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Federal Court of Australia |
PRACTICE & PROCEDURE - application by respondent to strike out the ACCC's application under s 87(1A) and (1B) the Trade Practices Act 1974 (Cth) for compensatory third party orders - whether an application under s 87(1A) and (1B) can only be made in a separate proceeding commenced after a finding of contravening conduct has been made in a proceeding under ss 79 or 80 of the Act - Federal Court's jurisdiction under ss 22 and 23 the Federal Court of Australia Act wide enough to enable Court, in the one suit, to resolve all issues in a controversy, both central and ancillary - claim for s 87(1A) relief can be made in the same proceeding brought under ss 79 or 80, but must be brought by motion in that proceeding and only after a finding of contravening conduct has been obtained.
Federal Court of Australia Act 1976 (Cth) - ss 22, 23, 32
Federal Court Rules - O 4 r 1, O 19 r 1
Trade Practices Act 1974 (Cth) - ss 51, 52, 79, 80, 82, 86, 87, 87(1A), 87(1B), 87(1C), 87(1CA), 163
Cases Considered
Caboolture Park Shopping Centre Pty Ltd (In Liquidation) v White Industries (Qld) Pty Ltd [1993] FCA 471; (1993) 45 FCR 224
Darling Downs Investments Pty Ltd v Ellwood (1988) 18 FCR 510
Dingle v Commonwealth Development Bank of Australia (1989) 23 FCR 63
Fencott v Muller (1983) 152 CLR 570
Landsal Pty Ltd (In Liquidation) v REI Building Society (1993) 41 FCR 421
Sent v Jet Corporation of Australia Pty Ltd [1986] HCA 35; (1986) 160 CLR 540
Trade Practices Commission v Collings Construction Co Pty Ltd (Hunter J, Supreme Court of New South Wales, unreported, 10 December 1996)
Trade Practices Commission v Friendship Aloe Vera Pty Ltd (1988) ATPR 40-892
Trade Practices Commission v Manfal Pty Ltd (No 3) [1991] FCA 650; (1991) 33 FCR 382
Wigan v Edwards (1973) 1 ALR 497
AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v THE SHELL COMPANY OF AUSTRALIA LIMITED
QG 194 OF 1996
DRUMMOND J
BRISBANE
13 FEBRUARY 1997
IN THE FEDERAL COURT OF AUSTRALIA No QG 194 of 1996
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION
Applicant
AND: THE SHELL COMPANY OF AUSTRALIA LIMITED
(ACN 004 610 459)
Respondent
CORAM: Drummond J
DATE OF ORDER: 13 February 1997
WHERE MADE: Brisbane
THE COURT ORDERS THAT:
1. Paragraph 1 of the amended application is struck out.
2. The costs of and incidental to the respondent's notice of motion are reserved.
NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA No QG 194 of 1996
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION
Applicant
AND: THE SHELL COMPANY OF AUSTRALIA LIMITED
(ACN 004 610 459)
Respondent
CORAM: Drummond J
DATE: 13 February 1997
PLACE: Brisbane
The respondent has accordingly confined the relief it now seeks to an order dismissing the proceedings in so far as they relate to the Commission's claim under s 87(1A). The respondent's contention, made clear in oral submissions, is that the making of the claim for relief under s 87(1A) is premature because the Commission cannot bring an application under s 87(1A) in the same proceeding in which it seeks relief under either s 79 or s 80; it must wait until it obtains, in those last-mentioned proceedings, a finding that the person the target of the s 87(1A) application has contravened a provision of Part IVA or V before it can seek an order under s 87(1A), which must be claimed in a proceeding separate from that in which the finding was made.
It is necessary to set out the relevant legislative history. This can commence with s 87 in the form it was in following the 1983 amendments:
"(1) Without limiting the generality of section 80, where, in a proceeding instituted under, or for an offence against, this Part, the Court finds that a person who is a party to the proceeding has suffered, or is likely to suffer, loss or damage by conduct of another person that was engaged in (whether before or after the commencement of this sub-section) in contravention of a provision of Part IV or V, the Court may, whether or not it grants an injunction under section 80 or makes an order under section 80A or 82, make such order or orders as it thinks appropriate against the person who engaged in the conduct or a person who was involved in the contravention (including all or any of the orders mentioned in sub-section (2) of this section) if the Court considers that the order or orders concerned will compensate the first-mentioned person in whole or in part for the loss or damage or will prevent or reduce the loss or damage.
(1A) Without limiting the generality of section 80, the Court may, on the application of a person who has suffered, or is likely to suffer, loss or damage by conduct of another person that was engaged in (whether before or after the commencement of this sub-section) in contravention of a provision of Part V, make such order or orders as it thinks appropriate against the person who engaged in the conduct or a person who was involved in the contravention (including all or any of the orders mentioned in sub-section (2)) if the Court considers that the order or orders concerned will compensate the first-mentioned person in whole or in part for the loss or damage or will prevent or reduce the loss or damage."
Section 87(2) has, at all relevant times, provided for a range of compensatory orders. Although amended from time to time, s 80 has always provided for the grant, on application by the Commission or any other person, of injunctions restraining conduct contravening various provisions of the Act, while s 82 has also always empowered a person who suffers loss or damage by conduct of another done in contravention of various provisions of the Act to recover the amount of that loss or damage; s 79 has always made it a criminal offence for a person to contravene various provisions of Part V of the Act or to engage in a range of conduct associated with such contraventions.
In Sent v Jet Corporation of Australia Pty Ltd [1986] HCA 35; (1986) 160 CLR 540, the applicant sought an order under s 87(1A), when it was in the form set out above, requiring the respondent to pay damages in respect of the loss suffered by the applicant from conduct of the respondent engaged in in contravention of s 52 the Trade Practices Act. The applicant could not seek damages under s 82(1) because the limitation period fixed in s 82(2) for such an action had expired. There was no limitation period then applicable to s 87(1A). The result of the High Court appeal was the dismissal of the applicant's action. The Court held, at 543:
"The `proceeding' to which the sub-section [s 87(1)] refers is a proceeding other than a proceeding for relief under that sub-section. The relief which might be granted to a party under sub-s (1) is therefore ancillary or additional to the relief which the Court might grant in the proceeding under other provisions of Part VI, although the power to grant relief under sub-s (1) is not dependent on the granting of relief under other provisions of that Part ..."
The Court then turned to s 87(1A), referred to how the ordinary meaning of the words of the sub-section as it then stood provided strong reason for reading the sub-section as conferring on any person a right to claim compensatory relief for loss or damage caused by conduct engaged in in contravention of Part V, irrespective of the making of any claim for relief under any other provision of Part VI, but then explained why it nevertheless rejected that construction, saying, at 544:
"But there are three countervailing indicia which together suggest that an application under sub-s (1A) must be ancillary to proceedings brought under other provisions of Part VI ..."
and concluded, at 545:
"... compensatory relief under sub-s (1A) can be applied for and granted only if a proceeding is instituted or has been instituted under or for an offence against a provision of Pt VI other than s 87 in respect of conduct engaged in in contravention of Pt V. Thus sub-s (1) provides for the discretionary granting of compensatory relief in favour of parties to such proceedings and sub-s (1A) provides for the discretionary granting of compensatory relief in favour of persons who may not be parties to such proceedings but who make applications in such proceedings. In either case the power to grant relief under s 87 is dependent on the institution of proceedings under a provision of Pt VI other than s 87." (emphasis added)
The High Court held that an injured person could only make an application under s 87(1A) if it was ancillary to proceedings under some other section of Part VI and it considered that such a s 87(1A) application could be made in those other proceedings, although the applicant was not a party to them. The High Court did not, however, consider whether an injured person could make a s 87(1A) application in proceedings of his own, provided they could be seen to be ancillary to other proceedings brought by another under some other section of Part VI. But I do not think what the High Court said should be understood as holding that this was not a second option open to a person for bringing a s 87(1A) application.
The judgment in Sent was delivered on 26 June 1986 on the Act in the form it stood prior to the amendments made just before that by the Trade Practices Revision Act 1986 (Cth) (No 17 of 1986), assented to on 13 May 1986. By s 55 of that Act, s 87(1A) was repealed and replaced by the following provision:
"(1A) Without limiting the generality of section 80, the Court may, on the application of a person who has suffered, or is likely to suffer, loss or damage by conduct of another person that was engaged in (whether before or after the commencement of this sub-section) in contravention of a provision of Part V or on the application of the Commission in accordance with sub-section (1B) on behalf of such a person or 2 or more such persons, make such order or orders as the Court thinks appropriate against the person who engaged in the conduct or a person who was involved in the contravention (including all or any of the orders mentioned in sub-section (2)) if the Court considers that the order or orders concerned will compensate the person who made the application, or the person or any of the persons on whose behalf the application was made, in whole or in part for the loss or damage, or will prevent or reduce the loss or damage suffered, or likely to be suffered, by such a person."
The new s 87(1A) radically changed the earlier provision in so far as, for the first time, the Commission was empowered to make application under the section for compensatory orders on behalf of third parties injured by the conduct of another that contravened Part V. But apart from some changes in wording of no significance, the whole of the text of the earlier version of s 87(1A), which had empowered only persons injured by conduct of another in contravention of Part V to seek compensatory orders, was incorporated in the new s 87(1A), ie, the injured person had the same rights to bring an application for an order under the new s 87(1A) as he had under the old section. The amending Act of 1986 also introduced the following new provisions into s 87:
"(1B) Where, in a proceeding instituted for an offence against section 79 or instituted by the Commission or the Minister under section 80, a person is found to have engaged (whether before or after the commencement of this sub-section) in conduct in contravention of a provision of Part V, the Commission may make an application under sub- section (1A) on behalf of one or more persons identified in the application who have suffered, or are likely to suffer, loss or damage by the conduct, but the Commission shall not make such an application except with the consent in writing given before the application is made by the person, or by each of the persons, on whose behalf the application is made.
(1C) An application under this section in relation to a contravention of section 52A may be made at any time within 2 years after the alleged contravention occurred."
Following delivery of the High Court judgment in Sent, further amendments were made to s 87 by the Statute Law (Miscellaneous Provisions) Act (No 2) 1986 (Cth) (No 168 of 1986, assented to on 18 December 1986). This Act repealed s 87(1C), replaced it with a new provision and added a new s 87(1CA). These provisions provide:
"(1C) An application may be made under sub-section (1A) in relation to a contravention of Part V notwithstanding that a proceeding has not been instituted under another provision of this Part in relation to that contravention.
(1CA) An application under sub-section (1A) may be commenced -
(a) in the case of conduct in contravention of section 52A - at any time within 2 years after the day on which the cause of action accrued; or
(b) in any other case - at any time within 3 years after the day on which the cause of action accrued."
Though s 87 was further amended in 1992, the question for determination can be resolved by reference to the form the section had reached by December 1986.
Shell contends that, properly construed, the section requires the Commission to bring proceedings under s 87(1A) and (1B) for compensatory orders for the benefit of persons injured by conduct in contravention of Part IVA or V separately from the proceedings for an offence against s 79 (which will almost always be brought by the Commission) or the proceedings instituted by the Commission or the Minister for injunctive relief under s 80. Shell advances three reasons: firstly, it submits that the natural meaning of the words of sub-sections (1A) and (1B) point to this conclusion; reference is made to the decision of Pincus J in Trade Practices Commission v Friendship Aloe Vera Pty Ltd (1988) ATPR 40-892 at 49,630. Secondly, Shell finds support for its contention in the difference between the language of s 87(1B), which empowers the Commission to make application for third party compensatory relief where, in a proceeding for an offence or for injunctive relief, "a person is found" to have engaged in contravening conduct and the language of s 87(1), which empowers the Court, in a proceeding instituted under or for an offence against Part VI, to make compensatory orders in favour of a party to the proceeding, provided "the Court finds that" that party has suffered loss as a result of contravening conduct. Thirdly, Shell relies on the Explanatory Memorandum accompanying the amending Act, No 17 of 1986.
The Commission contends that, in submitting that the Court's power to grant relief at the behest of the Commission under s 87(1A) is dependent upon the initiation and conclusion of separate proceedings under a provision of Part VI, other than s 87, Shell ignores the critical effect of s 87(1C). The Commission also relies upon Trade Practices Commission v Collings Construction Co Pty Ltd (Hunter J, Supreme Court of New South Wales, unreported, 10 December 1996) and Trade Practices Commission v Manfal Pty Ltd (No 3) [1991] FCA 650; (1991) 33 FCR 382.
In Friendship Aloe Vera, the Commission, in addition to seeking an injunction under s 80, also sought third party compensatory orders under s 87(1A) and (1B); the critical question was whether the relief claimed by the Commission in reliance on s 87(1B) was time barred pursuant to s 87(1CA)(b). Pincus J held that what he described as the cause of action mentioned in s 87(1B) was not time-barred because it only accrued when the findings of contravening conduct had been made, a conclusion the correctness of which the Commission accepts. His Honour said, at 49,630:
"It will be seen that the right to make an application on behalf of persons who have suffered, or are likely to suffer, loss or damage depends upon there having been a finding of the kind mentioned in the first part of the provision. ...
What is not so clear is whether the cause of action, in a case of the kind mentioned in sec 87(1B), is the Commission's cause of action, the existence of which depends upon the making of a finding, or the cause of action of the persons who are damaged or likely to suffer damage. The latter possibility is strengthened by the consideration that those persons could obtain under sec 87(1) an order of the precise description sought, without the intervention of the Commission. It is unclear whether the intention is that, where a representative suit is brought (of the kind described in sec 87(1B)), the Commission is to be allowed three years from the date of the finding.
My view is that the cause of action does not accrue until the necessary findings have been made; the findings are a precondition of the right to make this sort of claim. That is the natural meaning of the expressions used: `Where ... a person is found to have engaged' in certain conduct `the Commission may make an application'. It appears to me, in consequence, that it is necessary to make findings with respect to all the potential claimants, for none of the claims is statute-barred."
I respectfully agree with what Pincus J has to say about the making of the findings in question being "a precondition of the right to make this sort of claim", a conclusion that flows from what his Honour described as the natural meaning of the relevant expressions. But it cannot be accepted that, in saying this, his Honour intended to suggest that s 87(1A) can only be invoked by the Commission in a separate proceeding commenced after a finding of contravening conduct has been made in the proceeding under s 79 or s 80. It is apparent from Pincus J's comments in Dingle v Commonwealth Development Bank of Australia (1989) 23 FCR 63 at 64 that his Honour did not consider that the Commission was required to commence a proceeding for the relief under s 87(1A) and (1B) separate from that in which the s 80 injunction was claimed. In Dingle, his Honour described the Friendship Aloe Vera case, the subject of the report in (1988) ATPR, as litigation which "has been partially heard"; his Honour referred to the findings he had there made under s 87(1A) and added: "s 87(1B) contemplates that, such findings having been made, the Commission may then apply for relief on behalf of individuals. I gather that this later stage is unlikely to be pursued since the parties against which the findings were made are insolvent." The Commission, in its originating application, had joined a claim for an injunction under s 80 with a claim under s 87(1A) and (1B); his Honour clearly assumed that there was nothing inappropriate in this and that the claim for relief under s 87(1A) and (1B) could be included in the same proceedings in which s 80 relief was also claimed, although the former could not be dealt with and disposed of until the necessary findings had been made. It is also apparent that, although Pincus J considered that s 87(1B) created a cause of action in the Commission that was not complete until the requisite finding had been made in a proceeding under s 79 or s 80, his Honour did not see that as any impediment to the Commission including, in a s 79 or s 80 proceeding, a claim for s 87(1B) relief, from the outset. Cf Wigan v Edwards (1973) 1 ALR 497 at 508 and 515.
As to the difference in language between s 87(1) and (1B), I do not think this points to the conclusion contended for by Shell: the power conferred by s 87(1) to make compensatory orders can only be exercised in a proceeding in which the injured person is a party and then only if the Court finds that that party has, in fact, suffered damage, ie, such an order will be made at the same time as the Court determines all the other issues raised in the proceeding by the injured person, including whether the Act has been contravened (subject only to the Court's general power to try issues separately). The language of s 87(1B) is, in my opinion, wide enough to comprehend both the case where a proceeding is brought by the Commission for compensatory third party orders under s 87(1A), which is separate from the proceeding under s 79 or s 80, in which another is found to have engaged in contravening conduct, and also the case in which the Commission makes such application under s 87(1A) in the very proceeding under s 79 or s 80 in which the finding of contravening conduct is made against another. What the language of s 87(1B) emphasises is that the finding of contravening conduct must be made, as Pincus J observed in the Friendship Aloe Vera case, before the Commission may make application under s 87(1A): the language does not necessarily point to a separate proceeding being required in which the Commission is to make that application.
Paragraphs 188 to 190 of the Explanatory Memorandum accompanying the amendment Act, No 17 of 1986, antedate the decision in Sent. It is apparent that this Memorandum proceeds on the basis that the new power conferred on the Commission by s 87(1A) by the 1986 amendments could only be exercised by it once the Court had found contravening conduct in proceedings brought by the Commission or the Minister under s 79 or s 80. But I do not read anything in the Explanatory Memorandum as throwing any light on whether that power was intended to be exercised only by an originating application by the Commission made after the conclusion of the proceeding under s 79 or s 80, in which the necessary findings of contravening conduct have been made or whether it can be made in those proceedings, but only once the Court has made the necessary findings. There is nothing in the Explanatory Memorandum which suggests, in my opinion, that the author then had in mind this procedural question.
The introduction of s 87(1C) was plainly enough intended to overcome Sent, in so far as it was there held that, so far as an injured person is concerned, he could only make application for compensatory orders under s 87(1A) if there were proceedings brought under provisions of Part VI, other than s 87, on foot. But s 87(1C) does not, in my opinion, affect the holding in Sent that, if there is such a proceeding on foot, an injured person not party to that proceeding can make an application for a compensatory order pursuant to s 87(1A) in that other proceeding. In view of s 87(1C), it is clear that, in so far as s 87(1A) empowers the Court to make compensatory orders in favour of a person injured by contravening conduct "on the application of" such a person, the expression "application" there comprehends an originating application not ancillary to or dependent upon another proceeding as well as an application in another proceeding instituted by others under a provision of Part VI other than s 87(1A): the High Court's comments in Sent show that a person so injured can claim s 87(1A) relief by application made in a proceeding between others and the wrongdoer. Section 87(1C) accepts the availability of this procedure, while declaring that a s 87(1A) claim can also be made by the injured person in an originating proceeding not ancillary to any other proceeding.
There are, however, difficulties in accepting the Commission's argument that s 87(1C) not only permits or confirms the right of a person injured by contravening conduct to claim relief under s 87(1A) by originating proceeding not ancillary to any other proceeding, but also confers on the Commission, or recognises that the Commission has, exactly the same entitlement. Section 87(1A) empowers the Commission to obtain from the Court third party compensatory orders, but only on its application "in accordance with sub-section (1B)". Such an application by the Commission can only accord with sub-section (1B) if, before it is made in the sense referred to in sub-section (1B), a proceeding has been instituted for an offence against s 79 or for injunctive relief under s 80 and the relevant findings of contravening conduct have been made in that proceeding. To read s 87(1C) as empowering the Commission to seek orders under s 87(1A) in an originating proceeding not ancillary to or dependent upon a proceeding under either s 79 or s 80 would be to give no effect to the requirement in s 87(1A) that any such application by the Commission must be "in accordance with sub-section (1B)".
But accepting this, I do not think the requirement that the application of the Commission referred to in s 87(1A) must be "in accordance with sub-section (1B)" is directed to identifying the procedure the Commission must follow, rather is it directed to identifying the substantive matters which must be established before the Commission can obtain third party compensatory orders. This is, I think, supported by Trade Practices Commission v Manfal Pty Ltd. It appears from 383 and 384 of the report of that case that the proceedings took the form of an application by the Commission pursuant to s 80 for injunctions against Manfal and five individuals associated with Manfal with which was joined an application by the Commission on behalf of six identified consumers, pursuant to s 87(1B), for compensatory orders under s 87(1A) and (2)(d) against both Manfal and those five associated persons. At 384, Lee J referred to the fact that Manfal had ceased to trade and that "since then the live issue in the litigation has been the Commission's application pursuant to s 87(1B) of the Act for remedial orders on behalf of consumers under s 87(1A) of the Act in respect of the loss or damage suffered by those consumers by reason of the conduct in which Manfal is alleged to have engaged in contravention of s 52A of the Act". Like Pincus J in Friendship Aloe Vera, Lee J assumed that it was open to the Commission to join a claim for third party compensatory orders under s 87(1A) and (1B) with a claim for injunctive relief under s 80. At 384, Lee J also said:
"Section 87 provides both right and remedy. Upon the postulation in s 87(1B) that, inter alia, a corporation has engaged in conduct in contravention of Part V of the Act by reason of which another person has suffered loss or damage or is likely to suffer loss or damage, it confers a right upon the Commission to make an application for remedial orders on behalf of the person so affected. The remedy is provided in s 87(1A) pursuant to which, upon the exercise by the Commission of the right conferred upon it under s 87(1B), the Court may make such orders as the court thinks appropriate against the person who engaged in the contravening conduct, or a person who was involved in the contravention, as will compensate the person on whose behalf the application is made."
There is nothing in this dictum or in anything else that Lee J said in Manfal which, in my opinion, suggests that the Commission cannot make application under s 87(1A) and (1B) in the same proceeding in which it seeks relief under s 79 or s 80, although it is clear that Lee J considered that the making of the relevant findings of contravening conduct in the course of the proceeding under s 79 or s 80 must antedate the making of any order under s 87(1A) and (1B). In Trade Practices Commission v Collings Construction, Hunter J found in Manfal support for his view that the Commission was entitled to bring the proceedings it there brought under s 87(1A) and (1B) simultaneously, as his Honour put it, with the proceeding it brought seeking relief under s 80.
Properly construed, s 87(1A) and (1B) show that before the Commission can seek such an order, a finding of contravening conduct must have first been made in a particular kind of proceeding. But this does not, I think, necessarily mean that the Commission can only seek such third party compensatory orders after that proceeding has been heard and determined, in a fresh proceeding.
This Court can, in my opinion, deal with an application by the Commission under s 87(1A) and (1B) in the same proceedings brought under ss 79 or 80.
Section 86(1) confers jurisdiction on the Federal Court "in any matter arising under this Act in respect of which a civil proceeding has, whether before or after the commencement of this section, been instituted under this Part". By s 86(2), this jurisdiction is, in part only, exclusive of the jurisdiction conferred thereunder on State courts. By s 163(2) "jurisdiction is conferred on the [Federal] Court to hear and determine prosecutions under this Act", a jurisdiction declared by s 163(1) to be exclusive to the Federal Court. By s 22 the Federal Court of Australia Act 1976 (Cth), it is provided that: "The Court shall, in every matter before the Court, grant, either absolutely or on such terms and conditions as the Court thinks just, all remedies to which any of the parties appears to be entitled in respect of a legal or equitable claim properly brought forward by him in the matter, so that, as far as possible, all matters in controversy between the parties may be completely and finally determined and all multiplicity of proceedings concerning any of those matters avoided". Section 23 of that Act provides that: "The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, and to issue, or direct the issue of, writs of such kind, as the Court thinks appropriate". These provisions are as applicable to the exercise by the Court of its exclusive criminal jurisdiction under s 163 the Trade Practices Act 1974 (Cth) as they are to the exercise by the Court of its jurisdiction in civil proceedings under s 86.
The expression "matter", in the context of ss 22 and 23 the Federal Court of Australia Act, is a term of wide import. It conveys, in the general context of curially determinable disputes and not just in the special context of s 76(ii) the Commonwealth Constitution, the notion of a "justiciable controversy, identifiable independently of the proceedings which are brought for its determination and encompassing all claims made within the scope of the controversy": see Fencott v Muller (1983) 152 CLR 570 at 603 (a decision on s 86, in the form it took different from that which it now takes, but in which the majority of the Court said that the ambit of the jurisdiction conferred by the section on the Federal Court depended upon the meaning of "any matter arising under any laws made by the Parliament" in s 76(ii) the Constitution).
The jurisdiction conferred on this Court by ss 22 and 23 the Federal Court of Australia Act is jurisdiction to determine the entire controversy involving the parties provided it is a controversy arising under Federal law. The Court's jurisdiction can also extend to the determination of related but non-Federal causes of action: see s 32 the Federal Court of Australia Act and Fencott v Muller, although the question for present determination involves only causes of action arising under Federal law in respect of which this Court is given jurisdiction. Common law superior courts of record do not become functus officio merely upon the making and entry of the judgment or order that determines the rights of the parties: they retain power in the same suit to make supplemental orders thereafter, not limited to orders in aid of the enforcement and working out of the orders determining the rights of the parties, but including orders affecting persons who are not parties to the litigation; the Federal Court has these same ancillary powers. See Caboolture Park Shopping Centre Pty Ltd (In Liquidation) v White Industries (Qld) Pty Ltd [1993] FCA 471; (1993) 45 FCR 224 at 235 and Darling Downs Investments Pty Ltd v Ellwood (1988) 18 FCR 510 at 521 and 525-526. This Court's ancillary powers flow from its authority under ss 22 and 23 to resolve the whole of each controversy that comes before it.
For these reasons, I consider that the jurisdiction which this Court has under ss 22 and 23 the Federal Court of Australia Act is wide enough to enable the Court, in the one suit, to resolve all issues in the controversy involving the parties, both those central to the controversy and those ancillary to it.
There is a close relationship between the proceedings under s 79 and s 80 referred to in s 87(1B) and the application by the Commission for compensatory third party orders authorised by s 87(1B), which is dependent upon findings being made in the former proceedings. There is therefore no reason to infer that this Court is functus officio once it disposes of a proceeding brought before it under s 79 or s 80, so that it does not retain jurisdiction to dispose of, in the same proceeding, an application by the Commission under s 87(1A).
In any event, s 87(1A) and (1B) do not condition the Commission's entitlement to make application for a third party compensation order on a Court having delivered final judgment in a proceeding under s 79 or s 80: all that is required before the Commission can make application under s 87(1A) and (1B) is that there exist findings in either a s 79 or a s 80 proceeding of contravening conduct. This Court has wide powers to make findings without determining the litigation in which they are made. Cf Landsal Pty Ltd (In Liquidation) v REI Building Society (1993) 41 FCR 421 at 428.
The final question is whether the Commission can, in a proceeding brought by it under s 79 or s 80, claim relief under s 87(1A) and (1B) in the originating application in Form 5 filed pursuant to O 4, r 1 the Federal Court Rules or whether it must wait until it obtains the finding of contravening conduct referred to in s 87(1B), whereupon it would be able to claim relief under s 87(1A) and (1B) by motion in that proceeding, pursuant to O 19, r 1.
That the Commission can obtain an order under s 87(1A) and (1B) in the proceeding brought by it under s 79 or s 80 rather than in a separate originating proceeding favours an answer to the effect that a s 87(1A) order can be claimed in the originating proceeding. Pincus J, in Friendship Aloe Vera, and Lee J, in Manfal, assumed, while Hunter J, in Collings Constructions expressly held, that the Commission could bring a claim under s 87(1A) and (1B) in the same proceeding brought under either s 79 or s 80, which must be brought and in which relevant findings of contravention must be made before the Court can go on to deal with the Commission's claim under those sections. But whether the Commission could do this was not in issue in either of the first two cases and Manfal is, for that reason, in my respectful opinion, insufficient justification for the conclusion reached, in reliance on Manfal, in the third of these cases.
I do not think the language of sub-section (1B) is such that it can be read as directed only to defining the elements of the new statutory cause of action conferred on the Commission; the sub-section empowers the Commission to call on the Court to make an order under sub-section (1A) by making "an application under sub-section (1A) on behalf of one or more persons identified in the application". That, I think, refers to a formal step to be taken by the Commission, by which it gives notice that the Court is asked to make an order under sub- section (1A). This reading of sub-section (1B) is, I think, supported by sub-section (1CA), which applies to both applications by injured persons and by the Commission for orders under sub-section (1A) and which fixes limitation periods by declaring that: "An application under sub-section (1A) may be commenced ...". The formal step envisaged by sub-section (1B) cannot, I think, be taken by including the claim for an order under s 87(1A) in the originating application in which orders under s 79 or s 80 are sought by the Commission, but must be made either by motion in that proceeding or by the commencement, at the election of the Commission, of an originating proceeding after the requisite finding has been made in the s 79 or the s 80 action. In requiring the making of a finding of contravening conduct, sub-section (1B) does create a pre-condition to the Commission's right to take that formal step, ie, to make the application referred to.
Shell's objection to the Commission's proceeding is therefore well-founded, but only in so far as the Commission is not entitled to include a claim for relief under s 87(1A) in the originating application which seeks relief under s 80. It is not well-founded, in so far as Shell asserted that the Commission could only claim relief under s 87(1A) by an originating application separate from that in which relief under s 80 is claimed.
It is difficult, in the circumstances of this case, to see that Shell might suffer any inconvenience in conducting the litigation as a result of the Commission having included its claim for an order under s 87(1A) in the originating proceeding when it should have waited until it obtained a finding of contravening conduct on the part of Shell, whereupon it would have become entitled to file a motion in that proceeding for such an order: a reading of the Commission's statement of claim shows that exactly the same set of factual circumstances is the foundation for both its claim for injunctive relief under s 80 raised by amendment and its claim for compensatory orders under s 87(1A), which alone was initially sought. The Commission is entitled, I think, as part of its claim for relief under s 80, to allege and prove that the third parties in question have suffered loss and damage as a result of the conduct of Shell said to have contravened ss 51A and 52 the Trade Practices Act, even though proof of such loss and damage is not an essential element of the Commission's cause of action under s 80. That a person may have suffered substantial loss as a result of conduct contravening s 52 is, I think, a matter which could be relevant to whether the discretionary remedy of an injunction should be granted in respect of such conduct. The interlocutory relief Shell now seeks may therefore have little practical impact on the conduct of the litigation.
I will strike out paragraph 1 of the amended application, but the costs of Shell's notice of motion should be reserved to the trial judge, given my doubt as to whether this interlocutory skirmish will turn out to have served any useful purpose in the conduct of the action.
I certify that this and the preceding 20
pages are a true copy of the reasons
for judgment herein of the Honourable
Justice Drummond.
Associate:
Date: 13 February 1997
Counsel for the respondent
(applicant on the motion): Mr P A Keane QC and Mr L F Kelly
Solicitor for the respondent: Minter Ellison
Counsel for the applicant: Mr S White
Solicitor for the applicant: Australian Government Solicitor
Date of hearing: 7 February 1997
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URL: http://www.austlii.edu.au/au/cases/cth/FCA/1997/73.html