice Windeyer, who was in the majority, at
page 388 in the first full paragraph, down to about
point 7. We submit that that language is

appropriate to any treatment of the words

"otherwise affect" in this case.

Your Honours, going on now to the point we

raise in paragraph 11, that section 74 cannot be seen as affecting the limitation on liability or limitation on exposure to damages provided by

section 6(1), because we submit that the benefit

which the respondent obtains under section 6(1) is

a right within the meaning of section 75(3). And I

draw Your Honours' attention to two things:

subsection (3) commences with the words "except as
expressly provided by this Part"; dealing with that

firstly, there is nothing relevantly expressed in

section 74 concerning damages or any ability on the

part of any State legislature to make provision in

respect of damages. There, of course, is express

provision in section 68, but that express provision

is limited to contracts between parties and to
contracting parties. And the other matter to which

we draw attention is that subsection (3) refers to

a right of a person; it is not limited in any way

to conferring a benefit or a further benefit on any

consumer.

We submit that Your Honours might have

difficulty with the notion that the right of the

respondent to a statutory limitation on liability in prescribed circumstances is a right within the

meaning of subsection (3). To that end, we have

Wallis(2) 29 1/7/93

referred in our outline to various authorities.

Might I quickly take Your Honours to Salmond on

Jurisprudence, which is in the bundle of documents,

and refer Your Honours to page 224, half-way down

the page, and Your Honours will see from the passage to which I refer that there has been

earlier discussion about:

legal rights in the strictest sense in which

they constitute the correlatives of legal

duties.

And the learned author then goes on to say:

We must now consider the wider use of the

term, according to which rights, do not

necessarily correspond with duties. In this

generic sense a legal right may be defined as

any advantage or benefit conferred upon a

person by a rule of law ..... These are (1)

Rights (in the strict sense), (2) Liberties,

(3) Powers, and (4) Immunities.

And it is mentioned that there are correlatives to

those, the correlatives to Immunities being:

Disabilities.

And over at page 231:

Immunities -

is dealt with in paragraph 3 -

The term "right" is used in a fourth sense to

mean an immunity from the legal power of some

other person. Just as a power is a legal

ability to change legal relations, so an

immunity is an exemption from having a given

legal relation changed by another -

et cetera -	immunity is exemption from the power of
another in the same way as liberty (not) is exemption from the right of another.
Immunity, in short, is no-liability.

The correlative of immunity is

disability.

Your Honours, there are some authorities which

support the view which we put forward, if support

is needed: Sankey v Whitlam is one; it also is in

the bundle. Might we there refer to the judgment

of Sir Harry Gibbs at page 23, commencing at the

end of the first line:

Wallis(2) 30 1/7/93

The word "right", in the expression

"declarations of right" in section 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 - that was

established by Guaranty Trust Co of New York

v Hannay & Co, as well as by Dyson

v Attorney-General.

And, Your Honours, we refer to case of Columbian

National Life Insurance Co v Foulke, which
Your Honours will see in paragraph 11 of our

outline, in which the Circuit Court of Appeals, Eighth Circuit, by a majority, included that an insurer's alleged right to be immune from claims

under an insurance policy was a right in respect of

which an insurer could obtain declaratory relief;

the minority judgment did not find it necessary to

address the question of whether or not there was a

right. Your Honours, that case also is in the

bundle just ahead of letter D, and if I can refer

to page 262, going over to 263, in a judgment which

bears the name of Woodrough, Circuit Judge, but

appears to be, in fact, a joint judgment, it is

said at the foot of the second column on 262:

The trial court also expressed the

opinion that the declaration of the
plaintiff's petition to the effect that the ..

plaintiff, notwithstanding the death of the

insurer within the life of the policy and
notwithstanding the claims and demands of the
defendant, was not liable to the defendant
beneficiary on account of the policy "is not a

declaration of a right the plaintiff has or

had" (within the meaning of the act). On this

issue we have come to the conclusion that the

plaintiff's alleged right to be immune from

the claim the defendant makes against it under

the policy is a "right" which it may petition to have declared by the terms of section 274d.

And authority is referred to.

Your Honour, that concludes what we wish to

say on the subject of inconsistency. In relation

to section 74(3), we have largely set out what we

want to say in our outline of submission. There

are a couple things though we seek to add. If I

could refer Your Honours to paragraph 14. We

mention that the Court of Appeal, although not

finding it necessary to deal with section 74(3),

Wallis(2) 31 1/7/93

indicated some doubt as to the correctness of the

learned trial judge's conclusion that the

transportation was not for the purposes of any

occupation carried on by the Commissioner, but was
for a purpose of State.

two matters as being mutually exclusive. The Court The learned trial judge seemed to regard the of Appeal was not necessarily persuaded that that

was so and, Your Honours, we submit that it is not

necessarily so. If I could then refer Your Honours

to paragraph 15, where we set out why the carriage

was for the purposes of the appellant's occupation

and there, in that paragraph, one can also read,

for "appellant", "the Commissioner", because the

same considerations apply.

Our learned friend, Mr Keane, took

Your Honours to the order form on page 9.

Your Honours will see from that document that it is

of an official nature. It is an order by the

Commissioner of Police. It is to do with the

transportation of an individual described by his

rank and number, from one police station to

another, and, if I could refer Your Honours, in

this context, also to page 20 of the record, to

paragraph (a) which deals with transfers; that is

an extract from the Police Manual, Your Honours,

and it notes that:

A member of the Force who is under orders of

transfer will proceed at once to complete
them, and he will keep the Officer in Charge

of his station -

et cetera "fully advised". And then there is provision for reporting and limitation on the

duties which a police officer is to be ordered to

perform under such circumstances. So we see that

the transportation of the goods is something which

was officially arranged for the appellant in his

capacity as police sergeant.

McHUGH J: But supposing the only thing that the officer

wanted transported was his golf clubs; do you still
say that that was transportation for the purposes
of an occupation engaged in by the Commissioner or

the sergeant of police?

MR MUIR: Yes, Your Honour, in these circumstances: where

the removal of the police officer is pursuant to an
order of the Commissioner the officer has to obey

that order; the Commissioner, in order to ensure

the fulfillment of his obligation and the police

officer's obligation, arranges for and pays for the

transportation of the goods from station to

station. In those circumstances, we submit it does

Wallis(2) 32 1/7/93

not particularly matter what it is that is being
transported; it is the circumstances of the

transportation that are more immediately relevant.

DEANE J: What you say may be clearly right in terms of the

payment being for the purposes. It does not follow

that the transportation is for the purposes. That
is like saying that the dentist who comes in and

fills teeth - the teeth of a particular police

officer - is filling them for the purposes of the

occupation of the Commissioner for police. He may

well be being paid by a payment made for those

purposes, but it has little to say about the

purpose of filling the teeth.

MR MUIR: Well, Your Honour, why we would say this is

different, is really the features that I have just

mentioned of a transfer by order; a necessity to
obey the order; the fact that the removal is from
police station to police station; the fact that the

Commissioner, as part of his official function,

which you have heard from my learned friends, is to

superintend the administration of the police force,
is not only paying for but arranging that removal

from police station to police station. In those

circumstances, we submit, it can be seen that the

purpose of the transportation, to pick up 74(3), is

for the purpose of the Commissioner's occupation,

and we would submit, as well, that it - - -

DAWSON J: The trouble is, it is not just one purpose, there

are a number of purposes - - -

MR MUIR:	Yes.
DAWSON J:	- - - and one of those purposes is to fulfil the

Commissioner's obligation to have the man's goods

taken to where he is transferred, and it is also

for the purpose of having the man's goods there for

his use.

MR MUIR:  Yes and, Your Honour, that is a point we make in

relation to our learned friend's references to

money and the other tax cases, that there is no

need here for the purpose to be wholly or

exclusively one thing or the other, as long as we

can find a purpose which is able to be categorized

in terms of (3)(a) that is sufficient, and we
similarly make the point that there is no need that

there only be one person referred to in (3)(a) but

the reference to "person" may include the

Commissioner, it may also include the police

officer.

There is no need, we submit, and in fact it

would be rather odd, to limit subsection (3) to

mean that "person" referred to in the third line is

Wallis(2) 33 1/7/93

a contracting party, or consumer, because that is

precisely what it does not say, and there seems to

be deliberate intention not to attract the language

of subsection (1) and subsection (2) in

subsection (3).

Your Honours, our learned friends referred to

Lunney v The Commissioner of Taxation, might we

just add this to what is in our outline? Firstly,

we will draw, if we may, Your Honours' attention to

the fact - without going to the case, initially in

any event - that Sir Owen Dixon, although agreeing

in the result, expressed the view that if the

matter.were not decided afresh without the

constraints of authority, then he may well have a

different view about the matter.

There was, of course, one dissentient as well,

but the main point we wish to make about it is
that, of course, it deals with the application of

section 51(1) of the Income Tax Assessment Act and

what is required is a determination of the extent

to which expenditure has been incurred in the
gaining of assessable income, or in the carrying on
of a business for the purposes of gaining

assessable income. A necessary focus, for income

tax purposes, which is not relevant to

subsection 74(3) is the nexus between expenditure

and assessable income and, Your Honour, that is,

the emphasis in Lunney can be seen from the
references to Amalgamated Zinc and Ronpinbon Tin - the references, Your Honours, to Amalgamated Zinc and Ronpibon Tin, which occur on page 496 and also

497, where there is also a reference to W. Nevill &

Co Ltd. .

we also, in paragraph 18, deal with that part

of the joint judgment which discussed the English

experience and, in particular, Newsom v Robertson.

The only other observation we wish to make about

the English decisions, is that the discussion in

those decisions concerns simply journeying from

place of residence to place of work and back again.

The object of the removal in this case is not that

stated at 499 at about point 7, by

Lord Justice Romer, where he refers to the purpose

being:

not to enable a man to do his work but to live

away from it.

The purpose here, of course, is to enable the appellant to remove from one police station to another, and nor is the language at point 8 on the

same page, relevant, because here the appellant,

being required to comply with lawful directions, is

Wallis(2) 34 1/7/93

not free to choose in any relevant sense. Those

are our submissions, Your Honours.

DEANE J: Thank you, Mr Muir. Mr Street.

MR STREET: Could I hand up, Your Honours, an outline? If
Your Honours please, if I could take Your Honours

very briefly to the second reading speech for the purpose of putting in context the construction of

section 68 and section 74 of the Trade Practices

Act because, in our respectful submission, what is

material in approaching any question of
construction is first to work out the proper

construction and application of section 74 and

section 68.

In that regard, Your Honours, if I could first

of all, very briefly, refer to matters that have

been touched elsewhere in Concrete Constructions v

Nelson, but none the less I do seek to emphasize,

in respect of the nature of the Trade Practices Act

as an Act relating to trade practices as such, and

that the purpose of the Act identified in the

speech of the Honourable Mr Enderby, as he was, was

to protect consumers from unfair commercial
practices.

Can I just pause there at the outset to indicate that it was not to protect consumers from

unfair State legislation, and the protection was

protection from merchants, not from States or, in

our respectful submission, State law. That

purpose, Your Honour, is one which is touched upon

again in the extracts that I have handed up to

Your Honours at page 2738 in Hansard, under the

heading which mirrors, almost exactly, the heading

to Part V, which is relevant in relation to the

construction of the provisions, and it identifies

those provisions as addressed to consumer

transactions.

In that context, Your Honours, the

transactions, clearly, to which the provisions are

addressed, involve the merchants and the consumers.

It is not concerned with laws made by States and,

Your Honours, by way of interest, I have also
handed up some extracts of some observations by a

Mr Snedden as appears on pages 296 and 297 and

again at page 2910, which foreshadowed such issues

coming before this Court.·

Your Honours, in Concrete Constructions v

Nelson, (1990) 169 CLR 594, the majority decision

referred to the importance of the heading at

page 601, in the construction of the provisions of

the Trade Practices Act. That .same observation was

echoed, albeit not in the majority, by His Honour

Wallis(2) 35 1/7/93

Justice McHugh, at page 618 to 619, with which

Justice Brennan agreed at page 605, and

Justice Toohey made like observations in respect of

the purpose of the Act, to prevent unfair trading

practices, at page 611. It does not accord with

that purpose, clearly manifested by the heading and

the Act, the second reading speech, for these provisions to be working outside the consumer
transaction between the merchant and the consumer. Your Honour, so far as the State of New South

Wales is concerned, relevantly there is similar

legislation in existence, which is the Common

Carriers Act of New South Wales 1902, and also,

albeit in a sea context, the Sea Carriage of Goods

State Act 1921; each create limitations of

liability which could be affected in so far as

legislation in the present case is concerned if

section 74 and section 68 have a wider scope, just

as would the provisions in the Sale of Goods legislation.

Your Honours, for the sake of clarity, I do

wish to hand up a copy of the New South Wales Act,

albeit that there are similar statutes in the other

States - if it is not of assistance, Your Honours,

I will not seek to do so.

DEANE J:  Mr Street, I think we can assume that there is

other legislation that would be affected by this

decision.

MR STREET: If Your Honours please. Your Honours, can we

then turn to the language of section 68, and in

particular, what we respectfully submit the

appellant is asking Your Honours to do is to read

into section 68, where it says:

Any term of a contract -

words to the effect, any term or statutory

obligation implied in a contract, and the fact that

one has to read words into section 68 in order to

achieve a direct collision, indicates that there is

no direct collision on its face and, indeed, the

passage in brackets in section 68(1) identifies the

nature of incorporation, so far as the contract is

concerned, that is anticipated by the legislature,

namely the incorporation "in the contract by

another term of the contract", not incorporation by another term of the contract or otherwise by law or

by statute.

Those words do not appear in section 68(1) and, without them, in our respectful submission,

there is no direct collision, and it is contrary to

the purpose that we have sought to identify in

Wallis(2) 36 1/7/93

respect of the nature of this legislation to adopt

a construction that it was intended to go beyond

the practices engaged in by merchants in entering

into consumer transactions, as opposed to laws that

may co-exist enacted by the States.

Your Honours, in relation to the construction of section 6 and the nature of the liability

imposed by the Queensland Act, if I could just say

this: it is apparent from section 4 of the

Queensland Act that there is, in fact, a statutory

duty created by that Queensland Act.

Section 5, in its second paragraph, which is

not contained within the judgment with which

Your Honours were taken, also imposes a statutory

obligation for negligence in the second paragraph

of section 5 of the Queensland Act. So that, in

relation to the question that Your Honour

Justice Deane put to the parties, however the

parties may have conducted the case, none the less,

within the Act there is, in fact, a statutory

obligation that is imposed in respect of negligence

found in section 5.

Your Honours, so far as the question of direct conflict is concerned, we respectfully adopt what

has been said by Mr Muir, in focusing upon what was
said by Justice Mason, as he then was, in Ansett

Transport v Wardley, in that, in the present case there is no absolute term, or absolute right, created by sections 68 and 74. The fact that there

is no absolute right is manifest from the reference

to the general law that it is necessary for the

appellant to rely upon to find its remedy.

McHUGH J: But it is absolute as far as it goes, is it not?

The question is, how far it goes. The Queensland

Parliament, for example, could not illustrate to interfere with the terms of section 74 directly, could they? They could not write it out of the Act

or provide that a contract shall not contain such a

term?

MR STREET:  No, and perhaps in that regard, Your Honour, I

should say that it is capable of incorporation by

compliance with the notice provisions under

section 6(2). So that, if one gives the notice

provisions as required under section 6(2), one can

have incorporated section 74, so far as the

liability that is then in excess of the amount

referred up to the value of the goods. So that is

it capable of being incorporated into the contract

under section 6(2), where notice is given.

So, in our respectful submission, the need for

reliance upon general law, indicates that it is not

Wallis(2) 37 1/7/93

an absolute right within the concept which in our

respectful submission, is necessary for th~re to be

a direct conflict of the kind that His Honour

Mr Justice Mason was referring to in Ansett v

Wardley and, so far as concerns the further

question of whether one could exercise one's right

to incorporate a provision in conformity with the

State law, that is, capable of being done, which is

a matter referred to by Mr Justice Mason at page 65

in Wardley, is capable of being done by giving the

requisite notice under section 6(2).

Your Honours, in those circumstances, it is

our respectful submission, that there being no
direct inconsistency, this is not a case in respect

of which indirect inconsistency could arise, and so

far as concerns the question of the construction of

the language term, we draw Your Honours' attention

to the use of the words "warranty and condition",

that is found elsewhere in Part v, and respectfully

submit that the construction of term to include a

statutory obligation would be contrary to the

purpose that has been manifested by the second

reading speech; the heading "The Consumer

Protection Provisions", and what we would

respectfully submit is the clear purpose underlying

that legislation, which was addressed to the

practices of merchants and not laws enacted by

States governing them. If the Court pleases.

DEANE J: Thank you, Mr Street. Yes, Mr Keane.

MR KEANE:  Thank you, Your Honours. We had thought we had

made it clear, but to the extent that we have not,

we are not suggesting that this Court should

construe the word "term" in section 68(1) as

meaning statutory provision. Your Honours, in

relation to our learned friend Mr Muir's outline of

submissions, can we take Your Honours to

paragraph 8. In relation to paragraph 8, our

learned friends make the submission that some

provisions in Divisions 2 and 2A make express provision for recovery of a contractual measure,	and some do not, and they invite Your Honours to
act on the basis of an application of expressio
unius est exclusio alterius.

Your Honours, with respect, that would be an

unprincipled and, with respect, an irrational

application of the principle. Our submission is

that one can see that it is not a case for the

application of that maxim because the

subject-matter of section 73 and the provisions in Division 2 are cases where there is not a contract in existence upon which the statute operates and it

is therefore necessary to stipulate for a

contractual measure of the liability and a

Wallis(2) 38 1/7/93

correlative right. And hence, there is no question

of the subject-matter being the same. It is not a

case for the application of expressio unius est
exclusio alterius.

In relation to paragraphs 9, 10 and 11, Your Honours, the first observation to be made in

relation to section 75(3) and the reference to

"right" is that it occurs in a part of the Act

which, for example, in section 78(1)(b) and (l)(c),

refers to "right" and then to "liability".

Section 75(3) refers only to "right". It is, in

our respectful submission, not appropriate, as a

matter of construction, to regard that reference as
including a reference to "liabilities" or the
"absence of liabilities". Further, Your Honours,.
the construction which our learned friends advance

in relation to the words of 75(3):

to limit, restrict or otherwise affect any
right -

would, on the view they take, because they would read "right" as to mean no liability, would mean

something like, "limit, restrict or otherwise add

to or improve any right or remedy or position of

any person" .

Your Honours, the reference in the section, in

our submission, is concerned with the improvement
and with ensuring that the position of consumers

under State legislation is not adversely affected.

We certainly agree with our learned friend, protection of consumers, not with the protection of

carriers or merchants, and it is they who, in the

passages in the excerpt from the parliamentary

debates, are plainly the focus of concern. May we

refer Your Honours, for example, to page 2906 of

the excerpt that was handed up where, in the

right-hand column, in the last paragraph on the

page, it is said:  Another area which falls into this

category may be the provisions for the

protection of consumers. Broadly we agree

with the proposals in the bill for consumer

protection. But I must make these points

clear: Firstly, all the States have provision

for consumer protection. They are not

uniform, but all have them. We need to make

sure that by passing thfs legislation consumer

protection is not lessened rather than

strengthened.

The construction for which our learned friend,

Mr Muir, contends, in relation to 75(3), would have

Wallis(2) 39 1/7/93

the consequence that consumer protection is indeed

lessened, and we would submit that the remarks made

at page 2738, in the first full paragraph of text

under the heading in the left-hand column, "The

consumer protection provisions", where about 10

lines down it is said:

The consumer protection provisions do not

necessarily displace State legislation in the

same field -

and then there is a reference to clause 74, which

became section 75 - do not necessarily intend to

replace or displace consumer protection legislation

in the same field. It is, in our submission, quite

clear that what section 75(3) is concerned with is

not detracting from the rights created in

consumers; rights in consumers being the only

subject-matter of the part. And, Your Honours, in

relation to paragraph 11 of our learned friend's

submission, we submit, with respect, that the

subtleties of the Hohfeldian analysis, which our

learned friends urge on Your Honours, are not

readily apparent in the language used by the

draftsman and, in our respectful submission, were

not something which was in the forefront of his

mind in drafting these consumer protection

provisions.

Similarly, the provisions which our learned

friends rely on in relation to the ability of the
courts to declare the rights of parties, to declare

what the legal relationship of parties are, one to

the other, or whether one has a right or one does

not have rights against the other.	Your Honour,
those are our submissions.

DEANE J: Thank you, Mr Keane. The Court will reserve its

decision in this matter.

AT 12.28 PM THE MATTER WAS ADJOURNED SINE DIE

Wallis(2) 40 1/7/93