Re John Ralph Wallace v Walplan Pty Ltd [1985] FCA 169; 59 ALR 771 / 8 FCR 14 (1985) Atpr Para 40 - 570 (24 May 1985)

FEDERAL COURT OF AUSTRALIA

Re: JOHN RALPH WALLACE
And: WALPLAN PTY LTD
No. QLD G20-25 of 1984
Trade Practices
[1985] FCA 169; 59 ALR 771 / 8 FCR 14 (1985) ATPR para 40 - 570

COURT

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Pincus J.(1)

CATCHWORDS

Trade Practices - Prosecutions under ss.56(1) and (2) of the Trade Practices Act - Whether the word "offer" in s.56(2) means "make available" or "offer specifically to each person who enquires" - Single or multiple offences - Whether these questions should be reserved for the Full Court pursuant to s.26 of the Federal Court of Australia Act - Amendment of charges and particulars of charges - Defence under s.85(1)(c) of the Trade Practices Act - Interrelationship of s.85(1)(c) and s.84(2) of the Trade Practices Act - Meaning of s.84(2) of the Trade Practices Act - Whether conduct "on behalf of" a body corporate in s.84(2) is conduct with the express or implicit authority of the body corporate.

Trade Practices Act 1974 ss.56, 84, 85

Federal Court of Australia Act 1976 s.26

Restrictive Practices Act 1971 s.66

Wallace v. Brodribb (unreported decision of Spender J. 11.3.85)

Barton v. Westpac Banking Corporation (1983) A.T.P.R. 40-407

Reardon v. Morley Ford Pty Ltd [1980] FCA 151; (1980) 49 F.L.R. 401

Commissioner of Trade Practices v. Caltex Oil (Australia) Pty Ltd (1974) 23 F.L.R. 457

Universal Telecasters (Qld) Ltd v. Guthrie (1978) 18 A.L.R. 531

Tesco Supermarkets Ltd v. Nattrass [1971] UKHL 1; (1972) A.C. 153

Otzen v. Beabout [1947] HCA 49; (1947) 75 C.L.R. 116

Trade Practices - Conduct on behalf of a corporation - Whether requires actual authority of the corporation - Trade Practices Act 1974 (Cth), s 84(2). Prosecutions were brought for bait advertising under s 56 of the Trade Practices Act 1974.
(1) Section 56(2) is not directed against failure to respond to particular proposals to purchase by making a contract, although such failure may be
evidence of an offence; "offer" in that provision means "make available":
Wallace v. Brodribb (1985) 58 ALR 737, followed.
(2) Conduct may be held to be engaged in "on behalf of" a body corporate within the meaning of s 84(2) of the Trade Practices Act even if not

shown to have been engaged in with the express or implicit authority of
the defendant; the expression "on behalf of" embraces conduct "in the
affairs of" the body corporate and brings in conduct of agents or
servants in the course of their employment, even if not shown to have

the

actual authority of the defendant.
(3) The expression "another person" in s 85(1)(c) of the Act can include an

agent or servant.

HEARING

Brisbane, 1985, April 24; May 24. 24:5:1985

PROSECUTIONS

Prosecutions pursuant to s 56 of the Trade Practices Act 1974.

M G Morley QC and J A Logan, for the prosecutor.

J S Douglas, for the defendant.
Cur adv vult

Solicitors for the prosecutor: Australian Government Solicitor.

Solicitors for the respondent: S R. Jones & Co.
GFV

ORDER

Orders accordingly

DECISION

These are six prosecutions brought under s.56 of the Trade Practices Act 1974. Before the end of the hearing I expressed a view about the construction of the section and was subsequently asked by counsel for the prosecutor not to conclude the matters but to reserve a question for the Full Court, or alternatively state a case. The first question, then, is whether I should accede to that application or simply determine all these matters myself.

Application under s.26 of Federal Court of Australia Act

2. The application made on behalf of the prosecutor with a view to obtaining the view of the Full Court need not be set out in detail, but to give an understanding of what was desired by the applicant it is necessary first to quote s.56(1) and (2):-

"(1) A corporation shall not, in trade or
commerce, advertise for supply at a special
price goods or services that the corporation
does not intend to offer for supply at that
price for a period that is, and in
quantities that are, reasonable having
regard to the nature of the market in which
the corporation carries on business and the
nature of the advertisement.

(2) A corporation that has, in trade or
commerce, advertised goods or services for
supply at a special price shall offer such
goods or services for supply at that price
for a period that is, and in quantities that
are, reasonable having regard to the nature
of the market in which the corporation
carries on business and the nature of the
advertisement."

3. The charges, explained more fully in the next section of these reasons, relate to two motor vehicles. As to each, it is alleged that there was an offence under s.56(1) in advertising once without the requisite intention and that there were two offences under s.56(2) in failing, when requested by each of two named persons, to offer the vehicle for sale at the advertised price. The prosecutor framed a number of questions for the Full Court, the essence of which in my opinion is whether the expression "offer" in the provisions just quoted means "make available", as Spender J. held in Wallace v. Brodribb (unreported; 11 March 1985). The principal importance of that question for present purposes is that, if "offer" means "make available", then there can only be one offence under s.56(2), in respect of each vehicle, whereas the prosecutor says in effect that "offer" means "offer specifically to each person who enquires". If offer means "make available" then the vehicle is either made available or it is not and there is only one offence possible, as to each vehicle.

4. Mr Morley Q.C. on behalf of the prosecutor argued that if, when a single vehicle is advertised at a special price, it is not made available for sale at that price, there are as many separate offences as there are acts or omissions contrary to the obligations created by s.56(2). He explained that an act or omission constituting an offence was one which "can be shown to be one complete unit, act or omission separate from any other such alleged whole act or omission". In the instant case, that would achieve the result that many offences might be committed, under s.56(2), in not making a single vehicle, advertised once, available for sale. The argument would produce the result that each time a customer enquired after the advertised vehicle and was refused, a separate offence would be created. Not only that: many other individual acts or omissions going to make up the failure to put the single vehicle on sale could each constitute a separate offence.

5. It is plain that the proceedings should not be interrupted to have an interlocutory determination of a legal point except in unusual circumstances: Barton v. Westpac Banking Corporation (1983) ATPR 40-407. It was said that here the matter should go to the Full Court because the view expressed by Spender J. is in conflict with the earlier decision of Smithers J. in Reardon v. Morley Ford Pty Ltd [1980] FCA 151; 49 FLR 401.

6. It is unclear whether the decision in Reardon v. Morley Ford Pty Ltd, properly read, favours the argument of the prosecution in this case. It is for that reason, and also because that argument arrives at what I regard as a rather improbable construction, that I have decided not to accede to the application under s.26. As to the latter reason, it is necessary to go into some detail.

7. Prior to the passage of Act No. 81 of 1977, s.56 consisted only of what is now sub-s.(1), set out above. In that provision, the expression "offer for supply" clearly referred to making goods or services available, not to offering them specifically to any person. In considering whether the requisite intention existed, it would not ordinarily be relevant to ask whether the advertiser intended to offer the goods for sale to any specific person; at the stage of insertion of an advertisement, he could hardly have that intention. The state of mind required by the section, in its original form, was an intention to do whatever was necessary and appropriate genuinely to make the goods or services available at the advertised price. No doubt, in determining whether that intention existed, in such a case as the present quite a range of facts might be investigated. For example, it would be relevant to know whether the advertised vehicle was displayed in the car yard in the ordinary way, whether it had the advertised price on it and whether people who enquired after it were turned away or encouraged. Of course, proof that a number of people were turned away would not, under s.56(1), entitle the prosecution to as many convictions.

8. When sub-s.(2) and (3) were added in 1977, the evident purpose was to enable a conviction to be obtained on proof that (to take the present facts as an example) the advertised vehicle was not put on sale, and no doubt that step was taken because of difficulties in proving lack of intention. Again, evidence with respect to various acts or omissions might be relevant in determining whether a vehicle was genuinely offered for sale, including evidence that people who enquired after the vehicle were refused it. But, unless sub-s.(3), set out below, is taken to alter the meaning of the earlier provisions in s.56, it would seem clear that proof of the rejection of any specific customer would be unnecessary to show that the goods were not offered for sale. Section 56(2) does not say "shall offer such goods or services for supply at that price to any person who enquires for a period that is, and in quantities that are, reasonable ...". Indeed, that emendation does not fit the rest of the language of the provision. In my view, evidence that an advertised vehicle was simply not placed on sale in the car yard in question at all would be enough to prove a case under s.56(2), without proof of the experience of a prospective customer.

9. Yet sub-s.(3) is drawn on the assumption that there will be prosecutions under s.56(2) "in relation to a failure to offer goods or services to a person". Section 56(3) is as follows:-

"In a prosecution of a corporation under Part VI in
relation to a failure to offer goods or services
to a person (in this sub-section referred to as
the 'customer') in accordance with sub-section
(2), it is a defence if the corporation
establishes that -

(a) it offered to supply, or to procure another
person to supply, goods or services of the
kind advertised to the customer within a
reasonable time, in a reasonable quantity
and at the advertised price; or

(b) it offered to supply immediately, or to
procure another person to supply within a
reasonable time, equivalent goods or
services to the customer in a reasonable
quantity and at the price at which the
first-mentioned goods or services were
advertised,

and, in either case, where the offer was accepted
by the customer, the corporation has so supplied,
or procured another person to supply, goods or
services."

Since there is no offence created of failure to offer goods or services to a person, the meaning of the sub-section must be that the prosecutions contemplated will be "in relation to" a failure in the sense that the failure constitutes the particulars of, or evidence of, the offence. I cannot regard sub-s.(3), however, as controlling the meaning of the earlier provisions in the section so that, so far as is relevant to the present case, the result is achieved that, each time a customer enquires after the advertised vehicle and is rejected, there is another offence.

10. It will be noted that the point desired to be raised by the prosecution goes further; the argument is that one may be able to dissect the whole course of conduct, in failing to offer a single vehicle for sale, into numerous elements, only some of which may be failures to offer the vehicle to particular customers. The prosecution does not merely want to expand the scope of s.56(2) by an implication from s.56(3), but to treat s.56(2) as creating, in a typical case, several or many offences if the advertised vehicle is not put on sale.

11. I regard sub-s.(3) as providing a defence where the circumstances relied on as showing the existence of a failure to offer, for example, the advertised vehicle for sale consist of those spoken of. The sub-section is thus treated as saying that such a failure is of no consequence if the advertiser offers, instead, goods as set out in paragraph (a) or (b). It appears to me better to adopt this construction, which admittedly involves some straining of language, than to use sub-s.(3) to distort the meaning of both sub-s.(1) and (2). But whether or not this view of sub-s.(3) is correct, it should not be used to create, by implication, many offences under sub-s.(2), instead of only one.

12. Mr Douglas, for the defendant, did not dispute that each item in the advertisement, which depicted and described three different vehicles, could be the subject of a separate charge. I think that where distinct items or categories of items are advertised in one advertisement, a charge may be laid with respect to each distinct item or category. However, it is not necessary for me to analyse in any more detail the problem of a single advertisement for several items, i.e., in what circumstances each item can give rise to a separate offence; I hold that, here, each vehicle may be the subject of a separate charge.

13. I do not regard s.56(2) as directed against failure to respond to particular proposals to purchase by making a contract, although such a failure may be evidence of an offence; s.56(2) creates an offence of not putting the goods or services on sale - that is, on sale for a reasonable period and in reasonable quantities.

14. The reasons just set out for refusal of the prosecutor's application bring in their train another consequence, namely that two of these prosecutions must fail. There can be only one offence under s.56(2) in respect of each vehicle. Accepting that this would follow from the views just mentioned, the prosecutor sought to amend.

Particulars and Amendment

15. The six charges may be divided into two groups. Three of the charges, namely Nos. G20, G23 and G25 relate to a Ford Falcon XD Sedan and the other three, namely Nos. G21, G22 and G24 relate to a Holden Commodore Sedan. In respect of each vehicle, there are, as mentioned above, two charges under s.56(2). As to the Ford, it is alleged in No. G20 that on 18 March 1983 the defendant failed to offer the vehicle and an allegation in the same words is made in No. G25, with the difference only that the date is 19 March 1983. In No. G20 the particulars are as follows:-

"That on the 18th day of March 1983 you being a
corporation that had in trade or commerce
advertised goods namely a 79 Ford XD motor vehicle
for supply at a special price of $2,990 did fail,
when requested by Derek Cornick to offer such
goods for supply at that price."

16. In No. G25 the particulars are the same except that the date is 19 March and the person mentioned is Robert Crawford.

17. The charges under s.56(2) with respect to the Commodore Sedan are framed in an identical way.

18. After I expressed a provisional view in agreement with that expressed by Spender J., as to the meaning of "offer for supply" the prosecutor sought to amend the charges contingently upon my adhering to that opinion. The application in respect of both Nos. G24 and G25 was to change the date of the offence from 19 March to between 17 March and 22 March. It was also sought to amend the particulars by adding to those initially given in No. G24 the particulars of charge No. G21 and by adding to those initially given in No. G25 the G20 particulars. That involved dropping charges G20 and G21, from which the particulars were thus to be abstracted. It is not clear that the particulars are in strictness properly framed, in that they could be argued to specify the evidence, or part of it, relied on to prove the breach, but it does not seem to me that that prejudices the defence and I allow the amendments sought in respect of the particulars. Plainly, they raise no new factual question.

As to the charges themselves, the amendments sought are

subject to the formidable objection that there is no evidence, at least of a direct kind, as to whether the vehicles were on sale on all of the days between 17 March and 22 March. The evidence only supports unavailability during part of the period, viz on 18 and 19 March. I will therefore allow an amendment only with respect to that shorter period, so that in each charge, G24 and G25, "eighteenth and" is to be added before "nineteenth".

The Evidence

19. A notice under s.85(2) was given, and it was part of the case advanced on behalf of the defendant that any contravention which occurred was due to the default of salesmen employed at the yard, despite the taking of reasonable precautions and exercise of due diligence. It was also said by Mr Douglas, on behalf of the defendant, that the prosecutor had not proved that any of the events complained of had occurred with the authority of the defendant. As fought, the case concerned principally those two issues: the s.85 defence, as to which the onus lies on the defendant, and the question of agency, as to which the onus lies on the prosecutor. In the end, the resolution of these points, for reasons I shall explain, depends in part upon the construction of s.84(2) of the Act and its inter-relationship with s.85. Although there was really no serious challenge, in cross-examination or by the calling of opposing evidence, to most of the evidence given on behalf of the prosecution, it is desirable to explain that evidence in some detail.

20. On Friday 18 March 1983 the defendant caused a full-page advertisement to be published in the Daily Sun, a morning newspaper having a big circulation in Brisbane. The advertisement showed pictures of three cars, and had a heading "$300 cash deposit or your car as full deposit". Each of the cars was advertised at a price of $2,990, under the mention of which appeared "$22.59 per week", suggesting of course that terms were available. Two of the cars were described in the advertisement as a "79 Commodore" and a "79 Ford XD". There was nothing to suggest that the cars were in other than first-class condition; a note at the foot of the advertisement said "trade your old car as full deposit and drive away today".

21. Other notes at the foot included "prices remain for one week" and "all vehicles in stock at date of compiling advertisement". According to records produced on behalf of the defendant, the cost of acquisition of the Commodore was $3,780 and that of the Falcon $4,330. Mr A.J. Dalgarno, an apparently independent witness very experienced in the trade, said that if the vehicles were at the time in reasonable condition, their retail value would have been some thousands of dollars more than that shown in the advertisement and it is clear that the price of each was a "special price" within the meaning of s.56. On the evidence, the price of each vehicle was such that it would sell very quickly, unless the defendant took steps to prevent or delay such a sale.

22. Mr R.M. Crawford, shortly before 18 March 1983, noticed the Commodore Sedan referred to in the advertisement of that date and that the car's grille could be lifted out, which he thought was a "strange way to leave it". On a Wednesday evening which I find to be Wednesday 16 March, two days before the advertisement, he noticed that the vehicle's grille was removed, as was one headlight. On Friday evening 18 March 1983, he found the advertisement and noticed the Ford referred to in it, which had three interior door panels missing.

23. He says he came to the yard on a Saturday morning which was, as I find, Saturday 19 March 1983 and spoke to a man who was apparently a salesman, to ensure that the two vehicles he had found were those referred to in the advertisement. That man said they were and confirmed that the vehicles were still for sale. That man went to the office, telling Mr Crawford to wait until somebody arrived with the keys of the vehicles. Shortly afterwards such a man came and Mr Crawford was given the keys to both vehicles. Possession of the keys of the vehicles shows, of course, a likelihood that the man in possession was connected with the management of the defendant.

24. Mr Crawford offered to buy the Falcon, by paying $1,500 cash then and the rest in cash on the following Monday. As an alternative, he offered to pay the balance by cheque and pick up the car when the cheque was cleared. Obviously, either would seem to have been a more attractive proposal, from the point of view of the defendant, than Mr Crawford's paying $300 deposit and the balance at $22.59 per week, as suggested in the advertisement. However, the salesman did not accept either proposal but said it would have to go to the manager. Subsequently another man arrived, went into the office and sat at a desk. He confirmed that he was the manager and I will call him that. The manager was told of Mr Crawford's proposal but declined it, saying that "it will all have to be in cash". Mr Crawford promptly went away and returned with the cash and with his son Philip. When he came back, another man, apparently a salesman, confirmed that the Falcon Mr Crawford wished to buy was still not sold. Mr Crawford attempted to start the Falcon, but it had a flat battery and would not start. He then spoke to another salesman, described as having Maori features, and was told, as to the cars in question: "They are sold. I have bought them. I am going to back-yard them. $4,490, if you want it." Mr Crawford spoke to the manager again, being accompanied by the man with Maori features, who informed the manager that he had just bought the two cars. When Mr Crawford complained to the manager that he had just been told that the vehicles were for sale, the manager said: "You heard the man; he has bought the cars. You buy them off him, if you want them." Mr Crawford then left the office and again confirmed with a salesman that the two vehicles had not been sold.

25. As to the events relating to the supposed sale to the man with Maori features, Mr Crawford was corroborated by his son Philip. I found both the Crawfords credible witnesses and believe that what they told me is substantially true.

26. Mr Derek Cornick saw the advertisement I have referred to and says he went to the yard on Friday 18 March at 7.45 a.m. Although I am confident Mr Cornick was attempting to tell me the truth, he seemed uncertain as to the date and time of his visit. However, he telephoned the Trade Practices Commission twice on Friday 18 March 1983 and I accept that that was the date on which he visited the defendant's yard, despite a suggestion elsewhere that it was 19 March. Mr Cornick saw a man at the car yard and enquired about the Ford. He was told it had been sold. He asked about the Commodore and was given the same answer. There is some evidence from Mr Cornick suggesting, as did that of Mr Crawford, that the vehicles had deliberately been left in unattractive condition, with some items removed. However, I am not prepared to find beyond a reasonable doubt that Mr Cornick correctly identified the two vehicles mentioned in the advertisement. On the same day, after leaving the yard, he phoned one of the numbers mentioned in the advertisement and was told that the two cars were still for sale.

27. Evidence was given by Mr H.Z. Palaszczuk, a member of the Queensland Legislative Assembly, that he telephoned the car yard between 9.30 a.m. and 10.00 a.m. on Saturday 19 March 1983, apparently because of a complaint received from Mr Crawford senior. He enquired about the Ford shown in the advertisement and was told it was still for sale and encouraged to "get down here if you want to buy the car".

28. I am quite satisfied on the evidence that neither vehicle was genuinely available for sale at the advertised price on either 18 or 19 March 1983. I find that the claimed sale of both vehicles to one of the salesmen in the yard (the man with Maori features) was spurious and, although impromptu, part of the means of discouraging or preventing the sale of the "bait" vehicles. Mr Douglas made the general criticism that the defendant was disadvantaged by the fact that months elapsed before the complaints came to the knowledge of the defendant and that it was hardly in a position to call detailed evidence about these vehicles, in order to rebut or throw doubt upon the version given by the prosecution witnesses. I am by no means sure that the defendant was quite as powerless, in that regard, as is claimed. In August 1983 Mr Wallace, then an officer of the Trade Practices Commission, spoke to a Mr Brooks, who then controlled the defendant. Mr Brooks did not claim that he had no knowledge of the vehicles the subject of the complaint - rather the contrary - and said that he knew the Maori man; neither that man nor Mr Brooks was called. Mr Brooks appeared to be quite aware of the fact that complaints were being made to the Commission and said that he had "got a leak in your Department". It was argued for the defendant that a circumstance showing that both vehicles were genuinely for sale was that they were in fact sold on the following Monday, according to the defendant's documents. Those showed that each vehicle was expressly sold "as is" with no roadworthiness certificate or warranty, that being an unusual mode of sale. Since a complaint was made by Mr Cornick on Friday 18 March, it is possible that the leak Mr Brooks said existed brought the matter to the notice of the defendant and induced a prompt sale. However that may be, the question is whether the vehicles were genuinely for sale at the advertised prices on 18 March and 19 March 1983 and I am clearly of the view that they were not. In whatever way the reasonable period spoken of in s.56(2) is, in the instant case, defined, it must plainly include the day of appearance of the advertisement and the following day.

29. Apart from the evidence directly relevant, referred to above, evidence of what was called "similar facts" was, after argument, let in. I do not rely on the so-called similar fact evidence to corroborate that the events of 18 and 19 March 1983 occurred as alleged, but it appears to me to be relevant to the question whether what was done had the authority of the defendant and the related question whether such precautions were taken to prevent the commission of an offence as are spoken of in s.85. The defendant called evidence that it gave oral and written instructions to prevent commission of an offence. The sort of evidence given in this respect is exemplified by a memorandum dated 3 December 1982, forming part of exhibit 10. This exhorted the salesmen, with respect to vehicles advertised at special prices, not to do any of the things which the evidence shows they did. For example, they were told that if a client came to inspect an advertised vehicle, was shown it but did not want to buy it, he was not to be shown any other vehicle except by request. Also: "if the advertised vehicle is sold, please do not show him or her any other vehicle unless he requests you to do so". This rather quixotic advice is inconsistent with at least the tone of the response made by Mr Brooks when the allegations were put to him. Mr Brooks who was in charge of the whole operation at the time, did not rely upon any assertion that what was done was contrary to instructions. Insofar as he put forward anything by way of confession and avoidance, it was along the lines that customers who came from considerable distances might find that another buyer had anticipated them, that he was not willing to sell the vehicles cheaply to other dealers to enable them to make a profit, that the cars were not good and "could be shot right up the middle" and that "I am entitled to sell to who I like, aren't I".

30. The "similar fact" evidence concerned events consequent upon an advertisement inserted by the defendant on Friday 7 January 1983 which, it will be noticed, is a date close to that of the circular just mentioned, on which so much reliance was placed. One might have expected that if the instruction in the circular were seriously meant, the experience of persons enquiring after vehicles mentioned in the 7 January advertisement might have differed from that shown in the evidence. Karen Ann Smith gave evidence that she asked whether a 1979 XD Falcon (priced at $2,990) in that advertisement was for sale, on the day she saw the advertisement, and was told that it was. She was invited to come the next day to see it. She phoned again the same day about the car and was told that it was a Monza red one, not in bad condition but that she would have to get a roadworthiness certificate. The person who answered advised Karen Smith to come by at 10 a.m. the next day. Mrs Smith came as suggested, with a friend of hers, Janelle Lahrz. She met a salesman of Maori appearance and enquired about the vehicle. The man told her: "That is it over there, and it is under three lots of finance". He told her that it was not any good and that she would have to spend at least $3,000 on it, that the motor and gear box had "had it". He took her to more expensive XD Falcons.

31. Later Mrs Smith took the matter up again with the Maori salesman and said the car "seems to be okay to me". He replied: "It has had it; it is only a sales gimmick; do not touch it" and again mentioned the three lots of finance. Mrs Smith left the yard and phoned from the premises of friends, being told when she enquired about the same vehicle that it was still for sale. A similar phone enquiry, a little later, had the same result. A week later Mrs Smith and her husband went to the defendant's yard and looked at the same car. It had been highly polished and Mrs Smith was told that it was sold.

32. The assertions made by the salesman about that vehicle, as to its mechanical condition, are not in accordance with the advertisement, which said that it "drives very well". I am left with the suspicion, on the whole of the evidence, that in a systematic way the defendant was advertising cars at a "special price" as bait and then by various means discouraging people from buying them. However, I can hardly find that that was the defendant's regular method of operation. I regard the evidence about Mrs Smith's experience in January as relevant in tending to support the prosecution's case that on the occasions in question, in March, what was done had at least the acquiescence of the management and as refuting the defendant's s.85 arguments. The incident involving Mrs Smith and the Monza red Falcon gains particular strength from the evidence that the vehicle was in fact sold for $5,990, some $3,000 more than the advertised price, on 14 or 15 January 1983. I do not believe that if it was genuinely for sale from 7 January at $2,990 it would be likely to have remained unsold until 11 January. Mr McKerrow explained the higher price, in part, by saying that $900 was spent on the car but I do not believe he knows how much, if anything, was spent on it, apart from the lesser sum shown in the records and I am of opinion that his evidence on that point was not candid.

33. More generally, I thought the evidence of Mr McKerrow and, to a lesser extent, that of Mr Parker was unconvincing and simply do not believe that genuine efforts on the part of the management of the defendant were made to prevent the occurrence of events such as those described above. I think it is more probable that what the salesmen did was at least implicitly authorised by the defendant and that the purpose of advertising the vehicles in question at a remarkably low price was to get people to come to the yard to enquire after the vehicles, with the idea of putting them off and inducing them to buy some fully priced vehicle. Although I think that is probable, Mr Douglas has urged upon me the view that I cannot be satisfied beyond reasonable doubt that all these events occurred with the actual (express or implied) authority of the defendant, that I must have some doubt about that. On the whole, I have decided that I should accede to that submission. In doing so, I am not to any significant degree acting upon the evidence called from Mr McKerrow and Mr Parker; I am influenced, rather, by matters in the prosecution's case, such as the fact that when Mr Crawford enquired after the vehicles he was not, in the first place, entirely discouraged by the salesman whom he encountered. This leaves open the hypothesis that the salesmen had not received general instructions to avoid selling the "special price" cars.

34. I reject the defence based upon s.85, as I am not satisfied on the balance of probabilities that the use of the advertised vehicles as mere "bait" occurred despite the best efforts of the defendant; indeed, I think the probability is the other way. The more troublesome aspect is whether, as Mr Morley Q.C. on behalf of the prosecutor urges, the events in question constituted conduct engaged in by the defendant, by reason of the provisions of s.84(2). That appears to me to involve a legal question, of some difficulty, to which I now turn.

Effect of s.84(2)

35. Section 84(2) reads as follows:-

"Any conduct engaged in on behalf of a body
corporate by a director, agent or servant of the
body corporate or by any other person at the
direction or with the consent or agreement
(whether express or implied) of a director, agent
or servant of the body corporate shall be deemed,
for the purposes of this Act, to have been engaged
in also by the body corporate."

36. It was argued for the defendant that unless I could find beyond reasonable doubt that the conduct complained of had the actual (express or implicit) authority of the defendant I must acquit, since s.84(2) applies only where there is such authority. The prosecutor contended that s.84(2) goes further, and attaches liability to a body corporate with respect to some unauthorised acts. I think the difference between the two views may be illustrated by the familiar example of the employed truck driver speeding to complete his duties. On the prosecutor's contention, were such a section as 84(2) applicable, the employer would be liable even if there were no proof that the employer authorised the breach of the law; the conduct of the servant would be treated as a wrongful method of carrying out his duties.

37. What is relied on is the first leg of s.84(2) and it is said that the conduct of the various salesmen was engaged in "on behalf of" the defendant and is therefore deemed to have been engaged in by the defendant. Mr Douglas argued that I should not admit any of the evidence as to what was said or done in relation to the prosecution witnesses in the car yard, on the ground that the prosecution first has to prove that each of those persons was authorised. It seems to me clear that, taking the evidence as a whole, the events in the car yard are admissible; it then becomes a question whether any of them constitute conduct such as is spoken of in s.84(2). That is, I have no difficulty in finding that persons such as the Maori salesman were at the relevant times people who were either servants or agents of the defendant, as on the whole of the evidence they clearly were. The difficulty the prosecutor has is to establish that the particular conduct complained of was "on behalf of" the defendant, Mr Douglas, arguing that that simply means that what they did was authorised by the defendant. I hold that to come within the expression "on behalf of" in this provision it is not necessary that conduct be shown to have the express or implicit authority of the defendant. I deduce that, in part, from the wording of the second leg of the sub-section, which attributes to the body corporate conduct engaged in on its behalf by "any other person" - i.e. any person other than a director, agent or servant - "at the direction or with the consent or agreement (whether express or implied) of a director, agent or servant of the body corporate ...". The words just quoted would be superfluous if "on behalf of" was intended to have the meaning "as agent for". It was submitted for the prosecutor that "on behalf of" embraces conduct "in the affairs of" the body corporate and I think that is right. To use language which is both more traditional and more pertinent to the facts of the present case, I hold that s.84(2) brings in conduct of agents or servants in the course of their employment, even if not shown to have the actual authority of the defendant.

38. The position under s.66 of the Restrictive Practices Act 1971 was analysed by Smithers J. in Commissioner of Trade Practices v. Caltex Oil (Australia) Pty Ltd (1974) 23 FLR 457 especially at pp 475-476. His Honour said:-

"The proscription of conduct which is achieved by
s. 66 (1) and (2) is directed specifically to
corporations. A corporation must act by servants
and agents. It is conduct of servants and agents
to which, as a matter of practicality, the
proscription attaches. Achievement of the object
of the Act would be seriously prejudiced if proof
were required that an employee who committed
proscribed conduct in the course of his employment
had been authorized by the corporation to commit
that particular conduct. A corporation having
much to gain by such conduct, may have secretly
encouraged it, but proof of authority to commit
that particular conduct might well be an extremely
difficult task. In my opinion, therefore, in a
case in which the proscribed conduct is committed
by a servant of a corporation in the course of his
employment that conduct is, for the purposes of
the Act, the conduct of the corporation. It is to
be observed also that s. 66 (7) of the Act
provides: 'For the purpose of sub-section (4) of
this section, anything done by a person acting on
behalf of, or by arrangement with, the supplier
shall be deemed to have been done by the
supplier.'

It was argued that this section is intended to do
no more than to state a principle of the law of
agency. But the better view would seem that it
goes further and expresses the intention of the
legislature that on the issue of authority it is
sufficient to prove that the relevant acts or
omissions were committed 'on behalf of' the
supplier of the goods."

39. I respectfully adopt these views as accurate, with respect to the 1971 Act, and see no reason to assume that in s.84(2) of the 1974 Act "on behalf of" has any different meaning; I particularly rely on the implication in this passage that conduct committed in the course of employment, though not shown to have been authorised, may yet be "on behalf of" the employer. His Honour also, at p.475, mentioned the rule which applies under the general law that a master may be liable "even for acts which he has not authorized provided that they may rightly be regarded as modes, although improper modes, of doing them".

40. When it is an issue whether conduct of servants or agents is to be attributed to a body corporate under s.84(2), and (as here) it is not proved to the requisite standard that such conduct was expressly or implicitly authorised, two questions will arise. The first is whether the conduct was engaged in "on behalf of" the body corporate which, where a servant or agent has physically engaged in the conduct, is to be regarded as equivalent to the question whether the conduct was in the course of employment. An affirmative answer to that does not involve any conclusion that the employer authorised the illegality. The second question is whether s.85(1)(c)(ii) applies, since an agent or servant is in general "another person" within the meaning of s.85(1)(c)(i). In arriving at the opinion that this is the scheme of these provisions, I have been assisted by the views expressed in the Full Court, obiter, in Universal Telecasters (Qld) Ltd v. Guthrie (1978) 18 ALR 531 at pp 535-536 per Bowen C.J. and pp 551-552 per Franki J. I regard the statements made by their Honours in that case as supporting the conclusion that, at least where the conduct is not that of the "directing mind and will", conduct of an agent or servant can be regarded as that of "another person" within s.85(1)(c). Further, that view is in line with the decision in Tesco Supermarkets Ltd v. Nattrass [1971] UKHL 1; 1972 AC 153, which was decided shortly before the Trade Practices Act was enacted; it is not unreasonable to suppose that the draftsman had the result of the Tesco case in mind. Although I have derived great assistance from the discussion of this point in Donald and Heydon "Trade Practices Law" at pp.784-787, I cannot accept the learned authors' view.

41. It appears to me that the conclusion that "another person" in s.85(1)(c) can, in general, include an agent or servant makes it easier to accept that "on behalf of" has the broad meaning suggested by the prosecution in this case, for then the reasonable result is arrived at that the employer is prima facie liable for unauthorised illegalities committed in the course of employment, but may escape by establishing a s.85 defence. In arriving at my view about the meaning of "on behalf of" I have also relied on the decision of the High Court in Otzen v. Beabout [1947] HCA 49; 75 CLR 116 (especially at pp 121-122) to which Mr Morley Q.C. referred me.

Conclusions

42. I summarise the views expressed above:-

1. At least where only one item or a single category of items is

once advertised, a failure to comply with the duty laid down
in s.56(2) is a single offence; I reject the notion that
there are as many offences as components making up the
failure, or as many offences as disappointed customers.

2. I accept the evidence of the prosecution witnesses as

substantially true, but am not prepared to find beyond
reasonable doubt that the conduct of the agents or servants,
conflicting with performance of the duty prescribed by
s.56(2), had the actual authority of the defendant. I am,
however, satisfied that such conduct was engaged in by the
agents or servants in the course of their employment.

3. As a matter of law, it follows that such conduct was engaged

in "on behalf of" the defendant and therefore s.84(2)
attributes such conduct to the defendant.

4. I hold that although each agent or servant is "another

person" within the meaning of s.85(1)(c), the defence under
that provision is not made out.

43. It follows that the surviving charges under s.56(2) are proved; that is, I will convict the defendant in respect of Nos. G24 and G25 whereas, on the views of the law expressed above, Nos. G20 and G21 must fail.

44. The remaining question is whether it has been shown that the defendant advertised either of the cars at the price mentioned in the advertisement without having the intention mentioned in s.56(1), that is, an intention to offer for supply at the advertised price for a reasonable period. I have held that neither vehicle was offered for supply for a reasonable period at that price, because on 18 and 19 March 1983 neither was genuinely for sale at the advertised price.

45. To succeed, the prosecutor does not have to show positively that the defendant had any particular intention, e.g. that it intended to fob people off for some time and then "detail" the vehicle and sell it at the full price - which is what appears to have happened with the vehicle advertised on 7 January. What the prosecution has to do is to exclude any doubt about the proposition that the vehicles in question, those advertised on 18 March, were not intended to be placed genuinely on sale at the advertised price for a reasonable period. The fact that they were not so placed does not, of course, conclude the matter; the defendant might have intended to put them on sale and then changed its mind. However, it is clear that the fact that I have not found, beyond reasonable doubt, that the tactics employed on 18 and 19 March had the authority of the defendant does not conclude the matter in favour of the defendant. If the defendant had genuinely intended that the vehicles be on sale at the very low advertised prices, it could have, in my opinion, easily given effect to that intention. I am, on the whole, satisfied to the requisite standard about the absence of the intention of which s.56(1) speaks and convict the defendant in respect of those matters, also.

46. In the result, I have convicted the defendant in respect of four of the six charges, namely G22, G23, G24 and G25 and I will hear counsel on penalties and costs.