case_text: of a domain name may constitute conduct falling within s 52: e.g. CSR Ltd v Resource Capital Australia Pty Ltd [2003] FCA 279 , 128 FCR 408 ; Macquarie Bank Ltd v Seagle [2008] FCA 1417 , 79 IPR 72. Indeed, as in the present proceeding, in intellectual property cases it is not uncommon for a plaintiff to contend that the conduct of a respondent in using a domain name or a business name constitutes not only a contravention of ss 52 and 53 of the Trade Practices Act and the tort of passing off, but also a contravention of the Trade Marks Act : Bing! Software Pty Ltd v Bing Technologies Pty Ltd (No 1) [2008] FCA 1760 , 79 IPR 454; SAP Australia Pty Ltd v Sapient Australia Pty Ltd [1999] FCA 1821 , 169 ALR 1. In SAP Australia Pty Ltd [1999] FCA 1821 , 169 ALR 1 , French, Heerey and Lindgren JJ thus observed (citations omitted): [51] ... it was rightly observed that misleading or deceptive conduct in trade or commerce is not limited to conduct which induces or is likely to induce entry into a transaction. So to propose would be to limit s 52 of the TP Act in a way not justified by its terms. Conduct which misleads a customer so that, under some mistaken impression of a trader's connection or affiliation, he or she opens negotiations or invites approaches may be misleading or deceptive even if the true position emerges before the transaction is concluded ... In reaching these conclusions, one of the decisions relied upon by their Honours was the earlier decision of Beaumont J in TEC & Tomas (Australia) Pty Ltd v Matsumiya Computer Company Pty Ltd (1984) 1 FCR 28 at 37 to 38. His Honour there recognised as follows that misleading conduct at the outset may be a " door opener ": The fact that "Seiko" is a household name, at least in respect of watches, confirmed by the experience of the respondents that the name "Seiko" has been a "door opener" in marketing terms, indicates that a potential purchaser of computers may well commence to deal with the respondents in circumstances where he would not have done so if the respondents had made no mention of "Seiko" in its trade or business name and in advertising. In my view, to induce the introduction of such a dealing is conduct which contravenes s 52, even if, ultimately, the consumer becomes aware that the equipment he is purchasing is not that of the Hattori Seiko group, the deception having occurred at an earlier stage: what is relevantly induced is the dealing or the negotiations, as distinct from the subsequent purchase itself. As Taco's case held, there is no reason why s 52 cannot apply to the earlier inducement, even if, as Puxu's case held, the conduct in respect of the purchase itself does not offend s 52 because, by then, the consumer knows or ought to have known that he is purchasing a product other than that of the Hattori Seiko group.


case_outcome: cited

case_text: need not be any deliberate fraud or any intention on the part of a defendant to deceive: ConAgra (1992) 33 FCR at 344 per Lockhart J; Select Personnel Pty Ltd v Morgan & Banks Pty Ltd (1998) 12 IPR 167 at 170 to 171 per McLelland J. There is no requirement that a respondent has been fraudulent, malicious or negligent: R & C Products (1993) 42 FCR at 192 per Davies J. But the presence or lack of any conscious intent can be relevant as a matter of evidence in establishing whether there has been any unlawful passing off: Pacific Publications [2005] FCA 625 at [88] , [2005] FCA 625 ; 222 ALR 127 at 148 per Tamberlin J.


case_text: the absence of any statutory definition of the phrase " substantially identical ", the meaning of that phrase is to be determined by its ordinary or usual meaning, namely that which is " in substance " the same or " essentially " the same: Registrar of Trade Marks v Woolworths Ltd [1999] FCA 1020 at [70] [1999] FCAFC 1020 ; , 93 FCR 365 at 387 per Branson J. Whether marks are " substantially identical " requires a side by side comparison and depends on the Court's own judgment: Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 414. Windeyer J there observed (some citations omitted): In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison. "The identification of an essential feature depends", it has been said, "partly on the Court's own judgment and partly on the burden of the evidence that is placed before it": de Cordova v Vick Chemical Co [(1951) 68 R.P.C. 103 , at p. 106]. Whether there is substantial identity is a question of fact ... In order to determine whether marks are " substantially identical ", they should thus be compared side by side with their similarities and differences noted: Coca-Cola Co [1999] FCA 1721 at [38], 96 FCR at 121 per Black CJ, Sundberg and Finkelstein JJ. See also: E & J Gallo Winery [2008] FCA 934 at [41] to [43], 77 IPR at 78.


case_outcome: applied

case_text: assessing whether the marks are deceptively similar, it is relevant to consider the context in which customers are likely to form their impressions of the marks: Australian Woollen Mills Ltd v FS Walton & Co Ltd [1937] HCA 51 ; (1937) 58 CLR 641 at 658 per Dixon and McTiernan JJ; Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 595 per Kitto J; Anheuser-Busch Inc [2002] FCA 390 at [153] , [2002] FCA 390 ; 56 IPR 182 at 218 per Allsop J.


case_text: off is a remedy for the invasion of a right of property in the business or goodwill likely to be injured by misrepresentations made by the passing off of one person's goods as those of another: Star Industrial Company Ltd v Yap Kwee Kor [1976] FSR 256 at 269; Pacific Publications Pty Ltd v Next Publishing Pty Ltd [2005] FCA 625 at [25] , [2005] FCA 625 ; 222 ALR 127 at 135 per Tamberlin J. It is not a remedy for the invasion of a right of property in a mark, name or get-up which has been improperly used. Nor is it, unlike s 52 of the Trade Practices Act , designed to protect consumers.


case_text: 51A(1), it will be noted, provides ( inter alia ) that there is to be included in the sum for which judgment is given an order for interest " unless good cause is shown to the contrary ". The provision, introduced by way of amendment in 1984, " is a facultative provision intended to confer power on the Court to do justice between parties in relation to pre-judgment interest; a matter of some importance in these days of high interest rates and extensive delays in finalising litigation ": State Bank of NSW Ltd v Commissioner of Taxation [1995] FCA 1652 ; (1995) 62 FCR 371 at 385 per Wilcox J. The primary purpose of an award of pre-judgment interest is to compensate a successful applicant for the loss or detriment which has been suffered by reason of being kept out of money: Whitaker v Commissioner of Taxation (1998) 82 FCR 261 at 269 per Lockhart J.


case_text: Full Court of this Court revisited the decision in Yorke [1985] HCA 65 ; (1985) 158 CLR 661 and reviewed the previous decision of this Court as to the extent of the knowledge required to make a person " knowingly concerned " in a contravention: Medical Benefits Fund of Australia Ltd v Cassidy [2003] FCAFC 289 , 135 FCR 1. There in issue was s 12GD(1)(e) of the then Australian Securities and Investments Commission Act 1989 (Cth), a provision comparable to s 75B(1)(c) of the Trade Practices Act . The Court there heard two appeals, one in which the Medical Benefits Fund was the appellant; the other in which an advertising agency, Bevins, was the appellant. The primary judge accepted that Bevins did not subjectively appreciate that the advertisements involved were false, misleading or deceptive but found Bevins liable pursuant to s 12GD(1). This conclusion was reversed on appeal. Moore J reviewed the authorities on the analogous provision here in issue, s 75B , and concluded: [14] ... It follows, on his Honour's findings, that Bevins (through its officers and employees) was not aware of the second of the matters, as I earlier described them, constituting the contravening conduct of MBF. That is, while Bevins was aware of what the advertisements contained (necessarily so given that it created them) it was not aware that the advertisements might lead members of the public to believe that certain benefits would be enjoyed or rights conferred by taking out insurance with MBF. Accordingly, in my opinion, his Honour erred in concluding that Bevins was liable as an accessory under s 12GD(1). [15] I should add that, in my opinion, liability as an accessory (in circumstances where the contravening conduct of the principal was making false or misleading representations) does not depend on an affirmative answer to the question whether the alleged accessory knew the representations were false or misleading. All that would be necessary would be for the accessory to know of the matters that enabled the representations to be characterised in that way. ... Mansfield J agreed with Moore J. In a separate judgment, Stone J similarly concluded: [80] It is well established that neither knowledge nor intention is necessary for there to be a contravention of s 52 of the TPA or of s 12GA of the ASIC Act. It is sufficient (and necessary) that the conduct in question can be accurately described as "misleading or deceptive" or "likely to mislead or deceive". This misleading or deceptive character is a question of fact that must be decided in the context of all the surrounding circumstances; Taco Co of Australia Inc v Taco Bell Pty Ltd [1982] FCA 136 ; (1982) 42 ALR 177 at 202. That "fact" is an essential element of the contravention. It follows that to be liable as an accessory one must have knowledge of the misleading and deceptive character of the relevant conduct. ... [82] This is not to say that to be liable as an accessory to a strict liability breach of s 52 it is necessary to know that the conduct of the principal is unlawful, or indeed to have any knowledge of the provisions of the TPA or the ASIC Act. But it is necessary to know the essential elements of the contravention, by which I understand that one must know that which makes the conduct a contravention; in this case, its misleading and deceptive character. Only then can one form the intention to participate in conduct of that character. Liability of Directors and Joint Tortfeasors In this respect, it may be that there is a further distinction between passing off and s 52. For the purposes of passing off, it may be that deception must continue to the " point of sale ". Whether or not there is such a requirement in respect to the tort, s 52 does not impose any such constraint: Taco Co of Australia Inc v Taco Bell Pty Ltd [1982] FCA 136 ; (1982) 42 ALR 177. Deane and Fitzgerald JJ there observed: It is, in the circumstances, unnecessary that we form or express any concluded view on the question whether it is a principle of the law of passing-off that deception must continue, or be likely to continue, to the "point of sale". As a matter of principle and of logic, it is difficult to see why it should be. For the purposes of the present appeal, it suffices to say that, even if such a limitation should be recognized in the law of passing-off, we see no ground for importing it into the provisions of s 52 of the Act. In our view, it is sufficient to enliven s 52 that the conduct, in the circumstances, answers the statutory description, that is to say, that it is misleading or deceptive or is likely to mislead or deceive. It is unnecessary to go further and establish that any actual or potential consumer has taken or is likely to take any positive step in consequence of the misleading or deception. That is not to say that evidence of actual misleading or deception at the point of sale and of steps taken in consequence thereof is not likely to be both relevant and important on the question whether the relevant conduct in fact answers the statutory description and as to the relief, if any, which should be granted. In the circumstances of the present proceeding, it is considered that such disclaimers as were used are not sufficient to negate a conclusion that the conduct engaged in by the Bade Medical Institute which has been found to contravene s 52 remained " misleading or deceptive ". Even if, in limited instances, the " true position " may have emerged such that in a limited number of cases consumers may have realised that the Bade Medical Institute was " not associated with AMI Advanced Medical Institute ", its conduct remained misleading and deceptive and such as to occasion loss or damage to the Applicants. Although the evidence of Dr Beaini was that he was " insisting " upon a disclaimer being used, there is in any event considerable uncertainty as to when any disclaimer first appeared and how uniformly it was being used. Such further evidence as Dr Beaini did give in cross-examination only reinforced the conclusion that consumers were being misled. One exchange was as follows, when Dr Beaini was being asked questions as to his involvement in the preparation of a " business plan ": Did you prepare any business plan for Bade Medical Institute?---No. Never participated in the formulation of any business plan whatsoever?---No. You sure about that answer?---What do [sic] mean? Can you clarify what you mean by business plan? Well, did you prepare, or did you participate in the preparation of it, or were you consulted about ... MR AZZI: Objection, your Honour, that's irrelevant. HIS HONOUR: Will you wait until the question is put first? MR AZZI: Well, it says prepared, participated or consulted. MR GREEN: Well, any of those possibilities, Dr Beaini, in relation to the development and marketing of the Bade Medical Institute?---My involvement was basically getting the medical information out. There was an occasional issue where they would ask me my opinion. For example, they were getting some calls, people asking them if they were AMI and I said we should have it on our website that we're not. Because a lot of people wanted refunds and they were dissatisfied with AMI products. That was a joint agreement to have, "We are not AMI" on our website, so we wouldn't have to deal with that. My - and basically my role was to work with other products and expanding our product range, because we wanted to do something called Bade Online Pharmacy, which was going to sell different vitamins and insomnia products and lasers and Botox treatments and things like that. So they were the sort of business dealings that we had. But when any disclaimer was used and in what form of advertising remained unclear. It is concluded that the contraventions of ss 52 and 53 (d) of the Trade Practices Act have occasioned the Applicants " loss or damage ". The Applicants have suffered " loss or damage by conduct " that has contravened those provisions. In relation to passing off, the Applicants seek either damages or an account of profits. While it is a matter for an applicant to elect between these remedies, in the present proceeding it matters not which remedy is sought as the quantum to which the Applicants are entitled is the same.


case_text: SAP Australia Pty Ltd [1999] FCA 1821 , 169 ALR 1 , French, Heerey and Lindgren JJ thus observed (citations omitted): [51] ... it was rightly observed that misleading or deceptive conduct in trade or commerce is not limited to conduct which induces or is likely to induce entry into a transaction. So to propose would be to limit s 52 of the TP Act in a way not justified by its terms. Conduct which misleads a customer so that, under some mistaken impression of a trader's connection or affiliation, he or she opens negotiations or invites approaches may be misleading or deceptive even if the true position emerges before the transaction is concluded ... In reaching these conclusions, one of the decisions relied upon by their Honours was the earlier decision of Beaumont J in TEC & Tomas (Australia) Pty Ltd v Matsumiya Computer Company Pty Ltd (1984) 1 FCR 28 at 37 to 38. His Honour there recognised as follows that misleading conduct at the outset may be a " door opener ": The fact that "Seiko" is a household name, at least in respect of watches, confirmed by the experience of the respondents that the name "Seiko" has been a "door opener" in marketing terms, indicates that a potential purchaser of computers may well commence to deal with the respondents in circumstances where he would not have done so if the respondents had made no mention of "Seiko" in its trade or business name and in advertising. In my view, to induce the introduction of such a dealing is conduct which contravenes s 52, even if, ultimately, the consumer becomes aware that the equipment he is purchasing is not that of the Hattori Seiko group, the deception having occurred at an earlier stage: what is relevantly induced is the dealing or the negotiations, as distinct from the subsequent purchase itself. As Taco's case held, there is no reason why s 52 cannot apply to the earlier inducement, even if, as Puxu's case held, the conduct in respect of the purchase itself does not offend s 52 because, by then, the consumer knows or ought to have known that he is purchasing a product other than that of the Hattori Seiko group.


case_text: as joint tortfeasors arises where two or more persons act in concert in committing a tort: Thompson v Australian Capital Television Pty Limited [1996] HCA 38 ; (1996) 186 CLR 574. Brennan CJ, Dawson and Toohey JJ there observed at 580 to 581 (some citations omitted): The difference between joint tortfeasors and several tortfeasors is that the former are responsible for the same tort whereas the latter are responsible only for the same damage. As was said in The Koursk, ([1924] P 140 at 159-160), for there to be joint tortfeasors, "there must be a concurrence in the act or acts causing damage, not merely a coincidence of separate acts which by their conjoined effect cause damage". Principal and agent may be joint tortfeasors where the agent commits a tort on behalf of the principal, as master and servant may be where the servant commits a tort in the course of employment. Persons who breach a joint duty may also be joint tortfeasors. Otherwise, to constitute joint tortfeasors two or more persons must act in concert in committing the tort. Torts of all kinds may be joint ... Gummow J made like observations at 600. Applied: Louis Vuitton Malletier SA v Toea Pty Ltd [2006] FCA 1443 at [164] , [2006] FCA 1443 ; 156 FCR 158 at 196. See also: Baxter v Obacelo Pty Limited [2001] HCA 66 at [18] , [2001] HCA 66 ; 205 CLR 635 at 646 to 647 per Gleeson CJ and Callinan J. There must be a " joint purpose " in engaging in unlawful conduct if there is to be liability as joint tortfeasors: TS & B Retail Systems Pty Ltd v 3Fold Resources Pty Ltd (No 3) [2007] FCA 151 , 158 FCR 444. Finkelstein J there thus summarised the position as follows: Joint tortfeasors [177] The common law rule is that one tort may be committed by two or more persons: they are usually referred to as joint tortfeasors. Although the term is commonly used, the concept is not well defined. To be joint tortfeasors it is not sufficient that the independent wrongful acts of two persons have caused the same damage. Those persons are several tortfeasors. In Sir John Heydon's Case (1612) 7 ER 1150 at 1151 joint tortfeasors were described as "all coming to do an unlawful act, and of one party, the act of one is the act of all of the same party being present". The rule goes back to when an action in trespass was principally criminal ( Sir Charles Stanley's Case [1708] EngR 26 ; (1663) 84 ER 1094) but has been extended. There are three classes of joint tort: where a party is vicariously responsible for the acts of another — as in master and servant, principal and agent and partnership; when there is a breach of a joint duty, be it a statutory or common law duty; and concerted action. [178] As regards the third class (concerted action) to be joint tortfeasors the unlawful act must be for a "joint purpose" ( Clark v Newsam [1847] EngR 531 ; (1847) 154 ER 55) or "concerted action ... towards a common end" ( The Koursk [1924] P 140 at 152). In Thompson v Australian Capital Television Pty Ltd [1996] HCA 38 ; (1996) 186 CLR 574 the High Court accepted as a correct description of joint tortfeasors that given by Sargeant LJ in the The Koursk [1924] P at 159-160, namely that "there must be a concurrence in the act or acts causing damage not merely a coincidence of separate acts which by their conjoined effect cause damage". So, employing the language of criminal lawyers, all persons who aid or counsel direct or join in the commission of a tort are joint tortfeasors : Pratt v British Medical Association [1919] 1 KB 244 at 254 citing Petrie v Lamont [1841] EngR 66 ; (1841) 174 ER 424 at 426. Intent, of course, is not an ingredient of the tort for we are dealing with the civil law, not criminal conduct.


case_outcome: distinguished

case_text: Applicants' written Outline of Submissions states in part: 206. The language is clear and unambiguous and there were no reservations in relation to the orders sought or included in the consent orders. 207. The effect of those orders is that the respondents agreed to permanent injunctions, and thus foreclose any argument before the Court now that liability is denied. In support of their submission, the Applicants relied upon the following observations of Gibbs CJ, Stephen, Mason and Wilson JJ in Thomson Australian Holdings Pty Ltd v The Trade Practices Commission [1981] HCA 48 ; (1981) 148 CLR 150 at 164: In deciding whether consent orders sought are in conformity with legal principle the Court is entitled to treat the defendants' consent as involving an admission of all facts necessary or appropriate to the granting of the relief sought. The orders there in issue were orders giving effect to terms of settlement. They were final orders. The difficulty confronting the Applicants, however, is that notwithstanding that all Respondents consented to the orders made in December 2007 granting injunctive relief, those orders were made " until further order ". The order as then made was not a " permanent injunction " as contended by the Applicants. There may well be reasons why a respondent may not wish to oppose interlocutory relief at the outset of a proceeding but may seek to preserve an entitlement to defend the proceeding at a final hearing. Consent to the grant of interlocutory relief cannot be construed as an admission of all facts necessary to establish liability at a final hearing. To contend otherwise would be a submission without substance. It was for that reason that no reliance was ultimately placed by the Applicants upon the grant of the injunctive relief. This way in which the Applicants sought to advance their submission is thus rejected. The 2007 orders do not have the conclusive effect they assert. " Reservation " is expressed on the face of those orders in that the orders are not " permanent injunctions ". The interlocutory nature of the relief, it is thus considered, does not preclude any of the Respondents from now denying liability.


case_text: tort includes "... circumstances involving the deceptive or confusing use of names, descriptive terms or other indicia to persuade purchasers or customers to believe that goods or services have an association, quality or endorsement which belongs or would belong to goods or services of, or associated with, another or others ... ": Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2) [1984] HCA 73 ; (1984) 156 CLR 414 at 445 per Deane J. The tort is not confined to cases where loss consists in the diversion of trade: Turner v General Motors (Australia) Pty Ltd [1929] HCA 22 ; (1929) 42 CLR 352 at 368 per Dixon J. The tort extends to those cases where a plaintiff and defendant are not engaged in a " common field of activity " and where a defendant is not in direct competition with a plaintiff: Totalizator Agency Board v Turf News Pty Ltd [1967] VR 605 at 608 to 609 per Smith J; 10 th Cantanae (1987) 79 ALR at 324 per Gummow J.


case_text: must be a " joint purpose " in engaging in unlawful conduct if there is to be liability as joint tortfeasors: TS & B Retail Systems Pty Ltd v 3Fold Resources Pty Ltd (No 3) [2007] FCA 151 , 158 FCR 444. Finkelstein J there thus summarised the position as follows: Joint tortfeasors [177] The common law rule is that one tort may be committed by two or more persons: they are usually referred to as joint tortfeasors. Although the term is commonly used, the concept is not well defined. To be joint tortfeasors it is not sufficient that the independent wrongful acts of two persons have caused the same damage. Those persons are several tortfeasors. In Sir John Heydon's Case (1612) 7 ER 1150 at 1151 joint tortfeasors were described as "all coming to do an unlawful act, and of one party, the act of one is the act of all of the same party being present". The rule goes back to when an action in trespass was principally criminal ( Sir Charles Stanley's Case [1708] EngR 26 ; (1663) 84 ER 1094) but has been extended. There are three classes of joint tort: where a party is vicariously responsible for the acts of another — as in master and servant, principal and agent and partnership; when there is a breach of a joint duty, be it a statutory or common law duty; and concerted action. [178] As regards the third class (concerted action) to be joint tortfeasors the unlawful act must be for a "joint purpose" ( Clark v Newsam [1847] EngR 531 ; (1847) 154 ER 55) or "concerted action ... towards a common end" ( The Koursk [1924] P 140 at 152). In Thompson v Australian Capital Television Pty Ltd [1996] HCA 38 ; (1996) 186 CLR 574 the High Court accepted as a correct description of joint tortfeasors that given by Sargeant LJ in the The Koursk [1924] P at 159-160, namely that "there must be a concurrence in the act or acts causing damage not merely a coincidence of separate acts which by their conjoined effect cause damage". So, employing the language of criminal lawyers, all persons who aid or counsel direct or join in the commission of a tort are joint tortfeasors : Pratt v British Medical Association [1919] 1 KB 244 at 254 citing Petrie v Lamont [1841] EngR 66 ; (1841) 174 ER 424 at 426. Intent, of course, is not an ingredient of the tort for we are dealing with the civil law, not criminal conduct.


case_title: Turner v General Motors (Australia) Pty Ltd [1929] HCA 22 ; (1929) 42 CLR 352


case_title: Ward Group Pty Ltd v Brodie & Stone plc [2005] FCA 471 , 143 FCR 479

case_text: precise definition of the elements of the tort of passing off remains elusive: ConAgra Inc v McCain Foods (Aust) Pty Ltd [1992] FCA 159 ; (1992) 33 FCR 302 at 355 per Gummow J; Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd [1993] FCA 259 ; (1993) 26 IPR 261 at 268 per Gummow, French and Hill JJ. For present purposes, however, it may be accepted that the elements of the modern law of passing off were summarised in Erven Warnink BV v J Townend & Sons (Hull) Ltd [1979] AC 731 at 742 by Diplock LJ as follows: My Lords, A. G. Spalding & Bros. v. A. W. Gamage Ltd., 84 L.J.Ch. 449 and the later cases make it possible to identify five characteristics which must be present in order to create a valid cause of action for passing off: (1) a misrepresentation (2) made by a trader in the course of trade, (3) to prospective customers of his or ultimate consumers of goods or services supplied by him, (4) which is calculated to injure the business or goodwill of another trader (in the sense that this is a reasonably foreseeable consequence) and (5) which causes actual damage to a business or goodwill of the trader by whom the action is brought or (in a quia timet action) will probably do so. His Lordship continued: In seeking to formulate general propositions of English law, however, one must be particularly careful to beware of the logical fallacy of the undistributed middle. It does not follow that because all passing off actions can be shown to present these characteristics, all factual situations which present these characteristics give rise to a cause of action for passing off. True it is that their presence indicates what a moral code would censure as dishonest trading, based as it is upon deception of customers and consumers of a trader's wares but in an economic system which has relied on competition to keep down prices and to improve products there may be practical reasons why it should have been the policy of the common law not to run the risk of hampering competition by providing civil remedies to every one competing in the market who has suffered damage to his business or goodwill in consequence of inaccurate statements of whatever kind that may be made by rival traders about their own wares. The market in which the action for passing off originated was no place for the mealy mouthed; advertisements are not on affidavit; exaggerated claims by a trader about the quality of his wares, assertions that they are better than those of his rivals even though he knows this to be untrue, have been permitted by the common law as venial "puffing" which gives no cause of action to a competitor even though he can show that he has suffered actual damage in his business as a result. Lord Fraser of Tullybelton expressed perhaps a narrower statement of the cause of action: [1979] AC at 755 to 756. Lord Diplock's statement as to the five " characteristics " of the cause of action for passing off has been adopted in Australia: Moorgate Tobacco (1984) 156 CLR at 443 to 444 per Deane J; ConAgra (1972) 33 FCR at 308 to 309 per Lockhart J; Osgaig [2004] FCA 1394 at [83] to [85], 213 ALR at 167 to 168 per Weinberg J; Ward Group Pty Ltd v Brodie & Stone plc [2005] FCA 471 at [29] to [30] [2005] FCA 471 ; , 143 FCR 479 at 487 per Merkel J. The " declarations of principle " of Diplock and Fraser LLJ were also accepted by the Privy Council on appeal from the Supreme Court of New South Wales in Cadbury Schweppes Pty Ltd v Pub Squash Co Pty Ltd [1980] 2 NSWLR 851 at 856 as being of " general application ".


case_text: entitlement to loss or damages springs from s 82(1) of the Trade Practices Act , which provides as follows: ... a person who suffers loss or damage by conduct of another person that was done in contravention of a provision of Part ... V ... may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention. In order to obtain relief under s 82 , a person must have suffered loss or damage " by " conduct in contravention of (relevantly) Part V: Wardley Australia Ltd v The State of Western Australia [1992] HCA 55 ; (1992) 175 CLR 514. Mason CJ, Dawson, Gaudron and McHugh JJ there observed at 525: By virtue of s. 82(2) of the Act, the period of limitation begins to run at the time when the cause of action under s. 82(1) accrues. As loss or damage is the gist of the statutory cause of action for which s. 82(1) provides [ Elna Australia Pty. Ltd. v. International Computers (Australia) Pty. Ltd. [No. 2] [1987] FCA 230 ; (1987), 16 F.C.R. 410 , at p. 418], the cause of action does not accrue until actual loss or damage is sustained. The statutory cause of action arises when the plaintiff suffers loss or damage "by" contravening conduct of another person. "By" is a curious word to use. One might have expected "by means of", "by reason of", "in consequence of" or "as a result of". But the word clearly expresses the notion of causation without defining or elucidating it. In this situation, s. 82(1) should be understood as taking up the common law practical or common-sense concept of causation recently discussed by this Court in March v. Stramare (E. & M. H.) Pty. Ltd. [(1991) [1991] HCA 12 ; 171 CLR 506] , except in so far as that concept is modified or supplemented expressly or impliedly by the provisions of the Act. Had Parliament intended to say something else, it would have been natural and easy to have said so.


case_text: test to be applied before a director or other officer of a corporation is exposed to liability by reason of his involvement in the conduct of a corporation remains uncertain. The starting point, however, is the following observations of Gummow J in WEA International Inc v Hanimex Corporation Ltd (1987) 17 FCR 274 at 283 (citations omitted): Where the infringer is a corporation questions frequently arise as to the degree of involvement on the part of directors necessary for them to be rendered personally liable. Those questions are not immediately answered by principles dealing with "authorisation" or joint tortfeasance. Rather, recourse is to be had to the body of authority which explains the circumstances in which an officer of a corporation is personally liable for the torts of the corporation ...


case_title: Whitaker v Commissioner of Taxation (1998) 82 FCR 261


case_text: the purposes of a passing off action, it should also be noted at the outset that the comparison involved is different to the comparison undertaken for the purposes of resolving whether the use of a mark is " deceptively similar " for the purposes of s 120 of the Trade Marks Act : Wingate Marketing Pty Ltd v Levi Strauss & Co (1994) 49 FCR 89. Gummow J there observed at 128: Where the comparison of the marks is necessary to determine whether that of the defendant is deceptively similar to the registered mark of the plaintiff, who sues for infringement, the primary comparison must be between the registered mark on the one hand and the mark as used by the defendant on the other. The comparison differs from that in a passing off action where the plaintiff points to the goodwill built up around the mark by reason of prior use and then points to the conduct of the defendant as leading to deception (or perhaps merely confusion) and consequent damage to that goodwill of the plaintiff. No relief is sought as against the First or Second Respondents. Liability is, however, sought to be established as against the Third, Fourth and Fifth Respondents. That liability is said by the Applicants to arise by reason of either: s 75B of the Trade Practices Act , in the event that there is a contravention of ss 52 or 53 of that Act; or the liability ascribed to directors and others for corporate wrongdoing, in the case of an infringement of the trade mark or passing off. The liability of the Third, Fourth and Fifth Respondents arose on the Applicants' case in respect to conduct occurring as between May 2006 and January 2008.


case_outcome: discussed

case_text: not expressly pleaded, reliance is placed by the Applicants upon s 75B(1) of the Trade Practices Act , which relevantly provides as follows: (1) A reference in this Part to a person involved in a contravention of a provision of Part ...V ... shall be read as a reference to a person who: (a) has aided, abetted, counselled or procured the contravention; (b) has induced, whether by threats or promises or otherwise, the contravention; (c) has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention; or (d) has conspired with others to effect the contravention. In order to fall within s 75B(1)(a) it is necessary to prove that a person was aware or ought to have been aware of the facts that gave rise to the contravention and to prove that he intentionally participated in the contravention. But it is not necessary to prove that the person knew that his participation was a breach of the Act: Quinlivan v Australian Competition and Consumer Commission [2004] FCA 175 , 160 FCR 1; Yorke v Lucas [1985] HCA 65 ; (1985) 158 CLR 661 at 666 to 669 per Mason ACJ, Wilson, Deane and Dawson JJ. The particular provision invoked by the Applicants in the present proceeding is s 75B(1)(c). Their Honours in Yorke further relevantly observed at 670 that: There can be no question that a person cannot be knowingly concerned in a contravention unless he has knowledge of the essential facts constituting the contravention. ... In our view, the proper construction of par. (c) requires a party to a contravention to be an intentional participant, the necessary intent being based upon knowledge of the essential elements of the contravention. The Respondent to that proceeding, Lucas, was not liable as an accessory as he did not know that the information he was giving to the prospective purchaser was false. He lacked knowledge of an essential element of the contravention. The authorities and the " controversy " as to the extent of knowledge necessary to bring a person within s 75B have been discussed in Pearce M, "Accessorial Liability for Misleading or Deceptive Conduct" (2006) 80 ALJ 104. A Full Court of this Court revisited the decision in Yorke [1985] HCA 65 ; (1985) 158 CLR 661 and reviewed the previous decision of this Court as to the extent of the knowledge required to make a person " knowingly concerned " in a contravention: Medical Benefits Fund of Australia Ltd v Cassidy [2003] FCAFC 289 , 135 FCR 1. There in issue was s 12GD(1)(e) of the then Australian Securities and Investments Commission Act 1989 (Cth), a provision comparable to s 75B(1)(c) of the Trade Practices Act . The Court there heard two appeals, one in which the Medical Benefits Fund was the appellant; the other in which an advertising agency, Bevins, was the appellant. The primary judge accepted that Bevins did not subjectively appreciate that the advertisements involved were false, misleading or deceptive but found Bevins liable pursuant to s 12GD(1). This conclusion was reversed on appeal. Moore J reviewed the authorities on the analogous provision here in issue, s 75B , and concluded: [14] ... It follows, on his Honour's findings, that Bevins (through its officers and employees) was not aware of the second of the matters, as I earlier described them, constituting the contravening conduct of MBF. That is, while Bevins was aware of what the advertisements contained (necessarily so given that it created them) it was not aware that the advertisements might lead members of the public to believe that certain benefits would be enjoyed or rights conferred by taking out insurance with MBF. Accordingly, in my opinion, his Honour erred in concluding that Bevins was liable as an accessory under s 12GD(1). [15] I should add that, in my opinion, liability as an accessory (in circumstances where the contravening conduct of the principal was making false or misleading representations) does not depend on an affirmative answer to the question whether the alleged accessory knew the representations were false or misleading. All that would be necessary would be for the accessory to know of the matters that enabled the representations to be characterised in that way. ... Mansfield J agreed with Moore J. In a separate judgment, Stone J similarly concluded: [80] It is well established that neither knowledge nor intention is necessary for there to be a contravention of s 52 of the TPA or of s 12GA of the ASIC Act. It is sufficient (and necessary) that the conduct in question can be accurately described as "misleading or deceptive" or "likely to mislead or deceive". This misleading or deceptive character is a question of fact that must be decided in the context of all the surrounding circumstances; Taco Co of Australia Inc v Taco Bell Pty Ltd [1982] FCA 136 ; (1982) 42 ALR 177 at 202. That "fact" is an essential element of the contravention. It follows that to be liable as an accessory one must have knowledge of the misleading and deceptive character of the relevant conduct. ... [82] This is not to say that to be liable as an accessory to a strict liability breach of s 52 it is necessary to know that the conduct of the principal is unlawful, or indeed to have any knowledge of the provisions of the TPA or the ASIC Act. But it is necessary to know the essential elements of the contravention, by which I understand that one must know that which makes the conduct a contravention; in this case, its misleading and deceptive character. Only then can one form the intention to participate in conduct of that character. Liability of Directors and Joint Tortfeasors


case_title: Schweppes Ltd v Archer (1934) 34 SR (NSW) 178 at 183

case_text: Alternatively, Mr Tree submitted that review by the Court was constrained in the same way as courts are upon a review of a taxation of costs. In such a case it is said that the Court will only interfere on an error of principle or, on a matter of discretion, "where the taxing officer's discretion appears not to have been exercised at all, or to have been exercised in a manner which is manifestly wrong; and where the question is one of amount only, will do so only in an extreme case": Schweppes' Ltd v Archer (1934) 34 SR (NSW) 178 at 183. 28 Neither submission should be accepted. The power of the District Registrar to determine or review (or "confirm, increase or reduce") the Liquidator's remuneration and expenses comes from the Court's powers under s 473(3) and (5) of the Corporations Act . A power of the Court may be delegated to a Registrar by Rules of Court: Federal Court of Australia Act 1974 (Cth) s 35A(1)(h). The powers in question were delegated by r 16.1(1) of the Federal Court (Corporations) Rules 2000 (Cth), see sch 2, Pt 1 , item 54. The exercise of a power so delegated may be reviewed by the Court or a Judge: r 16(2). For constitutional reasons (see Harris v Caladine [1991] HCA 9 ; (1991) 172 CLR 84), the review of a Registrar's decision must be a hearing de novo : Mazukov v University of Tasmania [2004] FCAFC 159 at [21] - [24] (Kiefel, Weinberg and Stone JJ). For that reason, reviews of taxation of costs in this Court are not limited as in the Schweppes' rule: Cachia v Westpac Financial Services Limited [2003] FCA 817 at [18] - [24] (Hely J).


case_text: Neither submission should be accepted. The power of the District Registrar to determine or review (or "confirm, increase or reduce") the Liquidator's remuneration and expenses comes from the Court's powers under s 473(3) and (5) of the Corporations Act . A power of the Court may be delegated to a Registrar by Rules of Court: Federal Court of Australia Act 1974 (Cth) s 35A(1)(h). The powers in question were delegated by r 16.1(1) of the Federal Court (Corporations) Rules 2000 (Cth), see sch 2, Pt 1 , item 54. The exercise of a power so delegated may be reviewed by the Court or a Judge: r 16(2). For constitutional reasons (see Harris v Caladine [1991] HCA 9 ; (1991) 172 CLR 84), the review of a Registrar's decision must be a hearing de novo : Mazukov v University of Tasmania [2004] FCAFC 159 at [21] - [24] (Kiefel, Weinberg and Stone JJ). For that reason, reviews of taxation of costs in this Court are not limited as in the Schweppes' rule: Cachia v Westpac Financial Services Limited [2003] FCA 817 at [18] - [24] (Hely J).


case_title: Cachia v Westpac Financial Services Limited [2003] FCA 817 at [18] - [24]


case_title: Mazukov v University of Tasmania [2004] FCAFC 159 at [21] - [24]


case_text: ASIC sought information about the progress of the winding up. ASIC was at pains, both in its enquiries and in the present application to the Court, to make it clear that it was not alleging or suspecting wrongdoing by the Liquidator. It may be doubted that ASIC was exercising its power of enquiry under s 536(1) of the Corporations Act . It never stated that it was. It has never claimed that the Liquidator, in terms of s 536(1)(a) , had not "faithfully performed his duties" or had not "observed a requirement of the Court or of the Corporations Act or of the regulations or the rules". It did not make the Liquidator aware that it was acting as a result of communications from the Trust until 21 March 2006. But in any event, there is no question that ASIC had power to act as it did. Rather the point is whether in responding to ASIC's queries the Liquidator was providing the services contemplated by the Winding Up Order. Put another way, was the provision of information to ASIC an incident of the Liquidator acting as such, charged with the responsibility of winding up the Scheme (cf Pantzer v Wenkart [2006] FCAFC 140 ; (2006) 153 FCR 466 at [44] ). In my opinion, both questions must be answered in the affirmative. 38 In Pantzer the Full Court of this Court upheld a claim for remuneration by a trustee in bankruptcy. In his capacity as a former trustee the appellant had been drawn into litigate to assert a claimed amount which the respondent had not challenged by seeking taxation. Nothing in the judgment of the Full Court would appear to be inconsistent with the conclusion I have reached. Mr Tree was correct in submitting that (i) Pantzer provides no support for an additional requirement that to qualify for remuneration a liquidator's work must also "add value" to the liquidation, and (ii) the present case is stronger in that the Liquidator's work was not just "unavoidable, in a practical sense" albeit for his own benefit (at [43]-[44]) he was lawfully compelled by the Winding Up Order to perform it. 39 There will be an order that Barry Keith Hamilton is entitled to be paid by the Solicitors' Trust the sum of $85,639.65. ASIC's application will be dismissed. 40 The parties should file and serve before 10 am on Wednesday 20 December 2006 written submissions as to how the costs of this application should be dealt with. The alternatives seem to be that the costs of all parties be paid out of the proceeds of the winding up, or from the Guarantee Fund, or that ASIC and the Trust pay the Liquidator's costs. I certify that the preceding forty (40) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey . Associate: Counsel for the Applicant: P Tree SC Solicitors for the Applicant: Toomey Maning & Co Counsel for the Respondent: A Abbott Solicitor for the Respondent: Australian Government Solicitor Counsel for the Solicitors Trust: M Daly Solicitors for the Solicitors Trust: Page Seager Date of Hearing: 5 December 2006 Date of Judgment: 18 December 2006 Dated: AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2006/1774.html


case_title: Venetian Nominees Pty Ltd v Conlan (1998) 20 WAR 96 at 102-106

case_text: Mr Abbott, counsel for ASIC, relied on a number of authorities. In Venetian Nominees Pty Ltd v Conlan (1998) 20 WAR 96 the Full Court of the Supreme Court of Western Australia set aside a Master's approval of a provisional liquidator's remuneration. However, this was on the ground that the provisional liquidator had not provided "adequate evidentiary material" to enable the Court to determine whether the amounts claimed were fair and reasonable: at 102-106. In the present case, as noted above, quantum is not in issue.


case_text: Re Korda; in the matter of Stockford Ltd [2004] FCA 1682 ; (2004) 140 FCR 424 (Finkelstein J) was concerned with the validity of resolutions fixing administrators' fees. His Honour also discussed the basis on which the quantum of administrators' and liquidators' remuneration should be assessed. Again, such questions do not arise in the present case.


case_text: Ide v Ide [2004] NSWSC 751 ; (2004) 50 ACSR 324 was concerned with (hopefully) very unusual circumstances, far removed from the present case. A receiver of a partnership attended at the partnership property. In the course of an argument the defendant fired a rifle and killed the daughter of the plaintiff. The receiver's time spent in assisting police with their enquiries was held by Young CJ to be part of his "greater civic duty" and not recoverable as remuneration.


case_text: Australian Securities and Investment Commission v Atlantic 3 Financial (Aust) Pty Ltd [2004] QSC 133 involved claims for remuneration by investigating accountants appointed by order of the Supreme Court of Queensland to investigate certain managed investment schemes and report to the Court. Mullins J heard detailed objections to the accountants' claims. One claim disallowed (at [26]) was for attending a meeting with ASIC to explain the report. This was on the basis that the obligation of the accountants was to report to the Court and the subsequent conference with ASIC was a matter for ASIC and "cannot be characterised as part of the supervision required to be undertaken by the accountants or as part of the work in preparing the report". Also disallowed (at [35]) were work undertaken on certain loan schemes when the accountants knew the schemes had already been wound up by the date of their appointment. These were purely questions of fact and provide no analogy to the present case where the Liquidator reported to ASIC, pursuant to his obligations under the Winding up Order, express or implied, as to the progress of the winding up.


case_text: Mirror Group Newspapers plc v Maxwell [1988] 1 BCLC 638 supports the conclusion I have reached. The Court appointed receivers of the estate of the notorious Robert Maxwell. Questions rose over the remuneration of the receivers, including their costs of time spent in responding to a report of a committee of the House of Commons, the Select Committee on Social Security. The committee had been investigating pension funds. When it became apparent, soon after Mr Maxwell's death, that pension funds of companies associated with Mr Maxwell had been "plundered to the extent of hundred of millions of pounds" (at 658) the committee turned to investigate the receivers and other sets of administrators of the affairs of Mr Maxwell and his companies. The receivers devoted substantial amounts of time and incurred substantial expenditure in dealing with the requirements of the committee (at 659). They also spent time dealing with enquiries from the Serious Fraud Office in connection with the prosecution of Mr Maxwell's son. Ferris J said (at 659-660): "These activities are highly unusual ones for receivers to have become involved in. But they would not have arisen but for the fact that the receivers held the office to which the court had appointed them. Moreover the participation of the receivers was not initiated by them, nor was attendance before the select committee and the provision of information to it voluntary in any true sense, because physical, as well as moral, sanctions might have been applied if the receivers had ignored the requests for assistance made by the select committee. My present view is, therefore, that at least the initial response of the receivers to the requirements of the select committee and probably the entirety of their dealings with the Serious Fraud Office were wholly proper, even if also extraordinary, acts done in the course of the receivership. So far as I have residual doubts, these are attributable to the absence of full information about what has been done. In particular I am concerned that a significant part of the time and effort which the receivers have devoted to satisfying the requirements of the select committee may have been attributable to the receivers defending their conduct from criticism rather than merely providing information. If this were the case I would wish to give further consideration to the question whether the cost (whether in the form of remuneration for time spent by the receivers themselves or in disbursements paid to third parties) is properly to be paid out of the estate." 37 The present case is stronger in that the provision of information to ASIC was not extraordinary but rather an obligation expressly required by the Winding Up Order itself and indeed the very sort of obligation one would expect when a winding up occurs on the application of ASIC. Further, given the tenor of ASIC's enquiries, and particularly its letter of 20 December 2005, the essence of the Liquidator's response was the provision of information, not justification or answers to accusations.


case_text: note that in Re Narla Prospecting Proprietary Limited; Dallhold Investments Proprietary Limited v Narla Prospecting Proprietary Limited [1992] FCA 341 ; (1992) 10 ACLC 1310 , French J, when a member of this Court, in deciding at the behest of a holding company to wind up a subsidiary, appointed as liquidator of the subsidiary the person who was the liquidator of the holding company. That also was a case where his Honour concluded that the company should be wound up on the just and equitable ground. I also bear in mind that Messrs Worrell and Khatri are well-experienced liquidators. I confidently expect that in the event that such potential, and I consider it remote, as there is for conflict of interest does arise, that that will be the subject of application in short order to the Court by them. I am satisfied that it is appropriate that they be appointed as liquidators of Victorian Families. My attention has been drawn to an interesting and, perhaps, inconsistent position in the Act in respect of circumstances where more than one liquidator is appointed. Section 473(8) provides: If more than one liquidator is appointed by the court, the court must declare whether anything that is required or authorised by this Act be done by the liquidator is to be done by all or any one or more of the persons appointed.


case_outcome: considered

case_text: the matter of Storm Financial Limited (Receivers and Managers Appointed) (Administrators Appointed); Australian Securities and Investments Commission v Storm Financial Limited (Receivers and Managers Appointed) (Administrators Appointed) [2009] FCA 269 at [65] , I canvassed both learned academic authority as well as judicial decisions relating to the history and nature of the jurisdiction to wind up a company on the just and equitable ground. I shall not repeat what I there stated. It suffices to note that the just and equitable ground is one which provides for a very broad basis indeed upon which a company may be wound up. Further, it is neither necessary nor desirable to seek to place limits on language which Parliament has made deliberately broad in its purview. That said, Parliament has chosen, in a case where a winding up application is made by a contributory, to specify, in s 467(4), some relevant considerations. That subsection is in these terms: Where the application is made by members as contributories on the ground that it is just and equitable that the company should be wound up or that the directors have acted in a manner that appears to be unfair or unjust to other members, the court, if it is of the opinion that: (a) the applicants are entitled to relief either by winding up the company or by some other means; and (b) in the absence of any other remedy it would be just and equitable that the company should be wound up; must make a winding up order unless it also of the opinion that some other remedy is available to the applicants and that they are acting unreasonably in seeking to have the company wound up instead of pursuing that other remedy. The salient facts are these: Victorian Families remains in the position of being without any directors. Further, there are no persons who are willing to act as directors. But for the appointment of the provisional liquidators, Victorian Families would, in all likelihood, remain what one might describe as "a rudderless ship." Victorian Families is not trading. Indeed, having regard to the absence of any disposition prior to the appointment of the provisional liquidators to fill the vacancy in the office of director and, further, having regard to the placement of the parent company into administration and, more latterly, into liquidation, there is a compelling inference that those who ultimately controlled Victorian Families prior to the appointment of external administration made a conscious decision to abandon its business and the management of that company. Victorian Families is in the following present financial position. It has: (a) unpaid trade creditors of between $5000 and $10,000; (b) outstanding liabilities to the Commonwealth in respect of taxation debts of $65,255.65; (c) outstanding superannuation liabilities in respect of employees of $3135, and other employee entitlement liabilities of $11,400; (d) assets comprising: (i) a bank account balance in credit to the extent of $370,000 and an indebtedness owed by Storm Financial to it of $169,187.28. Additionally, Victorian Families is presently subject to the contingency of claims in respect of margin loan losses by former clients. In some instances that contingency has become manifest; in others, claims are anticipated. One client has made a claim for $69,053 in relation to up-front fees paid to Victorian Families. The provisional liquidator's assessment is that more such claims are likely. In addition, Victorian Families has received notice of impending professional disciplinary proceedings.


case_text: "Particular employment" means the actual employment the relevant employee was required to perform pursuant to his contract of employment, not the general status of an employee in the employer's organisation: Cosma v Qantas Airways Ltd [2002] FCA 640 ; (2002) 124 FCR 504. Today the particular employment from which Mr Gordon was dismissed no longer exists. 94 On 1 May 2003 Mr Gordon entered into a contract to purchase a house at 9 Denis Drive, Riverside (a suburb of Launceston) for $142,500. He paid a deposit of $5,000. Settlement was due on 13 June 2003. The contract was subject to Westpac Bank making available a mortgage to secure a loan of $150,000. 95 After the ATO terminated his employment Mr Gordon advised Westpac accordingly. Because he then failed the bank's income test the loan application was refused. An alternative buyer was found for the property in June or July 2003. Mr Gordon's deposit was retuned, but he claims the following losses: Legal fees $476.52 Surveying fees $250.00 Building Inspection $330.00 Credit Card Fee $62.56 Total $1,089.08 In addition he claims a loss of value. The property was valued by Brothers & Newton Pty Ltd of Launceston in May 2007, as at May 2003, at $250,000. Apparently there was a real estate boom in Launceston.


case_text: The usual practice in the Federal Court is to adopt the rate of interest applied by the Supreme Court of the State or Territory in which the Federal Court is considering the matter: GEC Marconi Systems Pty Ltd v BHP Information Technology Pty Ltd [2003] FCA 688 ; (2003) 201 ALR 55 at [7] . The current rate prescribed under rule 5A of the Supreme Court Rules 2000 (Tas) is 10.5 per cent. 125 The award for lost salary is for money lost progressively over the last five years. I will allow the 10.5 per cent on roughly half that amount, say $30,000, for five years, ie $15,750. The remainder of the award, $28,030, represents compensation for loss incurred five years ago. Interest on that component will be $14,715. Total interest amounts to $30,465. 126 The parties requested leave to make submissions as to costs after reasons were delivered. There will be a direction that within seven days of delivery of judgment the applicant file and serve submissions as to costs, the respondent file and serve submissions seven days thereafter and the applicant file and serve any reply within seven days. Costs will be decided on the papers. I certify that the preceding one hundred and twenty-six (126) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey. Associate: Dated: 6 May 2008 Counsel for the Applicant: B McTaggart Solicitors for the Applicant: Ogilvie Jennings Counsel for the Respondent: B Morgan Solicitor for the Respondent: Australian Government Solicitor Dates of Hearing: 4, 5 and 6 February 2008 Date of Final Submissions 18 February 2008 Date of Judgment: 6 May 2008 SCHEDULE Year Date Blood Pressure Reading Doctor 1997 21 November 150/93 Mee 26 November 135/85 Mee 1998 30 June 180/100 Mee 3 July 160/80 Mee 1999 20 April 150/93 Mee 2000 17 April 150/100 Cooper 18 November 150/85 Mee 28 November 150/95 Cooper 2001 23 July 135/85 Mee 2002 September/October 160/110 unknown 2003 22 April 200/110 Payne 22 April 190/105 Mee 9 May 170/105 Mee 13 May 200/125 Payne 15 May 170/110 McArdle 15 May 180/110 Cooper 19 May 170/98 Mee 28 May 170/100 McArdle 2 June 150/88 Mee 10 June 170/110 Mee 10 June 170/100 Cooper 19 June 172/100 Cooper 24 July 150/85 Mee 2004 14 January 165/110 Cooper 5 February 111/70 (ambulatory) Bishop AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2008/603.html


case_text: Anti-discrimination legislation is to be given a "fair, large and liberal" interpretation rather than one which is "literal or technical": IW v City of Perth [1997] HCA 30 ; (1997) 191 CLR 1 at 12 per Brennan CJ and McHugh J. From 28 April 2003 Mr Gordon was an "employee" of the respondent, however conditional the terms under which he was employed. He attended at the ATO Launceston office, carried out such duties as were required of him (there is nothing to suggest the contrary) and received, or became entitled to receive, a wage or salary as long as he so attended. During the period he was at the office the respondent would have owed him the common law and statutory obligations which employers owe to their employees. The respondent would have been liable to any third parties for torts committed by Mr Gordon in the course of his employment. Withdrawing an employment offer, in circumstances where Mr Gordon had already started work, and would have continued to work but for Mr Godden telling him to leave the premises that day, was within the concept of "dismissing" in s 15(2)(c). 60 Since s 15(1) make it unlawful to discriminate against a person on the grounds of disability in "determining who should be offered employment" (par (b)) or "in the terms or conditions on which employment is offered" (par (c)), it would be strange if someone like Mr Gordon who had actually started work would be in a weaker position and would have no protection against discrimination. 61 I reject the respondent's submission that Mr Gordon "commenced his employment under false pretences". The medical evaluation form ([18]-[20] above) made it clear that the doctor was not to decide whether Mr Gordon got the job. The form was quite encouraging in holding out the prospect that, if any medical problems existed, their effect on employment could quite possibly be resolved to the satisfaction of the employee. Mr Gordon was aware that Dr Payne would talk to the ATO. Mr Gordon was not to know when this would happen. In the meantime, according to Mr Godden, Mr Gordon's commencing work was somewhat accelerated, apparently on the ATO's initiative, because the training program was about to commence.


case_outcome: referred to

case_text: However, I do not think any amount in relation to the house purchase is properly allowable as damages by way of compensation for any loss or damage suffered because of the conduct of the respondent: s 46PO(4)(d) of the HREOC Act. There is no suggestion that the ATO was aware of, let alone encouraged, this purchase. Any loss, either by way of out of pocket expenses or loss of a chance to make a profitable investment, arose from Mr Gordon's rather precipitate decision to purchase and cannot, as a matter of commonsense, be attributed to the discriminatory conduct of the ATO: cf March v Stramare (E & MH) Pty Ltd [1991] HCA 12 ; (1991) 171 CLR 506. 99 At the time of his termination Mr Gordon's ATO gross salary was $42,351. 100 Following his termination he applied for the following positions; 22 June 2003 Deloittes Tax Analyst 30 March 2004 Tasmanian Perpetual Trustees position not advised 30 March 2004 Shadforths Stockbrokers Financial Advisor Assistance/Planner 30 March 2004 Commonwealth Bank Financial Planner 30 March 2004 SMF Funds Management Office Administrator 1 April 2004 RBF Cadet, Investments 1 April 2004 RBF Superannuation Administrator


case_text: Assessing what is likely to happen in the future, or would be likely to have happened had not something intervened, is not a matter of scientific demonstration or proof. Nor, unlike findings as to alleged past events, is it a case of all or nothing; 51 per cent probability win, 49 per cent probability lose: Malec v J C Hutton Pty Ltd [1990] HCA 20 ; (1990) 169 CLR 638 at 643. Nevertheless, the circumstances in the present case make it extremely unlikely that Mr Gordon, had it not been for the termination in May 2003, would have pursued a successful career with the ATO until retirement, let alone at the level he suggests. 107 First, without wishing to be hurtful to Mr Gordon, the inescapable fact is that, for whatever reason, he is not a high achiever. On paper his qualifications are considerable. He has an honours economics degree and an MBA from good universities. He is a qualified accountant. He has almost finished financial planning qualifications. Yet the positions he has occupied up until now could be characterised as occupying a rank and salary towards the lower end of mid-level clerical/professional jobs. Professional men or women in their mid-forties should be at or approaching their peak in terms of earnings and professional status. If they haven't got very far by this stage, things are unlikely to improve to any significant extent. 108 Secondly, in the past Mr Gordon has not displayed any particular enthusiasm for a career in taxation. He did not persist with the ATO in his earlier career (see [14] above). Perhaps more importantly, in his recent job applications, both in the public and private sectors ([100] above), only one was tax-related. The rest appear to have been for employment in the funds management industry.


case_outcome: followed

case_text: In Power v Aboriginal Hostels Limited [2003] FCA 1475 ; (2003) 133 FCR 254 Selway J held that it is the imputed disability which is relevant. His Honour said at [15]-[18]: 15 The next question is whether the appellant is unable to perform those duties 'because of his disability'. That question was not addressed by the learned Federal Magistrate. In my view the failure to address that question was an appealable error. If the question had been addressed then there are two possibilities. The first is that the 'imputed disorder' of depression is the relevant disability. Alternatively, his actual condition of an adjustment disorder (from which he seems to have recovered) is the relevant disability. 16 The appellant's submissions assumed that the relevant disability was the actual condition of the appellant at the time of his termination. On that basis the appellant submitted that he could perform the inherent requirements of the position - indeed, he was doing so for the four weeks before his employment was terminated. Consequently, he argued, s 15(4) of the DDA had no application. 17 On the other hand the respondent's submissions assumed that the relevant disability was the imputed disorder of depression, notwithstanding that the appellant was not suffering from that disability. On this basis the respondent argued that in light of the report of Dr Ducrou the appellant was unable to comply with the inherent duties of the position. 18 So far as my research reveals, there is no authority directly on point. The definition of 'disability' in s 4 of the DDA purports to be an exhaustive definition, 'unless the contrary intention appears'. There is no obvious contrary intention disclosed by s 15(4). Nor is there any obvious reason to imply one. The DDA is principally directed to the elimination as far as possible of 'discrimination against persons on the ground of disability' in relevant areas (s 3 DDA). It is not directed at achieving 'fair outcomes' as such. Consequently what is prohibited is discriminatory behaviour based upon disability. 'Imputed' disability is sufficient for this purpose. What the DDA prohibited in this case was not the dismissal of the appellant for a reason which was wrong, but the dismissal of the appellant who had a disability (albeit an imputed one) in circumstances where a person without a disability would not have been dismissed. When it is understood that the DDA is directed at the ground of discrimination (which includes imputed disability) and not 'fair outcomes' then there seems no reason to imply that 'disability' appearing in s 15(4) of the DDA does not include imputed disability. 64 Additionally to his Honour's observations, it can be said that it is likely that the word "disability" wherever it appears in s 15(4) is referring to the same thing. Where first appearing, "disability" is obviously referring to the discrimination alleged against the employer seeking to rely on the defence. If that discrimination was on the ground of imputed disability, then "disability" means imputed disability and the later expression "his or her disability" refers to the disability imputed to the employee alleging discrimination. 65 Since s 15 as a whole is setting up a norm of conduct, it is to be read as addressed to employers as at the time they are contemplating potentially discriminatory conduct. Subsections (1) and (2) tell employers what they must not do. Subsections (3) and (4) tell them in what circumstances they may lawfully do what would otherwise amount to unlawful discrimination. This suggests that what subs (4) is concerned with are circumstances known to the employer at the time. However, consistently with the philosophy of anti-discrimination legislation (see [58] above), the criterion is an objective one as is indicated by the reference to "all other factors that it is reasonable to take into account". The relevant circumstances include the nature of the imputed disability in the light of such medical investigation as may be reasonable and the availability of reasonable treatment.


case_text: As already mentioned, hypertension is a disability. The respondent, on the advice of Dr Payne, imputed this disability to Mr Gordon. The comparator for the purposes of s 5(1) is a hypothetical person who does not have hypertension but has Mr Gordon's qualifications and experience and is applying for the position of a GST Field Officer in the Launceston office of the ATO. There can be no doubt that such a person would have got the job and would not have had the employment offer withdrawn. By withdrawing the offer of employment the respondent has treated Mr Gordon less favourably than it would have treated such a hypothetical person. It did so because of the imputed condition of hypertension, which, it considered, made him unfit for the requirements of the particular position. The respondent thus discriminated against Mr Gordon, within the meaning of s 5(1): Purvis v New South Wales [2003] HCA 62 ; (2003) 217 CLR 92 at [213] . 57 I do not accept the respondent's argument that the offer was withdrawn, not because of Mr Gordon's hypertension, but because he failed to meet one of the pre-employment conditions, viz, that he be certified fit for the duties of the position. One cannot divorce the factual base from its legal characterisation. Even if regard is had to the three other medical conditions mentioned by Dr Payne, there would still be discrimination because they are equally "disabilities" which would not be suffered by the comparator. But viewed in a practical way, the inescapable conclusion from the evidence is that the real and operative reason for withdrawing the offer was Mr Gordon's imputed hypertension. 58 The respondent contended that it did not dismiss Mr Gordon, rather that it withdrew a conditional offer of employment when the condition was not satisfied.


case_text: I conclude therefore that Mr Gordon has made out a prima facie case of discrimination. Before passing to the s 15(4) defence I should note that the Act does not require an intention or motive to discriminate; cf Waters v Public Transport Corporation [1991] HCA 49 ; (1991) 173 CLR 349 at 359 per Mason CJ and Gaudron J, with whom Deane J at 382 agreed, a case under comparable Victorian legislation. There is nothing to suggest that Dr Payne, or Mr Godden and the other ATO officers, acted otherwise than in good faith.


case_text: Whether something is an "inherent requirement" of a particular employment depends on whether it is an essential element. The inherent requirements include at least the ability to carry out the physical tasks encompassed by the particular employment but also matters such as having regard for the safety of other employees, the general public and the employee himself: X v The Commonwealth [1999] HCA 63 ; (1999) 200 CLR 177 at [31] - [35] per McHugh J. 67 The requirements of the particular employment in question in the present case were described by Mr Godden. In 2003 GST Field Staff were organised into six teams, three each in Hobart and Launceston. The Launceston teams were based at an ATO office in that city. The office was purely a GST Field Site. No other ATO functions were performed at that site and there were no facilities for public contact. When a taxpayer had to be seen, the officers would go out to the taxpayer's place of business. 68 Launceston teams were expected to deal with clients in the North of the State down to Ross, on the North West Coast and in the North East down to Bicheno. 69 All Launceston staff were involved in field work in 2003. The work was a mixture of audit and advisory visits. The latter would be in response to a taxpayer's request for a visit. The Commissioner had given a public undertaking that the Office would contact the taxpayer within 72 hours of the initial request and complete the visit within 14 days. 70 Management was trying to maximise field time with an aim of officers spending 80 per cent of their time in the field. As it turned out, in 2003 officers in Launceston spent about 40 to 50 per cent of their time in the field, the remainder being taken up with training, team meetings, leave etc. New APS 4 staff such as Mr Gordon would have to spend more time in the field than the average because their work would have required them to spend more time doing advisory visits than audits.


case_text: In Australian Securities and Investments Commission v Tasman Investment Management Ltd [2006] NSWSC 943 ; (2006) 202 FLR 343 ( ASIC v Tasman Investment ), Austin J approached an application under s 601EE of the Act for directions concerning the distribution of assets of an unregistered management investment scheme along similar lines. His Honour considered (at [29]) that, on balance, on the authorities, it seemed that binding orders affecting third party rights were not authorised by s 479(3) of the Act. His Honour said that even if they were, the decided cases showed that directions under the section were usually made in the limited form described by McLelland J in Nathan (that the office holder is "justified" in acting in the manner specified in the order). Austin J added that one reason for making directions in that limited form is that even if authorised by the section, binding orders would not in fact be made unless all affected parties or their representatives were properly before the Court.


case_text: It is clear that under the Constitution of the Scheme the beneficial interests in the Assets within the respective FMIP and HYIP Classes were owned by the members of those Classes as tenants in common. The proceeds of sale attributed to one Class were to be shared equally on a pro rata basis by the members of that Class: see Re Sutherland; French Caledonia Travel Service Pty Ltd (in liq) [2003] NSWSC 1008 ; (2003) 59 NSWLR 361 at [186] - [190] . 132 It is clear that Mercator was required to keep the loans and the associated mortgages in each Portfolio separate. Pooling of assets was not permissible. 133 The Security Deed purported to increase the debt secured by the second mortgage over the Boondall Property to include the shortfall owed to the FMIP in relation to the Bonney Avenue Facility and the debt owed to the HYIP in relation to the Pashen Street Facility.


case_text: In Re GB Nathan and Co Pty Ltd (in liq) (1991) 24 NSWLR 674 ( Nathan ), McLelland J (as McLelland CJ in Eq then was) discussed the principles that govern an application by a liquidator for directions under the then s 479(3) of the Corporations Law (Cth). That provision is now found in s 479(3) of the Act, and was (and is): "The liquidator may apply to the Court for directions in relation to any particular matter arising under the winding up". His Honour traced the historical background to s 479(3) and concluded (at 679): The historical antecedents of s 479(3) , the terms of that subsection and the provisions of s 479 as a whole combine to lead to the conclusion that the only proper subject of a liquidator's application for directions is the manner in which the liquidator should act in carrying out his functions as such, and that the only binding effect of, or arising from, a direction given in pursuance of such an application (other than rendering the liquidator liable to appropriate sanctions if a direction in mandatory or prohibitory form is disobeyed) is that the liquidator, if he has made full and fair disclosure to the court of the material facts, will be protected from liability for any alleged breach of duty as liquidator to a creditor or contributory or to the company in respect of anything done by him in accordance with the direction. His Honour said that modern Australian authorities, to which he referred, also confirmed the view that s 479(3) did not enable the court to make binding orders in the nature of judgments, and that the purpose of a liquidator's application for directions was "to give [the liquidator] advice as to his proper course of action in the liquidation; ... not to determine the rights and liabilities arising from the company's transactions before the liquidation" (at 679 680, authorities cited omitted). 14 In Australian Securities and Investments Commission v Tasman Investment Management Ltd [2006] NSWSC 943 ; (2006) 202 FLR 343 ( ASIC v Tasman Investment ), Austin J approached an application under s 601EE of the Act for directions concerning the distribution of assets of an unregistered management investment scheme along similar lines. His Honour considered (at [29]) that, on balance, on the authorities, it seemed that binding orders affecting third party rights were not authorised by s 479(3) of the Act. His Honour said that even if they were, the decided cases showed that directions under the section were usually made in the limited form described by McLelland J in Nathan (that the office holder is "justified" in acting in the manner specified in the order). Austin J added that one reason for making directions in that limited form is that even if authorised by the section, binding orders would not in fact be made unless all affected parties or their representatives were properly before the Court. 15 It would have been possible for the Court to decline to give directions unless, with Stacks' consent, the Court converted the present proceeding into an inter partes proceeding by appointing and joining as a party, a representative of the members entitled to the First Mortgage Interest Portfolio (see below) on the one hand, and a representative of the members entitled to the High Yield Income Portfolio (see below) on the other hand: see Nathan at 680 per McLelland J and authorities there cited by his Honour. This course would have had the advantage that the members having interests in the remaining assets of those respective Portfolios would have been bound by the result.


case_text: In Editions Tom Thompson Pty Ltd v Pilley (1997) 77 FCR 141, I held that these observations applied to an application by an administrator of a company subject to a deed of company arrangement for directions under s 447D of the Corporations Law (Cth) (now s 447D of the Act).


case_outcome: related

case_text: grounds under this section were advanced. These were: (a) The Statutory Demand was not made in compliance with s 459E of the Act because it was not in the prescribed form (see s 459E(2)(e) of the Act) and was not accompanied by an affidavit that: (i) Verified that the claimed debt was due and payable by BMG as at 21 August 2007; and (ii) Complied with the Rules of Court. (see s 459E(3) of the Act). The alleged non-compliance with each of the provisions referred to above was said to be constituted by the failure on the part of Adelaide Bank to verify the Statutory Demand or otherwise include in the affidavits read in support of its case on the present Application a statement by an appropriately qualified witness to the following effect: I believe there is no genuine dispute about the existence or amount of the debt. In support of these contentions, Mr Watts relied upon the decision of Tamberlin J in IFA Homeware Imports Pty Ltd v Shanghai Jerrys Candle Company Ltd [2003] FCA 533. (b) The Statutory Demand was issued for an improper purpose. That purpose was said to be the purpose of preventing or delaying BMG, Mr Watts and Mrs Watts from taking action against Adelaide Bank for damages or compensation by reason of the bank's conduct in allegedly dishonouring various alleged agreements and arrangements and in taking possession of the property and in taking steps to sell it as mortgagee in possession; and (c) The amount of the debt claimed in the Statutory Demand was misstated. At the hearing on 10 December 2008, Mr Watts conceded that there was in existence as at 21 August 2007 a debt due from BMG to Adelaide Bank but submitted that the correct amount of the debt due from BMG to Adelaide Bank at that time was $16,281.29. Subsequently, in a submission which I allowed Mr Watts to advance as a result of my decision made on 21 April 2009 (see BMG Poseidon Corp Pty Ltd v Adelaide Bank Limited; In the Matter of BMG Poseidon Corp Pty Ltd [2009] FCA 389), Mr Watts submitted that no moneys were due from BMG to Adelaide Bank and that Adelaide Bank had an obligation to account to BMG for surplus funds of approximately $86,286.32.


case_text: the expression may well include an unliquidated claim, that claim must be capable of being quantified as an amount of money ( Chase Manhattan Bank Australia Ltd v Oscty Pty Ltd [1995] FCA 1208 ; (1995) 17 ACSR 128 at 135). The claim must exist at the time at which the statutory demand is made ie in this case as at 21 August or perhaps 27 August 2007. By reason of the terms of the definition of offsetting claim , the claim must be genuine . The concept of genuineness gives rise to the same considerations as those with which I have dealt in respect of the s 459H(1)(a) ground. The first contention relied upon by BMG in support of this ground is that Adelaide Bank sold the property at an undervalue. This allegation amounts to an allegation that the bank breached the duty owed by it to BMG as mortgagee in possession when exercising its power of sale.


case_text: it seems to me that the provisions of cl 11.7 would entitle Adelaide Bank to charge interest at the contractual rate after judgment, the terms of that clause do not authorise the continued charging after judgment of late payment fees and penalty charges in accordance with other provisions of the loan agreements. Whatever rights Adelaide Bank had to levy such fees and charges under the covenants in the loan agreements were merged in the judgment which it obtained on 3 April 2006. After 3 April 2006 its rights were confined to recovering the amount of the judgment plus interest, albeit levied at the contractual rate if it so desired and its rights under its securities (see Economic Life Assurance Society v Usborne [1902] AC 147 ; and Elders Trustee & Executor Co Ltd v Eagle Star Nominees Ltd (1986) 4 BPR 9205 , [1987] ANZ ConvR 14, (1987) NSW ConvR 55 333). A complete copy of the relevant mortgage was not tendered in evidence before me. I will therefore assume that, prior to 3 April 2006, Adelaide Bank's rights in respect of interest and other charges were confined to the personal covenants in the loan agreements. In that event, those rights were merged in the judgment and ceased to exist after 3 April 2006.


case_title: Elders Trustee & Executor Co Ltd v Eagle Star Nominees Ltd (1986) 4 BPR 9205 , [1987] ANZ ConvR 14, (1987) NSW ConvR 55 333


case_title: Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785 , (1994) 12 ACLC 669

case_text: Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785 at 787 788, (1994) 12 ACLC 669 , McLelland CJ in Eq said: It is, however, necessary to consider the meaning of the expression "genuine dispute" where it occurs in s 450H. In my opinion that expression connotes a plausible contention requiring investigation, and raises much the same sort of considerations as the "serious question to be tried" criterion which arises on an application for an interlocutory injunction or for the extension or removal of a caveat. This does not mean that the court must accept uncritically as giving rise to a genuine dispute, every statement in an affidavit "however equivocal, lacking in precision, inconsistent with undisputed contemporary documents or other statements by the same deponent, or inherently improbable in itself, it may be" not having "sufficient prima facie plausibility to merit further investigation as to [its] truth" (cf Eng Mee Yong v Letchumanan [1980] AC 331 at 341), or "a patently feeble legal argument or an assertion of facts unsupported by evidence": cf South Australia v Wall (1980) 24 SASR 189 at 194. But it does mean that, except in such an extreme case, a court required to determine whether there is a genuine dispute should not embark upon an inquiry as to the credit of a witness or a deponent whose evidence is relied on as giving rise to the dispute. There is a clear difference between, on the one hand, determining whether there is a genuine dispute and, on the other hand, determining the merits of, or resolving, such a dispute. In Mibor Investments (at 366-7) Hayne J said, after referring to the state of the law prior to the enactment of Div 3 of Pt 5.4 of the Corporations Law, and to the terms of Div 3: These matters, taken in combination, suggest that at least in most cases, it is not expected that the court will embark upon any extended inquiry in order to determine whether there is a genuine dispute between the parties and certainly will not attempt to weigh the merits of that dispute. All that the legislation requires is that the court conclude that there is a dispute and that it is a genuine dispute. In Re Morris Catering (Aust) Pty Ltd (1993) 11 ACSR 601 at 605 Thomas J said: There is little doubt that Div 3 ... prescribes a formula that requires the court to assess the position between the parties, and preserve demands where it can be seen that there is no genuine dispute and no sufficient genuine offsetting claim. That is not to say that the court will examine the merits or settle the dispute. The specified limits of the court's examination are the ascertainment of whether there is a "genuine dispute" and whether there is a "genuine claim". It is often possible to discern the spurious, and to identify mere bluster or assertion. But beyond a perception of genuineness (or the lack of it), the court has no function. It is not helpful to perceive that one party is more likely than the other to succeed, or that the eventual state of the account between the parties is more likely to be one result than another. The essential task is relatively simple — to identify the genuine level of a claim (not the likely result of it) and to identify the genuine level of an offsetting claim (not the likely result of it). I respectfully agree with those statements.


case_text: grounds under this section were advanced. These were: (a) The Statutory Demand was not made in compliance with s 459E of the Act because it was not in the prescribed form (see s 459E(2)(e) of the Act) and was not accompanied by an affidavit that: (i) Verified that the claimed debt was due and payable by BMG as at 21 August 2007; and (ii) Complied with the Rules of Court. (see s 459E(3) of the Act). The alleged non-compliance with each of the provisions referred to above was said to be constituted by the failure on the part of Adelaide Bank to verify the Statutory Demand or otherwise include in the affidavits read in support of its case on the present Application a statement by an appropriately qualified witness to the following effect: I believe there is no genuine dispute about the existence or amount of the debt. In support of these contentions, Mr Watts relied upon the decision of Tamberlin J in IFA Homeware Imports Pty Ltd v Shanghai Jerrys Candle Company Ltd [2003] FCA 533. (b) The Statutory Demand was issued for an improper purpose. That purpose was said to be the purpose of preventing or delaying BMG, Mr Watts and Mrs Watts from taking action against Adelaide Bank for damages or compensation by reason of the bank's conduct in allegedly dishonouring various alleged agreements and arrangements and in taking possession of the property and in taking steps to sell it as mortgagee in possession; and (c) The amount of the debt claimed in the Statutory Demand was misstated. At the hearing on 10 December 2008, Mr Watts conceded that there was in existence as at 21 August 2007 a debt due from BMG to Adelaide Bank but submitted that the correct amount of the debt due from BMG to Adelaide Bank at that time was $16,281.29. Subsequently, in a submission which I allowed Mr Watts to advance as a result of my decision made on 21 April 2009 (see BMG Poseidon Corp Pty Ltd v Adelaide Bank Limited; In the Matter of BMG Poseidon Corp Pty Ltd [2009] FCA 389), Mr Watts submitted that no moneys were due from BMG to Adelaide Bank and that Adelaide Bank had an obligation to account to BMG for surplus funds of approximately $86,286.32. In IFA Homeware Imports Pty Ltd [2003] FCA 533 , Tamberlin J held that, in circumstances where the Act, Rules of Court and the Regulations made under the Act required a statement to the effect that the creditor believed that there was no genuine dispute about the existence or the amount of the debt to be made as part of the evidentiary requirements supporting a creditor's statutory demand, the failure on the part of the creditor to make such a statement on oath was fatal to the validity of the statutory demand. In my opinion, however, the circumstances of the present case are quite different from those in play in IFA Homeware Imports Pty Ltd [2003] FCA 533. In my view, Adelaide Bank was not required to verify the Statutory Demand at all and was not required to include a statement in the form urged by Mr Watts. Section 459E(3) of the Act is in the following terms: (3) Unless the debt, or each of the debts, is a judgment debt, the demand must be accompanied by an affidavit that: (a) verifies that the debt, or the total of the amounts of the debts, is due and payable by the company; and (b) complies with the rules. In the present case, the amount asserted to be due from BMG to Adelaide Bank in the Statutory Demand is the balance of a judgment debt. Thus, the foundation for the claimed debt in the present case is the judgment, not the loan agreements or the mortgage security. That being so, in my view, the Statutory Demand was not required to be accompanied by an affidavit that complied with s 459E(3) of the Act. It is only if such an affidavit were required that consideration needs to be given to the requirements of the Rules. It is only when those requirements are brought into play that the reasoning of Tamberlin J in IFA Homeware Imports Pty Ltd [2003] FCA 533 is apt. I reject the first contention made by BMG in support of this ground. The second contention advanced by BMG in support of this ground has not been supported by any evidence or argument. It too is rejected.


case_title: Olivieri v Stafford (1989) 24 FCR 413

case_text: my opinion, this Court has the power to go behind a judgment in appropriate circumstances, even if the judgment was obtained by default and even if the debtors have unsuccessfully made application to set the judgment aside. This much is made clear in the Reasons for Judgment of Gibbs J in Re Johnson & Mann; Ex parte Greendale Engineering & Cables Ltd [1968] ALR 408 , (1967) 11 FLR 335 at 341. It may be thought that certain observations made by Beaumont J in Olivieri v Stafford (1989) 24 FCR 413 are authority for the contrary proposition. In that case, his Honour said (at 424): As has been said, a court of bankruptcy is concerned to inquire into the "reality" of the matter in hand. Here the "reality" of the matter is that the merits of the respondents' claim have been demonstrated to the satisfaction of one judge of the District Court and another judge of that Court has declined to disturb the judgment. As a matter of substance, it is appropriate, in all the circumstances, for a court of bankruptcy to treat what happened in the two hearings in the District Court as a trial of the merits of the respondents' claim. That is to say, a court of bankruptcy should, I think, accept that a process of adjudication in the District Court has established that the underlying transactions created a true debt which could, in turn, provide a proper foundation for the entry of a judgment in respect of which a bankruptcy notice could properly issue. In my view, notwithstanding these remarks, his Honour nonetheless recognised that the Court retained a discretion to go behind a default judgment in an appropriate case even where attempts to set aside that judgment had failed. There is no principle which denies the existence of that discretion. In Olivieri 24 FCR 413 , a judgment had been obtained in the District Court by default and two attempts to have it set aside had failed. The approach of Beaumont J was to look at the reality of the matter. In his Honour's view, by the time that the case before him had reached this Court, there was no reason for this Court to examine yet again the underlying basis for the judgment. . In the same case, Gummow J reached the same result through a different process of reasoning with which, with respect, I agree. The natural justice arguments advanced by BMG in support of its application to set aside the judgment made in the Supreme Court cannot constitute a defence to the claim of Adelaide Bank for repayment of its loans and other moneys due under the loan agreements. The remaining two broad grounds relied upon by BMG in the Supreme Court (as to which see [42](b) and (c) above) are reminiscent of contentions advanced on behalf of BMG in the present proceedings.


case_text: the position in Australia remains that there is no common law duty in negligence by which a mortgagee can be found liable for damages if it fails to obtain a good price or the best price upon the sale of a mortgaged property (as to which see Fisher and Lightwood's Law of Mortgage , (2 nd Australian edition, 2005) at 496 497 [20.21]). The duty of the mortgagee is one of good faith. That duty requires the mortgagee not to act fraudulently or wilfully or recklessly or to recklessly sacrifice the interests of the mortgagor ( Pendlebury v Colonial Mutual Life Assurance Society Ltd [1912] HCA 9 ; (1912) 13 CLR 676 at 680). BMG tendered no evidence to support its contention that the property was sold at an undervalue. Adelaide Bank, on the other hand, tendered the three valuations which it had obtained. The valuers were not cross-examined. Their opinions were not challenged at all. In addition, Mr Watts' anecdotal recounting of the casual offer made to BMG in mid 1996 of $850,000 tended to support the valuations which Adelaide Bank had obtained. Furthermore, the obvious difficulties which BMG had encountered in selling the property in 2006 and early 2007 and in procuring sufficient funds to refinance its debts to Adelaide Bank in the same period provide additional support for the conclusion that the property was not likely to have commanded a price much above $850,000 $900,000 viewed from the perspective of a seller looking forward in late 2006 and early 2007.


case_text: was submitted on behalf of Adelaide Bank in support of a contention that no genuine dispute existed that, by reason of the application of the principles articulated by the High Court in Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 ; (1981) 147 CLR 589 , BMG was estopped from arguing that there was any dispute in respect of the judgment and, further, was estopped from arguing in the present proceedings any matter which was in fact raised by it, or could have been raised by it, in support of the application made by it, Mr Watts and Mrs Watts in the Supreme Court to set aside the judgment. I do not think that these propositions are correct. There has been no adjudication on the merits and no occasion calling for such an adjudication. The exercise of considering and determining an application to set aside a default judgment involves the application of very different principles from those which would ordinarily be in play on a final hearing on the merits.


case_text: my opinion, this Court has the power to go behind a judgment in appropriate circumstances, even if the judgment was obtained by default and even if the debtors have unsuccessfully made application to set the judgment aside. This much is made clear in the Reasons for Judgment of Gibbs J in Re Johnson & Mann; Ex parte Greendale Engineering & Cables Ltd [1968] ALR 408 , (1967) 11 FLR 335 at 341. It may be thought that certain observations made by Beaumont J in Olivieri v Stafford (1989) 24 FCR 413 are authority for the contrary proposition. In that case, his Honour said (at 424): As has been said, a court of bankruptcy is concerned to inquire into the "reality" of the matter in hand. Here the "reality" of the matter is that the merits of the respondents' claim have been demonstrated to the satisfaction of one judge of the District Court and another judge of that Court has declined to disturb the judgment. As a matter of substance, it is appropriate, in all the circumstances, for a court of bankruptcy to treat what happened in the two hearings in the District Court as a trial of the merits of the respondents' claim. That is to say, a court of bankruptcy should, I think, accept that a process of adjudication in the District Court has established that the underlying transactions created a true debt which could, in turn, provide a proper foundation for the entry of a judgment in respect of which a bankruptcy notice could properly issue.


case_text: s 459H(1)(a) to be engaged, the Court must be satisfied that there is a genuine dispute about the existence or about the amount of the debt. In order for a dispute of that kind to be raised, there must be more than the mere assertion of a dispute or the mere making of a claim (per Lindgren J in Rohalo Pharmaceutical Pty Ltd v RP Scherer SpA & Pharmagel SpA (1994) 15 ACSR 347 , (1994) 13 ACLC 94 at 352/30 354/15, esp at 353/20 25). The dispute must have an objective existence the genuineness of which is capable of being assessed ( Rohalo 15 ACSR 347 , 13 ACLC 94 at 353/17 25). The test has been equated with the test as to whether the creditor would be entitled to summary judgment on the claim ( Rohalo 15 ACSR 347 , 13 ACLC 94 at 353/42 354/8).