Australian Broadcasting Commission v Parish [1980] FCA 1; (1980) 40 FLR 311 (2 January 1980)

FEDERAL COURT OF AUSTRALIA

AUSTRALIAN BROADCASTING COMMISSION v. PARISH [1980] FCA 1; (1980) 40 FLR 311
Trade Practices - Injunctions

COURT

FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
St. John J.(1)

CATCHWORDS

Trade Practices - Interlocutory relief - Contract alleged to contain "exclusionary provision" - Substantially lessening competition - Whether parties to contract in competition - Whether probable that plaintiff will be held entitled to relief at trial of action - Trade Practices Act 1974 (Cth.), ss. 4D, 45, 45A.

Injunctions - Trade practices - Contract allegedly containing "exclusionary provision" - Substantially lessening competition - Application for interlocutory relief - Whether parties to contract in competition - Whether probable that plaintiff will be held entitled to relief at trial of action - Trade Practices Act 1974 (Cth.), ss. 4D, 45, 45A. The first fourteen respondents were members of the Australian Cricket Board ("the Board"), an unincorporated association. The Board entered into an agreement in May 1979 with the fifteenth, sixteenth and seventeenth respondents ("the company respondents") whereby the company respondents were granted the exclusive right to televise international cricket organized by the Board. The agreement was reaffirmed in early November 1979. The applicant instituted proceedings in the Federal Court of Australia against fourteen members of the Board and the three company respondents and sought interlocutory orders restraining, inter alia, the first fourteen respondents from giving effect to certain clauses of the agreement for the purpose of preventing or limiting the television rights to cricket test matches and for the purpose of substantially lessening competition. The applicant adduced evidence, inter alia, that it had a long tradition of televising and broadcasting by radio commentaries on international and other cricket. It based its case upon alleging infringement of s. 45 of the Trade Practices Act 1974.

Held: The application for interlocutory relief should be dismissed because: (1) The court was not satisfied that if the evidence remained as it was there was a probability that at the trial of the action the applicant would be entitled to relief.

Beecham Group Ltd. v. Bristol Laboratories Pty. Ltd. [1968] HCA 1; (1968), 118 CLR 618; World Series Cricket Pty. Ltd. v. Parish (1977), 16 ALR 181, applied.

(2) On the facts of the present case the court was in doubt as to whether or not competition existed at the relevant times and consequently also in doubt that the agreement contained an "exclusionary provision" within the meaning of s. 45 (2) and as defined by s. 4D of the Trade Practices Act 1974.

(3) There was no evidence before the court directed to establish what the relevant market was.

Federal Commissioner of Taxation v. Newton (1957), 96 CLR 577, referred to.

HEARING

Sydney, 1979, December 27-28; 1980, January 2. 2:1:1980
APPLICATION.

The applicant sought interlocutory relief against the members of the Australian Cricket Board and three companies.

The facts are set out in the judgment.

J.D. Traill Q.C. and G. Walker, for the applicant.

K. Mason, for the first to fourteenth respondents (members of the Australian Cricket Board).

T.E.F. Hughes Q.C. and J.D. Heydon, for the fifteenth, sixteenth and seventeenth respondents (P.B.L. Marketing Pty. Ltd., World Series Cricket Pty. Ltd. and Publishing and Broadcasting Ltd.).

Cur. adv. vult.

Solicitor for the applicant: J.M. McD. Harris.

Solicitors for the first to fourteenth respondents: Stephen, Jacques &

Stephen.

Solicitors for the fifteenth, sixteenth and seventeenth respondents: Allen, Allen & Hemsley.

E.F. FROHLICH

DECISION

January 2.

The following written judgment was delivered.
ST. JOHN J. By an application dated 21st December, 1979, the Australian

Broadcasting Commission sought, inter alia, interlocutory relief against the respondents in respect to an agreement entered into between the first fourteen respondents and the three remaining respondents whom I shall refer to as the personal respondents and the company respondents. That agreement, originally entered into on 30th May, 1979, and reaffirmed on 21st November, 1979, provided that the Australian Cricket Board, an unincorporated association, of which the personal respondents were members, granted to the company respondents the exclusive right to televise international cricket organized by that Board. The rights are exclusive in the sense that no other television station can be granted such rights according to the terms of the agreement. (at p312)

2. The applicant amended the orders sought against the respondents. They are as follows: 1. That the first to fourteenth respondents be restrained pending the determination of the proceedings or until further order from engaging in the following conduct namely: (a) giving effect to cll. 1 and 2 of the contract, arrangement or understanding between the first to fourteenth respondents and the fifteenth to seventeenth respondents dated 30th May, 1979, as amended by the contract, arrangement or understanding of 21st November, 1979, for the purpose of or with the likely effect of preventing, restricting or limiting the supply of services namely television rights to cricket test matches by the first to fourteenth respondents; (b) giving effect to cll. 1 and 2 of the contract, arrangement or understanding between the first to fourteenth respondents and the fifteenth to seventeenth respondents dated 30th May, 1979, as amended by the contract, arrangement or understanding of 21st November, 1979, to the extent that the said provisions have the purpose or effect or likely effect of substantially lessening competition within the description in s. 45 (3) and s. 45A (1) of the said Act. 2. That all the respondents be restrained pending the determination of the proceedings or until further order from engaging in the following conduct namely: aiding abetting counselling procuring inducing or attempting to induce any person to prevent restrict or limit the supply of services namely television rights to cricket test matches by the first to fourteenth respondents. (at p313)

3. The evidence adduced in the applicant's case was that the applicant had for some number of years televised international cricket as a result of an agreement between it and the Board whereby the Board granted non-exclusive rights to the Commission. It had a long tradition of televising and broadcasting by radio commentaries on international and other cricket. During the summer of 1978-1979 there were two series of international cricket played in Australia. The first was that organized by the Australian Cricket Board and the other was organized by World Series Cricket Pty. Ltd. in Australia with the other company respondents. In the sense that there was competition in the presentation of international cricket it is clear that in that summer there was such competition. (at p313)

4. A lot of evidence was devoted to whether or not complete national coverage of international cricket played this summer could be televised with the same coverage as the applicant previously gave. It seems clear that because of the exclusive right of the respondent company certain areas of the Commonwealth will not be able to see international cricket on television. However this is not what the case is about, nor is it about whether the viewing public can have the choice of cricket unadulterated by advertisements in preference to that which is interspersed with advertisements. (at p313)

5. The applicant ultimately based its case upon an alleged infringement of s. 45 of the Trade Practices Act 1974 (Cth.). At the outset it also based its case upon an alleged infringement of s. 47 of that Act but that claim was abandoned. Pursuant to s. 93 of the Act, the Australian Cricket Board lodged a notification the effect of which, if such notification was valid, was to exempt the contract of 30th May, 1979, until such time as the Trade Practices Commission ruled otherwise. In November 1979 a similar application was lodged by one of the respondent companies namely P.B.L. Marketing Pty. Ltd. That application was based upon that agreement and the ratification of it on 21st November, 1979. On 4th December, 1979, the Trade Practices Commission issued a statement on the notifications lodged by the Australian Cricket Board and P.B.L. Marketing Pty. Ltd. That statement recited the receipt of the notifications, the parties to the agreement, the subject of such notifications, and its evaluation of the submissions made both by the parties notifying and the applicant. That Commission concluded that it "does not consider on present information that the P.B.L./Australian Cricket Board arrangements lessen competition" and concluded with the statement that both notifications were to stand. This history is not directly to the point so far as decision of the issues before this Court is concerned but it is recited because some argument was based upon the relationship between s. 47 and s. 45 of the Act. (at p314)

6. The legal questions to be answered involve ascertaining the legislative intention expressed in ss. 45 and 47 of the Act. Neither section has been judicially explored in this country although foreign legislation upon which they are partially based has been the subject of decision. Clearly, the two sections are intended to cover different conduct amounting to a restrictive trade practice. Counsel for the applicant contends that the same conduct can, in some circumstances, amount to a breach of both sections. As previously stated, the applicant has abandoned its claim based upon infringement of s. 47 and ultimately based its case upon infringement of s. 45. Its basic submission is that the agreement under consideration contains an "exclusionary provision" within the meaning of sub-s. (2) of s. 45 and as defined in s. 4D of the Act. That latter section provides that the provision in the contract shall be taken to be exclusionary if the parties to the contract are competitive with one another and the provision has the purpose of preventing, constricting or limiting the supply of services to or from particular persons. To be noted in that definition is the tense in the phrase "are competitive" and the use of the word "purpose" which, because the word "effect" appears also in s. 45, prima facie they have different meanings: c.f. per Williams J. in Federal Commissioner of Taxation v. Newton (1957) 96 CLR 577, at p 630 . International cricket, when it occurs in Australia is seasonal. It is played from November to early February each summer. There were two series of international matches in the summer of 1978-1979, the last World Series match being played in early February 1979. The question arises as to whether the parties to the contract were in competition in May 1979 or in early November 1979 when the May agreement was ratified. (at p314)

7. The applicant's evidence included the tender of the submissions of the respondents to the Trade Practices Commission in support of the notifications referred to. Therein were statements of losses of a substantial nature incurred by the State cricket bodies in the 1978- 1979 season of international cricket. Those losses replaced profit in previous years and represent lack of financial success of the international cricket organized by the Australian Cricket Board. The income from international cricket is split between the State bodies organizing cricket and the players. These losses could raise doubts as to whether the Board would continue to organize and produce such cricket. There was also a statement by the company respondents of initial losses in production of World Series Cricket but with an expressed anticipation of profit in the future. As these proceedings are interlocutory in nature, I accept the submission of respondents' counsel that I may have regard to those statements as having evidentiary value. (at p315)

8. The applicant also contended that the effect of the contract was to lessen competition. Because of the losses above referred to, I am in doubt as to whether or not competition existed at the relevant times. (at p315)

9. Further, when one has regard to the definition of competition in sub-s. (3) of s. 45 it is "competition in any market". That raises the issue of what is the market with which the contract is concerned. Is it only the television rights to international cricket or is it the television rights to a wider field, for example international sport of some or all varieties or any sport providing an adequate spectacle to be televised? There was no evidence directed to establishing what the relevant market was. However, there was evidence that on receipt of information of the contract the applicant put in train efforts to secure the rights to televise other sporting programmes. (at p315)

10. In addition to relying upon the first arm of s. 45 (2) (a) (i) the applicant also relied upon the alternative, namely s. 45 (2) (a) (ii) and further upon s. 45 (2) (b). This second arm includes the contract having the effect of substantially lessening competition. Again the statements in the submissions to the Trade Practices Commission and the doubt as to what constitutes the relevant market apply in both cases. (at p315)

11. The above-mentioned questions of law which were raised in themselves make this claim unsuitable for the grant of interlocutory relief. In addition, the applicant has not, in my view, satisfied the test laid down in Beecham Group Ltd. v. Bristol Laboratories Pty. Ltd. [1968] HCA 1; (1968) 118 CLR 618 and applied by the Full Court of this Court in World Series Cricket Pty. Ltd. v. Parish (1977) 16 ALR 181 . I am not satisfied that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief. (at p315)

12. Were I to find differently on that issue I would have to consider the balance of convenience between the parties. Had I reached that point, I would have found in favour of the personal respondents upon the obvious injury by their loss of consideration provided for in the contract. On the other hand I would not have been inclined to favour the company respondents as their injury would have been largely self-inflicted by their failure to warn respondents that the exclusiveness of their television coverage was legally suspect as they admitted by their notifications to the Trade Practices Commission. $NORDER The application for interlocutory relief is dismissed. (at p316)