case_text: it may readily be concluded that Hepbourne, acting through Vladimir Vaysman, authorised the infringing conduct in the sense as provided for in s 36(1A) of the Copyright Act . Hepbourne had control of the Moorabbin factory. It could have, had it wished to do so, prevented the manufacture and distribution of the infringing articles by refusing entry to those who were involved in the infringing conduct. Vladimir Vaysman's knowledge of the fact that the infringing conduct was taking place in the factory may be attributed to Hepbourne. There is no evidence to suggest that Hepbourne took any steps to prevent or avoid the infringing conduct which took place at the Moorabbin factory. The contrary is true. Hepbourne, acting through Vladimir Vaysman and others recruited by him, undertook, procured and oversaw the infringing conduct. His conduct therefore passed well beyond "mere inactivity or indifference": he clearly sanctioned, approved and countenanced the infringement of Deckers' rights: see The University of New South Wales v Moorhouse [1975] HCA 26 ; (1975) 133 CLR 1 at 12 (per Gibbs J), 20 (per Jacobs J); Cooper v Universal Music Australia Pty Ltd [2006] FCAFC 187 ; (2006) 156 FCR 380 at 408, 410-1 (per Kenny J). Passing-Off / Misleading Conduct


case_outcome: referred to

case_text: Deckers Outdoor Corporation Inc v Farley [2008] FCA 1514 I made declarations that Mr Mykhalovskyi had: I ordered that Mr Mykhalovskyi be restrained from performing further acts which infringed Deckers' intellectual property rights. I further ordered that Mr Mykhalovskyi deliver up any counterfeit footwear, any advertising material relating to the counterfeit footwear and any items used to manufacture such footwear. Costs orders were also made. It remains to consider what, if any, damages Mr Mykhalovskyi should be ordered to pay Deckers in respect of the infringing and tortious conduct for which he has been found to be liable to Deckers.


case_text: procedural history of the matter prior to 24 March 2009 is essayed in Deckers Outdoor Corporation Inc v Farley (No 2) [2009] FCA 256 ; (2009) 176 FCR 33 at 34-36. In that decision, declaratory and injunctive relief was granted to Deckers under s 31A of the Federal Court of Australia Act 1976 (Cth) for infringement of one of its registered trademarks. Hepbourne was one of the respondents against whom summary judgment was then granted. Deckers' application for summary judgment on claims arising under the Copyright Act 1968 (Cth) ("the Copyright Act "), the Trade Practices Act 1974 (Cth) ("the TP Act"), the Fair Trading Act 1999 (Vic) ("the FT Act") and for passing-off was refused. In April 2009 I dealt with an application by Deckers for summary judgment against Hepbourne and Mr Vladimir Vaysman. That application sought an order that Hepbourne and Mr Vaysman pay Deckers $150,000 pursuant to the terms of settlement which had been entered into between them (and other parties) on 10 June 2005. These terms of settlement compromised an earlier proceeding in which Deckers had alleged that Hepbourne and Vaysman (amongst others) had breached an earlier settlement agreement under which they had agreed to Orders which restrained them, inter alia, from manufacturing or advertising footwear or accessories which bore the words "UGG" or "UGG australia".


case_text: gave summary judgment against Hepbourne and Vladimir Vaysman, holding that they were jointly and severally liable to pay Deckers the sum of $150,000. I did so, accepting submissions by Deckers that: "...[t]he infringing conduct involved the manufacture of sheepskin footwear at a factory in Moorabbin. Hepbourne was the registered proprietor of the factory. Vaysman was the sole director of Hepbourne at relevant times. The word "UGG" appeared on the soles of the footwear and on a cloth label which was attached to the heels. The footwear was marketed on the internet, at market stalls and otherwise. Vaysman was actively involved in the marketing of the footwear. Among other things he recruited sales assistants to sell the footwear using the internet and oversaw their packaging and freight-forwarding activities..." See: Deckers Outdoor Corporation Inc v Farley (No 4) [2009] FCA 369 at [6] . Since then, other respondents have settled with Deckers and agreed to orders being made against them. On 9 September 2009 judgment was entered by consent against Josef, Polina and Victoria Vaysman and two companies, one controlled by Victoria Vaysman, and the other by Josef Vaysman. Upon the making of those orders, no outstanding issues remained between Deckers and those respondents. On 24 September 2009 Vladimir Vaysman consented to orders being made against him. As he was, at relevant times, the sole shareholder and director of Hepbourne, the terms of those orders are significant in relation to the claims made against Hepbourne. Vladimir Vaysman consented to orders being made against him for $3,000,000 for general compensatory damages and a further $3,000,000 for additional damages for copyright infringement. No further relief is sought against Vladimir Vaysman.


case_text: for Deckers invites a comparison of the circumstances of the present case with a large number of other cases in which both compensatory and additional damages have been awarded for copyright infringement. Attention was also directed to the quantum of the damages awarded in those cases. They include Aristocrat Technologies , Microsoft Corporation v Glostar Pty Ltd (t/as Downtown Technology Centre) (2003) 57 IPR 518 ; Vivid Entertainment LLC v Digital Sinema Australia Pty Ltd (No 3) [2007] FMCA 748 ; Microsoft Corporation v Ezy Loans Pty Ltd [2004] FCA 1135 ; (2004) 63 IPR 54 ; Microsoft Corporation v Goodview Electronics Pty Ltd (2000) 49 IPR 578; Zero Tolerance Entertainment Inc v Venus Adult Shops Pty Ltd [2007] FMCA 155 ; Sony Entertainment (Australia) Ltd v Smith [2005] FCA 228 ; (2005) 64 IPR 18 ; Bailey v Namol Pty Limited [1994] FCA 1401 ; (1994) 53 FCR 102 ; Amalgamated Mining Services Pty Ltd v Warman International Ltd [1992] FCA 542 ; (1992) 24 IPR 461 ; Foxtel Management Pty Ltd v Mod Shop Pty Ltd [2007] FCA 463 ; (2007) 72 IPR 1 ; Australasian Performing Right Association Ltd v Monster Communications Pty Ltd (2006) 71 IPR 212 ; and Elwood Clothing Pty Ltd (ACN 079 393 696) v Cotton On Clothing Pty Ltd (ACN 052 130 462) (2009) 8 IPR 378. These authorities are of limited assistance. They emphasise the unfettered nature of the discretion conferred on the Court in fixing an appropriate measure of additional damages. They demonstrate that, depending on the circumstances of the case, a significant award of additional damages can be made even though compensatory damages are fixed at a nominal sum; and that additional damages are often fixed at a lower sum than that awarded for compensatory damages. They make it plain that there is no recognised practice of awarding additional damages in an amount equal to or lower than compensatory damages: cf Raben Footwear at 104 (per Tamberlin J).


case_text: though the evidence may be deficient, the Court is, nonetheless, obliged to do the best it can to make a just and fair assessment of the quantum of damages. In Enzed Holdings Ltd v Wynthea Pty Ltd [1984] FCA 373 ; (1984) 3 IPR 619 at 637 the Full Court observed that: "The principle is clear. If the court finds damage has occurred it must do its best to quantify the loss even if a degree of speculation and guess work is involved. Furthermore, if actual damage is suffered, the award must be for more than nominal damages. We should add that we can see no reason why this principle should not apply in cases under the Trade Practices Act as well as in cases at common law". See also: Sony Computer Entertainment Australia Pty Ltd v Stirling [2001] FCA 1852 at [7] - [8] .


case_title: Foxtel Management Pty Ltd v Mod Shop Pty Ltd [2007] FCA 463 ; (2007) 72 IPR 1


case_outcome: applied

case_text: purpose of an award of damages in a tort action is to compensate the applicant for loss suffered as a result of the tort: see Haines v Bendall [1991] HCA 15 ; (1991) 172 CLR 60 at 63. The same principle operates in relation to damages for breach of copyright: see Aristocrat Technologies Australia Pty Ltd v DAP Services (Kempsey) Pty Ltd [2007] FCAFC 40 ; (2007) 157 FCR 564 at 568. The principle will also have application in determining many (but not all) cases arising from contraventions of consumer protection provisions in legislation such as the TP Act and the FT Act: see Gates v The City Mutual Life Assurance Society Limited [1986] HCA 3 ; (1986) 160 CLR 1 at 13.


case_text: each of these provisions, it is necessary for the Court to assess whether the conduct of Hepbourne was likely to mislead potential customers, whether they be astute or gullible, intelligent or lacking in intelligence, well educated or poorly educated: .au Domain Administration Ltd v Domain Names Australia Pty Ltd [2004] FCA 424 ; (2004) 207 ALR 521 at 527. It is not necessary for Deckers to establish that anyone was actually misled or deceived: see Parkdale Custom Built Furniture Proprietary Limited v Puxu Proprietary Limited [1982] HCA 44 ; (1982) 149 CLR 191 at 198. Conduct is likely to mislead or deceive if, on an objective assessment, there is a real and not remote possibility that it will do so. It is not necessary for an applicant to establish that the degree of likelihood exceeds 50 per cent: see Global Sportsman Pty Ltd v Mirror Newspapers Pty Ltd [1984] FCA 180 ; (1984) 2 FCR 82 at 87.


case_outcome: cited

case_title: Gordon Grant and Grant Pty. Ltd., Re [1983] 2 Qd R 314

case_text: 471B of the Corporations Act does not prescribe criteria which condition the exercise of the Court's power to grant leave to a person to begin or proceed with a proceeding against a company in liquidation. Although there is extensive case law on applications made under s 471B and its predecessors, no attempt has been made to identify exhaustively the circumstances in which it might be appropriate for leave to be granted: see Re Gordon Grant and Grant Pty. Ltd. [1983] 2 Qd R 314 at 317. The case law has recently and helpfully been summarised by Gilmour J in Swaby v Lift Capital Partners Pty Ltd [2009] FCA 749 at [22] - [32] .


case_title: Haines v Bendall [1991] HCA 15 ; (1991) 172 CLR 60


case_text: my opinion, Hepbourne has, by these contractual undertakings, bound itself not to prosecute a claim of the kind pursued in its cross-claim. These undertakings would be enforceable by the Court: cf Macteldir Pty Ltd v Dimovski (2005) 226 ALR 773 at 796 and the authorities there cited. The Court should not permit Hepbourne to prosecute a cross-claim of the kind presently attempted in breach of contractual undertakings. In particular, it should not do so in circumstances in which Deckers' defence stands unanswered. Judgment should be entered against Hepbourne and Mr Mykhalovskyi. By agreement, costs orders in the sum of $1,000,000 have already been made jointly and severally against Vladimir, Josef, Victoria and Polina Vaysman and companies associated with some of them. It is appropriate that Hepbourne and Mr Mykhalovskyi should also be jointly and severally liable for Deckers' costs to this extent. Orders to this effect should be made. I certify that the preceding one hundred and forty-six (146) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice TRACEY. Associate: Dated: 13 November 2009 Counsel for the Applicant: Mr E Heerey Solicitor for the Applicant: Middletons Date of Hearing: 24 September 2009 Date of Judgment: 13 November 2009 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2009/1298.html


case_title: Microsoft Corporation v Ezy Loans Pty Ltd [2004] FCA 1135 ; (2004) 63 IPR 54


case_title: Microsoft Corporation v Glostar Pty Ltd (t/as Downtown Technology Centre) (2003) 57 IPR 518


case_title: Microsoft Corporation v Goodview Electronics Pty Ltd (2000) 49 IPR 578


case_text: Norm Engineering v Digga Australia [2007] FCA 761 ; (2007) 162 FCR 1 at 79, Greenwood J summarised the principles which have been developed in relation to the exercise of the Court's powers under s 115(4): "The principles influencing an assessment of damages under the section are these... [f]lagrancy is not an essential pre-requisite for an award of additional damages; it is sufficient if the court is satisfied that any one or more of the circumstances set out in s 115(4)(b) is established ( Raben Footwear Pty Ltd v Polygram Records Inc (1997) 75 FCR 88 at 93 per Burchett J; at 103 per Tamberlin J and at 104 per Lehane J; Polygram Pty Ltd v Golden Editions Pty Ltd (1997) 76 FCR 565 at 575 per Lockhart J; Sony Entertainment (Australia) Ltd v Smith [2005] FCA 228 ; (2005) 215 ALR 788 at [158] per Jacobson J); additional damages under s 115(4) may be assessed having regard to principles derived from awards of aggravated and exemplary damages at common law ( Autodesk Inc v Yee (1996) 68 FCR 391 at 394 per Burchett J; Lamb v Cotongo [1987] HCA 47 ; (1987) 164 CLR 1 at 9-10 per Mason CJ, Brennan, Deane, Dawson and Gaudron JJ at pp 9, 10); one objective of an award is deterrence; an element of penalty is an accepted factor ( Autodesk v Yee 68 FCR at 384); the accrual of benefit by reason of the infringement to the respondent is a further factor and the notion of "benefit" suggests a pecuniary benefit to the respondent in excess of the damages otherwise payable ( Ravenscroft v Herbert [1980] RPC 193 (per Brightman J) at 208; the benefit need not be pecuniary ( Polygram v Golden Editions Pty Ltd 76 FCR at 576 per Lockhart J); and there need not be any proportionality between the amount of compensatory damages awarded pursuant to s 115(2) and the amount of additional damages awarded pursuant to s 115(4) ( Raben Footwear v Polygram Records 75 FCR at 93, 103 and 104; Microsoft Corporation v PC Club Australia Pty Ltd [2005] FCA 1522 ; (2005) 148 FCR 310 at 409, 410 per Conti J); and the assessment of the amount to be awarded is necessarily an imprecise exercise ( Bailey v Namol Pty Ltd 53 FCR at 114 per Burchett, Gummow and O'Loughlin JJ)."


case_title: Norm Engineering v Digga Australia [2007] FCA 761 ; (2007) 162 FCR 1


case_text: is not, therefore, a case in which the applicant has been in a position to adduce evidence which would assist the Court in assessing damages but has not done so: cf Placer (Granny Smith) Pty Ltd v Thiess Contractors Pty Ltd [2003] HCA 10 ; (2003) 196 ALR 257 at 266. It falls into the class of a case in which, as Black CJ and Jacobson J held in Aristocrat Technologies , "damages should be liberally assessed, in the sense that inferences will be more readily drawn against [the wrongdoers], but the object remains to compensate [the applicant], not to punish the respondent": at 569. See also Adidas Salomon AG v Turner [2003] FCA 421 and Paramount Pictures Corporation v Hasluck (2006) 70 IPR 293 at 300.


case_title: Parkdale Custom Built Furniture Proprietary Limited v Puxu Proprietary Limited [1982] HCA 44 ; (1982) 149 CLR 191


case_title: Placer (Granny Smith) Pty Ltd v Thiess Contractors Pty Ltd [2003] HCA 10 ; (2003) 196 ALR 257


case_text: elements of a cause of action in passing-off were identified by Lord Oliver in Reckitt and Colman Products Ltd v Borden Inc (1990) 17 IPR 1 at 7. In Vieright Pty Ltd v Myer Stores Ltd (1995) 31 IPR 361 at 369, the Full Court approved and summarised the elements to be derived from Reckitt : "(1) that the trader's get-up, including any brand name, is recognised by the public as distinctive specifically of the plaintiff's goods; (2) that there has been a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to believe that the goods offered by the defendant are the plaintiff's goods (whether the public is aware of the plaintiff's identity as the manufacturer or supplier of the goods is immaterial, provided they are identified with a particular source, eg by means of a brand name which is in fact the plaintiff's); (3) that the plaintiff suffers or, in a quia timet action is likely to suffer, damage by reason of the erroneous belief engendered by the defendant's misrepresentation that the source of the defendant's goods is the same as the source of those offered by the plaintiff". See also TGI Friday's Australia Pty Ltd v TGI Friday's Inc (1999) 45 IPR 43 at 50.


case_text: trader's reputation can be established even though purchasers of the goods do not know its name or have its name in mind when they purchase the goods. If the applicant's get-up has acquired a distinctive reputation, a respondent's use of the name or get-up conveys the misrepresentation that the goods are the applicant's, thereby harming the applicant's goodwill: Ricegrowers Ltd v Real Foods Pty Ltd [2008] FCA 639 ; (2008) 77 IPR 32 at 44-45.


case_text: my opinion the sun device is of sufficient complexity to attract copyright protection: see Roland Corporation v Lorenzo & Sons Pty Ltd [1991] FCA 617 ; (1991) 33 FCR 111 at 114-115 and the authorities there cited. The device was "plainly drawn with care, to obtain an effect." It is certainly as complex (if not more so) than the two devices which, in Roland Corporation , would have been accorded protection but for a defence which was not relied on by Hepbourne in the present proceeding. Sections 36 and 38 of the Copyright Act identify some of the circumstances in which an infringement of copyright may occur. They provide: "36 (1) Subject to this Act, the copyright in a literary, dramatic, musical or artistic work is infringed by a person who, not being the owner of the copyright, and without the licence of the owner of the copyright, does in Australia, or authorizes the doing in Australia of, any act comprised in the copyright. (1A) In determining, for the purposes of subsection (1), whether or not a person has authorised the doing in Australia of any act comprised in the copyright in a work, without the licence of the owner of the copyright, the matters that must be taken into account include the following: (a) the extent (if any) of the person's power to prevent the doing of the act concerned; (b) the nature of any relationship existing between the person and the person who did the act concerned; (c) whether the person took any reasonable steps to prevent or avoid the doing of the act, including whether the person complied with any relevant industry codes of practice. (2) The next three succeeding sections do not affect the generality of this section. ... 38 (1) Subject to Division 3, the copyright in a literary, dramatic, musical or artistic work is infringed by a person who, in Australia, and without the licence of the owner of the copyright: (a) sells, lets for hire, or by way of trade offers or exposes for sale or hire, an article; or (b) by way of trade exhibits an article in public; if the person knew, or ought reasonably to have known, that the making of the article constituted an infringement of the copyright or, in the case of an imported article, would, if the article had been made in Australia by the importer, have constituted such an infringement. (2) For the purposes of the last preceding subsection, the distribution of any articles: (a) for the purpose of trade; or (b) for any other purpose to an extent that affects prejudicially the owner of the copyright concerned; shall be taken to be the sale of those articles. (3) In this section: article includes a reproduction or copy of a work or other subject-matter, being a reproduction of copy in electronic form". As already noted, s 14 of the Act provides that a reproduction of a substantial part of a copyright work is sufficient to constitute an infringement of that work.


case_text: though the evidence may be deficient, the Court is, nonetheless, obliged to do the best it can to make a just and fair assessment of the quantum of damages. In Enzed Holdings Ltd v Wynthea Pty Ltd [1984] FCA 373 ; (1984) 3 IPR 619 at 637 the Full Court observed that: "The principle is clear. If the court finds damage has occurred it must do its best to quantify the loss even if a degree of speculation and guess work is involved. Furthermore, if actual damage is suffered, the award must be for more than nominal damages. We should add that we can see no reason why this principle should not apply in cases under the Trade Practices Act as well as in cases at common law". See also: Sony Computer Entertainment Australia Pty Ltd v Stirling [2001] FCA 1852 at [7] - [8] . One basis for assessing damages in cases in which infringements of intellectual property rights have occurred is the making of an estimate of sales lost by the applicant as a result of the infringing conduct. Such an approach is apposite in cases such as the present where the infringing conduct has been engaged in for the purpose of convincing purchasers that they are acquiring the applicant's products: see Aristocrat Technologies at 570; Sony Computer at [8].


case_text: Norm Engineering v Digga Australia [2007] FCA 761 ; (2007) 162 FCR 1 at 79, Greenwood J summarised the principles which have been developed in relation to the exercise of the Court's powers under s 115(4): "The principles influencing an assessment of damages under the section are these... [f]lagrancy is not an essential pre-requisite for an award of additional damages; it is sufficient if the court is satisfied that any one or more of the circumstances set out in s 115(4)(b) is established ( Raben Footwear Pty Ltd v Polygram Records Inc (1997) 75 FCR 88 at 93 per Burchett J; at 103 per Tamberlin J and at 104 per Lehane J; Polygram Pty Ltd v Golden Editions Pty Ltd (1997) 76 FCR 565 at 575 per Lockhart J; Sony Entertainment (Australia) Ltd v Smith [2005] FCA 228 ; (2005) 215 ALR 788 at [158] per Jacobson J); additional damages under s 115(4) may be assessed having regard to principles derived from awards of aggravated and exemplary damages at common law ( Autodesk Inc v Yee (1996) 68 FCR 391 at 394 per Burchett J; Lamb v Cotongo [1987] HCA 47 ; (1987) 164 CLR 1 at 9-10 per Mason CJ, Brennan, Deane, Dawson and Gaudron JJ at pp 9, 10); one objective of an award is deterrence; an element of penalty is an accepted factor ( Autodesk v Yee 68 FCR at 384); the accrual of benefit by reason of the infringement to the respondent is a further factor and the notion of "benefit" suggests a pecuniary benefit to the respondent in excess of the damages otherwise payable ( Ravenscroft v Herbert [1980] RPC 193 (per Brightman J) at 208; the benefit need not be pecuniary ( Polygram v Golden Editions Pty Ltd 76 FCR at 576 per Lockhart J); and there need not be any proportionality between the amount of compensatory damages awarded pursuant to s 115(2) and the amount of additional damages awarded pursuant to s 115(4) ( Raben Footwear v Polygram Records 75 FCR at 93, 103 and 104; Microsoft Corporation v PC Club Australia Pty Ltd [2005] FCA 1522 ; (2005) 148 FCR 310 at 409, 410 per Conti J); and the assessment of the amount to be awarded is necessarily an imprecise exercise ( Bailey v Namol Pty Ltd 53 FCR at 114 per Burchett, Gummow and O'Loughlin JJ)." Counsel for Deckers invites a comparison of the circumstances of the present case with a large number of other cases in which both compensatory and additional damages have been awarded for copyright infringement. Attention was also directed to the quantum of the damages awarded in those cases. They include Aristocrat Technologies , Microsoft Corporation v Glostar Pty Ltd (t/as Downtown Technology Centre) (2003) 57 IPR 518 ; Vivid Entertainment LLC v Digital Sinema Australia Pty Ltd (No 3) [2007] FMCA 748 ; Microsoft Corporation v Ezy Loans Pty Ltd [2004] FCA 1135 ; (2004) 63 IPR 54 ; Microsoft Corporation v Goodview Electronics Pty Ltd (2000) 49 IPR 578; Zero Tolerance Entertainment Inc v Venus Adult Shops Pty Ltd [2007] FMCA 155 ; Sony Entertainment (Australia) Ltd v Smith [2005] FCA 228 ; (2005) 64 IPR 18 ; Bailey v Namol Pty Limited [1994] FCA 1401 ; (1994) 53 FCR 102 ; Amalgamated Mining Services Pty Ltd v Warman International Ltd [1992] FCA 542 ; (1992) 24 IPR 461 ; Foxtel Management Pty Ltd v Mod Shop Pty Ltd [2007] FCA 463 ; (2007) 72 IPR 1 ; Australasian Performing Right Association Ltd v Monster Communications Pty Ltd (2006) 71 IPR 212 ; and Elwood Clothing Pty Ltd (ACN 079 393 696) v Cotton On Clothing Pty Ltd (ACN 052 130 462) (2009) 8 IPR 378. These authorities are of limited assistance. They emphasise the unfettered nature of the discretion conferred on the Court in fixing an appropriate measure of additional damages. They demonstrate that, depending on the circumstances of the case, a significant award of additional damages can be made even though compensatory damages are fixed at a nominal sum; and that additional damages are often fixed at a lower sum than that awarded for compensatory damages. They make it plain that there is no recognised practice of awarding additional damages in an amount equal to or lower than compensatory damages: cf Raben Footwear at 104 (per Tamberlin J).


case_title: Swaby v Lift Capital Partners Pty Ltd [2009] FCA 749


case_text: tort does not require proof of subjective intention to mislead or actual deception: see Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Ltd [2002] FCAFC 157 ; (2002) 55 IPR 354 at 372. The misrepresentation must be likely to lead the public to believe that the goods are those of the applicant. Section 52 of the TP Act relevantly provides that: "(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. (2) ....". Section 9(1) of the FT Act is in the same terms save that the word "person" appears instead of "corporation" and the word "must" appears instead of "shall". These findings also have relevance in the present context. There has been a deliberate attempt by those involved in the manufacture of the counterfeit boots (including Hepbourne and Vladimir Vaysman) to persuade potential purchasers that they would be purchasing what were described as "genuine UGG australia" products. Vladimir Vaysman so informed those involved in the marketing of the footwear including Ms Farley and Ms Sommer. In these circumstances, and in the absence of any contrary evidence, the inference may comfortably be drawn that Hepbourne, Vladimir Vaysman and the other Respondents who were involved replicated or substantially replicated Deckers' get-up in an attempt to convince potential purchasers that they were acquiring the genuine Deckers' product. As Weinberg and Dowsett JJ said in Sydneywide Distributors at 388: "Without wishing to labour the point unduly, we again point out that where a trader, having knowledge of a particular market, borrows aspects of a competitor's get-up, it is a reasonable inference that he or she believes that there will be market benefit in so doing. Often, the obvious benefit will be the attraction of custom which would otherwise have gone to the competitor. It is an available inference from those propositions that the trader, with knowledge of the market, considered that such borrowing was "fitted for the purpose and therefore likely to deceive or confuse"...". See also Australian Woollen Mills Limited v F.S. Walton and Company Limited [1937] HCA 51 ; (1937) 58 CLR 641 at 657 per Dixon and McTiernan JJ.


case_title: TGI Friday's Australia Pty Ltd v TGI Friday's Inc (1999) 45 IPR 43


case_text: method of assessment focuses on an applicant's lost profit. The method was explained by Finkelstein J in TS & B Retail Systems Pty Ltd v 3Fold Resources Pty Ltd (No 3) [2007] FCA 151 ; (2007) 158 FCR 444 at 495-6 as follows: "The plaintiff must show that he has lost sales to the defendant as a result of the infringement and quantify the loss suffered. This requires the court to explore the counter factual hypothesis of the contracts the plaintiff would have obtained absent the infringement and the costs associated with them. Necessarily the process will involve a degree of speculation, but that is no bar to recovery. The claim is not for loss of revenue but for loss of profits. The profits to be calculated are the lost net profits. By net profits I mean revenue less all costs including variable and indirect costs, but not including income tax. Care must be taken to ensure that costs savings are brought to account. If a plaintiff sells less of his products he will have less costs and that should be treated as a gain to be offset against the lost revenue which forms the basis of the computation of lost profits. The plaintiff is also entitled to recover indirect losses (such as damage to goodwill) as long as the cause is the infringement, the loss is foreseeable and is not unduly speculative. It will often be impossible to be precise in the calculation of lost profit. If needs be, the calculation can be rough and ready, with the benefit of any doubt favouring the plaintiff". In the present case, this assessment will involve an attempt to identify the number of infringing sales, the value of the sales, and the profit margin which Deckers would have secured on those sales. There will then be a need for discounts to be applied to take account of the possibility that not all of the purchasers of the counterfeit products would necessarily have bought more expensive genuine products and the reduction in Deckers' costs as a result of not having to meet the additional orders. Allowance will also need to be made for the loss of goodwill associated with the inferior quality of the counterfeit footwear. It is necessary to begin with an attempt to gauge the extent of the sales of the counterfeit products which were manufactured on Hepbourne's premises and distributed from those premises. The unchallenged evidence tendered by Deckers establishes that, during relevant times, the following sales of footwear (sourced from the Roper Street factory) occurred: In addition, Ms Ezzat deposed that she had been responsible for sales of boots to the value of $177,776.66. Victoria Vaysman admitted that she had sold counterfeit footwear worth approximately $300,000. Neither of these witnesses provided an estimate of the total number of pairs of boots sold by them. An estimate may be made. The 15,000 pairs which were sold by Leah Farley yielded approximately $1,800,000, an average of approximately $120 per pair. The 6,700 pairs sold by Dianne Sommer yielded approximately $735,000, an average of $110 per pair. The difference is explicable by reference to variations in the prices charged for different styles of boots. If an estimate of $115 is applied as the average cost of boots sold by Ms Ezzat she sold about 1,546 pairs and Victoria Vaysman sold some 2,609 pairs.


case_text: it may readily be concluded that Hepbourne, acting through Vladimir Vaysman, authorised the infringing conduct in the sense as provided for in s 36(1A) of the Copyright Act . Hepbourne had control of the Moorabbin factory. It could have, had it wished to do so, prevented the manufacture and distribution of the infringing articles by refusing entry to those who were involved in the infringing conduct. Vladimir Vaysman's knowledge of the fact that the infringing conduct was taking place in the factory may be attributed to Hepbourne. There is no evidence to suggest that Hepbourne took any steps to prevent or avoid the infringing conduct which took place at the Moorabbin factory. The contrary is true. Hepbourne, acting through Vladimir Vaysman and others recruited by him, undertook, procured and oversaw the infringing conduct. His conduct therefore passed well beyond "mere inactivity or indifference": he clearly sanctioned, approved and countenanced the infringement of Deckers' rights: see The University of New South Wales v Moorhouse [1975] HCA 26 ; (1975) 133 CLR 1 at 12 (per Gibbs J), 20 (per Jacobs J); Cooper v Universal Music Australia Pty Ltd [2006] FCAFC 187 ; (2006) 156 FCR 380 at 408, 410-1 (per Kenny J). Passing-Off / Misleading Conduct


case_text: Rishwain's evidence relates to the ownership of the copyright subsisting in the sun device and the logo which contains the sun device and the other two elements. Although she is unable to recall the names of the specific employees who created these works, she does depose that they were created by employees of Deckers' predecessor in the course of those employees' employment. That evidence is sufficient, in my view, to render Deckers the owner of the copyright in those works pursuant to s 35(6) of the Act: see Victoria University of Technology v Wilson [2004] VSC 33 ; (2004) 60 IPR 392 at 422. Ms Rishwain's inability to identify the particular employees is not an obstacle to the making of this finding. Mr Bergstrom deposed that he was the author of the text appearing on the "UGG australia" care instruction card and most of the "UGG australia" information booklet. He wrote both texts whilst employed by Deckers and in the course of his employment by that company. Deckers thereby became the owner of the copyright in these literary works pursuant to s 35(6). Ms Trayfors took the photographs which appear in the "UGG australia" information booklet. She did so pursuant to a contract for services with Deckers. She was the "author" of those photographs: see s 10 of the Copyright Act . She was, therefore, initially the owner of the copyright in the photographs. Her undisputed evidence is, however, that she assigned all of her rights in the photographs to Deckers. Deckers thereby became the owner of the copyright in those works.


case_text: elements of a cause of action in passing-off were identified by Lord Oliver in Reckitt and Colman Products Ltd v Borden Inc (1990) 17 IPR 1 at 7. In Vieright Pty Ltd v Myer Stores Ltd (1995) 31 IPR 361 at 369, the Full Court approved and summarised the elements to be derived from Reckitt : "(1) that the trader's get-up, including any brand name, is recognised by the public as distinctive specifically of the plaintiff's goods; (2) that there has been a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to believe that the goods offered by the defendant are the plaintiff's goods (whether the public is aware of the plaintiff's identity as the manufacturer or supplier of the goods is immaterial, provided they are identified with a particular source, eg by means of a brand name which is in fact the plaintiff's); (3) that the plaintiff suffers or, in a quia timet action is likely to suffer, damage by reason of the erroneous belief engendered by the defendant's misrepresentation that the source of the defendant's goods is the same as the source of those offered by the plaintiff". See also TGI Friday's Australia Pty Ltd v TGI Friday's Inc (1999) 45 IPR 43 at 50. In Vieright the Full Court observed (at 373) that: "The settled course of authority holds that, as in the passing off claim, the essential question here is largely one of fact: is, in all the circumstances, the respondent's conduct likely to mislead? In the present kind of case, it will usually be the situation that if a passing off claim is established, it will be so by reason of a finding of a misrepresentation of the type discussed in the authorities. Such a misrepresentation will usually constitute a contravention of s 52, and possibly s 53 , of the Trade Practices Act ". In the present case there can, in my opinion, be no doubt that the conduct of Hepbourne, acting through its sole director and shareholder, was likely to mislead purchasers of the footwear manufactured in and distributed from its premises. The second element of the tort of passing-off is established, as too are contraventions of ss 52 and 53 of the TP Act. The third element needed to make out the tort of passing-off is that an applicant must suffer damage as a result of a respondent's conduct. In the present case there can be no doubt that damage has been inflicted on Deckers. That damage occurred as a result of loss of sales and the undermining of the confidence of consumers in the Deckers products because of the poor quality of the counterfeit footwear manufactured and distributed by Hepbourne and others. I will return later in these reasons to the quantification of Deckers' losses. It is sufficient for present purposes to record that the sales of counterfeit products yielded many millions of dollars for Hepbourne and other respondents. It may reasonably be inferred that much of this money would have been expended on genuine Deckers footwear had the purchasers not been induced to purchase counterfeit products. There is also evidence to support a finding, which I do make, that the counterfeit product was, in many respects, inferior to the genuine Deckers footwear. This has implications for the reputation which Deckers' products enjoy in the marketplace. The evidence to support this was provided by Mr Ken Hirshberg, the Director of Materials, Quality Control and Logistical Sourcing for the applicant. He has had 53 years' experience in the footwear manufacturing industry. He has been involved in the industry in various capacities, primarily in the sourcing of materials for the manufacture of footwear, coordinating and supervising the manufacture of footwear, and quality control in the manufacturing of footwear. Mr Hirshberg found many deficiencies in the quality of the counterfeit footwear. These deficiencies included the:


case_text: for Deckers invites a comparison of the circumstances of the present case with a large number of other cases in which both compensatory and additional damages have been awarded for copyright infringement. Attention was also directed to the quantum of the damages awarded in those cases. They include Aristocrat Technologies , Microsoft Corporation v Glostar Pty Ltd (t/as Downtown Technology Centre) (2003) 57 IPR 518 ; Vivid Entertainment LLC v Digital Sinema Australia Pty Ltd (No 3) [2007] FMCA 748 ; Microsoft Corporation v Ezy Loans Pty Ltd [2004] FCA 1135 ; (2004) 63 IPR 54 ; Microsoft Corporation v Goodview Electronics Pty Ltd (2000) 49 IPR 578; Zero Tolerance Entertainment Inc v Venus Adult Shops Pty Ltd [2007] FMCA 155 ; Sony Entertainment (Australia) Ltd v Smith [2005] FCA 228 ; (2005) 64 IPR 18 ; Bailey v Namol Pty Limited [1994] FCA 1401 ; (1994) 53 FCR 102 ; Amalgamated Mining Services Pty Ltd v Warman International Ltd [1992] FCA 542 ; (1992) 24 IPR 461 ; Foxtel Management Pty Ltd v Mod Shop Pty Ltd [2007] FCA 463 ; (2007) 72 IPR 1 ; Australasian Performing Right Association Ltd v Monster Communications Pty Ltd (2006) 71 IPR 212 ; and Elwood Clothing Pty Ltd (ACN 079 393 696) v Cotton On Clothing Pty Ltd (ACN 052 130 462) (2009) 8 IPR 378. These authorities are of limited assistance. They emphasise the unfettered nature of the discretion conferred on the Court in fixing an appropriate measure of additional damages. They demonstrate that, depending on the circumstances of the case, a significant award of additional damages can be made even though compensatory damages are fixed at a nominal sum; and that additional damages are often fixed at a lower sum than that awarded for compensatory damages. They make it plain that there is no recognised practice of awarding additional damages in an amount equal to or lower than compensatory damages: cf Raben Footwear at 104 (per Tamberlin J).


case_text: purposes served by the award of exemplary damages include the punishment of the offender and deterrence of similar conduct in the future: see XL Petroleum (N.S.W.) Proprietary Limited v Caltex Oil (Australia) Proprietary Limited [1985] HCA 12 ; (1985) 155 CLR 448 at 471. These considerations are also to be discerned in ss 115(4)(b)(i) , (ia) and (ib).


case_title: Zero Tolerance Entertainment Inc v Venus Adult Shops Pty Ltd [2007] FMCA 155


case_text: It is of course well established that the general purpose and policy of a statutory provision are a guide to its proper construction: see Australian Broadcasting Authority v Project Blue Sky [1998] HCA 28 ; (1998) 194 CLR 355 at [69] [71]; see also CIC Insurance Limited v Bankstown Football Club Limited [1997] HCA 2 ; (1995) 187 CLR 384 at 408. Ordinarily, the purpose will be gleaned from the legislative history and other extrinsic material as well as from the provisions of the statute considered as a whole: Newcastle City Council v GIO General Limited [1997] HCA 53 ; (1997) 191 CLR 85 at 112-113 per McHugh J. Regard may be paid to an object clause but it is to be read in light of the overall statutory regime: IW v City of Perth [1997] HCA 30 ; (1997) 191 CLR 1 at 12 per Brennan CJ and McHugh J.


case_text: In order to succeed on the "no evidence" ground contained in 5(1)(h) and 5(3)(b) of the ADJR Act , Adultshop must do more than negative the existence of a fact on which the decision is based; it must adduce evidence positively establishing the contrary fact: Australian Retailers Association v Reserve Bank of Australia [2005] FCA 1707 ; (2005) 148 FCR 446 at [580] per Weinberg J. 185 This ground of review is confined to findings of fact; it does not extend to expressions of opinion; Reserve Bank Case at [581]. The fact, as to which there is said to be no evidence, must be shown to be critical to the impugned decision: Minister for Immigration and Multicultural Affairs v Rajamanikkam [2002] HCA 32 ; (2002) 210 CLR 222; Reserve Bank Case at [584].


case_text: The legislative scheme was described by Merkel J at first instance in Brown v Classification Review Board (1997) 145 ALR 464 at 466-468, and, on appeal from that decision, in Brown v Classification Review Board (1998) 82 FCR 225 at 231-233 (per French J), and at 252-254 (per Sundberg J). See also New South Wales Council for Civil Liberties Inc v Classification Review Board (No. 2) [2007] FCA 896 at [4] - [8] (per Edmonds J).


case_title: Brown v Classification Review Board (1998) 82 FCR 225


case_text: On appeal in Brown v Classification Review Board , Sundberg J said that a court should only interfere with the decision of the Board (or the Review Board) if the conclusion was not reasonably open on the material before the Board. This states the test for unreasonableness in similar terms to that of Gibbs J in Buck v Bavone [1976] HCA 24 ; (1976) 135 CLR 110 at 118-119. 180 Adultshop submitted that the Review Board's decision was unreasonable within this test on two bases. First, the Review Board "unreasonably refused to accept persuasive, unchallenged and uncontradicted evidence in deciding that Viva Erotica was offensive to a majority of adults." 181 The second ground of unreasonableness was said to be that the Review Board relied on facts for which no supporting evidence existed.


case_title: CIC Insurance Limited v Bankstown Football Club Limited [1997] HCA 2 ; (1995) 187 CLR 384


case_outcome: discussed

case_text: Nevertheless, it does seem to me that the approach of the House of Lords in Director of Public Prosecutions v Collins [2006] 4 All ER 602 provides some assistance in determining what is intended by the concept of "offence to a reasonable adult". 145 In Director of Public Prosecutions v Collins the respondent had been charged with an offence under s 127(1)(a) of the Communications Act 2003 (UK), which provided, inter alia, that a person was guilty of an offence if he or she sent, by means of a public electronic communications system, a message that was "grossly offensive". The charges arose from telephone calls to a member of Parliament and his staff. The respondent had strong views on immigration policy and shouted references to "wogs", "Pakis" and "black bastards". 146 Their Lordships were of the view that the question of whether a message is "grossly offensive" is to be determined by the standards of an open and just multi-racial society and that the words used must be considered in their context and all relevant circumstances. 147 Lord Bingham observed at [9] that there can be no yardstick of gross offensiveness other than by the application of reasonably enlightened, and not perfectionist contemporary standards. His Lordship concluded at [13] that the respondent's messages were grossly offensive and would be found "by a reasonable person" to be so. 157 Both Director of Public Prosecutions v Collins and Wurramura v Haymon dealt with offensive behaviour under penal statutes rather than depictions of acts likely to cause offence to a reasonable adult under a film classification scheme. Nevertheless, the definition of "offensive" in the Guidelines adopts the ordinary meaning of that term, ie. material which causes outrage or extreme disgust. Both of the authorities to which I have referred would appear to approach the meaning of the term in that sense. 158 It is also to be noted that although the statute under consideration in Director of Public Prosecutions v Collins did not expressly proscribe messages which were (grossly) offensive to "a reasonable person", both Lord Bingham and Lord Carswell proceeded upon the basis that this was to be established in order for a contravention to be made out. Lord Carswell drew no distinction between the concept of "a reasonable person" and that of "reasonable persons." 159 The Act refers in s 11(a) to the standards "generally accepted by reasonable adults". By contrast, the description of the X18+ classification in the Code refers to depictions likely to cause offence to "a reasonable adult". This distinction also appears in s 29(4)(a) and s 29(4)(b) of the Act. 160 I do not consider that anything turns on the difference in this language. Director of Public Prosecutions v Collins suggests that there is no difference between those terms. In any event, in a cooperative legislative scheme which provides for the classification of films, it would be wrong to draw narrow distinctions between "reasonable adults" and "a reasonable adult". 161 The words "a reasonable adult" in the X18+ classification are part of a composite phrase. That phrase has special work to do. It must be considered in light of the objective referred to by the ALRC, namely that censorship, and classification categories, are aimed at regulating the availability of films within the broad framework of general community standards. The Act and the Code establish a regime for classification of films which applies nationally. Community standards differ widely across Australia. The search is not for one reasonable representative person. The scheme takes account of diverse Australia-wide community standards. 162 The Review Board said it had regard to the definition of "reasonable adult" either as contained in the Guidelines or in the Macquarie Dictionary. However, the Guidelines (ie. The Guidelines for Classification of Films and Computer Games) contain no definition of that term. (Nor, for that matter, does the Macquarie Dictionary). There is a definition of "reasonable adult" in the Guidelines for the Classification of Publications, 2005, as follows: "Possessing common sense and an open mind, and able to balance personal opinion with generally accepted community standards."


case_text: There is ample authority for the proposition that inflexible application of a policy, even if the policy is consistent with the statute under which the power is conferred, gives rise to reviewable error: see eg NEAT Domestic Trading Pty Limited v AWB Limited [2003] HCA 35 ; (2003) 216 CLR 277 at [24] per Gleeson CJ; Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 364 at 640-641 per Brennan J; Elias v Commissioner of Taxation [2002] FCA 845 ; 123 FCR 499 at [34] per Hely J. Further authority for this proposition may be found in Khan v Minister for Immigration, Local Government and Ethnic Affairs (1987) 14 ALD 291; Oreb v Willcock [2004] FCA 1520 at [172] ; and Le v Minister for Immigration & Multicultural & Indigenous Affairs [2005] FCAFC 51 at [100] .


case_outcome: considered

case_text: Senior Counsel for Adultshop called in aid the remarks of Wheeler JA in Hutchins v The State of Western Australia [2006] WASCA 258 at [4] . Her Honour there observed that the broad social purposes of censorship include ensuring that ordinary members of the community are not affronted by the display of material to which a majority of reasonable adults would object. 128 Wheeler JA's observations in Hutchins were not based upon a consideration of the extensive material or the statute as a whole. Nor was her Honour considering the cooperative legislative scheme which is the subject of these proceedings. Rather, her Honour's remarks were directed at the broad social purpose of this type of legislation. A statement of legislative purpose at this level of generality cannot displace the construction of the statute which emerges from an analysis of the language of the provision in its full context: Victims Compensation Fund v Brown [2002] NSWCA 155 ; (2002) 54 NSWLR 668 at [9] [10] per Spigelman CJ; his Honour's dissenting judgment was approved by the High Court in Victims Compensation Fund Corporation v Brown [2003] HCA 54 ; (2003) 201 ALR 260. 129 It follows in my view that the observations of Wheeler JA in Hutchins are not authority for the proposition that the words "likely to cause offence to a reasonable adult" imports a test of whether a majority of Australians would be likely to be offended. Moreover, if her Honour intended to say that the test is one of ascertaining the views of a simple majority, that is, 51% of the population, I respectfully disagree. The legislative history, overseas and Australian authority as well as the construction of the phrase in its statutory context all point against that construction. 130 The genesis of the co-operative legislative scheme for censorship of films and other publications is to be found in the Australian Law Reform Commission Report No. 55, Censorship Procedure . The ALRC Report was produced following upon a reference from the then Commonwealth Attorney-General dated 10 May 1990. 131 The Attorney noted in the terms of reference to the ALRC that the Commonwealth, the States and the Territories were in broad agreement as to the policy that ought to be pursued in relation to the censorship of imported and locally produced films. The terms of reference also noted that the ALRC was to draft legislation to give effect to its recommendations.


case_title: IW v City of Perth [1997] HCA 30 ; (1997) 191 CLR 1


case_title: Khan v Minister for Immigration, Local Government and Ethnic Affairs (1987) 14 ALD 291


case_title: Le v Minister for Immigration & Multicultural & Indigenous Affairs [2005] FCAFC 51


case_text: This ground of review is confined to findings of fact; it does not extend to expressions of opinion; Reserve Bank Case at [581]. The fact, as to which there is said to be no evidence, must be shown to be critical to the impugned decision: Minister for Immigration and Multicultural Affairs v Rajamanikkam [2002] HCA 32 ; (2002) 210 CLR 222; Reserve Bank Case at [584].


case_title: NEAT Domestic Trading Pty Limited v AWB Limited [2003] HCA 35 ; (2003) 216 CLR 277


case_text: In New South Wales v Fahy [2007] HCA 20 ; (2007) 81 ALJR 1021, Gleeson CJ observed at [6], that the balancing exercise to be undertaken to determine the standard of "the reasonable person" should not be described as a "calculus". His Honour said that what is involved is a judgment about reasonableness which is not amenable to exact calculation. 167 Chief Justice Gleeson continued at [7] by referring to an earlier authority which pointed out that there are cases in which an unduly mathematical approach to the exercise can lead to an unreasonable result. See also at [57] per Gummow and Hayne JJ.


case_title: New South Wales Council for Civil Liberties Inc v Classification Review Board (No. 2) [2007] FCA 896


case_title: Newcastle City Council v GIO General Limited [1997] HCA 53 ; (1997) 191 CLR 85


case_title: Oreb v Willcock [2004] FCA 1520


case_title: Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) (1979) 2 ALD 364


case_text: Nor do I think that the word "likely" in the phrase at hand calls for a rigid or technical approach. Mr Walters SC, for Adultshop, referred to the discussion of the meaning of "likely" in Tillmanns Butcheries Pty Limited v Australasian Meat Industry Employees' Union (1979) 27 ALR 367 at 375, 380-382. That question arose in considering the construction of s 45D of the Trade Practices Act where entirely different considerations apply. 169 I do not consider that a statutory body charged with the task of determining whether a sexually explicit film would be likely to cause offence need ask itself whether there is more than a 50% chance that this would be so. The Review Board must engage in a question of judgment, based upon its perception of the community standards of a diverse community. It seems to me that the degree of likelihood that it is required to assess is best described by the "real chance or possibility" test to which Deane J referred in Tillmanns at 382. 170 In summary, the "offensiveness" test for the X18+ classification in the Code is not determined by a mechanistic majoritarian approach. It calls for a judgment about the reaction of a reasonable adult in a diverse Australian society. 171 The "reasonable adult" test must accommodate the community standards of Toorak and Newtown as well as those of Kunnanurra and Broken Hill. It must also accommodate the standards of various subgroups within a multi-racial, secular society which nonetheless includes persons of different ages, political, religious and social views.


case_text: Wheeler JA's observations in Hutchins were not based upon a consideration of the extensive material or the statute as a whole. Nor was her Honour considering the cooperative legislative scheme which is the subject of these proceedings. Rather, her Honour's remarks were directed at the broad social purpose of this type of legislation. A statement of legislative purpose at this level of generality cannot displace the construction of the statute which emerges from an analysis of the language of the provision in its full context: Victims Compensation Fund v Brown [2002] NSWCA 155 ; (2002) 54 NSWLR 668 at [9] [10] per Spigelman CJ; his Honour's dissenting judgment was approved by the High Court in Victims Compensation Fund Corporation v Brown [2003] HCA 54 ; (2003) 201 ALR 260.


case_title: Victims Compensation Fund Corporation v Brown [2003] HCA 54 ; (2003) 201 ALR 260


case_title: Wurramura v Haymon (1987) 44 NTR 1

case_text: In Wurramura v Haymon (1987) 44 NTR 1, the appellants had been convicted of offensive behaviour for the act of sexual intercourse in a private house, at night with the light on in full view of a public street. On appeal, Asche J said, at 5, that the concept of offensive behaviour depends upon the circumstances in which it takes place and it must be looked at in a contemporary light. 154 His Honour continued as follows: "No doubt on the question of sexual mores the present age is more tolerant than any in the last century, but there are obviously still limits to what the general public will stand. Even in this day and age, performance of the act of sexual intercourse in public would be considered by the normal reasonable citizen of Australia as offensive, and offensive in the sense that some form of legal prohibition should occur. This does not in my mind make the average Australian some form of narrow minded Puritan. It merely means that he or she accepts that there are boundaries (liberal though they may be) which for the sake of themselves and their families should not be transgressed." 155 Justice Asche also said that behaviour is not necessarily offensive because it offends a particular person; there is a wide variety of personal idiosyncrasies. He quoted part of a passage from Shakespeare's The Merchant of Venice but said that, having some Scottish ancestry, he indignantly refused to quote the next few lines. I have no such ancestry, and will therefore happily quote the passage in full: "Some men there are love not a gaping pig; Some, that are mad if they behold a cat; And others, when the bagpipe sings i' the nose, Cannot contain their urine; for affection, Mistress of passion, sways it to the mood Of what it likes or loathes." 156 His Honour went on to say that the law on offensive behaviour is not for the unduly sensitive or the totally permissive. It strikes a balance. 157 Both Director of Public Prosecutions v Collins and Wurramura v Haymon dealt with offensive behaviour under penal statutes rather than depictions of acts likely to cause offence to a reasonable adult under a film classification scheme. Nevertheless, the definition of "offensive" in the Guidelines adopts the ordinary meaning of that term, ie. material which causes outrage or extreme disgust. Both of the authorities to which I have referred would appear to approach the meaning of the term in that sense.


case_text: protection of the processes of the Court and the administration of justice which this involves may, in a proper case, extend to asset preservation orders against third parties to the principal litigation: Batistatos v Roads and Traffic Authority (NSW) [2006] HCA 27 ; (2006) 226 CLR 256 at 265 per Gleeson CJ, Gummow, Hayne and Crennan JJ (citing from the joint judgments of Gaudron, McHugh, Gummow and Callinan JJ in Cardile 198 CLR at 395 [25] and in CSR Ltd v Signa Insurance Australia Limited [1997] HCA 33 ; (1997) 189 CLR 345 at 391). The effect of the administration, as Pt 5.3A contemplates, will be to bind all creditors, including the council, in the event that a deed of company arrangement is entered into and is not terminated. Because that may produce outcomes that possibly may impact on the conduct of the current proceedings in a way that is not necessarily the same as in the ordinary course of every other piece of litigation, I am of opinion that it is appropriate to require production of the insurance information sought having regard to considerations to which I have referred: Jackson [1987] HCA 23 ; 162 CLR 612 ; Batistatos [2006] HCA 27 ; 226 CLR 256 ; Lopez [1997] FCA 454.


case_outcome: distinguished

case_text: however, his Honour held that the Court, as a matter of jurisdiction had power to grant the relief sought. Lehman Brothers argues, however, that in formulating the limits of this power the Court should be guided by the decision of the Full Court of the Supreme Court of South Australia in Beneficial Finance Corporation Ltd v Price Waterhouse (1996) 68 SASR 19. In that case, there were solvent defendants. The evidence established that they would be unlikely to be able to meet more than the costs of a lengthy and highly complicated piece of litigation, in circumstances, were the plaintiff successful, which might result in an award of very substantial damages. The Full Court held that the defendants could not be required to discover documents relating to their insurance position or otherwise to produce them in accordance with particular rules of the Supreme Court of South Australia. The Full Court was unanimous in that view, although Cox J dissented on the basis that he felt constrained to follow an earlier decision to the contrary of the Full Court of the Supreme Court of South Australia. Importantly, in that case, as on the evidence now before me, the insurer had not declined liability under the professional indemnity policy. There the insurer treated itself as having had a claim made on it, but had not at that stage either admitted or denied liability. Rather, the insurer was treating the claim as one which might attract liability under the relevant policy. Perry J accepted that an earlier decision of the Full Court, J N Taylor Holdings Limited (In liq) v Bond (1993) 59 SASR 432 , illustrated that an insurer may be properly joined as a defendant, where, first, it had denied liability and, secondly, there was a need to ensure that if the proceedings went ahead, the insurer would be bound by the findings of fact and law that may enliven liability in its insured: see Beneficial Finance 68 SASR at 28. However, his Honour concluded that because the insurer was not denying liability under the policy, any attempt to have access to the insurance documents must, in those circumstances, have amounted to nothing more than a fishing exercise designed to reveal whether the documents indicated a basis for the plaintiff seeking a declaration. He held that the necessity or desirability of a declaration that the insurance responded to the claim could not be demonstrated at that stage. In that way, he distinguished the earlier decision in J N Taylor 59 SASR 432: see Beneficial Finance 69 SASR at 36 and at 52-53, Lander J was of a similar view. In my opinion, Beneficial Finance 68 SASR 19 is distinguishable. The current application is not an application for discovery but for production of documents. I accept that considerations relevant to the issue of discovery may also govern or assist in the formulation of discretionary judgments as to whether documents ought be produced in particular circumstances. But the present circumstances are that the council is involved in the current litigation and an event has occurred in its course that has given rise to this application being made. That event is the administration of Lehman Brothers. No longer is Lehman Brothers the same entity as that with which the council dealt unlike in Beneficial Finance 68 SASR 19 , where the plaintiff had to take the solvent defendants as it found them. The same circumstances that enlivened Olney J's exercise of discretion to order production in Lopez [1997] FCA 454 have been introduced here by the intervening event of the administration and the consequent, inferred admission that Lehman Brothers is insolvent.


case_text: power of the Court to require a party to proceedings in which relief is sought against it to disclose its assets has been established authoritatively in Jackson v Sterling Industries Limited [1987] HCA 23 ; (1987) 162 CLR 612. In the leading judgment, Deane J ( Jackson 162 CLR at 622-623) discussed the power to make what are now known as Mareva orders ( Cardile v LED Builders Pty Ltd [1999] HCA 18 ; (1999) 198 CLR 380 at 401 [42] ) saying that (omitting citations): "That general power has been held to encompass an order requiring the disclosure by a defendant of his assets ... As a general proposition, it should now be accepted in this country that "a Mareva injunction can be granted ... if the circumstances are such that there is a danger of [the defendant's] absconding, or a danger of the assets being removed out of the jurisdiction or disposed of within the jurisdiction, or otherwise dealt with so that there is a danger that the plaintiff, if he gets judgment, will not be able to get it satisfied"." I am of opinion that the purposes of Pt 5.3A are relevant and do inform the exercise of the Court's discretion in this application to order production of documents of the kind sought. However, those purposes do not deny to the Court power properly to control and determine what orders it ought make in each particular case in the interests of the administration of justice, pursuant to its powers under s 23 of the Federal Court of Australia Act , or in its inherent or implied jurisdiction to ensure the protection of its process from any abuse: cf: Cardile 198 CLR at 396 [33]. The power of the Court to prevent abuse of its process comprehends a power to protect the integrity of its processes once set in motion. That includes the power to preserve the efficacy of the execution that would lie against a prospective judgment debtor. The protection of the processes of the Court and the administration of justice which this involves may, in a proper case, extend to asset preservation orders against third parties to the principal litigation: Batistatos v Roads and Traffic Authority (NSW) [2006] HCA 27 ; (2006) 226 CLR 256 at 265 per Gleeson CJ, Gummow, Hayne and Crennan JJ (citing from the joint judgments of Gaudron, McHugh, Gummow and Callinan JJ in Cardile 198 CLR at 395 [25] and in CSR Ltd v Signa Insurance Australia Limited [1997] HCA 33 ; (1997) 189 CLR 345 at 391).


case_text: there is an issue as to whether the solicitor for the council should be allowed to have access to these documents. She gave evidence that she acts for over 30 other councils, which are considering bringing similar or related claims against Lehman Brothers. The implied obligation or undertaking, as to confidentiality, is an important adjunct to the administration of justice in proceedings. The implied undertaking is a formula by which the law ensures that no harsher or more oppressive burden is placed on litigants or persons who produced documents than is necessary to do justice in the proceedings, at the stage they have reached. Persons who give discovery or produce documents under compulsion can suffer a very serious invasion of the privacy and confidentiality of their affairs: Hearne v Street [2008] HCA 36 ; (2008) 235 CLR 125 , at 158-159 [107] per Hayne, Heydon and Crennan JJ. There is a public interest in preserving the ordinary confidentiality that attaches to production of documents under compulsion by the Court. It is the circumstance that Lehman Brothers is, in fact, a party to this litigation, which attracts the jurisdiction and, ultimately, the exercise of my discretion, to order production of the documents the council has sought. I do not see, at the moment, any reason why the council should be relieved of the constraint, imposed in the implied undertaking to keep confidential and to use the documents only for the purposes of these proceedings and to assist it in determining its position for the adjourned second creditors' meeting. The council's ability to use the information in the documents to be produced extends to include, in my view, informing itself as to how it ought approach voting on any proposals for a deed of company arrangement, or liquidation, of Lehman Brothers, since those matters affect its entitlement to enforce, or may affect its entitlement to enforce, any judgment and the quantification of that judgment. I am of opinion that there is good reason to suppose that if Ms Banton is given access to the documents that I have ordered be produced, she will be placed in an impossible position as a fiduciary with the knowledge that she will gain of their contents in advising or dealing with persons who are her other clients. I think that I should afford the parties an opportunity to discuss and formulate an appropriate order that enables a person who would be bound by the implied undertaking, or may give express undertakings, who can advise the council, but will not be able to be involved in giving advice to or communicate with the other clients of Ms Banton's. Whether that person is independent entirely of the solicitors for the council or a person who, through the use of Chinese walls, can discharge that function, I think I should leave for the parties to discuss in the first instance. Finally, Lehman Brothers has asked that any order I make be stayed for 24 hours to enable it to consider its position as to whether it would wish to seek leave to appeal from my decision. I think that is a reasonable request. The reason I have given my judgment now is because of the urgency and the need, if any party wishes to challenge my decision, that they have some opportunity to do so and I would not wish to frustrate that. I certify that the preceding fifty-two (52) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Rares. Associate: Dated: 21 May 2009 Counsel for the Applicant: M Pembroke SC and T Mehigan Solicitor for the Applicant: Piper Alderman Counsel for the Respondent: B Coles QC and V Whittaker Solicitor for the Respondent: Clayton Utz Dates of Hearing: 19 and 21 May 2009 Date of Judgment: 19 May 2009 Date of making of Orders: 21 May 2009 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2009/532.html


case_text: of the relief claimed by the council in the principal proceedings is in relation to allegedly misleading statements by Lehman Brothers. In those circumstances, one Lehman Brothers' related company is proposing a deed of company arrangement that would have the effect, on the evidence before me, of seeking to destroy the creditors' right to sue directors and officers of the company for breaches of their obligations. Such a right may be capable of being enforced directly against the directors and officers in an action under the Trade Practices Act 1974 (Cth) or its analogues in State Fair Trading Acts : Houghton v Arms [2006] HCA 59 ; (2006) 225 CLR 553 at 566-567 [40] - [42] per Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ. The council is also in the position where its vote at the proposed meeting of creditors is, because of the administrators' current view, likely to be admitted at merely nominal value, whereas, the other parties who may benefit in that meeting, such as the related Lehman Brothers companies, have debts that will be available to vote for their full value of about $180 million, on a proposal they are seeking to put forward and commend to the other creditors. That may all have a dramatic impact on the rights and recourse of the council, were it successful in this litigation, in the event that the proceedings were permitted to continue having regard to the terms of the deed or any subsequent orders made by the Court granting the council leave to proceed to final hearing against Lehman Brothers. The grant of any such orders may, in themselves, be affected by the existence of insurance that, prima facie, does respond. Lehman Brothers has made claims on insurers A and B with respect to these proceedings. The information available to the council, as an ordinary incident of an administration under Pt 5.3A , is less than other creditors involved in this very administration, such as the related Lehman Brothers companies. While that is a result contemplated by the Parliament as potentially possible, the questions arise whether there will be potential or actual prejudice to the council in these proceedings of rights that may be valuable in the event that the council were able to succeed in obtaining a judgment in its favour.


case_outcome: followed

case_text: council argued essentially that the issue for decision was properly characterised in my summary in Wingecarribee (No 1) [2009] FCA 503 at [10] where I said: "In my opinion, the question whether a respondent or defendant has assets that are available to satisfy a judgment and whether there is another party who may be liable, such as an insurer the subject of a charge under s 6 of the Law Reform (Miscellaneous Provisions) Act are matters which are within the power of the Court to require to be disclosed in the proceedings themselves: see Jackson v Sterling Industries Limited [1987] HCA 23 ; (1987) 162 CLR 612 at 622-623 per Deane J, where he discussed the ambit of s 23 of the Federal Court of Australia Act and the power of the court to grant relief in the nature of Mareva orders, including the disclosure of assets by a defendant or respondent." Section 23 of the Federal Court of Australia Act 1976 (Cth) provides that: "The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, and to issue, or direct the issue of, writs of such kinds, as the Court thinks appropriate." The inherent or implied power of the Court as a superior court of record constituted under the Act may also give the court additional powers. Lehman Brothers argues that essentially there are two substantive reasons why there is either no power, or the circumstances of the proceedings are such as to condition and constrain the exercise of any such power. First, it points to the general principle that the courts have been unwilling to accept that insurance arrangements entered into between parties to proceedings for indemnity in respect of any liability that might be established against those parties in the proceedings are relevant or discoverable in the ordinary course of litigation or having regard to the principles on which discovery is given. The power of the Court to require a party to proceedings in which relief is sought against it to disclose its assets has been established authoritatively in Jackson v Sterling Industries Limited [1987] HCA 23 ; (1987) 162 CLR 612. In the leading judgment, Deane J ( Jackson 162 CLR at 622-623) discussed the power to make what are now known as Mareva orders ( Cardile v LED Builders Pty Ltd [1999] HCA 18 ; (1999) 198 CLR 380 at 401 [42] ) saying that (omitting citations): "That general power has been held to encompass an order requiring the disclosure by a defendant of his assets ... As a general proposition, it should now be accepted in this country that "a Mareva injunction can be granted ... if the circumstances are such that there is a danger of [the defendant's] absconding, or a danger of the assets being removed out of the jurisdiction or disposed of within the jurisdiction, or otherwise dealt with so that there is a danger that the plaintiff, if he gets judgment, will not be able to get it satisfied"." The other members of the High Court agreed with that approach: Jackson 162 CLR at 616 per Mason CJ, at 617 and 619 per Wilson and Dawson JJ. Indeed, Wilson and Dawson JJ said that the purpose of the grant of a Mareva order is to prevent the abuse of the process of the Court by frustration of its remedies. The power could be exercised for purposes including to prevent a defendant from removing assets in order to defeat a judgment: ( Jackson 162 CLR at 617). They explained that the power ( Jackson 162 CLR at 619): "... exists not to create additional rights but to enable a court to protect its process from abuse in relation to the enforcement of its orders. It is neither a species of anticipatory execution nor does it give a form of security for any judgment which may ultimately be awarded." Likewise, Brennan J, in agreeing, explained that the remedy was incidental to the exercise by the court of its jurisdiction to enter judgment for a debt or damages and was designed to prevent the defendant from divesting himself of his assets whereby enforcement of such a judgment might be frustrated ( Jackson 162 CLR at 621). There is no suggestion here that the administrators have the purpose of interfering with or frustrating the ordinary execution of the Court's orders. But, the effect of implementation of a deed of company arrangement, as opposed to a liquidation, can radically affect the ordinary rights of creditors. In a liquidation their rights would be converted into a right to prove in the liquidation which may be different to their rights under a deed of company arrangement. Indeed, some of the proposed terms of Lehman Brothers Asia Holdings' deed to which I have referred, such as the release of rights against third parties including directors and officers, could have a significant and adverse affect on a creditor being able to enforce its ordinary remedies. In addition, the suggested deed of company arrangement will make provision for the distribution of whatever entitlements may be available to creditors that would otherwise have had rights in respect of insurance policies, such as those written by insurers A, B or C that might respond to the various claims. Those proposals include ones affecting the creditors rights to proceed directly against insurers under s 6 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) or against the directors and officers of Lehman Brothers or their insurers. I am of opinion that the Court's power to require Lehman Brothers to produce the insurance documents is found in s 23 and the inherent or implied power of the Court to do justice in a matter before it. It is an important part of the Court's ordinary processes to permit litigants before it to have effective remedies and the means, if appropriate, of enforcing them when orders are made. The effect of the administration, as Pt 5.3A contemplates, will be to bind all creditors, including the council, in the event that a deed of company arrangement is entered into and is not terminated. Because that may produce outcomes that possibly may impact on the conduct of the current proceedings in a way that is not necessarily the same as in the ordinary course of every other piece of litigation, I am of opinion that it is appropriate to require production of the insurance information sought having regard to considerations to which I have referred: Jackson [1987] HCA 23 ; 162 CLR 612 ; Batistatos [2006] HCA 27 ; 226 CLR 256 ; Lopez [1997] FCA 454.


case_text: Lopez v Star World Enterprises Pty Ltd [1997] FCA 454 (unreported, 18 April 1997) Olney J held that a respondent company that had been placed in administration could be ordered by the Court to make available its insurance policies to the applicant. He held that after the respondent company had been placed in administration, and was in jeopardy of going into liquidation, the question whether or not there was any insurance indemnity available in the event of liability being established was a matter appropriate to take into account for the purpose of determining whether or not leave to proceed against the company should be given under s 440D(1) of the Corporations Act . For the purposes of doing justice and to progress the matter in an orderly fashion, Olney J ordered that the respondent company produce for inspection evidence of any relevant insurance policy that it had. Lehman Brothers does not suggest that his Honour erred in principle. But it seeks to distinguish his decision on the ground that those proceedings were brought under Pt IVA of the Federal Court of Australia Act , as representative proceedings. Lehman Brothers argues that the discretionary considerations attaching to the conduct of such proceedings and the fact that there is a large body of potential group members who may be affected, are grounds for confining the exercise of a similar discretion in favour of production of the insurance documents in a case such as the present. But the present circumstances are that the council is involved in the current litigation and an event has occurred in its course that has given rise to this application being made. That event is the administration of Lehman Brothers. No longer is Lehman Brothers the same entity as that with which the council dealt unlike in Beneficial Finance 68 SASR 19 , where the plaintiff had to take the solvent defendants as it found them. The same circumstances that enlivened Olney J's exercise of discretion to order production in Lopez [1997] FCA 454 have been introduced here by the intervening event of the administration and the consequent, inferred admission that Lehman Brothers is insolvent. The effect of the administration, as Pt 5.3A contemplates, will be to bind all creditors, including the council, in the event that a deed of company arrangement is entered into and is not terminated. Because that may produce outcomes that possibly may impact on the conduct of the current proceedings in a way that is not necessarily the same as in the ordinary course of every other piece of litigation, I am of opinion that it is appropriate to require production of the insurance information sought having regard to considerations to which I have referred: Jackson [1987] HCA 23 ; 162 CLR 612 ; Batistatos [2006] HCA 27 ; 226 CLR 256 ; Lopez [1997] FCA 454.


case_text: And, in a decision handed down on the same day, Cohn v Hatcher [2005] FCAFC 199 ; (2005) 146 FCR 275 the same Full Court looked again at the operation of 'exceptional circumstances' within s 106KA and reg 11. Lander J said that reg 11(a) provided for certain circumstances which are like, but not the same as, circumstances which might be 'exceptional circumstances' in s 106KA(2) ( Cohn 146 FCR at 288 [67]). He held that, first, the medical practitioner had to establish that an unusual occurrence had occurred which caused an unusual level of need for professional attendances. Next, the practitioner must establish that that occurrence affected the rendering or initiating of services by him or her ( Cohn 146 FCR at 288 [70]). In this way each of reg 11(a) and s 106KA(2) were held to interact. And, once the medical practitioner establishes both that exceptional circumstances existed and they affected the rendering or initiating of services by him or her, the day or days on which that is established are not taken by s 106KA(1) to have constituted engaging in inappropriate practice. The Full Court did not deal with the operation of s 106KA(2A). 16 At the outset it is important to understand how s 106KA operates. First, s 106KA(1) is expressly made subject to subsections (2) and (2A). Each of the latter subsections identifies an exception to s 106KA(1) although the exceptions work in different ways. How they work bears on what s 106KA(1) itself does in deeming a certain state of affairs to amount to a practitioner engaging in inappropriate practice. 17 Because s 106KA(1) creates a statutory fiction, by the deeming it prescribes, ss 106KA(2) and (2A) recognise that the person under review is entitled, to a point, to negate that fiction. Critically, s 106KA(1) refers to '... the circumstances in which some or all of the referred services were rendered ... constituted a prescribed pattern of services'. Thus while not all of the referred services may remain a part of a pattern after the committee examines them, it is essential that what remains is a pattern. A pattern, by regulation 10 , must have the characteristic that 80 or more professional attendances within the meaning of reg 7 ' ... are rendered on each of 20 or more days in a 12 month period'. Thus, conduct cannot satisfy reg 10 so as to constitute a prescribed pattern of services unless it occurs 'on each of 20 or more days'. 78 It is common ground that there was no express consideration of reg 11(a) by either committee. At the forefront of the doctors' argument was the fact that the committees failed to conduct any analysis in the terms of, or having regard expressly to, reg 11(a). In Lee v Kelly [2005] FCAFC 197 , another decision of Black CJ, Wilcox and Lander JJ decided at the same time as Oreb [2005] FCAFC 196 ; 146 FCR 237 and Hatcher [2005] FCAFC 199 ; 146 FCR 275, Lander J, with whom the Chief Justice and Wilcox J agreed, said at [2005] FCAFC 197 [24] that if a medical practitioner relied on the provisions of s 106KA(2), the committee must satisfy themselves as to whether in doing so the medical practitioner was relying upon 'exceptional circumstances' in its ordinary English meaning or upon either of the sub-paragraphs in reg 11. He pointed out that a medical practitioner could rely on all three, but that would be unlikely. Lander J observed that it was more likely that the practitioner would rely on only one of the three matters to discharge the onus in s 106KA(2) and continued: 'If, however, the medical practitioner is not able to articulate which of the three separate legislative provisions are relied upon, then the committee must inquire as to whether the factual circumstances advanced by the medical practitioner come within any of the exceptional circumstances in s 106KA(2), or the circumstances in reg 11(a) or reg 11(b).'


case_text: The second aspect of procedural fairness or natural justice is that a person should not be a judge in his or her own cause. Here, each committee has acted as a protagonist in this Court in their own cause and they now suggest they should be returned to the position of being a judge, in the sense of a lay tribunal charged with functions of administrative decision-making, in the same cause. That is an unsatisfactory outcome which should not occur unless it is necessary under the legislation: see Laws v Australian Broadcasting Tribunal [1990] HCA 31 ; (1990) 170 CLR 70 at 81-82 per Mason CJ and Brennan J, 96 per Deane J. I am of the preliminary opinion that it is not necessary, but I will hear the parties, if they desire, on whether I should make orders of the following nature: (a) An order in the nature of a writ of prohibition in the first instance issue prohibiting each of the first respondents from further constituting Professional Services Review Committee No 295 [293]. (b) An order in the nature of a writ of mandamus issue requiring the fourth respondent to reconstitute Professional Services Review Committee No 295 [293] to further consider the referral made on 13 December 2001 under s 86 of the Health Insurance Act 1973 (Cth) in accordance with law. 115 For the reasons I have given, each committee made a jurisdictional error and the doctors are entitled to relief. I certify that the preceding one hundred and fifteen (115) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Rares. Associate: Dated: 26 March 2007 Counsel for the Applicants: MA Robinson Solicitor for the Applicants: Tress Cox Counsel for the Respondents: RM Henderson Solicitor for the Respondents: Minter Ellison Date of Hearing: 21, 22 September 2006 Date of Judgment: 26 March 2007 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2007/388.html


case_text: However, in their approach the committees have made the tail of the regulation wag the dog of the statute. This eschewed the ordinary principles of statutory construction and the application of the salutary and broad discretion which the Parliament, by its words, conferred on the committees in s 106KA(2). While reg 11 gave effect to intentions expressed in the Review Report and in the Parliament, it did not restrict the circumstances which a committee must take into account in forming a view for the purposes of the application of s 106KA(2). Those intentions are matters to which the Court may have regard as part of the historical context in which s 106KA was enacted so that a purposive meaning can be given to the legislation: Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14 ; (2004) 218 CLR 273 at 280-281 [10] - [11] per McHugh ACJ, Gummow and Hayne JJ; Sydney Airport Corporation Ltd v Australian Competition Tribunal [2006] FCAFC 146 ; (2006) 155 FCR 124 at 125 [2] per French, Finn and Allsop JJ. The literal construction of s 106KA(2) and reg 11 will not defeat the intention of the Parliament (or the Executive in making the regulation).