case_text: At common law a person who would otherwise be entitled to the benefit of client legal privilege will waive that privilege, perhaps unintentionally, if he or she engages in conduct that is inconsistent with the maintenance of the confidentiality that the privilege protects ( Mann v Carnell [1999] HCA 66 ; (1999) 201 CLR 1 per Gleeson CJ, Gaudron, Gummow and Callinan JJ at [28]). 10 A central allegation made by Ms Rich is that, by imposing access restrictions on her, the first respondent, Mr Harrington, the Country Senior Partner for Australia, acting on behalf of the partners of PwC who answer the description of "Management" in the Partnership Deed ("the Management"), and with the subsequent approval of the Board of Partners ("the Board"), committed an act of victimisation against her within the meaning of s 94 of the Sex Discrimination Act . 11 Section 94(2) of the Sex Discrimination Act relevantly provides: (2) For the purposes of subsection (1), a person shall be taken to commit an act of victimization against another person if the first mentioned person subjects, or threatens to subject, the other person to any detriment on the ground that the other person: (a) has made, or proposes to make, a complaint under this Act or the Human Rights and Equal Opportunity Commission Act 1986 ; (b) has brought, or proposes to bring, proceedings under this Act or the Human Rights and Equal Opportunity Commission Act 1986 against any person; ... (d) has attended, or proposes to attend, a conference held under this Act or the Human Rights and Equal Opportunity Commission Act 1986 ; ... (f) has reasonably asserted, or proposes to assert, any rights of the person or the rights of any other person under this Act or the Human Rights and Equal Opportunity Commission Act 1986 ; or (g) has made an allegation that a person has done an act that is unlawful by reason of a provision of Part II ; or on the ground that the first-mentioned person believes that the other person has done, or proposes to do, an act or thing referred to in any of paragraphs (a) to (g), inclusive. 20 The form of implied waiver that Ms Rich seeks here to invoke is known as "issue waiver". In Mann v Carnell at [29] the majority of the High Court stated the governing principle concerning waiver of privilege as follows: Waiver may be express or implied. Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. When an affirmative answer is given to such a question, it is sometimes said that waiver is "imputed by operation of law". This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege. ... What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large. (Citation omitted) 21 In Commissioner of Taxation v Rio Tinto Ltd [2006] FCAFC 86 ; (2006) 151 FCR 341 the Full Court gave careful consideration to modern authorities, including recent judgments of the Full Court of this Court, on issue waiver. It is not necessary for me to refer extensively to what their Honours there said as they summarised their conclusions at [60]-[61]. At [60] their Honours emphasised that the authorities reveal that whether or not privilege has been waived will in every case depend very much on the particular circumstances of the case. At [61] their Honours identified the governing principle in the following way: Both before and after Mann , the governing principle required a fact-based inquiry as to whether, in effect, the privilege holder had directly or indirectly put the contents of an otherwise privileged communication in issue in litigation, either in making a claim or by way of defence. In DSE [ie DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384 ; (2003) 127 FCR 499] [58], Allsop J put the matter somewhat more descriptively, saying waiver arises when "the party entitled to the privilege makes an assertion (express or implied), or brings a case, which is either about the contents of the confidential communication or which necessarily lays open the confidential communication to scrutiny and, by such conduct, an inconsistency arises between the act and the maintenance of the confidence, informed partly by the forensic unfairness of allowing the claim to proceed without disclosure of the communication" (emphasis in original). 29 At [68] his Honour, after referring to Australian Unity Health Ltd v Private Health Insurance Administration Council [1999] FCA 1770 ; Ampolex Ltd v Perpetual Trustee (Canberra) Ltd (1996) 40 NSWLR 12; Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd [1996] HCA 15 ; (1996) 137 ALR 28 at 34; [1996] HCA 15 ; 70 ALJR 603 at 607 per Kirby J; Adelaide Steamship Company Ltd v Spalvins (1998) 81 FCR 360 at 366 367; BT Australasia Pty Ltd v State of New South Wales (No 7) (1998) 153 ALR 722 at 743 744; BT Australasia Pty Ltd v State of New South Wales (No 8) (1998) 154 ALR 202 at 207 and Mann v Carnell observed: ... The test looks to inconsistency between the disclosure that has been made by the client on the one hand and the purpose of confidentiality that underpins legal professional privilege on the other. It is not a matter simply of applying general notions of fairness as assessed by the individual judge. The authorities to which I have referred show that it is well established that for a client to deploy the substance or effect of legal advice for forensic or commercial purposes is inconsistent with the maintenance of the confidentiality that attracts legal professional privilege. 78 The respondents argued that, even if there were not a sufficient identity of interest between Mr Harrington and Mr Edwards, it does not automatically follow that the limited disclosure to Mr Harrington resulted in a waiver of privilege in the advice against the rest of the world. They placed reliance in particular on the majority judgment in Mann v Carnell at [30] where their Honours said: In Goldberg v Ng this Court considered a case in which there was disclosure of a privileged communication to a third party, for a limited and specific purpose, and upon terms that the third party would treat the information disclosed as confidential. The Court was divided upon whether, in the circumstances of the case, privilege was waived. However, the reasoning of all members of the Court was inconsistent with the proposition that any voluntary disclosure to a third party necessarily waives privilege. No application was made on the present appeal to re-open Goldberg or any of the earlier authorities on the subject. In Goldberg , reference was made to the statement of Jordan CJ in Thomason v Campbelltown Municipal Council : "The mere fact that a person on some one occasion chooses to impart to another or others advice which he has received from his solicitor indicates no intention on his part to waive his right to refuse on other occasions to disclose in evidence what that advice was, and supplies no sufficient reason for depriving him of a form of protection which the law has deemed it specially necessary to throw around communications between solicitor and client". (Citations omitted) 79 Shortly before the publication of the High Court's judgment in Mann v Carnell , Sackville J had followed Goldberg v Ng in Australian Rugby Union Ltd v Hospitality Group Pty Ltd (1999) 165 ALR 253. At [44] his Honour said: In my view, the mere fact that otherwise privileged communications at the meeting took place in the presence of persons who did not represent clients of [a legal firm], does not justify a conclusion that the ARU had expressly or intentionally waived privilege in those communications. The disclosure of the privileged communications was to a limited group, namely those attending the meeting. While there is no evidence of an express undertaking by the non-clients present at the meeting to preserve confidentiality, the circumstances suggest that the non-clients were under an implied obligation to respect the confidentiality of the communications at the meeting.


case_outcome: cited

case_text: It is not sufficient for a party merely to assert a claim for client legal privilege; the party making the claim must establish the facts giving rise to the privilege ( National Crime Authority v S (1991) 29 FCR 203 at 211). Where the claim is made in respect of a document, the Court has power to examine the document for itself ( National Crime Authority v S at 211). I interpolate that in this case, to avoid the risk of my seeing privileged communications that might render it impossible or undesirable for me to be the trial judge, I have undertaken not to examine any document in respect to which privilege is claimed without first hearing from the parties. If, having done so, I am persuaded that it is necessary for the Court to examine the document but that it would be inappropriate for me to do so, another judge will be asked to determine the status of the document in question.


case_text: As Giles J observed in Network Ten Ltd v Capital Television Holdings Ltd (1995) 36 NSWLR 275 at 279: If two parties with a common interest exchange information and advice relating to that interest, the documents or copy documents containing that information will be privileged from production in the hands of each; ...


case_text: Although a party who asserts a claim for client legal privilege carries the onus of establishing the claim, where it is alleged that privilege has been waived in a communication that was privileged when made, the party alleging waiver carries the onus of establishing waiver ( Nine Films & Television Pty Ltd v Ninox Television Ltd (2005) 65 IPR 442 at [21]).


case_text: Ms Rich did not argue that a salaried, or in-house lawyer, necessarily lacks the independence necessary for client legal privilege to attach to his or her advice. Rather she placed reliance on the approach adopted by Graham J in Seven Network Ltd v News Ltd (2005) 225 ALR 672 at [15] where his Honour said: In my opinion, an in-house lawyer will lack the requisite measure of independence if his advice is at risk of being compromised by virtue of the nature of his employment relationship with his employer. On the other hand, if the personal loyalties, duties and interests of the in-house lawyer do not influence the professional legal advice which he gives, the requirement for independence will be satisfied. 44 In arguing that OGC was in a position to provide independent advice to them, the respondents placed weight on the following passages from the reasons for judgment of Tamberlin J in Seven Network Ltd v News Ltd [2005] FCA 142 concerning documents generated by an in-house counsel: 4. The dominant purpose test has particular importance in relation to the position of in-house counsel because they may be in a closer relationship to the management than outside counsel and therefore more exposed to participation in commercial aspects of an enterprise. The courts recognise that being a lawyer employed by an enterprise does not of itself entail a level of independence. Each employment will depend on the way in which the position is structured and executed. For example, some enterprises may treat the in-house adviser as concerned solely in advising and dealing with legal problems. As a matter of commercial reality, however, both internal and external legal advisers will often be involved in expressing views and acting on commercial issues. 5. The authorities recognise that in order to attract privilege the legal adviser should have an appropriate degree of independence so as to ensure that the protection of legal professional privilege is not conferred too widely. Commercial reality requires recognition by the courts of the fact that employed legal advisers not practising on their own account may often be involved to some extent in giving advice of a commercial nature related to the giving of legal advice. Such involvement does not necessarily disqualify the documents relating to that role from privilege. The matter is necessarily one of fact and degree and involves a weighing of the relative importance of the identified purposes. ... 38. ... I am cognisant of the fact that there is no bright line separating the role of an employed legal counsel as a lawyer advising in-house and his participation in commercial decisions. In other words, it is often practically impossible to segregate commercial activities from purely "legal" functions. The two will often be intertwined and privilege should not be denied simply on the basis of some commercial involvement. In the present case, however, I am persuaded that Mr Philip was actively engaged in the commercial decisions to such an extent that significant weight must be given to this participation. In many circumstances where in-house counsel are employed there will be considerable overlap between commercial participation and legal functions and opinions. As can be seen from the specific rulings below, I am not persuaded that in this proceeding Mr Philip was acting in a legal context or role in relation to a number of the documents in respect of which privilege was claimed. Nor am I persuaded that the privilege claims were based on an independent and impartial legal appraisal. 45 In reliance on the above passages the respondents submitted as follows: A reading of these passages ... shows that when Tamberlin J was referring to 'independence', his Honour was focussing specifically on the issue of whether the in-house lawyer is, in generating the particular communication or document, performing a legal function distinct from (that is, independent of) the commercial activities or management of the client. That is, 'independence' has to be determined having regard to whether or not the person in question was performing a legal function (rather than a commercial or management function) in making a communication or preparing a document. The decision is not authority for the proposition that an in-house lawyer is, prima facie, someone who is not independent of the client. Nor is it authority for the proposition that, where there is some issue about independence in the sense outlined above, none of the documents generated by the in-house counsel can attract privilege. Instead, as the analysis of the documents generated by Mr Phillip shows, privilege can still be maintained in all documents generated in a legal context, or which embody or refer or relate to legal advice. 46 I am not persuaded that Tamberlin J in Seven Network Ltd v News Ltd intended to conflate the criteria for a claim of client legal privilege in the way suggested by the above submissions. The requirement that the legal adviser be independent is principally concerned with the nature of the relationship between the client who claims client legal privilege and the legal adviser. The requirement that the communication be made for the dominant purpose of obtaining legal advice or to conduct or aid in the conduct of litigation in reasonable prospect is concerned with the object and subject matter of the communication. Each criterion must be satisfied before a claim for client legal privilege will succeed. 47 I therefore turn to consider the evidence concerning the nature of the relationship between OGC, Ms Rich and the respondents. The person directly responsible for the legal advice and other legal services provided by OGC is the holder of the position of General Counsel. At all relevant times the holder of the position of General Counsel has been a partner in PwC. Elizabeth Jane Dibbs, solicitor, was General Counsel for the period from 1 July 1998 until her retirement in December 2004. At all times while she was General Counsel she held a current practicing certificate and each of the solicitors in OGC also held a current practicing certificate. Ms Dibbs' successor as General Counsel was Meredith Kim Beattie, solicitor. Prior to joining PwC on 8 February 2005, Ms Beattie had been a partner in the legal firm Blake Dawson Waldron for almost 16 years. She has maintained her practicing certificate as General Counsel and each of the solicitors in OGC continues to hold a practicing certificate. 48 I accept the evidence of Ms Dibbs and Ms Beattie concerning the general functioning of OGC. Their evidence demonstrated that OGC operates as a separate functional unit with PwC. Both Ms Dibbs and Ms Beattie have regarded it as essential that OGC operate on a professional basis, providing professional legal advice and services to PwC with the same level of objectivity as would external lawyers. Separate files are opened within OGC and marked accordingly. Working documents and current files are either kept in a separate and secure OGC area or in lawyers' offices capable of being locked. OGC is separately located on an administrative floor away from the business units of PwC. Neither Ms Dibbs nor Ms Beattie has held any management or executive positions at PwC, nor have any of the other solicitors in OGC. Nonetheless, Ms Howard, the Deputy General Counsel, has fulfilled the role of secretary to the Board of partners and was (perhaps is) a member of the Partnership Amendment Review Committee. In both capacities Ms Howard's role has been to provide professional legal advice and legal services and incidental administrative services such as preparing agendas and collating papers.


case_text: Client legal privilege exists to serve the public interest in the administration of justice by encouraging frank disclosure by clients to their lawyers. As Mason and Wilson JJ stated in Waterford v The Commonwealth [1987] HCA 25 ; (1987) 163 CLR 54 ( "Waterford" ) at 62, "the proper functioning of the legal system is facilitated by freedom of consultation between the client and the legal adviser". Their Honours went on to observe at pages 64-65 that legal professional privilege is the product of a balancing exercise between competing public interests whereby, subject to the well-recognised crime or fraud exception, the public interest in the administration of justice is accorded paramountcy over the public interest in a fair trial conducted by reference to all relevant documents (see also Esso Australia per Gleeson CJ and Gaudron and Gummow JJ at [35]). There is no further balancing exercise to be carried out; if client legal privilege attaches to a communication, the privilege may be waived or overridden by statue but is otherwise absolute ( Telstra Corporation Ltd v Minister for Communications, Information Technology and the Arts (No 2) [2007] FCA 1445 ( "Telstra" ) at [21]). 43 Graham J has more recently adopted the same approach in Telstra at [35]. In Telstra his Honour concluded at [36]-[39] that as no evidence had been adduced going to the independence of the relevant internal legal advisers no sufficient claim for legal professional privilege had been made. I reject the submission of Ms Rich that the respondents in this case have similarly adduced no real evidence going to the independence of OGC. I refer below to the evidence touching on the independence of OGC.


case_text: The content of the requirement that a legal adviser be independent is understandably less stringent than the requirement that, for example, a judge be independent. However, it is informed by the same notions of absence of fear or favour. The concepts of independence and objective impartiality are closely linked ( The Queen (Brooke and Another) v Parole Board and Others [2007] EWHC 2036 (Admin) at [19]). An independent legal adviser is one who can bring a disinterested mind to bear on the subject matter of the legal advice. In the words of Brennan J in Waterhouse , what is required is a legal adviser who is able to be "professionally detached" in giving the advice. 41 Ms Rich submitted, in effect, that (a) the independence of legal advice provided by OGC could not rise above the independence of the person who holds the position of General Counsel because that person supervises, and carries responsibility for, the work of OGC; and (b) since at all relevant times General Counsel has been a partner in PwC, OGC's legal advice has not been independent because General Counsel has been both legal adviser and client. I have not found it necessary to form a concluded view as to the validity of the second part of this broad submission although the first part seems to me to be correct. For present purposes it is sufficient for me to reach a view on whether, having regard to the nature of the dispute between Ms Rich and PwC that forms the subject matter of this proceeding, the relationship between OGC and PwC was a professional relationship which secured OGC's advice an independent character notwithstanding that General Counsel, and one other senior solicitor in OGC, were partners in PwC.


case_text: Client legal privilege exists to serve the public interest in the administration of justice by encouraging frank disclosure by clients to their lawyers. As Mason and Wilson JJ stated in Waterford v The Commonwealth [1987] HCA 25 ; (1987) 163 CLR 54 ( "Waterford" ) at 62, "the proper functioning of the legal system is facilitated by freedom of consultation between the client and the legal adviser". Their Honours went on to observe at pages 64-65 that legal professional privilege is the product of a balancing exercise between competing public interests whereby, subject to the well-recognised crime or fraud exception, the public interest in the administration of justice is accorded paramountcy over the public interest in a fair trial conducted by reference to all relevant documents (see also Esso Australia per Gleeson CJ and Gaudron and Gummow JJ at [35]). There is no further balancing exercise to be carried out; if client legal privilege attaches to a communication, the privilege may be waived or overridden by statue but is otherwise absolute ( Telstra Corporation Ltd v Minister for Communications, Information Technology and the Arts (No 2) [2007] FCA 1445 ( "Telstra" ) at [21]). 36 In Waterford Mason and Wilson JJ, in giving consideration to whether it was open to the Commonwealth to claim legal professional privilege in respect of legal advice obtained from employed solicitors within Government, observed at p 62: To our minds it is clearly in the public interest that those in government who bear the responsibility of making decisions should have free and ready confidential access to their legal advisers. Whether in any particular case the relationship is such as to give rise to the privilege will be a question of fact. It must be a professional relationship which secures to the advice an independent character notwithstanding the employment. 37 Brennan J in Waterford similarly stressed the need for the legal adviser to be independent at p 70 where his Honour said: The purpose of legal professional privilege is to facilitate the seeking and giving of legal advice and thereby to ensure that the law be applied and litigation be properly conducted ... If the purpose of the privilege is to be fulfilled, the legal adviser must be competent and independent. Competent, in order that the legal advice be sound and the conduct of litigation be efficient; independent, in order that the personal loyalties, duties or interests of the adviser should not influence the legal advice which he gives or the fairness of his conduct of litigation on behalf of his client. If a legal adviser is incompetent to advise or to conduct litigation or if he is unable to be professionally detached in giving advice or in conducting litigation, there is an unacceptable risk that the purpose for which privilege is granted will be subverted. (Citations omitted) I interpolate that no issue of incompetence arises in this case. 38 Although Brennan J expressed a narrower view than Mason and Wilson JJ on the question of when legal professional privilege attaches to confidential professional communications between government agencies and salaried legal officers, their Honours were in agreement as to the need in every case for the legal adviser to be "independent" (see also Deane J at p 80). See also Alfred Crompton Amusement Machines Ltd v Customs and Excise Commissioners (No 2) [1972] 2 QB 102 per Lord Denning MR at 129. 39 I do not understand the other members of the High Court in Waterford to have suggested a different rationale for the requirement of independence from that identified by Brennan J in the above passage. His Honour's reference to professional detachment is consistent with the ordinary meaning of "independent". The Macquarie Dictionary (online version) relevantly defines "independent" in the following ways: 1. not influenced by others in matters of opinion, conduct, etc; thinking or acting for oneself: an independent person 2. not subject to another's authority or jurisdiction; autonomous, free. 3. not influenced by the thought or action of others; independent research ..... The Oxford English Dictionary defines "independent" in a comparable way.


case_outcome: referred to

case_text: Further, the Federal Magistrate declined to adjourn the hearing of the petition until the determination of the appeal to the Court of Appeal. After noting the curial history of the matter, including the judgment delivered by Justice Williams in the Supreme Court, her Honour stated (at [19]-[20]): The determination as to whether or not to grant an adjournment in the proceedings is a discretionary one. Whilst the court is mindful that it should not proceed to sequestrate the estate of a debtor where an appeal is pending against the judgment relied on as the foundation of the bankruptcy proceedings, in this case the judgment relied on as the foundation of the bankruptcy proceedings is a judgment of Judge Holt and nowhere is there evidence before the court that the appeal to the Court of Appeal in the Supreme Court of Victoria is based on genuine and arguable grounds (Ahern v Deputy Commissioner of Taxation (Qld) [1987] FCA 312 ; (1987) 76 ALR 137 at 148). [Mr Strangio] has had ample opportunity to place such evidence before the court including any as contained in the two affidavits relied upon and filed this day. No material persuasive of the granting of an adjournment or that could even properly found such an application was before the court. Having determined to refuse the application for an adjournment the court proceeded to hear the petition. Each of the grounds of opposition are rejected. All formal evidence as necessary has been filed and the court is satisfied with the proof of those matters. No opposition to the granting of the petition was put in submissions made by Counsel for [Mr Strangio]. The court exercises the discretion conferred by section 52 of the [Bankruptcy Act 1966 (Cth)] in favour of [Westpac]. 11 Mr Strangio was legally represented in the Federal Magistrates Court but unrepresented in this Court. In this Court, he relied on his own affidavits of 25 August 2008 and 12 September 2008. In his 12 September affidavit, he deposed that his appeal to the Court of Appeal was still on foot. A copy of a notice of appeal was annexed to this affidavit. In his 25 August affidavit, he deposed that he was informed by the Federal Magistrate on 28 July 2008 and later by another Court officer that he had 28 days in which to lodge his appeal. 12 Westpac relied on the affidavit of Robert Hinton of 11 September 2008, which exhibited a copy of the transcript of the hearing before the Federal Magistrate. 13 A proposed notice of appeal was attached to Mr Strangio's application for an extension of time. The grounds stated were: 1. The learned Magistrate erred in law by making a sequestration Order against the appellant in disregard of the principles enunciated by the Federal Court of Australia in Ahern v Deputy Commissioner of Taxation (Qld) [1987] FCA 312 ; (1987) 76 ALR 137 at 148 (" Ahern "). 2. The learned Magistrate erred in law by finding that " no opposition to the granting of the petition was put in submission " made by Counsel for the appellant when, in fact, the appellant's Counsel had submitted that the petition should be dismissed on the basis of the principles enunciated in Ahern . 3. The learned Magistrate denied the appellant natural justice by failing to accede to the appellant's application to adjourn the hearing of the petition pending the making of an application to stay execution of the judgment debt to the Court of Appeal. 21 Mr Strangio would argue on appeal that the Federal Magistrate misapplied the principle in Ahern . In Ahern , which was also an appeal from a decision refusing an adjournment of a creditor's petition, the Full Court observed (at 148) that "in general a court exercising jurisdiction in bankruptcy should not proceed to sequestrate the estate of a debtor where an appeal is pending against the judgment relied on as the foundation of the bankruptcy proceedings provided that the appeal is based on genuine and arguable grounds". A Full Court of this Court followed Ahern in Adamopoulos v Olympic Airways SA (1990) 95 ALR 525 , at 526 per Pincus J and 531-32 per Burchett and Gummow JJ. 28 As already indicated, the Federal Magistrate's decision to refuse Mr Strangio's adjournment application was a discretionary one. The principles applicable on an appeal against the exercise of discretion are well established: see House v The King [1936] HCA 40 ; (1936) 55 CLR 499 , at 504-5 per Dixon, Evatt and McTiernan JJ; Australian Coal and Shale Employees' Federation v Commonwealth [1953] HCA 25 ; (1953) 94 CLR 621 , at 627 per Kitto J; and Ahern, at 146-47 per Davies, Lockhart and Neaves JJ. In order for an appellate court to interfere with an exercise of discretion, it is not enough that the appellate court considers that, had it been the first instance judge, it would have taken a different course. Rather, the appellant must show that there was some error in exercising the discretion, as for example, that the first instance judge acted on a wrong principle. In the present case, there is nothing shown below or in the affidavits filed or the submissions made in this Court that would lead me to conclude that the Federal Magistrate made any discernible error in exercising her discretion. Her Honour did not deny Mr Strangio natural justice as he would allege.


case_outcome: followed

case_title: Jess v Scott (1986) 12 FCR 187

case_text: Under the Federal Court Rules ("the Rules"), the applicant was required to file and serve a notice of appeal against the sequestration order within 21 days from the date of the Federal Magistrates judgment, namely, on or before 18 August 2008: see O 52 r 15(1). Mr Strangio filed his application for an extension of time in which to appeal some 7 days outside the prescribed appeal period. Pursuant to O 52 r 15(2), the time limit in O 52 r 15(1) may be extended at any time for 'special reasons'. In Jess v Scott (1986) 12 FCR 187 , a Full Court of this Court said, at 195: "...the expression 'special reasons' is intended to distinguish the case from the usual course according to which the time is twenty-one days. But it may be so distinguished (not necessarily will, for the rule gives a discretion) wherever the Court sees a ground which does justify departure from the general rule in the particular case. Such a ground is a special reason because it takes the case out of the ordinary. We do not think the use of the expression 'for special reasons' implies something narrower than this." 15 As counsel for Westpac pointed out, Mr Strangio also requires leave to appeal from her Honour's refusal of an adjournment since this decision is interlocutory in character: see Federal Court of Australia Act 1976 (Cth), s 24(1A). Mr Strangio, who as I have said was not represented in this Court, did not expressly seek leave to appeal before or at the hearing. It is plain enough, however, that he challenges her Honour's refusal of an adjournment. I would treat his submissions at the hearing as in substance an application for leave to appeal against this refusal and an application for an extension of time in which to file and serve an application for leave to appeal: see O 52 r 10. I would dispense with the need for a notice of motion.


case_text: In determining whether leave to appeal against an interlocutory decision should be granted, the Court must be satisfied that the decision under challenge is attended with sufficient doubt to warrant it being reconsidered, and that substantial injustice would result if leave were refused, supposing the decision under challenge were wrong: see Décor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 655 ; (1991) 33 FCR 397 , at 399-400 per Sheppard, Burchett and Heerey JJ. The question on the extension of time is whether this test has sufficient prospect of being satisfied. 17 In practice, in this area, much the same considerations are relevant for the extensions of time and grant of leave to appeal. Unless the Court grants these applications for an extension of time and, in the case of the interlocutory decision, leave to appeal, there can be no competent appeal against the Federal Magistrate's judgment and orders. 18 Mr Strangio submitted, in effect, that he was misled about the time limit involved in filing a notice of appeal. Westpac did not argue that it has suffered any particular prejudice merely by virtue of the delay in lodgement.


case_text: Mr Strangio would argue on appeal that the Federal Magistrate misapplied the principle in Ahern . In Ahern , which was also an appeal from a decision refusing an adjournment of a creditor's petition, the Full Court observed (at 148) that "in general a court exercising jurisdiction in bankruptcy should not proceed to sequestrate the estate of a debtor where an appeal is pending against the judgment relied on as the foundation of the bankruptcy proceedings provided that the appeal is based on genuine and arguable grounds". A Full Court of this Court followed Ahern in Adamopoulos v Olympic Airways SA (1990) 95 ALR 525 , at 526 per Pincus J and 531-32 per Burchett and Gummow JJ.


case_text: As already indicated, the Federal Magistrate's decision to refuse Mr Strangio's adjournment application was a discretionary one. The principles applicable on an appeal against the exercise of discretion are well established: see House v The King [1936] HCA 40 ; (1936) 55 CLR 499 , at 504-5 per Dixon, Evatt and McTiernan JJ; Australian Coal and Shale Employees' Federation v Commonwealth [1953] HCA 25 ; (1953) 94 CLR 621 , at 627 per Kitto J; and Ahern, at 146-47 per Davies, Lockhart and Neaves JJ. In order for an appellate court to interfere with an exercise of discretion, it is not enough that the appellate court considers that, had it been the first instance judge, it would have taken a different course. Rather, the appellant must show that there was some error in exercising the discretion, as for example, that the first instance judge acted on a wrong principle. In the present case, there is nothing shown below or in the affidavits filed or the submissions made in this Court that would lead me to conclude that the Federal Magistrate made any discernible error in exercising her discretion. Her Honour did not deny Mr Strangio natural justice as he would allege.


case_title: Australian Coal and Shale Employees' Federation v Commonwealth [1953] HCA 25 ; (1953) 94 CLR 621


case_text: The CEPU contests the allegations against it. On 7 April 2006, I ordered that the contested proceeding between the ACCC and the CEPU concerning the CEPU's liability under ss 76 and 80 of the TPA be heard prior to the penalty hearing as between the ACCC and Edison: see Australian Competition and Consumer Commission v Edison Mission Operations and Maintenance Loy Yang Pty Ltd [2006] FCA 853. There was no appearance for Edison at the hearing of the contested proceeding between the ACCC and the CEPU. 5 The hearing proceeded by viva voce evidence. The ACCC called five witnesses. Four of the witnesses, Colin Sutherland ('Sutherland'), Paul Burns ('Burns'), Wayne Buckley ('Buckley') and Mark Pearson ('Pearson') were employees of Edison or a related company at all relevant times. Sutherland was a general manager of Edison Mission Energy Australia Pty Ltd ('EME') and a director of Edison and certain of its related entities including Valley Power Pty Ltd ('Valley Power'). Burns was the manager of community and employee relations for EME and was stationed at Loy Yang B. Sutherland and Burns had the principal carriage of discussions between Edison and the CEPU in August 2001. Pearson was the maintenance manager of EME's plant at Loy Yang B. Buckley held the position of maintenance coordinator for EME at Loy Yang B and reported directly to Pearson. Nothing in this case turns on any distinction between the various corporate entities within the Edison group of companies and, where the context permits, I refer to them simply as 'Edison'. The other witness was David Nabulsi ('Nabulsi'), the sole director of a company called DJN Electrical & Instrumentation Pty Ltd ('DJN'). Prior to August 2001, DJN regularly supplied services to Edison at Loy Yang B in its capacity as an electrical contractor. 6 In addition, the ACCC relied on an affidavit of Rodney McKemmish ('McKemmish') sworn 7 September 2006. Exhibit RMCK-3 to McKemmish's affidavit is his expert forensic report in relation to the authenticity and source of certain emails which were discovered by Edison and which are relevant to the ACCC's case against the CEPU. The affidavit was received in evidence subject to the CEPU's objection to those parts of the affidavit in which McKemmish purported to express an opinion identifying the author of certain emails. The objection is a good one and I uphold it. McKemmish is not in a position to give admissible evidence concerning the authorship of the emails. His evidence is only admissible to the extent to which he addresses the authenticity and technical source of the emails. Apart from this objection, the CEPU did not dispute McKemmish's evidence. 7 The CEPU did not call any witnesses or rely on any affidavit material in support of its case. 8 There are two main issues in this proceeding. The first concerns the nature, scope and terms of the contract, arrangement or understanding that was made or arrived at between the respondents. The ACCC submitted that the true nature, scope and terms of the contract, arrangement or understanding can be inferred from the circumstances surrounding a written heads of agreement between Edison and the CEPU, which was signed on behalf of Edison on 23 August 2001 ('the heads of agreement'). The ACCC's primary argument was that the contract, arrangement or understanding was not confined to the literal terms of the heads of agreement, and that it prevented or hindered Edison from acquiring services from electrical contractors including DJN because they did not have a certified agreement with the CEPU. Further, the ACCC argued that the contract, arrangement or understanding was given effect by Edison. Alternatively, the ACCC argued that the same consequences follow even if the contract, arrangement or understanding is entirely embodied in the heads of agreement.


case_outcome: approved

case_text: Section 45E was originally introduced into the TPA by the Trade Practices (Boycotts) Amendment Act 1980 (Cth). While there are minor differences in the drafting of that section in comparison to the current s 45E, it had essentially the same objects and a similar operation: see Gibbins v Australasian Meat Industry Employees' Union (1986) 12 FCR 450 (' Gibbins' ). The original s 45E was repealed by the Industrial Relations Reform Act 1993 (Cth). In 1996, s 45E was re-enacted it its current form by the Workplace Relations and Other Legislation Amendment Act 1996 (Cth). Section 45EA was also introduced by that Act. 105 The authorities on s 45 of the TPA explain the concept of a 'contract, arrangement or understanding' as it is used in Pt IV: see Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd [2004] FCA 1678 ; (2004) 141 FCR 183 (' Leahy' ); Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission [2005] ATPR 42-078 (' Apco' ); Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 (' Rural Press' ); Trade Practices Commission v Email Ltd (1980) 43 FLR 383 (' Email' ); and Trade Practices Commission v David Jones (Australia) Pty Ltd (1986) 13 FCR 446 (' David Jones' ). Some assistance is also to be gained from authorities that have considered s 45E in its original form: Gibbins ; see also Keith Russell Simplicity Funerals Pty Ltd v Cremation Society of Australia (ACT) Ltd (1982) 57 FCR 472. 170 My conclusion regarding the scope of the contract, arrangement or understanding between Edison and the CEPU is similar to the conclusion reached by Smithers J in Gibbins , a case concerning the original form of s 45E. In Gibbins , the second respondent ('Borthwicks'), entered into an agreement with the Australasian Meat Industry Employees' Union ('AMIEU') as a result of conciliation proceedings under the Conciliation and Arbitration Act 1904 (Cth). Essentially, the agreement provided that the Borthwicks would not 'invite or engage' carriers of livestock who were banned by the AMIEU to come onto its abattoir works to deliver stock. Smithers J observed at 467: 'It is clear that the immediate purpose of including the provisions in the agreement was, with the consent of Borthwicks, to lessen the likelihood that banned carriers would come upon the abattoir and to ensure, again with Borthwicks' consent, that if they did the stock were not to be unloaded or killed by Borthwicks' Union employees. But it went further than that. It obviously was designed to prevent Borthwicks from engaging banned carriers for carrying services.' Smithers J held that the exclusionary purpose was part of a wider understanding between the parties, at 470-471: 'It is clear that the conciliation agreement not only governs by its own strength but has given rise to an understanding of a slightly wider nature, namely by the exclusion from an invitation to come onto the works or from being engaged to come onto the works, not only of carriers who have passed the picket lines but to those who according to Union judgment have done so or have done the equivalent.' Smithers J found that the wider understanding arose out of the conciliation agreement and in connection with its implementation: at 472. 171 The CEPU submitted that the existence of an agreement or arrangement in the week of 13 August would render the subsequent heads of agreement a sham. The CEPU's submissions on this point are misguided. To adapt the words of Smithers J in Gibbins , the heads of agreement was expressed in its own terms, but it implemented a wider arrangement or understanding. In my opinion, Edison and the CEPU intended that the heads of agreement should be controlled by, and operate in accordance with, the arrangement that had been agreed upon by the parties and put into place in the week of 13 August. 172 The CEPU also argued that DJN's continued presence on site at Loy Yang B gives rise to an inference that the agreement was not intended to exclude DJN from continuing to supply services at Loy Yang B. The fact that DJN continued to perform some work on site at Loy Yang B in August and September 2001, under pre-existing contractual arrangements and as a subcontractor, does not affect my conclusion that the arrangement rendered DJN ineligible from continuing to supply services to Edison. Rather, as Burns' file note of the 9 August meeting shows, Edison implemented a process of 'grandfathering' DJN's existing contracts. 217 In Gibbins , Smithers J imposed liability on the union under s 80(1) of the TPA. His Honour found at 474 that it was 'beyond question' that the AMIEU, which was a party to a contract, arrangement or understanding which contravened s 45E, had aided, abetted, counselled and procured Borthwicks' contraventions. Then, as now, a union could not contravene s 45E as a principal.


case_outcome: considered

case_text: There is little judicial consideration of the current form of ss 45E and 45EA: cf Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Corke Instrument Engineering Australia Pty Ltd (2005) 223 ALR 480 ( 'Corke' ). There is, however, considerable authority in relation to phrases that occur in s 45E and in other provisions of Pt IV of the TPA. Those authorities are helpful in construing s 45E in a way that gives a consistent meaning to phrases that are used elsewhere in the TPA: see Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28 ; (1998) 194 CLR 355 at 381-382 [69] - [71] . 180 In closing submissions, senior counsel for the CEPU appeared to present an alternative argument that the second person must be 'in contemplation' of the parties at the time of making the agreement. He relied on Corke , where Finkelstein J refused to grant an interlocutory injunction in relation to an agreement that allegedly contravened s 45E. In my opinion, Corke does not provide any support for the argument. The provision in question in Corke obliged one of the respondents, Corke Instrument Engineering (Aust) Pty Ltd ('Corke'), to negotiate a specific site agreement with the union for each construction project, and provided that the site agreement must be agreed before work commences on the project. His Honour observed that it was entirely by chance that the deed containing the provision was made after Corke had entered into a particular supply agreement. His Honour said that the purpose for the inclusion of the provision in the deed was no different from the purpose for its inclusion in an earlier certified agreement and it was not included for the purpose of interfering with the supply of services from Corke. In this context, his Honour observed that it was inherently unlikely that the plant owner who contracted with Corke for its services was even in the contemplation of the CEPU or Corke when the certified agreement was negotiated: at 484 [14]. The present case is very different. The parties clearly had in contemplation that the provision would prevent or hinder a defined class of electrical contractors from performing work at Loy Yang B. 181 In any event, I am satisfied on the balance of probabilities that the parties knew that DJN, in particular, would be prevented from supplying services to Edison under the arrangement. Nabulsi gave evidence that he had discussions with Mooney over the years about the possibility of DJN signing an EBA with the CEPU. Burns gave evidence that from time to time he and Mooney discussed which contractors were being engaged by Edison to carry out particular work at Loy Yang B, and whether those contractors had an EBA with the CEPU. The evidence clearly establishes that Mooney was in close discussion with Sutherland and Burns during the period between 13 August and 23 August 2001. I infer from this evidence that the CEPU was aware that DJN performed work at Loy Yang B, that it did not have an EBA with the CEPU, and that the provision would exclude DJN from working at Loy Yang B if it did not enter into an EBA with the CEPU. 182 There was some debate in the course of argument as to whether the purpose of the provision, as alleged by the ACCC, would fall within para (a) or para (b) of s 45E(3). The ACCC relied on both paragraphs. In my opinion, the purpose of the provision that I have found to exist falls within the scope of both paras (a) and (b). It is therefore unnecessary for me to resolve the question of which paragraph applies.


case_text: There is little judicial consideration of the current form of ss 45E and 45EA: cf Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Corke Instrument Engineering Australia Pty Ltd (2005) 223 ALR 480 ( 'Corke' ). There is, however, considerable authority in relation to phrases that occur in s 45E and in other provisions of Pt IV of the TPA. Those authorities are helpful in construing s 45E in a way that gives a consistent meaning to phrases that are used elsewhere in the TPA: see Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28 ; (1998) 194 CLR 355 at 381-382 [69] - [71] .


case_text: The authorities on s 45 of the TPA explain the concept of a 'contract, arrangement or understanding' as it is used in Pt IV: see Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd [2004] FCA 1678 ; (2004) 141 FCR 183 (' Leahy' ); Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission [2005] ATPR 42-078 (' Apco' ); Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 (' Rural Press' ); Trade Practices Commission v Email Ltd (1980) 43 FLR 383 (' Email' ); and Trade Practices Commission v David Jones (Australia) Pty Ltd (1986) 13 FCR 446 (' David Jones' ). Some assistance is also to be gained from authorities that have considered s 45E in its original form: Gibbins ; see also Keith Russell Simplicity Funerals Pty Ltd v Cremation Society of Australia (ACT) Ltd (1982) 57 FCR 472.


case_text: The authorities on s 45 of the TPA explain the concept of a 'contract, arrangement or understanding' as it is used in Pt IV: see Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd [2004] FCA 1678 ; (2004) 141 FCR 183 (' Leahy' ); Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission [2005] ATPR 42-078 (' Apco' ); Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 (' Rural Press' ); Trade Practices Commission v Email Ltd (1980) 43 FLR 383 (' Email' ); and Trade Practices Commission v David Jones (Australia) Pty Ltd (1986) 13 FCR 446 (' David Jones' ). Some assistance is also to be gained from authorities that have considered s 45E in its original form: Gibbins ; see also Keith Russell Simplicity Funerals Pty Ltd v Cremation Society of Australia (ACT) Ltd (1982) 57 FCR 472. 109 In Leahy , Merkel J discussed the concepts of 'arrangement' and 'understanding' where multiple parties were alleged to have been involved, in different capacities, in price fixing contravening s 45 of the TPA. In that case, the ACCC brought proceedings against eight corporations and eight individuals. A number of the respondents admitted to contraventions of the TPA. The remaining respondents did not seriously challenge the ACCC's case against the admitting respondents, but rather they sought to distinguish their actions from those of the admitting respondents. The contesting respondents submitted that, unlike the other respondents, they had not initiated any of the price increases in the pricing 'cycle' at the heart of the ACCC's case. While the contesting respondents did not dispute that price increases were communicated amongst competitors in the Ballarat petrol market, they argued that their price increases were the result of competitive market forces and not made pursuant to an understanding to increase petrol prices in the event of a 'price-increase call' by the initiating respondents. His Honour stated at 200 [54]: 'It is well established that, for the purposes of ss 45(2) and 45A , the term "understanding" is apt to describe something less than a binding contract or arrangement. An understanding will usually, but may not necessarily, involve some reciprocity of obligation: see Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 at 360 (ACCC v Amcor); Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 397. At the least, there must be a meeting of minds of those said to be parties to the understanding and a consensus as to what is to be done; not merely a hope as to what might be done or might happen. Thus, ordinarily, an understanding involves communication between the parties arousing expectations in each party that the other party/parties will act in a particular way: see Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd [2003] FCAFC 149 ; (2003) 129 FCR 339 at [409] '. 110 On appeal, in Apco , the Full Court of this Court (Heerey, Hely and Gyles JJ) considered whether an understanding necessarily involves the making of a commitment to a particular course of action, as opposed to giving rise to a mere expectation or hope that a party will act in a certain way. After considering Merkel J's findings in Leahy , their Honours said at 43,234 - 43,235: 'Whilst the appellants attacked the factual finding that the parties arrived at the price-fixing understanding outlined in [330] of the reasons for judgment, they did not dispute that the primary judge had enunciated the correct legal principles which are applicable in determining whether parties have entered into an understanding. In particular, the primary judge referred to the following observations of Lindgren J in Australian Competition and Consumer Commission v CC (NSW) Pty Ltd [1999] FCA 954 ; (1999) 92 FCR 375 at [141] (emphasis in original) which were specifically endorsed by the Full Court in Rural Press Ltd v Australian Competition and Consumer Commission [2002] FCAFC 213 ; (2002) 118 FCR 236 at [79] : "The cases require that at least one party 'assume an obligation' or give an 'assurance' or 'undertaking' that it will act in a certain way. A mere expectation that as a matter of fact a party will act in a certain way is not enough, even if it has been engendered by that party. In the present case, for example, each individual who attended the meeting may have expected that as a matter of fact the others would return to their respective offices by car, or, to express the matter differently, each may have been expected by the others to act in that way. Each may even have 'aroused' that expectation by things he said at the meeting. But these factual expectations do not found an 'understanding' in the sense in which the word is used in ss 45 and 45A . The conjunction of the word 'understanding' with the words 'agreement' and 'arrangement' and the nature of the provisions show that something more is required." The primary judge's inference at [371] that Anderson [the Director and General Manager of one of the respondent companies] expected that his competitors would hold their increased price for a time whilst he was deciding whether or not to match their prices represents Anderson's assessment of what was likely to occur, without any assurance being given to him that the competitors would act in that way. It is no more than what Lindgren J described as a "factual expectation" which falls short of an "understanding".' Special leave to appeal the Full Court's decision was refused by the High Court in Australian Competition and Consumer Commission v APCO Service Stations Pty Ltd [2006] HCATrans 272. 111 As these passages from Leahy and Apco indicate, the authorities have expressly refrained from holding that the consensus or meeting of minds required by the words 'arrangement' or 'understanding' must involve a reciprocity of obligation. In Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 (' Amcor' ) at 359-360 [75], Sackville J said: 'An arrangement or understanding for the purposes of s 45(2) of the TP Act is apt to describe something less than a binding contract or agreement: Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd (1975) 5 ALR 465; 24 FLR 286 at 290 1 (Aust Ind Ct, FC) per Smithers J. However, in order for there to be an arrangement or understanding for the purposes of s 45(2), there must be a meeting of the minds of those said to be parties to the arrangement or understanding. There must be a consensus as to what is to be done and not merely a hope as to what might be done or happen: Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 385 (Lockhart J); Ira Berk at FLR 291 per Smithers J. Ordinarily, an arrangement or understanding involves communication between the parties arousing expectations in each that the other will act in a particular way: Email at 395. There is no necessity for an element of mutual commitment between the parties to an arrangement or understanding, although in practice such an arrangement or understanding would ordinarily involve reciprocity of obligation: Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230 1; 116 ALR 643 per Lockhart J.' There are, however, several cases in which the courts have said that an assumption of mutual obligations or reciprocal commitments will be the common situation: eg Trade Practices Commission v Parkfield Operations Pty Ltd (1985) 5 FCR 140 at 144. In Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and 238, the Full Court endorsed Lockhart J's observation in Email at 397 that it is difficult to envisage circumstances where there would be an understanding involving a commitment by one party as to the way it should behave, without some reciprocal obligation by the other party.


case_outcome: applied

case_text: The authorities on s 45 of the TPA explain the concept of a 'contract, arrangement or understanding' as it is used in Pt IV: see Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd [2004] FCA 1678 ; (2004) 141 FCR 183 (' Leahy' ); Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission [2005] ATPR 42-078 (' Apco' ); Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 (' Rural Press' ); Trade Practices Commission v Email Ltd (1980) 43 FLR 383 (' Email' ); and Trade Practices Commission v David Jones (Australia) Pty Ltd (1986) 13 FCR 446 (' David Jones' ). Some assistance is also to be gained from authorities that have considered s 45E in its original form: Gibbins ; see also Keith Russell Simplicity Funerals Pty Ltd v Cremation Society of Australia (ACT) Ltd (1982) 57 FCR 472. 110 On appeal, in Apco , the Full Court of this Court (Heerey, Hely and Gyles JJ) considered whether an understanding necessarily involves the making of a commitment to a particular course of action, as opposed to giving rise to a mere expectation or hope that a party will act in a certain way. After considering Merkel J's findings in Leahy , their Honours said at 43,234 - 43,235: 'Whilst the appellants attacked the factual finding that the parties arrived at the price-fixing understanding outlined in [330] of the reasons for judgment, they did not dispute that the primary judge had enunciated the correct legal principles which are applicable in determining whether parties have entered into an understanding. In particular, the primary judge referred to the following observations of Lindgren J in Australian Competition and Consumer Commission v CC (NSW) Pty Ltd [1999] FCA 954 ; (1999) 92 FCR 375 at [141] (emphasis in original) which were specifically endorsed by the Full Court in Rural Press Ltd v Australian Competition and Consumer Commission [2002] FCAFC 213 ; (2002) 118 FCR 236 at [79] : "The cases require that at least one party 'assume an obligation' or give an 'assurance' or 'undertaking' that it will act in a certain way. A mere expectation that as a matter of fact a party will act in a certain way is not enough, even if it has been engendered by that party. In the present case, for example, each individual who attended the meeting may have expected that as a matter of fact the others would return to their respective offices by car, or, to express the matter differently, each may have been expected by the others to act in that way. Each may even have 'aroused' that expectation by things he said at the meeting. But these factual expectations do not found an 'understanding' in the sense in which the word is used in ss 45 and 45A . The conjunction of the word 'understanding' with the words 'agreement' and 'arrangement' and the nature of the provisions show that something more is required." The primary judge's inference at [371] that Anderson [the Director and General Manager of one of the respondent companies] expected that his competitors would hold their increased price for a time whilst he was deciding whether or not to match their prices represents Anderson's assessment of what was likely to occur, without any assurance being given to him that the competitors would act in that way. It is no more than what Lindgren J described as a "factual expectation" which falls short of an "understanding".' Special leave to appeal the Full Court's decision was refused by the High Court in Australian Competition and Consumer Commission v APCO Service Stations Pty Ltd [2006] HCATrans 272. 111 As these passages from Leahy and Apco indicate, the authorities have expressly refrained from holding that the consensus or meeting of minds required by the words 'arrangement' or 'understanding' must involve a reciprocity of obligation. In Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 (' Amcor' ) at 359-360 [75], Sackville J said: 'An arrangement or understanding for the purposes of s 45(2) of the TP Act is apt to describe something less than a binding contract or agreement: Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd (1975) 5 ALR 465; 24 FLR 286 at 290 1 (Aust Ind Ct, FC) per Smithers J. However, in order for there to be an arrangement or understanding for the purposes of s 45(2), there must be a meeting of the minds of those said to be parties to the arrangement or understanding. There must be a consensus as to what is to be done and not merely a hope as to what might be done or happen: Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 385 (Lockhart J); Ira Berk at FLR 291 per Smithers J. Ordinarily, an arrangement or understanding involves communication between the parties arousing expectations in each that the other will act in a particular way: Email at 395. There is no necessity for an element of mutual commitment between the parties to an arrangement or understanding, although in practice such an arrangement or understanding would ordinarily involve reciprocity of obligation: Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230 1; 116 ALR 643 per Lockhart J.' There are, however, several cases in which the courts have said that an assumption of mutual obligations or reciprocal commitments will be the common situation: eg Trade Practices Commission v Parkfield Operations Pty Ltd (1985) 5 FCR 140 at 144. In Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and 238, the Full Court endorsed Lockhart J's observation in Email at 397 that it is difficult to envisage circumstances where there would be an understanding involving a commitment by one party as to the way it should behave, without some reciprocal obligation by the other party. 113 In the present case, there were no detailed submissions on the meaning of 'arrangement' or 'understanding' for the purposes of ss 45E and 45EA. Senior counsel for the ACCC generally used the composite phrase 'contract, arrangement or understanding', while senior counsel for the CEPU tended to restrict his language to 'agreement'. In my opinion, there is no reason why the reasoning in Apco and Amcor should not apply. It follows that an 'arrangement' or 'understanding' for the purposes of ss 45E and 45EA must be proven by evidence of a consensus or meeting of minds between Edison and the CEPU under which one party or both parties committed to a particular course of action; it is not sufficient that there is a mere expectation that a party or parties will act in a certain way.


case_text: The authorities on s 45 of the TPA explain the concept of a 'contract, arrangement or understanding' as it is used in Pt IV: see Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd [2004] FCA 1678 ; (2004) 141 FCR 183 (' Leahy' ); Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission [2005] ATPR 42-078 (' Apco' ); Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 (' Rural Press' ); Trade Practices Commission v Email Ltd (1980) 43 FLR 383 (' Email' ); and Trade Practices Commission v David Jones (Australia) Pty Ltd (1986) 13 FCR 446 (' David Jones' ). Some assistance is also to be gained from authorities that have considered s 45E in its original form: Gibbins ; see also Keith Russell Simplicity Funerals Pty Ltd v Cremation Society of Australia (ACT) Ltd (1982) 57 FCR 472. 106 The cases on s 45 of the TPA make it clear that for an arrangement or understanding to occur, there must be a 'meeting of the minds' of the parties: Top Performance Motors Pty Ltd v Ira Berk (Queensland) Pty Ltd (1975) 5 ALR 465; Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 2) (1979) 26 ALR 609. There must be a consensus as to what is to be done, not just a mere hope as to what might be done or might happen: Email at 385. 107 In Federal Commissioner of Taxation v Lutovi Investments Pty Ltd [1978] HCA 55 ; (1978) 140 CLR 434 (' Lutovi' ), the meaning of an 'arrangement' was considered in the context of s 260 of the Income Tax Assessment Act 1936 (Cth). Gibbs and Mason JJ (Murphy J agreeing) said at 444: 'In the context of s 260 an arrangement is something less than a binding contract or agreement, something in the nature of an understanding which may not be enforceable at law ( Newton v Federal Commissioner of Taxation). ... It is, however, necessary that an arrangement should be consensual, and that there should be some adoption of it. But in our view it is not essential that the parties are committed to it or are bound to support it. An arrangement may be informal as well as unenforceable and the parties may be free to withdraw from it or to act inconsistently with it, notwithstanding their adoption of it.' The High Court's formulation in Lutovi has been applied in the context of 'arrangement or understanding' under s 45 of the TPA: see, eg, Email at 396; and David Jones at 463-464. In Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1 (' TNT' ), Franki J referred to the above passage from Lutovi and said at 25: 'I lean with respect to the views expressed by Smithers J in L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd ... at 89; 17,842 where he said: "I have to remember that the concept of an understanding is broad and flexible. It may arise merely where the minds of the parties are at one that a proposed transaction proceeds on the basis of the maintenance of a particular state of affairs or the adoption of a particular course of conduct."' 109 In Leahy , Merkel J discussed the concepts of 'arrangement' and 'understanding' where multiple parties were alleged to have been involved, in different capacities, in price fixing contravening s 45 of the TPA. In that case, the ACCC brought proceedings against eight corporations and eight individuals. A number of the respondents admitted to contraventions of the TPA. The remaining respondents did not seriously challenge the ACCC's case against the admitting respondents, but rather they sought to distinguish their actions from those of the admitting respondents. The contesting respondents submitted that, unlike the other respondents, they had not initiated any of the price increases in the pricing 'cycle' at the heart of the ACCC's case. While the contesting respondents did not dispute that price increases were communicated amongst competitors in the Ballarat petrol market, they argued that their price increases were the result of competitive market forces and not made pursuant to an understanding to increase petrol prices in the event of a 'price-increase call' by the initiating respondents. His Honour stated at 200 [54]: 'It is well established that, for the purposes of ss 45(2) and 45A , the term "understanding" is apt to describe something less than a binding contract or arrangement. An understanding will usually, but may not necessarily, involve some reciprocity of obligation: see Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 at 360 (ACCC v Amcor); Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 397. At the least, there must be a meeting of minds of those said to be parties to the understanding and a consensus as to what is to be done; not merely a hope as to what might be done or might happen. Thus, ordinarily, an understanding involves communication between the parties arousing expectations in each party that the other party/parties will act in a particular way: see Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd [2003] FCAFC 149 ; (2003) 129 FCR 339 at [409] '. 111 As these passages from Leahy and Apco indicate, the authorities have expressly refrained from holding that the consensus or meeting of minds required by the words 'arrangement' or 'understanding' must involve a reciprocity of obligation. In Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 (' Amcor' ) at 359-360 [75], Sackville J said: 'An arrangement or understanding for the purposes of s 45(2) of the TP Act is apt to describe something less than a binding contract or agreement: Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd (1975) 5 ALR 465; 24 FLR 286 at 290 1 (Aust Ind Ct, FC) per Smithers J. However, in order for there to be an arrangement or understanding for the purposes of s 45(2), there must be a meeting of the minds of those said to be parties to the arrangement or understanding. There must be a consensus as to what is to be done and not merely a hope as to what might be done or happen: Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 385 (Lockhart J); Ira Berk at FLR 291 per Smithers J. Ordinarily, an arrangement or understanding involves communication between the parties arousing expectations in each that the other will act in a particular way: Email at 395. There is no necessity for an element of mutual commitment between the parties to an arrangement or understanding, although in practice such an arrangement or understanding would ordinarily involve reciprocity of obligation: Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230 1; 116 ALR 643 per Lockhart J.' There are, however, several cases in which the courts have said that an assumption of mutual obligations or reciprocal commitments will be the common situation: eg Trade Practices Commission v Parkfield Operations Pty Ltd (1985) 5 FCR 140 at 144. In Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and 238, the Full Court endorsed Lockhart J's observation in Email at 397 that it is difficult to envisage circumstances where there would be an understanding involving a commitment by one party as to the way it should behave, without some reciprocal obligation by the other party. 112 Parallel conduct can constitute circumstantial evidence from which an arrangement or understanding may be inferred: Email at 386. Where there is no direct evidence of an arrangement or understanding, an inference that such an arrangement or understanding existed may be drawn from evidence that the parties' conduct exhibits 'a concurrence of time, character, direction and result': David Jones at 468 applying R v Associated Northern Collieries [1911] HCA 73 ; (1911) 14 CLR 387 (' Northern Collieries' ) at 400. Inferences of an arrangement or understanding are apt to be drawn from circumstantial evidence when the facts are particularly within the knowledge of a party who is not called to give evidence: Jones v Dunkel [1959] HCA 8 ; (1959) 101 CLR 298 (' Jones v Dunkel' ); see also David Jones at 465.


case_text: The authorities on s 45 of the TPA explain the concept of a 'contract, arrangement or understanding' as it is used in Pt IV: see Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd [2004] FCA 1678 ; (2004) 141 FCR 183 (' Leahy' ); Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission [2005] ATPR 42-078 (' Apco' ); Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 (' Rural Press' ); Trade Practices Commission v Email Ltd (1980) 43 FLR 383 (' Email' ); and Trade Practices Commission v David Jones (Australia) Pty Ltd (1986) 13 FCR 446 (' David Jones' ). Some assistance is also to be gained from authorities that have considered s 45E in its original form: Gibbins ; see also Keith Russell Simplicity Funerals Pty Ltd v Cremation Society of Australia (ACT) Ltd (1982) 57 FCR 472. 107 In Federal Commissioner of Taxation v Lutovi Investments Pty Ltd [1978] HCA 55 ; (1978) 140 CLR 434 (' Lutovi' ), the meaning of an 'arrangement' was considered in the context of s 260 of the Income Tax Assessment Act 1936 (Cth). Gibbs and Mason JJ (Murphy J agreeing) said at 444: 'In the context of s 260 an arrangement is something less than a binding contract or agreement, something in the nature of an understanding which may not be enforceable at law ( Newton v Federal Commissioner of Taxation). ... It is, however, necessary that an arrangement should be consensual, and that there should be some adoption of it. But in our view it is not essential that the parties are committed to it or are bound to support it. An arrangement may be informal as well as unenforceable and the parties may be free to withdraw from it or to act inconsistently with it, notwithstanding their adoption of it.' The High Court's formulation in Lutovi has been applied in the context of 'arrangement or understanding' under s 45 of the TPA: see, eg, Email at 396; and David Jones at 463-464. In Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1 (' TNT' ), Franki J referred to the above passage from Lutovi and said at 25: 'I lean with respect to the views expressed by Smithers J in L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd ... at 89; 17,842 where he said: "I have to remember that the concept of an understanding is broad and flexible. It may arise merely where the minds of the parties are at one that a proposed transaction proceeds on the basis of the maintenance of a particular state of affairs or the adoption of a particular course of conduct."' 108 In David Jones at 463-464, Fisher J agreed with Franki J's comments in TNT and also favoured the views expressed by Smithers J in L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd (1978) 34 FLR 81. 112 Parallel conduct can constitute circumstantial evidence from which an arrangement or understanding may be inferred: Email at 386. Where there is no direct evidence of an arrangement or understanding, an inference that such an arrangement or understanding existed may be drawn from evidence that the parties' conduct exhibits 'a concurrence of time, character, direction and result': David Jones at 468 applying R v Associated Northern Collieries [1911] HCA 73 ; (1911) 14 CLR 387 (' Northern Collieries' ) at 400. Inferences of an arrangement or understanding are apt to be drawn from circumstantial evidence when the facts are particularly within the knowledge of a party who is not called to give evidence: Jones v Dunkel [1959] HCA 8 ; (1959) 101 CLR 298 (' Jones v Dunkel' ); see also David Jones at 465. 174 Under s 45E of the TPA, I am not limited to an examination of the words of cl 4.1. This is not a proceeding to enforce a contract. Section 45E is not concerned only with written agreements; it is also concerned with the making of an 'arrangement' or arriving at an 'understanding'. An arrangement or understanding may be informal and unenforceable: Lutovi at 444. The concept of an 'understanding' is a broad and flexible one: L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd , supra, at 89; TNT at 25; and David Jones at 463-464. For the reasons explained above, I am satisfied that there was a broader arrangement between the parties which overshadowed and controlled the language used in the heads of agreement. It was understood and agreed between the CEPU and Edison that the heads of agreement imposed an obligation on Edison not to retain electrical contractors at the Loy Yang B site if they did not have a current certified agreement with the CEPU, and that this is the way in which Edison would implement it. Nothing in cl 4.1 prevented Edison implementing its arrangement with the CEPU in this way.


case_text: The cases on s 45 of the TPA make it clear that for an arrangement or understanding to occur, there must be a 'meeting of the minds' of the parties: Top Performance Motors Pty Ltd v Ira Berk (Queensland) Pty Ltd (1975) 5 ALR 465; Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 2) (1979) 26 ALR 609. There must be a consensus as to what is to be done, not just a mere hope as to what might be done or might happen: Email at 385. 111 As these passages from Leahy and Apco indicate, the authorities have expressly refrained from holding that the consensus or meeting of minds required by the words 'arrangement' or 'understanding' must involve a reciprocity of obligation. In Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 (' Amcor' ) at 359-360 [75], Sackville J said: 'An arrangement or understanding for the purposes of s 45(2) of the TP Act is apt to describe something less than a binding contract or agreement: Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd (1975) 5 ALR 465; 24 FLR 286 at 290 1 (Aust Ind Ct, FC) per Smithers J. However, in order for there to be an arrangement or understanding for the purposes of s 45(2), there must be a meeting of the minds of those said to be parties to the arrangement or understanding. There must be a consensus as to what is to be done and not merely a hope as to what might be done or happen: Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 385 (Lockhart J); Ira Berk at FLR 291 per Smithers J. Ordinarily, an arrangement or understanding involves communication between the parties arousing expectations in each that the other will act in a particular way: Email at 395. There is no necessity for an element of mutual commitment between the parties to an arrangement or understanding, although in practice such an arrangement or understanding would ordinarily involve reciprocity of obligation: Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230 1; 116 ALR 643 per Lockhart J.' There are, however, several cases in which the courts have said that an assumption of mutual obligations or reciprocal commitments will be the common situation: eg Trade Practices Commission v Parkfield Operations Pty Ltd (1985) 5 FCR 140 at 144. In Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and 238, the Full Court endorsed Lockhart J's observation in Email at 397 that it is difficult to envisage circumstances where there would be an understanding involving a commitment by one party as to the way it should behave, without some reciprocal obligation by the other party.


case_text: Burns' file note of the 10 August teleconference states: 'Telephone hook up R. Driscoll, C Sutherland, J Bacchi, C Weber (LV) BW, MP, WB & PB - Col outlined mtg above [arrowup] and proposed settlement. 1 Grandfather existing contracts 2.' The vertical arrow in the note points to the first part of the page that sets out Burns' note of the 9 August meeting: see [22] above. 41 In his evidence, Burns said that Sutherland outlined what had happened at the 9 August meeting and proposed that the issues be settled. There was then general discussion about the two issues that the CEPU had asked the company to address concerning site access and the requirement that contractors have a certified EBA in place with the CEPU. By the end of the meeting, Burns said that agreement was reached as to what Edison was going to do: 'We in essence agreed that we would only employ electrical contractors that had a certified EBA in place and that the one contractor that the only contractor that seemed to be impacted which was DJN, would continue the work which it had been commissioned to do until that had concluded.' Burns recollected that Pearson or Buckley mentioned during the teleconference that the only contractor who appeared to be affected by this agreement was DJN. Burns also gave evidence that the reference to 'Grandfather existing contracts' in his handwritten note referred to the fact that DJN would be permitted to continue work it had already been commissioned to do until that work was concluded. 42 Pearson's understanding of what was discussed in the teleconference was that Edison was minded to proceed down the path of entering into an agreement with the CEPU that would put a limitation on Loy Yang B maintenance, such that only electrical contractors who had certified agreements with the CEPU would be engaged. Pearson said it was explained that Edison was proceeding down this path in order to get the Simon Engineering site agreement for the peaker plant signed, so that construction of the plant could commence. Pearson also said that towards the end of the meeting, or just afterwards, Warrillow instructed him, and Buckley, that they were not to engage electrical contractors who did not have a certified agreement with the CEPU and that they should look at putting that instruction into place. 106 The cases on s 45 of the TPA make it clear that for an arrangement or understanding to occur, there must be a 'meeting of the minds' of the parties: Top Performance Motors Pty Ltd v Ira Berk (Queensland) Pty Ltd (1975) 5 ALR 465; Trade Practices Commission v Nicholas Enterprises Pty Ltd (No 2) (1979) 26 ALR 609. There must be a consensus as to what is to be done, not just a mere hope as to what might be done or might happen: Email at 385.


case_text: In Federal Commissioner of Taxation v Lutovi Investments Pty Ltd [1978] HCA 55 ; (1978) 140 CLR 434 (' Lutovi' ), the meaning of an 'arrangement' was considered in the context of s 260 of the Income Tax Assessment Act 1936 (Cth). Gibbs and Mason JJ (Murphy J agreeing) said at 444: 'In the context of s 260 an arrangement is something less than a binding contract or agreement, something in the nature of an understanding which may not be enforceable at law ( Newton v Federal Commissioner of Taxation). ... It is, however, necessary that an arrangement should be consensual, and that there should be some adoption of it. But in our view it is not essential that the parties are committed to it or are bound to support it. An arrangement may be informal as well as unenforceable and the parties may be free to withdraw from it or to act inconsistently with it, notwithstanding their adoption of it.' The High Court's formulation in Lutovi has been applied in the context of 'arrangement or understanding' under s 45 of the TPA: see, eg, Email at 396; and David Jones at 463-464. In Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1 (' TNT' ), Franki J referred to the above passage from Lutovi and said at 25: 'I lean with respect to the views expressed by Smithers J in L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd ... at 89; 17,842 where he said: "I have to remember that the concept of an understanding is broad and flexible. It may arise merely where the minds of the parties are at one that a proposed transaction proceeds on the basis of the maintenance of a particular state of affairs or the adoption of a particular course of conduct."' 174 Under s 45E of the TPA, I am not limited to an examination of the words of cl 4.1. This is not a proceeding to enforce a contract. Section 45E is not concerned only with written agreements; it is also concerned with the making of an 'arrangement' or arriving at an 'understanding'. An arrangement or understanding may be informal and unenforceable: Lutovi at 444. The concept of an 'understanding' is a broad and flexible one: L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd , supra, at 89; TNT at 25; and David Jones at 463-464. For the reasons explained above, I am satisfied that there was a broader arrangement between the parties which overshadowed and controlled the language used in the heads of agreement. It was understood and agreed between the CEPU and Edison that the heads of agreement imposed an obligation on Edison not to retain electrical contractors at the Loy Yang B site if they did not have a current certified agreement with the CEPU, and that this is the way in which Edison would implement it. Nothing in cl 4.1 prevented Edison implementing its arrangement with the CEPU in this way.


case_text: In Federal Commissioner of Taxation v Lutovi Investments Pty Ltd [1978] HCA 55 ; (1978) 140 CLR 434 (' Lutovi' ), the meaning of an 'arrangement' was considered in the context of s 260 of the Income Tax Assessment Act 1936 (Cth). Gibbs and Mason JJ (Murphy J agreeing) said at 444: 'In the context of s 260 an arrangement is something less than a binding contract or agreement, something in the nature of an understanding which may not be enforceable at law ( Newton v Federal Commissioner of Taxation). ... It is, however, necessary that an arrangement should be consensual, and that there should be some adoption of it. But in our view it is not essential that the parties are committed to it or are bound to support it. An arrangement may be informal as well as unenforceable and the parties may be free to withdraw from it or to act inconsistently with it, notwithstanding their adoption of it.' The High Court's formulation in Lutovi has been applied in the context of 'arrangement or understanding' under s 45 of the TPA: see, eg, Email at 396; and David Jones at 463-464. In Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1 (' TNT' ), Franki J referred to the above passage from Lutovi and said at 25: 'I lean with respect to the views expressed by Smithers J in L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd ... at 89; 17,842 where he said: "I have to remember that the concept of an understanding is broad and flexible. It may arise merely where the minds of the parties are at one that a proposed transaction proceeds on the basis of the maintenance of a particular state of affairs or the adoption of a particular course of conduct."' 108 In David Jones at 463-464, Fisher J agreed with Franki J's comments in TNT and also favoured the views expressed by Smithers J in L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd (1978) 34 FLR 81. 130 The CEPU drew support for this argument from judicial consideration of the words 'particular persons' in s 4D of the TPA in Bullock v Federated Furnishing Trades Society of Australasia (1985) 5 FCR 464 (' Bullock' ); see also TNT at 75-76. Prior to 1986, s 4D referred to 'particular persons' as the target of the proscribed provision. In Bullock, the Full Court left open the question whether Gray J had been correct in limiting the words 'particular persons' in s 4D to 'persons whose identity is known or can be ascertained': at 473. In apparent response to the decisions in Bullock and TNT, the words 'or classes of persons' were added to s 4D by the Trade Practices Revision Act 1986 (Cth): see Gummow J's discussion in South Sydney at 589-590 [75]. The scope of s 45E has not been similarly expanded to include 'classes of persons'. According to senior counsel for the CEPU, it can therefore be inferred that the legislature did not intend to expand the scope of s 45E. Thus, it was submitted, the section requires the identification of a particular second person. 139 It is convenient to consider the ACCC's primary case, and the CEPU's response to it, before turning to consider the ACCC's alternative argument that in any event the heads of agreement contained a provision that contravened s 45E(3). For ease of reference, I will use the expression 'arrangement' rather than the more cumbersome 'contract, arrangement or understanding'. Obviously, the terms 'arrangement' and 'understanding' are much broader than the term 'contract', and they are often equated in the authorities: TNT at 25; and Amcor at 359-360 [75]. However, neither party suggested that anything turns on the differences that exist between the three concepts. 174 Under s 45E of the TPA, I am not limited to an examination of the words of cl 4.1. This is not a proceeding to enforce a contract. Section 45E is not concerned only with written agreements; it is also concerned with the making of an 'arrangement' or arriving at an 'understanding'. An arrangement or understanding may be informal and unenforceable: Lutovi at 444. The concept of an 'understanding' is a broad and flexible one: L Grollo & Co Pty Ltd v Nu-Statt Decorating Pty Ltd , supra, at 89; TNT at 25; and David Jones at 463-464. For the reasons explained above, I am satisfied that there was a broader arrangement between the parties which overshadowed and controlled the language used in the heads of agreement. It was understood and agreed between the CEPU and Edison that the heads of agreement imposed an obligation on Edison not to retain electrical contractors at the Loy Yang B site if they did not have a current certified agreement with the CEPU, and that this is the way in which Edison would implement it. Nothing in cl 4.1 prevented Edison implementing its arrangement with the CEPU in this way. 222 As to whether the CEPU was involved in Edison's contravention of s 45EA, it is necessary to bear in mind the width of the concept of 'give effect to'. It is defined in s 4(1) as including the doing of 'an act or thing in pursuance of or in accordance with' the contract, arrangement or understanding. An act or thing may be done in accordance with a contract, arrangement or understanding even though the person who did that act or thing did not have the contract, arrangement or understanding in mind at the time: TNT at 68. Independent decisions made by parties to a contract, arrangement or understanding can nevertheless give effect to an arrangement made between them: Dowling v Dalgety Australia Ltd (1992) 34 FCR 109.


case_text: On appeal, in Apco , the Full Court of this Court (Heerey, Hely and Gyles JJ) considered whether an understanding necessarily involves the making of a commitment to a particular course of action, as opposed to giving rise to a mere expectation or hope that a party will act in a certain way. After considering Merkel J's findings in Leahy , their Honours said at 43,234 - 43,235: 'Whilst the appellants attacked the factual finding that the parties arrived at the price-fixing understanding outlined in [330] of the reasons for judgment, they did not dispute that the primary judge had enunciated the correct legal principles which are applicable in determining whether parties have entered into an understanding. In particular, the primary judge referred to the following observations of Lindgren J in Australian Competition and Consumer Commission v CC (NSW) Pty Ltd [1999] FCA 954 ; (1999) 92 FCR 375 at [141] (emphasis in original) which were specifically endorsed by the Full Court in Rural Press Ltd v Australian Competition and Consumer Commission [2002] FCAFC 213 ; (2002) 118 FCR 236 at [79] : "The cases require that at least one party 'assume an obligation' or give an 'assurance' or 'undertaking' that it will act in a certain way. A mere expectation that as a matter of fact a party will act in a certain way is not enough, even if it has been engendered by that party. In the present case, for example, each individual who attended the meeting may have expected that as a matter of fact the others would return to their respective offices by car, or, to express the matter differently, each may have been expected by the others to act in that way. Each may even have 'aroused' that expectation by things he said at the meeting. But these factual expectations do not found an 'understanding' in the sense in which the word is used in ss 45 and 45A . The conjunction of the word 'understanding' with the words 'agreement' and 'arrangement' and the nature of the provisions show that something more is required." The primary judge's inference at [371] that Anderson [the Director and General Manager of one of the respondent companies] expected that his competitors would hold their increased price for a time whilst he was deciding whether or not to match their prices represents Anderson's assessment of what was likely to occur, without any assurance being given to him that the competitors would act in that way. It is no more than what Lindgren J described as a "factual expectation" which falls short of an "understanding".' Special leave to appeal the Full Court's decision was refused by the High Court in Australian Competition and Consumer Commission v APCO Service Stations Pty Ltd [2006] HCATrans 272.


case_text: In Leahy , Merkel J discussed the concepts of 'arrangement' and 'understanding' where multiple parties were alleged to have been involved, in different capacities, in price fixing contravening s 45 of the TPA. In that case, the ACCC brought proceedings against eight corporations and eight individuals. A number of the respondents admitted to contraventions of the TPA. The remaining respondents did not seriously challenge the ACCC's case against the admitting respondents, but rather they sought to distinguish their actions from those of the admitting respondents. The contesting respondents submitted that, unlike the other respondents, they had not initiated any of the price increases in the pricing 'cycle' at the heart of the ACCC's case. While the contesting respondents did not dispute that price increases were communicated amongst competitors in the Ballarat petrol market, they argued that their price increases were the result of competitive market forces and not made pursuant to an understanding to increase petrol prices in the event of a 'price-increase call' by the initiating respondents. His Honour stated at 200 [54]: 'It is well established that, for the purposes of ss 45(2) and 45A , the term "understanding" is apt to describe something less than a binding contract or arrangement. An understanding will usually, but may not necessarily, involve some reciprocity of obligation: see Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 at 360 (ACCC v Amcor); Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 397. At the least, there must be a meeting of minds of those said to be parties to the understanding and a consensus as to what is to be done; not merely a hope as to what might be done or might happen. Thus, ordinarily, an understanding involves communication between the parties arousing expectations in each party that the other party/parties will act in a particular way: see Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd [2003] FCAFC 149 ; (2003) 129 FCR 339 at [409] '. 111 As these passages from Leahy and Apco indicate, the authorities have expressly refrained from holding that the consensus or meeting of minds required by the words 'arrangement' or 'understanding' must involve a reciprocity of obligation. In Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 (' Amcor' ) at 359-360 [75], Sackville J said: 'An arrangement or understanding for the purposes of s 45(2) of the TP Act is apt to describe something less than a binding contract or agreement: Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd (1975) 5 ALR 465; 24 FLR 286 at 290 1 (Aust Ind Ct, FC) per Smithers J. However, in order for there to be an arrangement or understanding for the purposes of s 45(2), there must be a meeting of the minds of those said to be parties to the arrangement or understanding. There must be a consensus as to what is to be done and not merely a hope as to what might be done or happen: Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 385 (Lockhart J); Ira Berk at FLR 291 per Smithers J. Ordinarily, an arrangement or understanding involves communication between the parties arousing expectations in each that the other will act in a particular way: Email at 395. There is no necessity for an element of mutual commitment between the parties to an arrangement or understanding, although in practice such an arrangement or understanding would ordinarily involve reciprocity of obligation: Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230 1; 116 ALR 643 per Lockhart J.' There are, however, several cases in which the courts have said that an assumption of mutual obligations or reciprocal commitments will be the common situation: eg Trade Practices Commission v Parkfield Operations Pty Ltd (1985) 5 FCR 140 at 144. In Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 and 238, the Full Court endorsed Lockhart J's observation in Email at 397 that it is difficult to envisage circumstances where there would be an understanding involving a commitment by one party as to the way it should behave, without some reciprocal obligation by the other party. 113 In the present case, there were no detailed submissions on the meaning of 'arrangement' or 'understanding' for the purposes of ss 45E and 45EA. Senior counsel for the ACCC generally used the composite phrase 'contract, arrangement or understanding', while senior counsel for the CEPU tended to restrict his language to 'agreement'. In my opinion, there is no reason why the reasoning in Apco and Amcor should not apply. It follows that an 'arrangement' or 'understanding' for the purposes of ss 45E and 45EA must be proven by evidence of a consensus or meeting of minds between Edison and the CEPU under which one party or both parties committed to a particular course of action; it is not sufficient that there is a mere expectation that a party or parties will act in a certain way. 139 It is convenient to consider the ACCC's primary case, and the CEPU's response to it, before turning to consider the ACCC's alternative argument that in any event the heads of agreement contained a provision that contravened s 45E(3). For ease of reference, I will use the expression 'arrangement' rather than the more cumbersome 'contract, arrangement or understanding'. Obviously, the terms 'arrangement' and 'understanding' are much broader than the term 'contract', and they are often equated in the authorities: TNT at 25; and Amcor at 359-360 [75]. However, neither party suggested that anything turns on the differences that exist between the three concepts.