Re Walplan Pty Ltd v John Ralph Wallace [1985] FCA 479; 8 FCR 27 (19 December 1985)

FEDERAL COURT OF AUSTRALIA

Re: WALPLAN PTY. LTD.
And: JOHN RALPH WALLACE
No. G47-50 of 1985
Trade Practices - Words, Phrases and Maxims
8 FCR 27

COURT

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Sweeney(1), Lockhart(2) and Neaves(3) JJ.

CATCHWORDS

Trade Practices - bait advertising - admissiblity of evidence tending to show authority to act on behalf of corporation - whether conduct of servants was engaged in "on behalf of" the corporation within sub-s.84(2) - admissibility of evidence concerning question whether corporation "took reasonable precautions and exercised due diligence to avoid the contravention" within para.85(1)(c).

Markby v. The Queen [1978] HCA 29; (1978) 140 CLR 108

Perry v. The Queen (1982) 57 ALJR 110

Sutton v. The Queen (1984) 58 ALJR 60

Fraser Hennleins Pty. Limited v. Cody [1945] HCA 49; (1945) 70 CLR 100

Ex parte Gerard and Co. Pty. Limited; Re Craig (1944) 44 SR(NSW) 370

Barrett v. Steel Products Co.Pty.Limited (1962) N.S.W. 981

Woods v. Brookes (Milk) Limited (1963) 1 WLR 795

Chappell v. Ross and Sons Pty. Limited (1969) VR 376

T.P.C. v. Queensland Aggregates Pty. Limited (No.3) (1982) 61 FLR 52

Doherty v. Traveland Pty. Limited (1982) ATPR 40-323

T.P.C. v. Tubemakers Australia Limited (1983) ATPR 40-358

T.P.C. v. Mobil Oil Australia Limited (1984) ATPR 40-482

Maisey v. Mudgeeraba Village Estates Pty. Limited (unreported; Federal Court of Australia 22 May 1985)

Tesco Supermarkets Limited v. Nattrass [1971] UKHL 1; (1972) AC 153

Universal Telecasters (Qld.) v. Guthrie (1978) ATPR 40-062

Wings Limited v. Ellis (1984) 1 WLR 731

Darwin Bakeries Pty. Limited v. Sully (1981) 51 FLR 90

Trade Practices Act 1974 sub-s.56(1), 56(2), 84(1), 84(2); para.85(1)(c).

Trade Practices - Bait advertising - Evidence in respect of authority to act on behalf of corporation - Whether conduct of employees was engaged in "on behalf of" the corporation within s 84(2).

Words, Phrases and Maxims - "on behalf of" - Trade Practices Act 1974 (Cth), ss 56, 84, 85. Held: (1) For the purposes of attributing conduct of an individual to the corporation under s 84(2) of the Trade Practices Act 1974 (Cth) as conduct engaged in "on behalf of" the corporation, it is not necessary for it to be shown that a person had the corporation's actual authority (either express or implied) to engage in the conduct in question. Nor need it be established that the conduct was for the benefit of the corporation. The phrase "on behalf of" is not one of strict legal meaning in this context and it will depend upon the circumstances of each case whether a person has engaged in conduct on behalf of a corporation. The phrase conveys a meaning similar to the phrase "in the course of the body corporate's affairs or activities".

(2) Authority to act on behalf of a corporation may be inferred from the circumstances. It need not be proved by direct evidence of grant of authority. For example, it may be proved by conversations, the time when and place where statements were made and the acquiescence of others, who govern the corporation's affairs, in the statements made. However a person's own statement that he had authority to act is inadmissible unless it is accompanied by other evidence supporting the existence of his authority.

Markby v. The Queen [1978] HCA 29; (1978) 140 CLR 108; Perry v. The Queen [1982] HCA 75; (1982) 150 CLR 580; Sutton v. The Queen (1984) 58 ALJR 60; Fraser Henleins Pty Ltd v. Cody [1945] HCA 49; (1945) 70 CLR 100; Ex parte Gerard & Co Pty Ltd; Re Craig (1944) 44 SR (NSW) 370; Barrett v. Steel Products Co Pty Ltd (1962) NSWR 981; Edwards v. Brookes (Milk) Ltd (1963) 1 WLR 795; Chappell v. Ross & Sons Pty Ltd (1969) VR 376; Trade Practices Commission v. Queensland Aggregates Pty Ltd (No 3)(1982) 61 FLR 52; Doherty v. Traveland Pty Ltd (1982) 2 TPR 419; Trade Practices Commission v. Tubemakers Australia Ltd (1983) ATPR 40-358; Trade Practices Commission v. Mobil Oil Australia Ltd (1984) 3 FCR 168; Maisey v. Mudgeeraba Village Estates Pty Ltd (1985) ATPR 40-569; Tesco Supermarkets Ltd v. Nattrass [1971] UKHL 1; (1972) AC 153; Universal Telecasters (Qld) Ltd v. Guthrie (1978) 32 FLR 360; Wings Ltd v. Ellis (1984) 1 WLR 731; Darwin Bakeries Pty Ltd v. Sully (1981) 51 FLR 90, referred to.

HEARING

Brisbane, 1985, September 30, December 19. 19:12:1985
APPEALS

Appeals against convictions by Pincus J (8 FCR 14) in respect of offences under s 56(1) and (2) of the Trade Practices Act 1974.

J S Douglas, for the appellant.

G Morley QC and J Logan, for the respondent.
Cur adv vult

Solicitors for the appellant: S R. Jones and Co.

Solicitor for the respondent: Director of Public Prosecutions.
SMW

ORDER

The appeals against the convictions of the appellant of charges G22 of 1984, G23 of 1984, G24 of 1984 and G25 of 1984 are dismissed.

The appellant pay the costs of the respondent of this appeal.

Note:

Settlement and entry of orders is dealt with in
Order 36 of the Federal Court Rules.

Appeals dismissed

DECISION

I have had the advantage of reading the reasons for judgment of my brother Lockhart. I agree with those reasons and with the order that the appeals should be dismissed with costs.

These are appeals against convictions of the appellant by a single Judge of this Court in respect of four offences under sub-ss. 56(1) and (2) of the Trade Practices Act 1974 ("the Act"). Those sub-sections relate to what is sometimes called "bait advertising" and they provide:

"56(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."

The charges arose out of the conduct by the appellant of its business of

selling second-hand motor vehicles in Underwood, Brisbane. Two of the four charges relate to a Ford Falcon XD Sedan and the other two to a Holden Commodore Sedan. In respect of each vehicle there was one charge under sub-s. 56(1) and originally two charges under sub-s. 56(2), a total of six charges. When the hearing commenced before his Honour two of the charges under sub-s. 56(2) were dismissed and his Honour gave leave to the prosecution to amend the two remaining charges relating to sub-s. 56(2) (one in respect of each vehicle). I shall mention later the reasons which led his Honour to take this course.

The charge under sub-s. 56(1) in respect of the Commodore vehicle was that the appellant advertised it for supply at a special price, that it did not intend to offer the vehicle for supply at that price for a period that was reasonable having regard to the nature of the market in which the appellant carried on business and the nature of the advertisement. The particulars of the charge were that on 18 March 1983 the appellant in the Daily Sun newspaper, which has a wide circulation in Brisbane, advertised that it would supply a Commodore vehicle at a special price of $2,990 and that it did not have the intention referred to in the sub-section (charge G22 of 1984). A similar charge was brought for contravention of sub-s. 56(1) in relation to the Ford motor vehicle (charge G23 of 1984).

After the primary Judge allowed the prosecution to amend the charges for contravention of sub-s. 56(2), the charge in respect of the Commodore was that the appellant contravened sub-s. 56(2) in that, having in trade or commerce advertised the vehicle for supply at a special price, it failed to offer the vehicle at that price for a period that was reasonable having regard to the nature of the market in which the appellant carried on business and the nature of the advertisement. The particulars of the charge as amended said that the alleged offence was committed on 18 and 19 March 1983 (G24 of 1984). A similar charge was brought in relation to the Ford vehicle for contravention of sub-s. 56(2) (G25 of 1984).

The advertisement in question which appeared in the Daily Sun on 18 March 1983 depicted and described three different vehicles; and it was not disputed by the appellant before his Honour that each item in the advertisement could be the subject of a separate charge. His Honour rejected, however, a submission of the prosecution that the word "offer" in sub-s. 56(2) means "offer specifically to each person who enquires" with the consequence, if this be right, that each time a customer enquired after the advertised vehicle and was refused supply, a separate offence was created. His Honour held that the expression "offer for supply" in sub-ss. 56(1) and (2) referred to making goods or services available, not to offering them specifically to any person. It was for these reasons that his Honour dismissed two of the charges brought under sub-s. 56(2). His Honour's findings on these questions were not challenged before us. I mention them by way of background to the appeal.

The questions on which this appeal turns involve a fairly detailed analysis of the facts. My statement of them relies principally upon the findings of the primary Judge. On Friday 18 March 1983 the appellant caused the advertisement mentioned above, which was a full page advertisement, to be published in the Daily Sun. It showed pictures of the three motor 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 reference to which appeared "$22.59 per week", suggesting 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 other than in first-class condition; and a note at the foot of the advertisement said "Trade Your Old Car As Full Deposit and Drive Away Today". Other notes at the foot of the advertisement stated "Prices Remain For One Week" and "All Vehicles in Stock At Date of Compiling Advertisement". His Honour was satisfied that the cost of acquisition of the Commodore was $3,780 and that of the Falcon $4,330. His Honour was satisfied also that the retail value of each vehicle would have been substantially more than that shown in the advertisement, so that it was clear that the price of each was a "special price" within the meaning of s. 56 and that it would sell very quickly unless the appellant took steps to prevent or delay such a sale.

A Mr. Derek Cornick saw the advertisement and went to the yard of the appellant on Friday, 18 March 1983 at about 7.45 a.m. After entering the yard he saw a man standing to the side of the building in the yard and enquired about the Ford car. The man told him that it had been sold. Mr Cornick asked about the Commodore and was given the same answer. Later he left the yard and on the same day telephoned one of the telephone numbers mentioned in the advertisement as being the number of the appellant and was told that the two cars were still for sale.

A Mr. Crawford gave evidence that shortly before 18 March 1983, he noticed, when visiting the appellant's car yard, a Commodore sedan with its grill lifted out and he thought this was a "strange way to leave it". On the evening of 16 March, two days before the advertisement appeared, Mr. Crawford noticed that the vehicle's grill and one headlight had been removed. On the evening of Friday, 18 March 1983 Mr. Crawford read the advertisement and then went to the car yard and noticed a Ford vehicle which had three interior door panels missing. He visited the yard on 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. The man said that they were and confirmed that the vehicles were still for sale. That man went to the office in the car yard telling Mr. Crawford to wait until somebody arrived with the keys to the vehicles. Soon afterwards a man came and Mr. Crawford was given the keys to them. His Honour found that possession of the keys of the vehicle showed a likelihood that the man in possession was connected with the management of the appellant.

Mr. Crawford offered to buy the Falcon vehicle by paying $1,500 cash then and the remainder in cash on the following Monday. As an alternative he offered to pay the balance by cheque and to pick up the car when the cheque was cleared. His Honour said that obviously either would seem to have been a more attractive proposal from the point of view of the appellant 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 that both proposals would have to be referred to the manager. Subsequently another man arrived who went into the office at the car yard and sat at a desk. He confirmed that he was the manager. The manager was told of Mr. Crawford's proposal but declined it saying "It will all have to be in cash". Mr. Crawford promptly left and returned with the cash and with his son, Philip. Upon his return, another man, apparently a salesman, said that the Falcon which 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 in the evidence as having Maori features, and was told by him 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 who was then accompanied by the man with Maori features and who told 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 car. You buy them off him if you want them." Mr. Crawford left the office and again confirmed with the salesman that the two vehicles had not been sold.

Mr. Crawford's evidence about the events relating to the supposed sale to the man with Maori features was corroborated by his son Philip. His Honour accepted both the Crawfords as credible witnesses.

Other evidence was given before his Honour about enquiries to the appellant's car yard on Saturday 19 March 1983 when the enquirer was told that the Ford vehicle shown in the advertisement was still for sale and the enquirer was encouraged to "get down here if you want to buy the car".

His Honour was satisfied that neither vehicle was genuinely available for sale at the advertised price on either 18 or 19 March 1983. He found that the claimed sale of both vehicles to one of the salesman in the yard (the man with Maori features) was spurious and part of the means of discouraging or preventing the sale of the "bait" vehicle. His Honour found that the reasonable period spoken of in sub-s. 56(2), as defined with reference to this case, plainly included the day of appearance of the advertisement (Friday, 18 March) and the following day.

His Honour also allowed evidence of what was called "similar facts" to be given before him. He expressly said that he did not rely on the so-called similar fact evidence to corroborate that the events of 18 and 19 March 1983 occurred as alleged, but he treated it as being relevant to two questions; first, whether what was done had the authority of the appellant and second, a related question, whether such precautions were taken to prevent the commission of an offence so as to permit the appellant to raise the defence under para. 85(1)(c) of the Act which provides:

"85(1) Subject to sub-s. (2), in a prosecution
under this Part in relation to a contravention of a
provision of Part V, it is a defence if the
defendant establishes -

. . .

(c) that -

(i) the contravention in respect of which
the proceeding was instituted was due
to the act or default of another
person, to an accident or to some other
cause beyond the defendant's control;
and
(ii) the defendant took reasonable
precautions and exercised due diligence
to avoid the contravention."

In support of this defence the appellant called evidence that it gave oral

and written instructions to prevent the commission of an offence of the kind charged in this case. His Honour said that the sort of evidence given in this respect was exemplified by a memorandum dated 3 December 1982. This was a memorandum from Mr. N.E. McKerrow, the general manager of the appellant, directed to "Management and Sales Staff" relating to the subject of "complaints and advertising". The document exhorted the salesmen of the appellant 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 and was shown it but did not want to buy, 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". His Honour referred to this exhortation as "quixotic" advice, inconsistent with at least the tone of the response made by Mr. Brooks who controlled the appellant when the allegations were put to him by an officer of the Trade Practices Commission. Mr. Brooks was in charge of the operations of the appellant at relevant times and did not rely upon any assertion that what was done was contrary to instructions.

The "similar fact" evidence related to events that followed an advertisement inserted by the appellant on Friday, 7 January 1983, also in the Daily Sun, which was not unlike the advertisement the subject of this appeal. His Honour noted that the date of the 7 January advertisement was close to that of the circular of 3 December 1982 on which considerable reliance was placed on behalf of the appellant.

The "similar fact" evidence consisted of evidence in the main from Karen Ann Smith and a friend of hers, Janelle Lahrz. Mrs. Smith gave evidence that, on the day she saw the advertisement, she telephoned the number mentioned in the advertisement and enquired whether a 1979 XD Falcon priced at $2,990 in that advertisement was for sale and was told that it was. She was invited to come the next day to see it. She telephoned again later the same day about the car and was told that it was a Monza red vehicle not in bad condition, but that she would have to get a roadworthiness certificate. The person who answered informed Mrs. Smith to come by at 10.00 a.m. the next day. Mrs. Smith came as suggested accompanied by Janelle Lahrs. She met a salesman who was described in the evidence as being of Maori appearance and enquired about the vehicle. He told her "That over there and it is under three lots of finance". He said that it was not "any good", that she would have to spend at least $3,000 on it and, that the motor and gearbox had "had it". He took her to more expensive XD Falcons.

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

His Honour said that he was "left with the suspicion" on the whole of the evidence that in a systematic way the appellant was advertising cars at a special price as bait and then by various means discouraging people from buying them; but he said that he could not find that that was the appellant's regular method of operation. He said that he regarded the evidence about Mrs. Smith's experience in January as relevant on the ground that it tended 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 of the appellant and as refuting the appellant's s.85 case. He said that the incident involving Mrs. Smith and the Monza red Falcon gained 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. He said that he did 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 his Honour said he did not believe that Mr. McKerrow knew how much, if anything, was spent on it and that he was of the opinion that his evidence on that point was not candid.

His Honour found that the evidence of Mr. McKerrow and to a lesser extent that of Mr. Parker, the sales manager of the appellant, was unconvincing and he did not believe that genuine efforts on the part of the management of the appellant were made to prevent the occurrence of events such as those involved in the case.

His Honour found that, although he accepted the evidence of the prosecution witnesses as substantially true, he was not prepared to find beyond reasonable doubt that the conduct of the agents or servants of the appellant conflicting with performance of the duty prescribed by sub-s. 56(2) had the actual authority of the appellant. He was satisfied that that conduct was engaged in by the agents or servants of the appellant in the course of their employment. His Honour then concluded that it followed that such conduct was engaged in "on behalf" of the appellant and therefore sub-s. 84(2) attributed that conduct to the appellant. His Honour held that, although each agent or servant of the appellant was "another person" within the meaning of para. 85(1) (c), the defence under that provision was not made out.

His Honour rejected the defence based upon s. 85 on the ground that he was not satisfied on the balance of probabilities that the use of the advertised vehicles as mere "bait" occurred despite the best efforts of the appellant. He said that he thought the probability was the other way.

His Honour also concluded that the two charges based on sub-s. 56(1) of the Act had been proved. He based that finding upon his findings relevant to sub-s. 56(2) that neither vehicle was offered for supply for a reasonable period at the price mentioned in the advertisement because on 18 and 19 March 1983 neither was genuinely for sale at the advertised price. He said that what the prosecution had to do was to exclude any doubt about the proposition that the vehicles in question were not intended to be placed genuinely on sale at the price advertised on 18 March for a reasonable period. He said that the fact that they were not so placed did not conclude the matter because the appellant might have intended to put them on sale and then changed its mind. He said that if the appellant had genuinely intended that the vehicles be on sale at the very low advertised prices it could have easily given effect to that intention. He was on the whole satisfied to the requisite standard about the absence of the intention of which sub-s. 56(1) speaks.

Counsel for the appellant argued that the trial Judge erred in three respects. First, it was submitted that the evidence of Mr. Cornick was wrongly admitted and that without such evidence there was no evidence to support the charges brought under sub-s. 56(2) in respect of the events of 18 March. Alternatively, it was submitted that his Honour could not have been satisfied beyond reasonable doubt that the man to whom Mr. Cornick spoke on 18 March was a servant or representative of the appellant and therefore his Honour should not have relied upon it. In the result only the evidence of Mr. Crawford and his son remained with respect to the events of 19 March and the primary Judge could not have safely convicted the appellant on that evidence.

The second ground of attack was that the only basis on which criminal responsibility for the acts of the "salesmen" on 18 and 19 March 1983 could be attributed to the appellant was sub-s. 84(2). It was submitted by counsel for the appellant that sub-s. 84(2) applies only if the conduct complained of had the actual (express or implied) authority of the appellant. Alternatively, counsel for the appellant argued that the phrase "on behalf of" required that the relevant conduct be for the benefit of the appellant.

The consequence of these submissions was said to be that the prosecution must fail on the two alleged contraventions of sub-s. 56(2) in view of the primary Judge's finding that he was not satisfied beyond reasonable doubt that the acts founding the charges were actually authorised by of the appellant. As the evidence of the events of 18 and 19 March was relied on also to establish the absence of the requisite intent for the purposes of sub-s. 56(1) those two charges based on that sub-section must also fail.

Third, it was submitted that his Honour wrongly rejected the appellant's defence under para. 85(1)(c) of the Act in that he erred in receiving into evidence the "similar fact" evidence from Mrs. Smith and Mrs. Lahrs about events in January 1983. Reliance was placed upon Markby v. The Queen [1978] HCA 29; (1978) 140 CLR 108; Perry v. The Queen (1982) 57 ALJR 110; and Sutton v. The Queen (1984) 58 ALJR 60.

I shall turn first to the question whether Mr. Cornick's evidence was wrongly admitted. A person's authority to act on behalf of a company may be proved by direct evidence of the grant of authority; for example, a resolution of the Board of Directors or in some instances the articles of association themselves. But the authority may be established otherwise than by direct evidence; it may be inferred from circumstances. Once the circumstances have been proved a prima facie case of the existence of the authority may be established; but the other party to the proceeding may lead evidence to negate the prima facie case. It is impossible to define exhaustively the relevant circumstances, but they may include evidence of the office held by the person whose authority is in question, statements made by him, the time when and the place where the statements were made and the acquiescence of others who govern the company's affairs in the statements made. Of course, care must be taken before admitting the person's own statements that he had authority to act on behalf of the company. Those statements are inadmissible unless accompanied by other evidence supporting the existence of his authority. Particular care must be exercised by a trial Judge on this question when hearing a criminal charge, especially if there is a jury. Sometimes for convenience and the orderly conduct of a trial the presiding Judge may admit statements of this kind provisionally, leaving it to be established later in the case whether the requisite connection exists between the person and the company, especially if counsel for the plaintiff or the prosecution undertakes to complete the chain of evidence. See Fraser Hennleins Pty. Limited v. Cody [1945] HCA 49; (1945) 70 CLR 100; Ex parte Gerard and Co. Pty. Limited, Re Craig (1944) 44 SR(NSW) 370; Barrett v. Steel Products Co. Pty. Limited (1962) NSWR 981; Woods v. Brookes (Milk) Limited (1963) 1 WLR 795; and Chappell v. Ross and Sons Pty. Limited (1969) VR 376.

Counsel for the appellant did not challenge the finding of the primary Judge relating to the events of Saturday, 19 March 1983 including the evidence of Mr. Crawford of the conversations with persons present at the appellant's car yard who spoke to him that day. It is plain that there was sufficient evidence to support the admissibility of those conversations as binding the appellant.

It is the evidence of Mr. Cornick about his conversation with a person at the appellant's car yard early in the morning on Friday 18 March which was said to be inadmissible. The point is of significance because it was common ground that there was no other evidence of relevant events of 18 March except, of course, the publication of the advertisement itself. Notwithstanding the rather slender reed upon which the responsibility of the appellant for the acts and statements of the person to whom Mr. Cornick spoke on the morning of 18 March rests, in my opinion it has not been established that his Honour erred in admitting that evidence. Mr. Cornick went to the yard in response to the advertisement published earlier that morning in the Dail Sun newspaper and spoke to a man standing beside the car yard office. There is some suggestion in the evidence that the car yard was not open then and that it did not open until 8.30 a.m.. But that was evidence which did not find favour with his Honour. However, whether technically open for business or not, Mr. Cornick entered the appellant's premises on the Friday morning, walked through them and inspected cars there. There is no suggestion that his entry or progress was impeded or unlawful or otherwise than in the usual course of business activities of the appellant's car yard. Also, the advertisement was published on that same morning presumably because Fridays and weekends were expected to be busy days. Obviously Mr. Cornick assumed that the man to whom he spoke was a salesman in the employ or service of the appellant and nothing which he said to Mr. Cornick dispelled that impression. In the circumstances it has not been established that the primary Judge erred in finding that the man was a salesman of the appellant and that his conduct on 18 March towards Mr. Cornick was in the course of the appellant's business. His Honour must have concluded that a prima facie case had been established that the man bound the appellant in the discussions with Mr. Cornick and that it was not displaced by evidence to the contrary.

Even if the evidence of Mr. Cornick was inadmissible it does not follow that the charges must be dismissed. The two charges for contraventions of sub-s. 56(2) are that the appellant, having advertised the two cars for supply at a special price, did not offer them for supply at that price for a period that was reasonable having regard to the nature of the market in which the appellant carried on business and the nature of the advertisement. The period was particularised in the summons as 18 and 19 March 1983. If the case for the prosecution fails in relation to 18 March it still leaves the evidence about 19 March which raises the question whether that would sufficiently satisfy the requirement of sub-s. 56(2) that there be a reasonable period for which the cars were offered for supply. As the appellant's business was selling used motor vehicles and the advertisement was published on the Friday obviously to attract the busy late week and week-end trade in my view the failure to offer the cars for supply at the special price on the Saturday would be sufficient to bring the two charges within sub-s. 56(2).

I reject the argument that, if the only evidence of breach of sub-s. 56(2) relates to the events of 19 March, which rests essentially on Mr. Crawford's evidence and that of his son, the trial Judge could not have been satisfied beyond reasonable doubt that the appellant contravened that sub-section. His Honour accepted the evidence of Mr. Crawford and the corroborating evidence of his son. There is no substance in this ground of attack on the findings of the primary Judge.

I turn to the questions relating to sub-s. 84(2). His Honour was not able to find beyond reasonable doubt that the conduct of the servants or agents of the appellant which conflicted with the performance of the duty prescribed by sub-s. 56(2) had the actual authority of the appellant, but found that it was engaged in by them in the course of their employment and it therefore followed that such conduct was engaged in "on behalf" of the appellant within the meaning of sub-s. 84(2).

The construction of sub-s. 84(2) must therefore be considered. Section 84 appears in Part VI of the Act titled "Enforcement And Remedies". Although sub-s. 84(1) is not directly involved in this case it is necessary to refer to it. Sub-section 84(1) concerns intention and sub-s. 84(2) concerns conduct which, in each case, is deemed to be that of the corporation. Sub-sections 84(1) and (2) provide:

"84(1) Where, in a proceeding under this Part in
respect of any conduct engaged in by a body
corporate, being conduct in relation to which a
provision of Part V applies, it is necessary to
establish the intention of the body corporate, it
is sufficient to show that a servant or agent of
the body corporate by whom the conduct was engaged
in had that intention."

(2) 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.

Both sub-sections are deeming provisions; sub-s. 84(1) in substance and

sub-s. 84(2) in both form and substance.

The meaning and scope of sub-s. 84(1) and (2) have been considered in a number of cases by Judges of this Court: many of them are conveniently collected in the judgment of Morling J. in Trade Practices Commission v. Queensland Aggregates Pty. Limited (No. 3) (1982) 61 FLR 52 at p. 66. To those references may be added Doherty v. Traveland Pty. Limited (1982) ATPR 40-323; Trade Practices Commission v. Tubemakers Australia Limited (1983) ATPR 40-358; Trade Practices Commission v. Mobil Oil Australia Limited (1984) ATPR 40-482; and Maisey v. Mudgeeraba Village Estates Pty. Limited (unreported 22 May 1985).

Although the two sub-sections apply to proceedings for contraventions of the Act (only Part V in the case of sub-s. 84(1)) they apply also to proceedings for injunctions, damages and orders under s. 87. Where a contravention of a provision of Part V of the Act requires an intent by the corporation, without sub-s. 84(1) the corporation would not be guilty unless the requisite intention was a state of mind of one or more of the persons who constituted the directing mind and will of the corporation, the test enunciated by the House of Lords in Tesco Supermarkets Limited v. Nattrass [1971] UKHL 1; (1972) AC 153. But sub-s. 84(1) adopts a different test to Tesco: see Universal Telecasters (Qld.) v. Guthrie (1978) ATPR 40-062 and Tubemakers. Under sub-s. 84(1) it is not necessary for the intent to be that of a person who posseses the directing mind and will of the corporation; it is sufficient if that person having the intent is a servant or agent of the corporation. This is a large extension to the organic theory enunciated in Tesco.

Sub-section 84(2) is obviously a provision of wide application. It is, in my opinion, an extension of the principles enunciated in Tesco. Where proceedings are brought against a corporation for contravention of a provision of the Act the corporation's liability may be determined either by applying the principles of Tesco or by sub-s. 84(2). The sub-section is not concerned with intention and I agree with what Toohey J. said about this in Tubemakers at p. 44,326.

I cannot accept the submission of counsel for the appellant that sub-section 84(2) only applies where a person had the corporation's actual (be it express or implied) authority to engage in the conduct in question. If the sub-section had so limited an operation it would, I think, fail to achieve any useful purpose. It would be largely a restatement of the general law. It is a statutory provision designed to facilitate proof of the responsibility of a corporation for the acts of its directors, servants, agents and others. It is designed to attribute to a corporation conduct of others for which the corporation would not necessarily be otherwise responsible.

The phrase "on behalf of" is not one with a strict legal meaning and it is used in a wide range of relationships. The words are not used in any definitive sense capable of general application to all circumstances which may arise and to which the sub-section has application. This must depend upon the circumstances of the particular case; but some statements as to the meaning and operation of the sub-section may be made. In the context of sub-s. 84(2) the phrase suggests some involvement by the person concerned with the activities of the company. The words convey a meaning similar to the phrase "in the course of the body corporate's affairs or activities". The words "on behalf of" also encompass acts done by a corporation's servants in the course of their employment; but those words are not confined to the notion of the master/servant relationship. Sub-section 84(2) refers to conduct by directors and agents of a body corporate as well as its servants. Also, the second limb of the sub-section extends the corporation's responsibility to the conduct of other persons who act at the behest of a director, agent or servant of the corporation. Hence the phrase "on behalf of" casts a much wider net than conduct by servants in the course of their employment, although it includes it.

The second limb of the sub-section reinforces my view that the words "on behalf of" govern both limbs of the sub-section. It may be possible to read the second limb as if it was not qualified by the words "on behalf of" and relate back only to the opening words of the sub-section "any conduct engaged in"; but the more ordinary and natural meaning of the sub-section when read as a whole is that the conduct by the various persons to whom it refers must be engaged in "on behalf of" the corporation to attract the benefit of the deemed responsibility of the corporation. If this were not so a corporation could be liable by the application of the sub-section yet be unable to avail itself of defences under sub-s. 85(1) in circumstances where the only nexus between the corporation and the conduct complained of is the fact that a director, servant or agent (whether he be in a position of authority in the corporation or at the bottom of the corporation's ladder) directed that the conduct be engaged in.

Counsel for both parties emphasised the relationship between sub-s. 84(2) and s. 85 which provides defences to prosecutions under Part VI for contraventions of Part V. I agree that there is a nexus between the two provisions, indeed a close one; but the relationship must not be taken too far because sub-ss. 84(1) and (2) have operation beyond prosecutions for contraventions of Part V. Many examples come to mind, but an obvious one is s. 52 of the Act which prohibits corporations from, in trade or commerce, engaging in misleading or deceptive conduct. Contraventions of s. 52 do not constitute offences against the Act (sub-s. 79(1)); yet sub-ss. 84(1) and (2) may be relied on by parties to proceedings for injunctions (s. 80), damages (s. 82) or other orders (s. 87) which involve contraventions of s. 52. It is important therefore not to treat sub-ss. 84(1) or (2) as mirror images of s. 85.

Sub-section 84(2) attributes responsibility to a corporation for a wide range of conduct engaged in by others provided that it was engaged in on behalf of the corporation, whether actually authorised by it or not. But the defences provided by s. 85 must have been regarded by the legislature as safeguarding against injustice that might otherwise have been occasioned by the width of the operation of sub-s. 84(2).

Although for some purposes of company law it may be sufficient to show that conduct of an agent was "on behalf of" the corporation if it is established that it was for the benefit of the corporation, I see no justification for importing this concept into the construction of sub-s. 84(2). It would unduly restrict the ordinary and natural meaning of the language of the sub-section. I agree with Toohey J.'s observations in Tubemakers at p. 44,327.

Sub-section 84(2) is an enlarging provision of general application under the Act. It extends to proceedings, both civil and criminal, and is designed to eliminate the necessity to apply the various and at times divergent tests of the common law relating to a corporation's responsibility for the acts of its servants or agents. It extends those common law principles in order to facilitate proof of a corporation's responsibility. To alleviate injustice which might otherwise flow from the width of its extended reach where contraventions of the provisions of Part V are involved the legislature has fashioned s. 85 as an instrument of enlarged defences to which the corporation may have recourse.

The next submission of counsel for the appellant with which I shall deal is that the trial Judge erred in holding that, although each agent or servant of the appellant was "another person" within the meaning of para. 85(1)(c), the defence under that provision was not established.

Paragraph 85(1) (c) presents some nice questions of construction. The reference in the sub-paragraph to "another person" is not merely a reference back to the expression "other person" in the second limb of sub-s. 84(2). A corporation can only act through others, generally natural persons. It is, I think, seriously arguable that para. 85(1) (c) applies where the conduct in question is that of any person who is not the corporation itself or one of the persons who carry out the functions of direction and management of the corporation and its affairs. The distinction between "the ruling officers" (the description of Lord Widgery C.J. in Coupe v. Guyett (1973) 1 WLR 669 at 675) of a corporation or "those who constitute the directing mind and will of the company" (Denning L.J.'s oft cited description in H.L. Bolton (Engineering) Co. Limited v. T.J. Graham & Sons Limited (1957) 1 QB 159 at 172) on the one hand and people in the company who are mere servants and agents on the other hand is now well known and it is a distinction closely related to the present question: see Tesco Supermarkets Limited v. Nattrass (supra): Wings Limited v. Ellis (1984) 1 WLR 731; Universal Telecasters (Qld.) Limited v. Guthrie (supra) per Bowen C.J. and 551-552 per Franki J.. Where a contravention of a provision of Part V of the Act requires an intent by the corporation so that it is not guilty unless the requisite intent was a state of mind of one or more of the persons who constitute the directing mind and will of the corporation, the argument that the defence under para, 85(1)(c) is restricted to other persons within the corporation gains, I think, greater strength. But the defences afforded by s. 85 relate to any prosecution under Part VI in relation to any contravention of a provision of Part V. Some of those contraventions require an intent by the corporation. Section 54, which deals with the offering by corporations of gifts and prizes, is one example. Other contraventions do not require such an intent. Section 53 is an example: Darwin Bakeries Pty. Limited v. Sully (1981) 51 FLR 90. The logic of the dichotomy between those who direct and manage the corporation and its other servants or agents become less obvious in the case of contraventions akin to absolute offences where the intent of the corporation is irrelevant. So it may be that the meaning of the expression "another person" in para. 85(1) (c) is to be gathered, not in an absolute sense, but according to the circumstances of the particular case; or the words may simply mean any person other than the defendant which in the case of a corporation means any person other than the corporation itself considered as a legal entity. It is not necessary for me to decide this question as his Honour found that the acts of each servant or agent of the appellant relating to the events of 18 and 19 March were the acts of "another person" within the meaning of para. 85(1) (c).

His Honour's conclusion that the defence under para. 85(1) (c) was not made out was essentially one of fact and included his assessment of the credibility of witnesses, an assessment generally unfavourable to the appellant's case. The submission that his Honour erred in receiving the "similar fact" evidence of Mrs. Smith and Mrs. Lahrs about events in January 1983 fails. In relation to para. 85(1) (c) that evidence is not in my view "similar fact" evidence at all. It is simply evidence touching, first, the question whether the contraventions were due to the act or default of some person other than the appellant or to an accident or some other cause beyond its control and second, whether the appellant took reasonable precautions and exercised due diligence to avoid the contravention. The measures taken and systems instituted by the appellant to safeguard against occurrences of the kind involved in the conduct with which this case is concerned were matters to which this evidence was directed. Plainly the gap of some two months or so between the January and March incidents was not so great as to render the evidence inadmissible or unreliable on the issues arising under para. 85(1) (c). The evidence of Mrs. Smith and Mrs. Lahrs was admitted by his Honour for other purposes as well, but his Honour's reliance upon it was substantially for the purpose to which I have just referred.

The appeals should be dismissed with costs.

I have had the advantage of reading the judgment prepared by Lockhart J. I agree that the appeals should be dismissed with costs for the reasons given by his Honour.