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Federal Court of Australia |
Last Updated: 8 March 2001
D & D Technologies Pty Ltd v Easy-Fit Fencing Components Pty Ltd
TRADE PRACTICES - misleading and deceptive conduct - where applicant and respondent manufacture and sell swimming pool safety latches - whether respondent represented latch conforms to pool safety standards in Australia - whether respondent represented latch is suitable for use as a swimming pool latch - whether representations false or misleading
TRADE PRACTICES - misleading and deceptive conduct - where applicant issued press release - whether applicant represented latch complied with pool safety standards - whether applicant instituted proceedings in the interests of public safety not for own commercial interests - whether representations false or misleading
INTERPRETATION - construction of instruments - where pool safety standards not statutes - where no legislation operating in relation to standards - where standards related - whether standard construed in light of objects of related standard
Trade Practices Act 1974 (Cth) ss 52, 53(a)
Trade Practices Commission v BMW Australia Ltd (1985) ATPR 40-620 referred to
D & D TECHNOLOGIES PTY LTD v EASY-FIT FENCING COMPONENTS PTY LTD
N 1219 OF 2000
EMMETT J
7 MARCH 2001
SYDNEY
IN THE FEDERAL COURT OF AUSTRALIA |
|
NEW SOUTH WALES DISTRICT REGISTRY |
1. NOTES the undertaking given by the respondent to the Court without admission, to affix to all units of the Easy-Fit Child Resistant Gate Latch manufactured by the respondent after 1 April 2001 a label bearing the following words:
WHILE GATE IS OPEN"
2. ORDERS THAT the application be dismissed.
3. ORDERS THAT the cross-claim be dismissed.
4. ORDERS THAT the applicant pay the respondent's costs of the application and the respondent pay the applicant's costs of the cross claim.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA |
|
NEW SOUTH WALES DISTRICT REGISTRY |
BETWEEN: |
D & D TECHNOLOGIES PTY LIMITED ACN 059 412 430 APPLICANT |
AND: |
EASY-FIT FENCING COMPONENTS PTY LIMITED ACN 062 321 751 RESPONDENT |
JUDGE: |
EMMETT J |
DATE: |
7 MARCH 2001 |
PLACE: |
SYDNEY |
1 The applicant, D & D Technologies Pty Limited ("D & D"), and the respondent, Easy-Fit Fencing Components Pty Limited ("Easy-Fit"), are competitors in the business of manufacturing and selling, amongst other things, swimming pool safety latches. Specifically, Easy-Fit is the manufacturer and distributor of a product which is described as the Easy-Fit "Ultimate" Child Resistant Gate Latch ("the Latch").
2 D & D contends that, in connection with marketing the Latch, Easy-Fit has engaged in conduct that is misleading or deceptive in contravention of ss 52 and 53(a) of the Trade Practices Act 1974 ("the Act"). D & D alleges that Easy Fit has represented that the Latch:
(a) conforms to pool safety standards in Australia;
(b) complies with Australian Standard AS 2820-1993 ("AS 2820");
(c) is suitable for use as a swimming pool latch;
(d) is covered by valid and enforceable public liability insurance;
and that those representations are false. In the proceeding, D & D claims relief by way of declaration, injunction and orders for corrective advertising. D & D makes no claim for damages.
3 It is common ground that the reference to "pool safety standards in Australia" should be taken to be a reference to AS 2820 and Australian Standard AS 1926.1-1993 ("AS 1926"). D & D also asserts that the Latch does not comply with Australian Standard AS 1926. However, it is common ground that if the Latch satisfies AS 2820, it satisfies AS 1926. If it does not satisfy AS 2820, D & D has established its case in any event.
4 Easy-Fit has filed a cross-claim. By the cross-claim, Easy-Fit alleges that:
(a) D & D represented in trade or commerce that:
* the Latch did not comply with AS 2820 or AS 1926;
* it constituted a public safety hazard;
* D & D had instituted proceedings in the interest of public safety and not solely or principally in its own commercial interests;
(b) those representations were false;
(c) accordingly, D & D had engaged in conduct that was misleading or deceptive or likely to mislead or deceive in contravention of s 52 of the Act; and
(d) as a result of such contravention, Easy-Fit has suffered or is likely to suffer loss and damage, being loss of sales and resultant loss of profits and damage to commercial reputation.
5 Easy-Fit claims damages and also seeks orders restraining D & D from making public statements to the effect that the Latch does not comply with relevant Australian standards. By consent, I made an order that any question of the quantum of any loss or damage suffered by Easy-Fit be determined separately from and after the determination of all other questions in the proceeding.
THE STANDARDS
6 AS 2820 is entitled "GATE UNITS FOR PRIVATE SWIMMING POOLS" and its preface says, inter alia, as follows:
"This standard is intended for use by manufacturers who are seeking certification that their products comply with this Standard. It relates to the assessment of gate units in factories or test houses."
7 Section 1 of AS 2820 relevantly provides as follows:
1.1 SCOPE This Standard sets out requirements for the design, construction and performance of gate units intended to be installed as part of a fence which complies with the requirements of AS 1926.1, which will restrict the access of young children to private swimming pools. (emphasis added)...........................
1.4 DEFINITIONS For the purpose of this Standard, the definitions below apply:
1.4.1 Fence - the assembly of components, natural or otherwise, which forms the intended barrier to the pool, exclusive of gates or doorsets. The fence includes posts and panels, constructed or natural walls, sides of buildings, child-resistant windows, balustrades on a balcony where they form part of the intended barrier.
1.4.2. Fencing - the fence and associated gate or gates, or doorsets.
1.4.3. Gate - any portion of the fencing other than a child-resistant doorset that is designed to provide an access way through the intended barrier.
1.4.4. Gate unit - an assembly comprising a gate, a hinge post, a latching post, a latching device, hinges and an automatic closing device.
...........................
1.4.5 Young child - a child under the age of 5 years.
1.5 INSTRUCTIONS Gate units shall be supplied with a set of written instructions as follows:
(a) Installation instructions which include all necessary information including foundation requirements to allow erection of the gate unit as part of a fence complying with AS 1926.1.
(b) Parts list and exploded diagram showing all of the components supplied.
(c) Maintenance instructions including any special requirements for maintaining the latching mechanism and hinges.
(d) A statement explaining the need to keep the automatic closing device properly adjusted.
(e) A statement that the gate must swing outwards, away from the pool area."
8 The substantive provisions of AS 2820 that are in issue are sections 2.8, 2.9 and 2.10. Those sections are in the following terms:
"2.8 HANGING OF GATES2.8.1 Security of closure Gates shall be hung so that when a gate is closed and latched and is lifted upwards or pulled downwards, movement of the gate does not-
(a) release the latching device;
(b) unhinge the gate; or
(c) increase the gap between the bottom of the gate and the finished ground level beyond 100 mm.
2.8.2. Direction of opening Gates shall be hung so that they only swing outwards, i.e. away from the pool area.
2.9 SELF-CLOSING DEVICE All gates shall be fitted with a device that will return the gate to the closed position and operate the latching device from any position with a stationary start without the application of a manual force.
The self-closing device shall be capable of complying with these requirements with the gate at any position from resting on the latching mechanism to fully open.
NOTES:
1 The self-closing device may require a cushioned back-checking operation to prevent shock when the gate is closing.
2 Self-closing devices subject to wind loading (which may prevent their closing), may require special consideration.
2.10 LATCHING DEVICE
2.10.1 General Gates shall be fitted with a latching device that will automatically operate on the closing of the gate and will prevent the gate from being re-opened without manually releasing the device.
The latching device shall not be able to be inadvertently adjusted during operation, and shall not be able to be adjusted without the use of tools.
The latching mechanism itself shall not be able to be operated when in the closed position by the insertion of any implement between the 10 mm gap, shown in Figure 2.3(a) particularly from below the mechanism.
2.10.2 Location of the latching device (see Figure 2.3) Where the release to the latching device or the latch itself is located at a height less than 1.5 m above the finished ground level or less than 1.4 m above the highest lower horizontal member and is capable of being released at the latching mechanism, the location of the release of the latching device shall-
(a) not be on the outside of the fencing;
..........................."
9 There are several references in AS 2820 to AS 1926. Under the heading "REFERENCED DOCUMENTS" AS 1926 is referred to expressly as a document "referred to in this standard". As I have indicated, the scope of AS 2820 is to set out requirements for gate units intended to be installed as part of a fence that complies with AS 1926. Gate units must be accompanied by written instructions, which include foundation requirements to allow erection of the gate as part of a fence complying with AS 1926.
10 Further, AS 1926 also refers to AS 2820. Thus, the preface to AS 1926 contains, inter alia, the following:
"This Standard is part of a series dealing with fencing, location of fencing and water recirculation and filtration systems............................
This Standard establishes safety requirements for design, construction and performance of fencing, windows and doorsets for swimming pools of the types normally installed for private use; however it is also applicable for public use if consideration is taken of the differing dynamics of public swimming pools to private swimming pools.
Statistical evidence shows that the majority of drownings in private swimming pools involve children under five years of age. For that reason, the requirements established by the Standard are directed at obtaining a barrier that will make it difficult for a young child to gain access to a pool area, whether under, over or through the fencing.
It should be noted that the provisions of this Standard relate to fencing that is intended to be child resistant but not childproof, as effectiveness of the fencing is very much dependent on its location and installation. (emphasis added)
...........................
Requirements for the effective use of fencing in protecting children from pool hazards are given in AS 1926.2. A Standard for gate units for private swimming pools is set out in AS 2820, which is intended for use by manufacturers who are seeking certification that their products comply with the Standard."
11 The scope of AS 1926.1 is stated to be as follows:
"1.1 SCOPE This Standard specifies requirements for the design, construction and performance of fences, gates, retaining walls, windows, doorsets and balconies intended to form part of a barrier that will restrict the access of young children to swimming pools.NOTES:
1. The Standard for gate units for private swimming pools (AS 2820) is intended for use by manufacturers of pool gates who are seeking certification that their products comply with the Standard. It is not intended for use by householders or regulatory authorities when assessing pool fencing installations. In such cases this Standard should be used."
12 AS 1926 also refers expressly to AS 2820 in section 3.4 in the following terms:
"3.4 CLOSING AND LATCHING OF GATES Each gate shall comply with at least one of the following requirements:(a) The gate unit shall comply with AS 2820.
(b) The gate shall close and latch from any position from resting on the latching mechanism to fully open, under both of the following conditions:
(i) Under the natural weight of the gate.
(ii) After a mass of 25 kg supported by the top rail is placed at a point 100 mm from the outer edge of the locking stile of the gate
NOTE: This requirement is intended to indicate whether the automatic closing and latching mechanism is likely to remain effective after the gate has been subject to deflection, either under its own weight or as a result of children swinging on it.
(c) The latching device and posts of the fencing to which the gate is attached shall be capable of retaining the gate in a closed position when tested in accordance with Item (b)."
13 Section 2.11.3 of AS 1926 is in exactly the same terms as section 2.10 of AS 2620 except that AS 2620 contains a statement that the latching device and parts of the fencing to which it is attached must be capable of retaining the gate in the closed position when tested in accordance with Appendix B to AS 2820. Appendix B is headed "STRENGTH TEST FOR RIGID COMPONENTS OF GATE UNITS".
14 In construing instruments such as the two standards, it is important to recognise that they are not statutes. They are not mandatory. In the present case, there is no legislation that has any operation in relation to the standards, as could be the case if s 65C of the Act applied. Section 65C provides that a corporation must not supply goods that are intended to be used by a consumer in respect of which there is a proscribed consumer product safety standard and which do not comply with that standard. In some instances, Australian Standards have been prescribed for the purposes of that provision.
15 Nevertheless, in so far as the construction of the two standards is in issue in the proceeding, the normal rules for the construction of instruments must be applied. The primary rule of construction is that the words that are used must be given their natural and ordinary meaning. In cases of ambiguity or uncertainty, recourse may be had to the usual external aids to interpretation. In particular, it is permissible to have regard to the mischief or problem to which a particular provision might be directed - see Trade Practices Commission v BMW Australia Ltd (1985) ATPR 40-620 at 47,004.
16 The references in each of AS 2820 and AS 1926 to the other indicates that the two must be construed as part of a single scheme dealing with swimming pool safety. According to its preface, AS 1926 itself is part of a series "dealing with fencing, location of fencing and water recirculation and filtration systems". I consider that AS 2820 must be read in the light of the provisions of AS 1926. In particular, it is appropriate to have regard to the provisions of AS 1926 in order to determine the mischief or problem to which AS 2820 is directed.
17 The preface to AS 2820 makes no reference to the object of specifying a standard that will deal in any particular way with young children. The preface simply states:
"This Standard is intended for use by manufacturers who are seeking certification that their products comply with this Standard. It relates to the assessment of gate units in factories or test houses."
That language may suggest absolute requirements rather than requirements related to the object of restricting access of young children to private swimming pools.
18 However, the provisions of AS 1926 demonstrate that its object is to prescribe requirements for a barrier that will make it difficult for a young child to gain access to a pool area. The requirements, however, are not intended to render fencing child proof, but only child resistant. That object is recognised in the scope of AS 2820, which refers to AS 1926 as specifying requirements that will restrict the access of young children. In both, "young child" is defined as a child under the age of 5 years.
19 The scope of AS 2820 indicates that it is to a considerable degree ancillary to AS 1926. That is to say, it sets out requirements for gate units intended to be installed as part of a fence that complies with AS 1926, being gate units that will restrict the access of young children to private swimming pools. I consider therefore, that both standards should be construed in the light of their object of specifying requirements intended to restrict the access of young children to private swimming pools, but not necessarily to make a pool child proof.
THE CONDUCT OF EASY-FIT
20 D & D's complaint is based primarily on a two sided single sheet distributed by Easy-Fit in connection with its business. The sheet appears to be instructions for the attachment and operation of the Latch. It is headed "Easy-Fit Child Resistant Gate Latch". It contains the following:
" SUITABLE FOR SWIMMING POOLSThe Easy Fit Magnetic Pool Gate latches are designed to assist in the prevention of swimming pool accidents.
Pool safety is the responsibility of the owner.
The Manufacturer cannot accept responsibility for an accident where the device is used.
Conforms to Pool Safety Standards provided all other fencing materials, manufacturing and installation methods also conform to the same standards."
21 The sheet contains a photograph of a child standing at a gate to which the Latch has been affixed, together with an exploded diagram showing the component parts of the Latch. At the bottom of the sheet the words "For ultimate child safety" appear.
22 On the reverse of the sheet the heading "Fixing Procedure" appears, followed by seven steps and the same diagram, showing the component parts of the Latch with numbering corresponding with those steps. At the bottom of the reverse is another diagram giving instructions as to the place of fixing of the Latch. There is also a box containing the following:
" WARNING
THIS LATCH IS CHILD RESISTANT ONLY - NOT CHILD PROOF
Ensure that you consult your Local Authority prior to fitting this latch in order to ascertain the correct positioning.
Maintain latch regularly, ensuring that the Pull Knob and other working parts are free from debris.
This latch will operate correctly only if installed and maintained in accordance with the Manufacturer's instructions."
23 D & D's claim is also based in part on a circular dated 28 August 2000 distributed by Easy-Fit ("the August Circular") containing, relevantly, the following:
"OVER THE LAST TWELVE MONTHS A COMPETITOR, AND SOME OF THEIR DISTRIBUTORS HAVE BEEN MISLEADING PEOPLE, IN RELATION TO THE PERFORMANCE OF OUR PRODUCTS. THIS LETTER IS TO PUT TO REST ANY MISCONCEPTIONS ARISING FROM MISLEADING ALLEGATIONS.ALLEGATION 1
THE EASY-FIT LATCHES AND HINGES DO NOT CONFORM TO THE AUSTRALIAN STANDARDS AS 2820 1993.
ANSWER 1
OUR HINGES AND LATCHES DO CONFORM TO AS 2820 1993, PROVIDED ALL OTHER FENCING MATERIALS AND INSTALLATION METHODS, ALSO CONFORM TO THE SAME AUSTRALIAN STANDARDS.
ALLEGATION 2
EASY-FIT FENCING COMPONENTS P/L DOES NOT HAVE ANY PUBLIC LIABILITY INSURANCE ON ANY PRODUCTS THEY MANUFACTURE.
ANSWER 2
EASY-FIT FENCING COMPONENTS P/L DOES HAVE PUBLIC LIABILITY INSURANCE RELATING TO THE OPERATIONS OF EASY-FIT FENCING COMPONENTS P/L.
SUM INSURED: $10 MILLION.
THIS POLICY IS CURRENT.
It is clear that representation (d) alleged by D & D does not arise out of the August Circular. For that reason the fourth representation was not pressed.
24 D & D asserts that the Latch fails to comply with the requirements of AS 2820 in several respects as follows:
(a) When a gate to which the Latch is attached is closed, it is possible to open the gate with the handle end of a teaspoon or a screwdriver or like implement, simply by inserting the implement under the plunger of the Latch and raising it. Accordingly, section 2.10.1 is not satisfied because the latching device must prevent the gate from being re-opened without manually releasing the device.
(b) With certain movements on a gate to which the Latch is attached, it is possible to open the gate without operating the Latch. Accordingly, the Latch does not comply with the requirement of section 2.10.1, because the latching device must prevent the gate from being re-opened without manually releasing the device. Further, it is impossible for any gate to which the Latch is attached to satisfy the requirements of section 2.8.1(a), because movement of the gate, even when it is closed and latched, is capable of releasing the latching device.
(c) The Latch is located at a height less than 1.5 metres above the finished ground level or less than 1.4 metres above the highest level horizontal member. As a result of items (a) and (b) above, the Latch is capable of being released at the latching mechanism. Accordingly, section 2.10.2(a) is not satisfied because the Latch is designed to be affixed on the outside of the fencing.
(d) The Latch contains a locking device operated by a key. The mechanism is in the nature of a dead lock. It is possible to lock the Latch while the gate to which the Latch is affixed is in the open position. When the Latch is locked with the gate open, the mechanism of the lock will prevent the gate from closing and the Latch from operating. Accordingly, section 2.9 is not satisfied. Further, the possibility of the lock being operated with the gate open means that the latching device will not automatically operate on the closing of the gate and therefore will not satisfy the first limb of section 2.10.1.
I shall deal with each of the complaints separately.
MOVEMENT OF THE GATE
25 The evidence concerning the extent to which a gate fitted with the Latch could be reopened without manual release in accord with its design is unsatisfactory. D & D relied on the evidence of Dr Hugh Lithgow Stark and Easy-Fit relied on the evidence of Dr Andrei Lozzi. Both gave evidence by affidavit. Neither was cross-examined.
26 Dr Stark's first report of 2 January 2001 makes no mention of the possibility of a gate being capable of being opened by movement. However, D & D sought to rely on a further report that was rejected. A report of 21 February 2001 contained a statement that Dr Stark had repeated certain tests after having reinforced the test rig upon which he had carried out his original tests. His report of 21 February 2001 contained the following statement:
"With the now very stiff posts I have found... the gate could still be opened by movement of the gate rather than opening the latch as intended."
27 In his affidavit dated 16 February 2001, Dr Lozzi gave the following evidence:
" 25. In testing the rig, I attempted to release the latch using the following six (6) different movements of the gate:(i) lifting the gate upwards;
(ii) pushing the gate downwards;
(iii) lifting the gate upwards and then pushing it downwards in a single movement;
(iv) lifting the gate upwards and pulling it outwards;
(v) pushing the gate downwards and pulling it outwards; and
(vi) `jiggling' the gate (that is, lifting and pushing the gate vigorously and frequently).
The latch was not released at any stage in the tests described above.
26. Dr Stark was present during my attempts to release the latch and witnessed my inability to successfully release the latch by using the movements listed above. Dr Stark demonstrated to me how he moved the gate so that the latch would be released. I observed that Dr Stark (standing on what would be the pool side of the gate) had to use multiple movements in different directions involving considerable force and timing."
28 In the absence of cross-examination of either witness, I am unable to form any view as to the extent to which, and the mechanism by which, it is possible to release the Latch by movement of the gate. The only evidence indicates is that it can be done by standing on the pool side of the gate and by use of multiple movements in different directions involving considerable force and timing. I am not persuaded by that evidence that section 2.10.1 of AS 2820 would not be satisfied by a gate fitted with the Latch.
29 The evidence of Dr Lozzi, to which I have referred above, indicates six different movements of the gate, including lifting upwards and pushing downwards, that did not result in release of the Latch. Dr Stark's evidence does not indicate what movement he found was adequate to release the Latch. Dr Lozzi's evidence indicates that, in order to release the Latch, Dr Stark used multiple movements in different directions involving considerable force and timing, from the pool side of the gate. I am not satisfied by the evidence that the Latch can be released by an upward lifting movement or downward pulling movement of the gate as described in section 2.8 of AS 2820. Accordingly, I am not satisfied that a gate to which the Latch is attached could not be hung in a way that would satisfy section 2.8.1 of AS 2820.
USE OF AN IMPLEMENT
30 In paragraph 4 of his report of 2 January 2001 Dr Stark said as follows:
"The latched gate could be readily opened from either inside or outside the gate with the handle end of a teaspoon (or a screwdriver or like implement) with or without it key locked, simply by inserting the teaspoon under the plunger of the latch and raising it... The plunger of the latch is at a height of approximately 1 m from the ground when the release knob is at the required 1.5 m from the ground."
31 Dr Lozzi gave the following evidence in his affidavit:
"I endeavoured to perform the test described by Dr Stark in paragraph 4... of his 2 January 2001 report. I attempted, on several occasions to insert a teaspoon under the latching mechanism. I was unable to obtain the release of the latch as described by Dr Stark's 2 January 2001 report... Dr Stark was present during my testing of the latch. As I was unable to obtain the release of the latch, Dr Stark performed the test on the latching mechanism using the same teaspoon, which test I observed. I observed that it was necessary to insert the teaspoon at a precise angle, such that the end of the teaspoon slid under the locking pin. It was then necessary to apply careful leverage to the teaspoon to raise the locking pin. This required a degree of dexterity and control."
32 In his report of 21 February 2001, Dr Stark reported that in a repeat test after reinforcing the posts of his test rig "the latch could still be opened with a teaspoon". In that report Dr Stark made the following response to Dr Lozzi's comments:
"Dr Lozzi asserts that opening with a teaspoon requires "a precise angle" "careful leverage" that is difficult to do. This is not so, it is easy to do without particular care or precision."
33 A photograph was said to illustrate how an implement could be used in the way asserted by Dr Stark. However, the mechanism for operating the Latch with such an implement is not apparent to me either from the photograph or from my examination of an exhibit comprising a sample of the Latch attached to a gate. In the absence of any cross-examination of either witness, I am unable to be satisfied as to the means whereby it is possible to operate the Latch by means of an implement such as has been described. I accept that it is possible but I am not persuaded that that possibility means that a gate fitted with the Latch does not satisfy the requirements of section 2.10.1 of AS 2820.
LOCATION OF THE LATCHING DEVICE
34 It is common ground that the Latch is designed to be installed on the outside of the fencing. However, the prohibition in paragraph 2.10.2(a) of AS 2820 applies only where a latching device "is capable of being released at the latching mechanism". It is common ground that the release of the latching device in the Latch is located at a height less than 1.5 metres above ground level, when attached in accordance with Easy-Fit's instructions. The question, however, is whether, by reason of the matters referred to above, namely, movement or use of an implement, the Latch is capable of being released at the latching mechanism, rather than by operation of the knob. The knob would be located at a height in excess of 1.5 m above the finished ground level.
35 Having regard to the conclusions that I have reached above concerning compliance with sections 2.9 and 2.10.1, I do not consider that, by reason of the possibility of opening the gate by movement or by use of an implement in the circumstances described above, the latching device of the Latch is capable of being released at the latching mechanism within the meaning of section 2.10.2.
LOCKING DEVICE
36 It is common ground that, when the locking device on the Latch is in the locked position and the gate is open, the latching device cannot be operated, even with the application of manual force. It follows that the latching device will not operate automatically on the closing of the gate when the lock is in the locked position. However, it is only if the key is turned in the lock that the locking device is operated. There has been no suggestion that the lock can be operated otherwise than with the key. Further, it is not designed to be locked in the open position. It is only if a key is turned in the lock while open, that the Latch will not operate. There was no evidence that the key would turn accidentally in the course of the gate opening or shutting.
37 AS 2820 does not deal with the possibility that a latching device might be fitted with a lock. Equally, AS 2820 does not deal with the possibility that it would always be possible to introduce a barrier between gate and fence post that would prevent any latching device from operating. Such conduct would, of course, defeat the object of making a swimming pool child resistant. On the other hand, if fitted to the Latch, a lock becomes an integral part of the design.
38 Paragraph 1.5(d) of AS 2820 recognises the possibility that the automatic closing device required by s 2.9 could require adjustment from time to time to ensure that it operates properly. That is to say, the possibility that a gate unit, by use, even in accordance with its design, might need adjustment to ensure that the gate will return to the closed position automatically does not mean that the gate unit does not comply with AS 2820.
39 There is no requirement in either of AS 2820 or AS 1926 for a lock to be incorporated as part of a latching device. Nor is there anything in either of those standards to suggest that a locking device should not be included as an integral part of a latching device. When the Latch is operated in accordance with its design, and only locked when the gate unit is in the closed position, a gate fitted with the Latch would operate as sections 2.9 and 2.10.1 of AS 2820 specify.
40 In my opinion, sections 2.9 and 2.10.1 of AS 2820 would be satisfied if the latching device can be operated automatically when unlocked, notwithstanding that, when it is locked with the gate in the open position, it would not then operate automatically. I am not persuaded that that characteristic of the Latch has the consequence that a gate fitted with it would not, for that reason alone, fail to satisfy the requirements of section 2.9 or the requirements of section 2.10.1 of AS 2820.
SUITABILITY OF THE LATCH FOR SWIMMING POOLS
41 The instruction sheet contained, with some prominence, the statement "SUITABLE FOR SWIMMING POOLS". Clearly enough, the instruction sheet represents that the Latch is suitable for use in connection with domestic swimming pools. The August circular, however, contains no such statement concerning the suitability of the Latch.
42 D & D alleged that representation (c) was false and that by making the representation, Easy-Fit engaged in conduct that contravened s 52 and s 53(a) of the Act. However, no great emphasis was placed on representation (c) in the course of the hearing. Indeed, on the first day of hearing I had the following exchange with senior counsel for D & D:
"HIS HONOUR: Yes, what about representation (c), does that go beyond these? Do you say it's not suitable simply because it doesn't comply with the standard or do you say even if it does comply with the standard it's still not suitable for use as a swimming pool latch?MR WEST: If it complies with the standard in the respects that we submit, it doesn't then it would be very difficult to make out 5(c).
HIS HONOUR: If it doesn't comply with the standard you don't need (c), so we are not really concerned with that either. Really the only question is whether it complies with AS 2820.
MR WEST: Yes. As to that, that's what I propose to say."
Senior counsel conceded that if the Latch complies with AS 2820 and AS 1926 in respect of the matters referred to above, it would be very difficult to make out a case based on representation (c).
43 While the presence of the locking device does not mean that a gate fitted with the Latch would not, by reason of the locking device alone, not satisfy the requirements of AS 2820 and AS 1926, the question of whether the Latch is suitable for use as a swimming pool latch is a different issue. It may be that it would be preferable not to promote the Latch as being suitable for use as a swimming pool latch without drawing attention to the risk that arises from the presence of the locking device. That is to say, it may be desirable for the instruction sheet to contain a clear warning that, if the locking device is engaged while the gate is in the open position, the gate cannot be securely closed. In the absence of such a warning, the Latch might not be suitable for use as a swimming pool latch.
44 Accordingly, after indicating to the parties that I was troubled by the possibility of the locking device being engaged while a gate is in the open position, I invited the parties to make further submissions concerning representation (c). In the course of the further argument that ensued, senior counsel for Easy-Fit, without making any admission, proffered an undertaking to the Court by Easy-Fit to affix to all units of the Latch manufactured after 1 April 2001 a label bearing the following words:
"WARNING: DO NOT TURN KEY TO LOCKED POSITION WHILE GATE IS OPEN"
45 I am not persuaded that representation (c) is a contravention of the Act. Further, any disquiet that I had concerning the lock would be removed by the presence of such a warning.
CONTRAVENTION OF PART V BY EASY FIT
46 I am not persuaded that a gate unit to which the Latch is fitted would not satisfy the requirements of AS 2820. The ultimate question, of course, however, is whether the distribution of the instruction sheet and the August Circular to prospective customers of Easy Fit constitutes conduct that is misleading or deceptive or likely to mislead or deceive. I do not consider that it is misleading or deceptive for Easy-Fit to say that the latch conforms to pool safety standards, meaning AS 2820 and AS 1926, provided all other fencing materials, manufacturing and installations methods also conform to the same standards.
47 The instruction sheet contains the statement that pool safety is the responsibility of the owner. The warning on the reverse of the instruction sheets repeats the words of the preface to AS 1926, namely, that the Latch is "child resistant" but not necessarily "child proof". I consider that a gate unit fitted with the Latch would not fail to satisfy the requirements of AS 2820 by reason only of the matters complained of by D & D. Notwithstanding the possibility, in somewhat vague circumstances, that a gate might be opened by movement or by use of some implement, the evidence is not such as to persuade me that a gate fitted with the Latch would not satisfy sections 2.9 and 2.10 of AS 2820.
48 So far as the locking device is concerned, the position is more difficult. However, I consider that the criterion or benchmark for determining compliance with AS 2820 and AS 1926 and suitability for use in connection with swimming pools is the ordinary use of the Latch in accordance with its design. The Latch is designed to be locked only when a gate is in the closed position.
49 I consider that the presence of the locking device does not mean that a gate fitted with the Latch will not comply with sections 2.10.1 and 2.9. On the argument and evidence before me I am not persuaded that representation (c) is misleading or deceptive. Nevertheless, it would be desirable a statement to be included in any material relating to the Latch, warning against the danger of operating the locking device while the gate is in the open position. Accordingly, it is appropriate for the Court to receive the undertaking proffered by Easy-Fit.
CONTRAVENTION OF PART V BY D & D
50 On 22 November 2000, D & D issued a press release, which was forwarded to a number of distributors of the products of D & D. Three distributors appear to have been involved, namely the Aluminium Specialties Group, Smorgon ARC and the Downee Group. Twenty-two individuals were recipients of the press release in New South Wales, Victoria, Queensland, South Australia and Western Australia.
51 The press release is in the following form:
"Wednesday, November 22, 2000PRESS RELEASE
Court proceedings initiated against `Easy-Fit' Latch
D&D Technologies Pty Ltd has initiated proceedings in the Supreme Court of NSW to restrain Easy-Fit Fencing Components Pty Ltd (ACN 062 321 751) from making claims on the `Easy-Fit Latch' product or packaging that the product complies with the relevant Australian Standards.
This has been done in the interests of public safety based on a report by Unisearch testing laboratory stating that the `Easy-Fit' latch does not comply with Australian Standards AS 2820-1993 or AS 1926.1-1993.
Please advise all your resellers, agents, contractors and users of D&D Technologies Pty Ltd's products.
Sincerely,
Justin Francis"
52 The cross claim alleges that the press release makes the following representations:
(a) Unisearch testing laboratory had tested the Latch;
(b) Unisearch testing laboratory reported that the Latch did not comply with AS 2820 or AS 1926;
(c) the testing had been carried out by a person independent of the applicant;
(d) the Latch did not comply with AS 2820 or AS 1926 and constituted a public health hazard;
(e) the applicant had instituted proceedings in the interests of public safety and not solely or principally in its own commercial interests.
53 There was no evidence before me of any report by Unisearch testing laboratory ("Unisearch") prior to 22 November 2000. However, Dr Stark, who has a connection with Unisearch Limited, had been retained by D & D prior to 19 December 2000. I was not invited to draw any inference that no report had been received by D & D prior to the distribution of the press release. In the absence of any evidence as to the nature of any report that D & D had received prior to that date, I am unable to conclude that representations (a) or (b) contained in the press release are false or misleading. Representation (c) was not the subject of any submissions on behalf of Easy-Fit. In any event, there was no evidence that a representation in those terms was other than true.
54 Further, I do not consider that the press release contains a representation that the Latch does not comply with AS 2820 or AS 1926. It certainly contains a representation that the report by Unisearch stated that the Latch does not comply with AS 2820 or AS 1926 (representation (b) above). Easy-Fit made no attempt in the proceeding to establish positively that the Latch does comply with AS 2820 and AS 1926. The evidence related only to rebutting assertions made by D & D concerning specific areas of non-compliance.
55 Nor do I consider that the press release contains a representation that the Latch constitutes a public safety hazard. The words used by the press release are "[t]his has been done in the interests of public safety". In any event, Easy-Fit did not attempt to establish that the Latch was not a public safety hazard. I have already raised my concern that a dead locking device may not be suitable for swimming pools. I mention the matter to highlight that Easy-Fit did not attempt to establish a positive case to answer representation (d).
56 Whether D & D had instituted proceedings in the interests of public safety rather than in its own commercial interests is a different matter. However, that question was not tested. Mr David Thomas Doyle, a founding director and shareholder of D & D, gave evidence by way of affidavit. He was not cross-examined concerning the reasons for commencing the proceedings.
57 I am not persuaded, on the material before me, that the press release issued by D & D was misleading or deceptive or likely to mislead or deceive.
CONCLUSION
58 It follows from the conclusions that I have reached above, that D & D's application should be dismissed. However, I will note the undertaking proffered on behalf of Easy-Fit. It also follows that Easy-Fit's cross-claim should be dismissed. The appropriate order for costs would be for D & D to pay Easy-Fit's costs on the claim and for Easy-Fit to pay D & D's costs of the cross-claim.
I certify that the preceding fifty-eight (58) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett. |
Associate:
Dated: 7 March 2001
Counsel for the Applicant: |
J N West QC with M Green |
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Solicitor for the Applicant: |
Somerville & Co |
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Counsel for the Respondent: |
T E F Hughes QC with D R Sibtain |
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Solicitor for the Respondent: |
Blake Dawson Waldron |
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Date of Hearing: |
22 and 23 February and 7 March 2001 |
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Date of Judgment: |
7 March 2001 |
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URL: http://www.austlii.edu.au/au/cases/cth/FCA/2001/179.html