case_text: application before this Court under s 104 is an application in the original jurisdiction of the Court. Having regard to the powers conferred upon the Court under s 197 of the Act, it is plain that it is not necessary on appeal under s 104 to determine whether the decision of the Registrar was correct when made. In that sense, the appeal proceeding is a hearing conducted "afresh" or de novo (like an appeal proceeding under s 56 of the Act: N.V. Sumatra Tobacco Trading Company v British American Tobacco Australia Services Limited [2008] FCA 1542) on material properly placed before the Court ( Blount Inc. v Registrar of Trade Marks [1998] FCA 440 ; (1998) 83 FCR 50 at 58-9; [1998] FCA 440 ; 40 IPR 498 at 506; Soncini v Registrar of Trade Marks [2001] FCA 333 ; (2001) 109 FCR 548 ; 51 IPR 411 ; Ostrowski-Meissner v Registrar of Trade Marks (2006) 69 IPR 291 at [7] and [8]). Section 197 is in these terms: On hearing an appeal against a decision or direction of the Registrar, the Federal Court may do any one or more of the following: (a) admit further evidence orally, or on affidavit or otherwise; (b) permit the examination and cross-examination of witnesses, including witnesses who give evidence before the Registrar; (c) order an issue of fact to be tried as it directs; (d) affirm, reverse or vary the Registrar's decision or direction; (e) give any judgment, or make any order, that, in all the circumstances, it thinks fit; (f) order a party to pay costs to another party. Section 197 of the Act is framed in broad terms. The terms of that enabling provision are directed to conferring broad powers of rehearing in the disposition of an appeal from the particular decision of the Registrar ( Blount Inc. v Registrar of Trade Marks (supra)), that is: admit further evidence; permit examination and cross-examination of witnesses; permit an issue of fact to be tried as directed; affirm, reverse or vary the primary decision; give any judgment or make any order the Court thinks fit; and make an order as to costs. That which is to be reheard on the application (appeal) of FCN is whether FCN can make out, on all the evidence, its opposition to removal of the mark having failed to make out that position before the Registrar's delegate. The decision from which the appeal lies did not involve any element of security for costs. Nevertheless, s 197(e) of the Act confers broad power to "... give any judgment, or make any order , that, in all the circumstances, it thinks fit on hearing an appeal against a decision or direction of the Registrar" [emphasis added]. The conferral of power upon the Court to make any order on hearing an appeal is sufficiently broad to confer a power to make any order in the course of an appeal proceeding including any interlocutory order. That power may extend in a given case to a security for costs order. In the ordinary course however, an applicant for security would find the source of the power for such an order in s 56 of the Court Act and Order 28, r 1 of the Federal Court Rules . The conferral of an express power on the Court to order security under the Trade Marks Act was probably not thought necessary having regard to the powers conferred upon the Court by the Court Act and the Federal Court Rules . In principle, the scope of s 197(e) is broad enough to confer power on the Court to make an order against any party in all the circumstances in any given case, if the relevant discretionary factors are satisfied. In this case, it is not necessary to consider any further the scope of the power particularly as it relates to a potential order that might be made against a respondent (if at all) as no order ought to be made in the exercise of discretion for these reasons. First, no claim for relief is made by the respondent other than to affirm the decision of the respondent's delegate challenged by the applicant by way of rehearing. Secondly, although the respondent initiated the proceeding before the Registrar and sought to remove the trade mark from the Register, the present applicant seeks the rehearing and could have put on before the Registrar all of the evidence that it now proposes to put on in the appeal. If all the evidence bearing on the question is as compelling as FCN contends, the Court proceeding and the attendant costs would not have been necessary. Thirdly, the applicant bore the rebuttal burden as a matter of law under s 100 of the Act before the Registrar in relation to any allegation made by TFN under s 92(4)(b) of the Act and failed to put on all the evidence that might have discharged that burden. Fourthly, the evidence as to the amount of costs which might be the subject of an order is scant. Accordingly, FCN's application for security is to be dismissed, with costs. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood. Associate: Dated: 11 February 2009 Counsel for the Applicant: Mr Stephens Solicitor for the Applicant: Potts & Co, Lawyers Counsel for the Respondent: Respondent represented by its solicitors Solicitor for the Respondent: Bennett & Philp Lawyers Date of Hearing: 5 February 2009 Date of Judgment: 11 February 2009 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2009/68.html


case_outcome: cited

case_text: application before this Court under s 104 is an application in the original jurisdiction of the Court. Having regard to the powers conferred upon the Court under s 197 of the Act, it is plain that it is not necessary on appeal under s 104 to determine whether the decision of the Registrar was correct when made. In that sense, the appeal proceeding is a hearing conducted "afresh" or de novo (like an appeal proceeding under s 56 of the Act: N.V. Sumatra Tobacco Trading Company v British American Tobacco Australia Services Limited [2008] FCA 1542) on material properly placed before the Court ( Blount Inc. v Registrar of Trade Marks [1998] FCA 440 ; (1998) 83 FCR 50 at 58-9; [1998] FCA 440 ; 40 IPR 498 at 506; Soncini v Registrar of Trade Marks [2001] FCA 333 ; (2001) 109 FCR 548 ; 51 IPR 411 ; Ostrowski-Meissner v Registrar of Trade Marks (2006) 69 IPR 291 at [7] and [8]). Section 197 is in these terms: On hearing an appeal against a decision or direction of the Registrar, the Federal Court may do any one or more of the following: (a) admit further evidence orally, or on affidavit or otherwise; (b) permit the examination and cross-examination of witnesses, including witnesses who give evidence before the Registrar; (c) order an issue of fact to be tried as it directs; (d) affirm, reverse or vary the Registrar's decision or direction; (e) give any judgment, or make any order, that, in all the circumstances, it thinks fit; (f) order a party to pay costs to another party.


case_title: Ostrowski-Meissner v Registrar of Trade Marks (2006) 69 IPR 291


case_text: is true that FCN has failed to identify assets of the company out of which an order for costs might be satisfied. However, on the evidence, FCN is a going concern. FCN has previously satisfied at least one order for costs in litigation between the same parties. The undertaking offered by Mr Lawrence is not decisive of TFN's application in the sense that the offer of the undertaking is determinative of a decision in the exercise of the discretion. It is one important factor to be taken into account. In Intercraft Cabinets Pty Ltd v Sampas Pty Ltd [1998] HCA 30 ; (1998) 16 ACLC 1 at p 8, Malcolm CJ put the principle in these terms: While the fact that those who stand behind the company have offered to guarantee payment of the taxed costs of the appellant is a material consideration, it is not the only consideration. There are other matters to be considered such as the merits of the action, the conduct of the parties and any other matter relevant to the exercise of the discretion, including the proposition that the mere impecuniosity of a plaintiff should not be a bar to the commencement of proceedings. [emphasis added]


case_text: Mantaray Pty Ltd v Brookfield Breeding Co. Pty Ltd (1990) 8 ACLC 304 at 306 Byrne J adopted observations of Connolly J (Campbell CJ and Demack J agreeing with Connolly J) in Harpur & Ors v Ariadne Australia Ltd & Ors (1984) 2 ACLC 356 at 362 to the effect that the purpose of an order for security is to require a person to step out from behind the "skirts of the company" and bring his or her own assets into play. Connolly J also observed that, "If however he [or she] is already available for whatever he [or she] is worth, the object of the legislation is seen to be satisfied". In Gentry Bros. Pty Ltd v Wilson Brown & Associates Pty Ltd & Ors (1992) 10 ACLC 1394 at 1399, Cooper J observed that once the shareholders have been exposed to personal liability, the weight to be given to the statutory purpose of an order for security against the corporation is gone. Cooper J described the offer by shareholders to accept personal liability for the costs of the corporation as a factor "weighing heavily" against the making of an order for security "notwithstanding that the worth of the shareholders may ultimately prove insufficient to satisfy any judgment in whole or in part". In KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 13 ACLC 437 , Beazley J at 445 considered both Mantaray and Gentry and put the principle to be adopted in these terms: ... the offer of security by way of guarantee from the directors or shareholders or other persons interested in the outcome of the litigation [is] a factor, which could be decisive in a given case, to be considered in determining whether any other form of order for security for costs should be made.


case_title: Harpur & Ors v Ariadne Australia Ltd & Ors (1984) 2 ACLC 356


case_title: Gentry Bros. Pty Ltd v Wilson Brown & Associates Pty Ltd & Ors (1992) 10 ACLC 1394


case_title: KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 13 ACLC 437


case_text: It is apparent that the intention was that s 483 apply to all appeals from privative clause decisions. Section 483 was then amended in the 2005 Act ('the 2005 amendments'), presumably because of decisions such as S157 ( Bodruddaza v Minister for Immigration & Multicultural Affairs [2007] HCA 14 ; (2007) 228 CLR 651 at [19] ). Clause 39 of the Explanatory Memorandum to the Migration Litigation Reform Bill 2005 says: Item 27 Section 483 This item repeals section 483 and substitutes a new section. This provides that section 44 of the AAT Act does not apply to privative clause decisions or purported privative clause decisions (inserted by item 14, Schedule 1). Section 44 of the AAT Act provides that a person may appeal a decision of the AAT on a point of law to the Federal Court. An appeal to the Federal Court under section 44 is available in relation to a non-privative clause decision.


case_text: Section 483 is clear in its terminology and meaning. The amendments to the Migration Act in the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth) and the 2005 Act do not remove a right of judicial review of Tribunal decisions. They confer jurisdiction on the Federal Magistrates Court to review those migration decisions for which jurisdiction is not conferred on the Federal Court by s 476A and to place statutory limits on a statutory right of appeal. Justice Besanko observed in Epenisa v Minister for Immigration & Multicultural Affairs (2007) 44 AAR 456 at [11], on the subject of the limitation imposed by s 483 of the Migration Act , that s 44 of the AAT Act is a statutory right of appeal and ' there is nothing to prevent Parliament from excluding from its purview a certain class of decision '. 21 Clause 51 of the Revised Explanatory Memorandum to the Migration Legislation Amendment (Judicial Review) Bill 2001 concerns the proposed s 483. It says: Section 483 Section 44 of the Administrative Appeals Tribunal Act 1975 51 Section 44 of the Administrative Appeals Tribunal Act 1975 allows for appeals from the Administrative Appeals Tribunal to the Federal Court on a point of law. New section 483 prevents section 44 from applying to a privative clause decision. Therefore, an application to the Federal Court in respect of such a decision needs to be made under section 39B of the Judiciary Act . 26 There have, however, been other decisions of the Court where the effect of s 483 has been considered on appeal from the Tribunal and in the context of business visa decisions. In Li-Shien Chen v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 1496 at [2] [3] Drummond J noted that it was common ground that that the Tribunal's decision was a privative clause decision and that an appeal against the Tribunal's decision to the Court under s 44 of the AAT Act was not available because of s 483 of the Migration Act (as it was, prior to the 2005 Act). In Jong Hak Kim v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCA 31 ; (2004) 38 AAR 304 , also concerning a business visa decision, Kiefel J noted at [26] that it had been submitted by the Minister that the Court's jurisdiction was under s 39B of the Judiciary Act 1903 (Cth) and not s 44 of the AAT Act because of s 483 of the Migration Act . Her Honour did not reject that submission but did not consider it further. In SHCB v Minister for Immigration & Multicultural & Indigenous Affairs [2003] FCAFC 308 ; (2003) 133 FCR 561 , not a business visa case, the Full Court held at [5] that, if the Tribunal decision was a privative clause decision, there was no right of appeal under s 44 of the AAT Act by reason of the operation of s 483. In Epenisa , Besanko J considered the Court's jurisdiction in an appeal from the Tribunal decision. Noting that the Court had jurisdiction under s 39B of the Judiciary Act and under ss 476A(1)(b) or (c) of the Migration Act , his Honour observed at [8] that there was no right of appeal under s 44 of the AAT Act because of s 483 of the Migration Act .


case_outcome: considered

case_text: There have, however, been other decisions of the Court where the effect of s 483 has been considered on appeal from the Tribunal and in the context of business visa decisions. In Li-Shien Chen v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 1496 at [2] [3] Drummond J noted that it was common ground that that the Tribunal's decision was a privative clause decision and that an appeal against the Tribunal's decision to the Court under s 44 of the AAT Act was not available because of s 483 of the Migration Act (as it was, prior to the 2005 Act). In Jong Hak Kim v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCA 31 ; (2004) 38 AAR 304 , also concerning a business visa decision, Kiefel J noted at [26] that it had been submitted by the Minister that the Court's jurisdiction was under s 39B of the Judiciary Act 1903 (Cth) and not s 44 of the AAT Act because of s 483 of the Migration Act . Her Honour did not reject that submission but did not consider it further. In SHCB v Minister for Immigration & Multicultural & Indigenous Affairs [2003] FCAFC 308 ; (2003) 133 FCR 561 , not a business visa case, the Full Court held at [5] that, if the Tribunal decision was a privative clause decision, there was no right of appeal under s 44 of the AAT Act by reason of the operation of s 483. In Epenisa , Besanko J considered the Court's jurisdiction in an appeal from the Tribunal decision. Noting that the Court had jurisdiction under s 39B of the Judiciary Act and under ss 476A(1)(b) or (c) of the Migration Act , his Honour observed at [8] that there was no right of appeal under s 44 of the AAT Act because of s 483 of the Migration Act .


case_text: The applicant also relies on two decisions of the Court which considered appeals on a question of law under s 44 of the AAT Act from business visa decisions of the Tribunal, Koosasi v Minister for Immigration & Multicultural Affairs (2006) 43 AAR 462 and Yang v Minister for Immigration & Multicultural Affairs [2006] FCA 1159. The applicant accepts that neither decision canvassed the effect of s 483, although other aspects of the Court's jurisdiction were discussed. It is likely that the effect of that section on jurisdiction was simply not raised for consideration. In any event, there was no determination that the Court did have jurisdiction despite s 483 of the Migration Act .


case_title: Li-Shien Chen v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 1496


case_text: Third, he points to the scheme of the Migration Act and the legislation which introduced the provisions in question. He submits that, as there is no specific reference to business visa decisions, they are not encompassed by s 483. The applicant submits that, if the intention of Parliament was to remove an existing right of appeal to the Federal Court on a question of law in relation to business visa decisions, this would have been clearly stated ( Plaintiff S157/2002 v Commonwealth of Australia (2003) 211 CLR 476 at [32] per Gleeson CJ and at [72] per Gaudron, McHugh, Gummow, Kirby and Hayne JJ). The correct interpretation is, he submits, that s 476A in combination with s 483 limits judicial review of migration decisions but not the right of appeal on a question of law, particularly in relation to business visa decisions by the Tribunal. He submits that, read together, s 483 only applies to the class of decisions referred to in s 476A. 19 There are a number of responses to this submission. Again, there is no differentiation between the subject matter of privative clause decisions or purported privative clause decisions in s 483 and there is no reason to isolate business visa decisions. Parliament chose not to refer to business visa decisions in s 476A and chose to deal globally with privative and purported privative clause decisions in s 483. Further, s 483 makes no reference to s 476A. It does not, for example, commence with the words "on review under s 500". There is no reason to read s 483 as if those words were included so that only decisions the subject of s 476A(1) were excluded from an appeal to the Federal Court under s 44 of the AAT Act. To do so would be to ignore the clear words of s 483 and the note. 22 It is apparent that the intention was that s 483 apply to all appeals from privative clause decisions. Section 483 was then amended in the 2005 Act ('the 2005 amendments'), presumably because of decisions such as S157 ( Bodruddaza v Minister for Immigration & Multicultural Affairs [2007] HCA 14 ; (2007) 228 CLR 651 at [19] ). Clause 39 of the Explanatory Memorandum to the Migration Litigation Reform Bill 2005 says: Item 27 Section 483 This item repeals section 483 and substitutes a new section. This provides that section 44 of the AAT Act does not apply to privative clause decisions or purported privative clause decisions (inserted by item 14, Schedule 1). Section 44 of the AAT Act provides that a person may appeal a decision of the AAT on a point of law to the Federal Court. An appeal to the Federal Court under section 44 is available in relation to a non-privative clause decision.


case_title: SHCB v Minister for Immigration & Multicultural & Indigenous Affairs [2003] FCAFC 308 ; (2003) 133 FCR 561


case_text: The note supports the interpretation that s 483 bears on its face, that the section excludes an appeal under s 44 of the AAT Act for privative clause decisions and purported privative clause decisions ( Sneddon v Minister for Immigration & Multicultural & Indigenous Affairs (2005) 88 ALD 84 at [3]). The applicant does not contend to the contrary. 13 Thus, s 476A(1)(d) confers jurisdiction on the Federal Court in relation to such appeals from the Tribunal as can continue to arise under the Migration Act , given the limitation imposed by s 483. The Federal Court has jurisdiction to undertake judicial review of Tribunal decisions under the Migration Act where the decision on review is a privative clause decision or a purported privative clause decision under s 500 of the Migration Act , or a non-privative clause decision the subject of an appeal under s 44(3) of the AAT Act, or a referral by the Tribunal under s 45(2) of the AAT Act. 14 The Federal Magistrates Court has jurisdiction to undertake judicial review of any other decision of the Tribunal in relation to a migration decision, including the decision of the Tribunal in this case (s 476 of the Migration Act ). Symmetrically, s 476(2) provides that the Federal Magistrates Court does not have jurisdiction in relation to decisions described as in s 476A(1). The applicant is, however, out of time to make an application to the Federal Magistrates Court. 15 To overcome this result, the applicant makes a number of submissions. 16 First, he submits that as s 483 of the Migration Act does not specifically refer to business visas, they are excluded from the ambit of that section. I reject that submission. Section 483 does not refer to any particular category of privative clause decision or purported privative clause decision. There is no reason to put business visas into a special category.


case_title: Yang v Minister for Immigration & Multicultural Affairs [2006] FCA 1159


case_outcome: referred to

case_text: In Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd [2003] VSC 201 Gillard J identified the elements which it is necessary for a complainant to establish in order to make good a charge of civil contempt of Court. His Honour said: "[31] In order to prove a civil contempt of Court involving a breach of an order of the Court, the plaintiff has to prove the following: (i) that an order was made by the Court; (ii) that the terms of the order are clear, unambiguous and capable of compliance; (iii) that the order was served on the alleged contemnor or excused in the circumstances, or service dispensed with pursuant to the Rules of Court; (iv) that the alleged contemnor has knowledge of the terms of the order; (v) that the alleged contemnor has breached the terms of the order. [32] It is necessary for the plaintiff to prove each element beyond reasonable doubt. In accordance with the principles of the criminal law, in proving element (v) it must be proven that the act or omission which constituted the breach of the order was deliberate and voluntarily." 16 There is no dispute, and I am satisfied that: • Order 2 was made by the Full Court on 19 July 2006. • The terms of the order were clear and unambiguous. • A copy of the Full Court's orders was served on Mr Siminton on 27 July 2006. The endorsement required by O 37 r 2(3) of the Federal Court Rules appeared on the order. • Mr Siminton had knowledge of the terms of the order. Mr Siminton has put in issue the question of whether, at relevant times, he had the capacity to pay all or any of the $50,000 fine and the related question of whether, in the absence of any capacity to pay, it can be said that he deliberately and voluntarily failed to comply with the Full Court's order.


case_text: In Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83 ; (2006) 149 FCR 494 at 497-8 Merkel J summarised the current state of the law on when disobedience of a Court order will constitute a contempt of court. His Honour said: "Deliberate conduct which is in breach of a court order will constitute wilful disobedience of the order, and therefore a civil contempt, unless the conduct be casual, accidental or unintentional: see Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd [1986] HCA 46 ; (1986) 161 CLR 98 at 106 to 107 and 112 to 113. However, the disobedience will amount to a criminal contempt if it involves 'deliberate defiance or, as it is sometimes said, if it is contumacious': see Witham v Holloway [1995] HCA 3 ; (1995) 183 CLR 525 at 530 ... However, as all proceedings for contempt are now regarded as criminal in nature, all of the charges must be proved beyond reasonable doubt: see Witham at 534." See also AMIEU v Mudginberri Station Pty Ltd [1986] HCA 46 ; (1986) 161 CLR 98 at 112-3; Heatons Transport v TGWU [1973] AC 15 at 109. 28 The area of disagreement between the parties was thus narrowed to the question of whether it was necessary for the District Registrar to establish that Mr Siminton had the capacity to pay the full $50,000 fine at relevant times or whether, if he had the capacity to pay part of the fine (as it was conceded he did) and did not do so he could be found guilty of contempt. It was not disputed that a failure to comply with an order of the Court to pay a money amount could constitute a contempt (a proposition supported by decisions of the Court in Australian Industry Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries of Australia (2001) 188 ALR 653 at 658 and World Netsafe at [29]) or that the Court had power to deal with such a contempt under s 31(1) of the Federal Court of Australia Act 1976 (Cth) and s 24 of the Judiciary Act 1903 (Cth) (as to which see Mudginberri Station at 105-6). 30 In my view a person who is ordered by the Court to make a payment within a certain time and, within the prescribed period, has the capacity to pay part, but not all, of the amount needed to satisfy the order, is bound to make that part of the payment which he or she has the capacity to make. Failure to make such part payment as the person has the capacity to make will constitute a contempt of Court. I understand Spender J's dictum in World Netsafe to admit this possibility. Where the Court order is made in favour of another person such an approach ensures that that person obtains at least some of the money to which the Court has adjudged him or her to be entitled. Where, as here, the Court has imposed a fine for contempt, a requirement of part payment to the limit of the contemnor's capacity at least partially serves "the very substantial purpose of disciplining the [contemnor] and vindicating the authority of the court": see Mudginberri at 112. It would offend common sense and a sense of justice if a person could avoid complying with a Court order to pay a particular sum when he or she had the capacity to pay most but not all of it.


case_outcome: discussed

case_text: Counsel for the District Registrar accepted that his client bore the onus of establishing that Mr Siminton had the capacity to comply with the Full Court's order and that his failure to comply with that order was wilful. He was correct to do so: see Australian Competition and Consumer Commission v World Netsafe Pty Ltd [2003] FCA 159 at [51] ; Pattison v Bell [2007] FCA 137 at [34] . 28 The area of disagreement between the parties was thus narrowed to the question of whether it was necessary for the District Registrar to establish that Mr Siminton had the capacity to pay the full $50,000 fine at relevant times or whether, if he had the capacity to pay part of the fine (as it was conceded he did) and did not do so he could be found guilty of contempt. It was not disputed that a failure to comply with an order of the Court to pay a money amount could constitute a contempt (a proposition supported by decisions of the Court in Australian Industry Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries of Australia (2001) 188 ALR 653 at 658 and World Netsafe at [29]) or that the Court had power to deal with such a contempt under s 31(1) of the Federal Court of Australia Act 1976 (Cth) and s 24 of the Judiciary Act 1903 (Cth) (as to which see Mudginberri Station at 105-6). 29 In dealing with the disputed issue both parties sought to rely on a passage from the judgment of Spender J in World Netsafe . His Honour said, at [51], that: "The ACCC is not seeking to imprison Mr Butler because he has not paid a debt to it; it is seeking his committal for disobedience of a court order. Further, and regardless of any possible application of the Debtors Act in the present application, I am of the opinion that to establish contempt of an order to pay within 28 days of the making of the order, it has to be shown that a failure to comply with that order was wilful. That requirement will not be made out unless it is shown that the person the subject of the order has the capacity to comply with it, in whole or in part. A truly impecunious person who does not make a payment which a court has ordered him to pay is not guilty of contempt, in my opinion." The money had been paid to a company as part of pyramid selling scheme promoted by it. The alleged contemnor was the sole shareholder and director of the company. He was found not to have committed contempt by failing to comply with an order requiring him to refund certain moneys which had been paid to the company. This was because it had not been established that he had the means of making the payment. 30 In my view a person who is ordered by the Court to make a payment within a certain time and, within the prescribed period, has the capacity to pay part, but not all, of the amount needed to satisfy the order, is bound to make that part of the payment which he or she has the capacity to make. Failure to make such part payment as the person has the capacity to make will constitute a contempt of Court. I understand Spender J's dictum in World Netsafe to admit this possibility. Where the Court order is made in favour of another person such an approach ensures that that person obtains at least some of the money to which the Court has adjudged him or her to be entitled. Where, as here, the Court has imposed a fine for contempt, a requirement of part payment to the limit of the contemnor's capacity at least partially serves "the very substantial purpose of disciplining the [contemnor] and vindicating the authority of the court": see Mudginberri at 112. It would offend common sense and a sense of justice if a person could avoid complying with a Court order to pay a particular sum when he or she had the capacity to pay most but not all of it.


case_text: The area of disagreement between the parties was thus narrowed to the question of whether it was necessary for the District Registrar to establish that Mr Siminton had the capacity to pay the full $50,000 fine at relevant times or whether, if he had the capacity to pay part of the fine (as it was conceded he did) and did not do so he could be found guilty of contempt. It was not disputed that a failure to comply with an order of the Court to pay a money amount could constitute a contempt (a proposition supported by decisions of the Court in Australian Industry Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries of Australia (2001) 188 ALR 653 at 658 and World Netsafe at [29]) or that the Court had power to deal with such a contempt under s 31(1) of the Federal Court of Australia Act 1976 (Cth) and s 24 of the Judiciary Act 1903 (Cth) (as to which see Mudginberri Station at 105-6).


case_text: On 29 December 2005, 4 January 2006 and on 19 January 2006 APRA filed notices of motion and statements of charge seeking orders that Mr Siminton be punished for contempt in respect of nine alleged breaches of the orders made by Sundberg J. On 30 March 2006 Merkel J found six of those charges proven. He described them collectively as "the disposal contempts". In sentencing Mr Siminton for these contempts Merkel J summarised Mr Siminton's conduct as follows: "On the evidence before the court, it is clear that Siminton's disposal contempts were of an extremely serious kind and constituted wilful disobedience and contumacious disregard of the court's orders. The seriousness of the breaches is underlined by the fact that Siminton's conduct was precisely the kind of conduct against which Sundberg J sought to guard by the making of the orders the subject of the contempt charges. The conduct involved the actual transfer of large sums of money ($536,880.18, $38,000, $43,000, $5,000 and $10,000 respectively), and an attempted cash withdrawal from a Bendigo Bank account of $500,000, all of which occurred shortly after Siminton became aware of the Sundberg J orders." See: Australian Prudential Regulation Authority v Siminton (No 3) (2006) 230 ALR 528 at 529. On 10 April 2006 Merkel J ordered that Mr Siminton be imprisoned for a period of 10 weeks in respect of the disposal contempts. 3 Mr Siminton lodged an appeal against the findings and orders made by Merkel J. On 19 July 2006 a Full Court allowed the appeal in part, setting aside the order for imprisonment and imposing, in lieu, a fine of $50,000. Paragraph two of the Full Court's order read: "2. Paragraph 2 of the orders of Merkel J made on 10 April 2006 is set aside and in lieu thereof it is ordered: (a) A fine in the sum of $50,000 be imposed on the appellant in respect of the contempt the subject of charges 1.1 and 1.2 of the statement of charge dated 4 January 2006 and charges 1.1, 1.2, 1.3 and 1.4 of the statement of charge dated 19 January 2006. (b) The fine be paid to the District Registrar within 60 days or such further time and by such instalments as the District Registrar may allow. (c) In the event that there is default in payment of the fine or of any instalment, the District Registrar shall apply to a judge of the Court for direction concerning enforcement." Mr Siminton was present in Court when the order was pronounced. 4 On 18 September 2006, the day which the 60 day period prescribed by Order 2(b) expired, Mr Siminton applied for an extension of time within which to make payment of the $50,000. The application was supported by an affidavit, sworn on 14 September 2006, by the solicitor acting for Mr Siminton. The solicitor deposed: "5. I am advised by my client and verily believe that he is presently unable to pay the said fine. On 10 January 2006 Gray J made an interlocutory order in the principal matter inter alia totally freezing all of my client's funds and assets. As a consequence of the full order of Gray J, which addresses a number of aspects, many hundreds of thousands of dollars have been frozen. As part of the proposed Application to stay and or set aside the principal application, a consequential application will be made to stay and/or set aside the said order of Gray J. In the circumstances, it is respectfully submitted that my client's ability to pay the fine or otherwise should not be determined whilst he is subject to such freezing order and since a challenge is to be mounted as aforesaid to such order that there be a stay for the payment of the fine pending the hearing and determination of such challenge." By order dated 18 September 2006 the District Registrar extended the time for payment to 5:00 pm on 2 October 2006. On that day Mr Siminton's solicitors wrote to the District Registrar seeking a further extension of one month for Mr Siminton to pay the fine. No reason for seeking the extension was given. The application was refused. The fine has not since been paid. 5 On 3 October 2006, in accordance with paragraph 2 (c) of the order of the Full Court, the District Registrar applied for direction concerning enforcement of its order.


case_text: The second objection was framed thus: "(a) The Contempt Charges herein have been brought in the wrong proceeding and in the wrong Court, and should have been brought either in matter number 376 of 2006 or, alternatively, in a new separate a discretely numbered proceeding and, in any event, in the Full Court. (b) The Victorian District Registrar proceeded on Directions which were incorrectly made in matter number 1607 of 2005, by Tracey J, sitting in the Trial Division, rather than on a Direction given by a Member of the Full Court in matter number 376 of 2006 ..." A submission to like effect had been made to me when the Registrar sought directions on 6 October 2006. I rejected the submissions for reasons which I gave in Australian Prudential Regulation Authority v Siminton (No 5) [2006] FCA 1340 at [5] . Proceeding number 376 of 2006 was the file number assigned to Mr Siminton's appeal from the finding and orders of Merkel J. Proceeding number 1607 of 2005 is the file number assigned to the principal proceeding in which the ex parte orders of Sundberg J were made. In my view Order 2(c) of the Full Court's orders empowered the District Registrar to make application to a single judge of the Court. It did not require her to make application to a member of the Full Court. It was appropriate for her to seek such directions by resort to a notice of motion filed in the principal proceeding. This is what she did. 11 The third preliminary matter was an application that I disqualify myself from dealing with this contempt charge. It was submitted that I should disqualify myself because I had: • previously rejected an application by Mr Siminton for a further extension of time in which to pay the fine; and • directed the District Registrar to bring contempt charges. I refused to disqualify myself. Neither of these decisions involved any prejudgment of any issue arising on the present notice of motion. Nor have I, in making those decisions, had occasion to form or express any judgment as to Mr Siminton's credit. I was not referred to any authority which would require me to disqualify myself.


case_text: The first objection was that s 65A of the Act was "unconstitutional" and that this precluded the laying of contempt charges. I rejected this contention for reasons which I gave when dealing with the principal proceeding: see Australian Prudential Regulation Authority v Siminton [2007] FCA 1608 at [7] to [11]. 12 The fourth objection was that the principal application was an abuse of process which should permanently be stayed or struck-out. This submission was also made in the principal proceeding. I rejected it then: see Australian Prudential Regulation Authority v Siminton (No 6) [2007] FCA 1608 at [25] to [27]. I reject it now.


case_text: Siminton's attempts to conceal his use of funds, and his failure to complete a statement of affairs or provide books of account leads readily to an inference that Siminton has access to the funds in the account in the name of Holzheimer. ..." 20 Some of the transactions and other events on which the Deputy Registrar relies were also relied on by APRA in a separate but related contempt proceeding: see Australian Prudential Regulation Authority v Siminton (No 7) [2007] FCA 1609 (" Siminton (No 7 )"). • The transactions referred to in para 15 of the District Registrar's written submissions are explained and dealt with in Siminton (No 7) at [33] and [63]. • The transaction referred to in para 17 of the District Registrar's submissions is explained and dealt with in Siminton (No 7) at [28], [29] and [62]. • The direction referred to in para 19 of the District Registrar's submissions is explained and dealt with in Siminton (No 7) at [37]. The transactions referred to in para 16 of the District Registrar's submissions are, largely, in addition to those dealt with in Siminton (No 7) at [22]. They involved the use, by Mr Siminton, of the Visa card in the name of Holzheimer, to purchase goods and services from a garage, a Seven Eleven store, a cinema and a restaurant. 21 In oral submissions counsel for the District Registrar also drew attention to the use, by Mr Siminton, of the Holzheimer's Visa account, to pay legal fees totalling $19,500 in the period between 3 May 2006 and 16 August 2006. Nine separate transactions were involved. The details appear in Siminton (No 7) at [23]. Of these only one payment of $2,000 was made between 19 July and 2 October 2006. Counsel, however, submitted that the earlier payments provided evidence that Mr Siminton was in a position to draw on and did drawn on the account to satisfy his financial needs during 2006. 22 The District Registrar's invitation to the Court to draw inferences from the facts is made in circumstances in which neither Mr Siminton nor any other persons, such as the Holzheimers, who might reasonably have been expected to have knowledge of the various transactions and of his financial position, gave evidence. No adverse inference can be drawn merely because Mr Siminton has chosen not to give or call evidence in defence of the charge. The failure is nonetheless of potential significance. This is because, as the High Court explained in RPS v R [2000] HCA 3 ; (2000) 199 CLR 620 at 632-3: "...it will seldom, if ever, be reasonable to conclude that an accused in a criminal trial would be expected to give evidence. The most that can be said in criminal matters is that there are some cases in which evidence (or an explanation) contradicting and apparently damning inference to be drawn from proven facts could come only from the accused. In the absence of such evidence or explanation, the jury may more readily draw the conclusion which the prosecution seeks. As was said in Weissensteiner v The Queen: '[I]n a criminal trial, hypotheses consistent with innocence may cease to be rational or reasonable in the absence of evidence to support them when that evidence, if it exists at all, must be within the knowledge of the accused.' "(footnotes omitted)." 26 Counsel for the District Registrar submitted that the evidence supported the conclusion that, in the period between 19 July 2006 and 2 October 2006, Mr Siminton had access to funds which would have enabled him, had he wished to do so, to pay some or all of the fine imposed by the Full Court. Counsel accepted that there was an issue as to whether Mr Siminton was entitled to have access to the funds consistently with orders made by Gray J on 10 January 2006. In Siminton (No 7) I have held that, in dealing with these funds, Mr Siminton was in contempt of His Honour's orders: see at [3], [4], [60], [61], [62], and [63]. Counsel, however, submits that Mr Siminton could have made application to the Court in accordance with an order made by Gray J which gave him "liberty to apply on two days notice in writing to [APRA], supported by an Affidavit as to his means, for an order that he be permitted to withdraw moneys for the purposes of paying his own living expenses and/or paying his legal expenses in relation to the proceeding." Alternatively, an application could have been made to vary His Honour's orders so as to permit Mr Siminton to have access to sufficient funds to pay some or all of the $50,000 fine. This was not done. 27 Counsel for Mr Siminton pointed to the attempt made by Mr Siminton, in September 2006, to have the time for payment enlarged and, in particular, to the part of the affidavit, sworn by his instructing solicitor on 14 September 2006, which has been extracted above at [4]. This was said to indicate that Mr Siminton was making a bona fide attempt to obtain access to the funds frozen by Gray J's order in order to pay the fine. The affidavit did not disclose that Mr Siminton had, in fact, obtained access to some of the funds comprehended by his Honour's orders. Faced with the uncontradicted evidence that Mr Siminton had had access to some of these funds counsel was forced to concede that Mr Siminton did, during the relevant period, have the capacity, should he have so wished, to pay part of the fine. He submitted, however, that the evidence, adduced by the District Registrar, did not establish that Mr Siminton had the capacity to pay the entire $50,000 before 2 October 2006. There was, therefore, he contended a "more than reasonable doubt" as to whether Mr Siminton's failure to pay the full amount was wilful. 31 The circumstances in which Mr Siminton came to have access to the Holzheimer's Visa account are explained in detail in Siminton (No 7) at [23] and [36]. In summary, what occurred was that, in April 2006, Mrs Holzheimer obtained an additional card to operate the account by reporting the loss of a card held by her. She provided the replacement card to Mr Siminton who used it regularly from April 2006 until it was cancelled by the bank on [15] September 2006. Between 19 July 2006 and 16 August 2006 he used it on many occasions to purchase goods and services. On 16 August 2006 the account had a debit balance of $2,463.73. At about that time Mr Siminton gave instructions to a bank in Austria to transfer $25,000 (less commission) from an account controlled by him to the Holzheimer's Visa account. Pursuant to those instructions $24,981 was transferred into the Visa account on 16 August 2006. The account then had a credit balance of $22,517.27. On that day he used the card to pay $2,000 to his solicitor. On 18 August 2006 he withdrew $1,000 in cash from the account. He did so again on 30 August 2006. 32 I am, accordingly, satisfied that Mr Siminton had the financial capacity to pay at least $22,517.27 to comply, in part, with the Full Court's order. I am satisfied that his refusal to do so was wilful. He was well aware of his obligation to make the payment and he chose to use the funds at his disposal for other purposes. 33 I found, in Siminton (No 7) , that the funds transferred from the Austrian bank and other funds credited to the Visa account were subject to the "freezing order" made by Gray J in January 2006. Mr Siminton should not, therefore, have dealt with these moneys. This does not, in my opinion, lead to the conclusion that he lacked the capacity to make part payment. Counsel for Mr Siminton did not so submit. Mr Siminton, in fact, had obtained access to these funds and used them. He asserted an entitlement to some, at least, of the moneys covered by Gray J's order. He had the option of preparing an affidavit as to his means and establishing his entitlement to the funds. He chose not to do so. I accept the submission of counsel for the District Registrar that Mr Siminton could, had he wished to do so, lawfully have obtained the right to use the funds to pay the fine by exercising the liberty to apply granted to him by Gray J or by applying to vary Gray J's orders. He did neither of these things. 34 I am satisfied beyond reasonable doubt that each element of the charge preferred by District Registrar has been made out. I will give directions as to the steps which need to be taken in advance of a hearing on penalty. I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey. Associate: Dated: 7 November 2007 Counsel for the District Registrar: Mr R Niall Solicitor for the District Registrar: Australian Government Solicitor Counsel for the Respondent: Mr D Sharp Solicitor for the Respondent: Erhardt & Associates Date of Hearing: 14 June 2007 Date of Judgment: 7 November 2007 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2007/1612.html


case_title: Heatons Transport v TGWU [1973] AC 15

case_text: In Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83 ; (2006) 149 FCR 494 at 497-8 Merkel J summarised the current state of the law on when disobedience of a Court order will constitute a contempt of court. His Honour said: "Deliberate conduct which is in breach of a court order will constitute wilful disobedience of the order, and therefore a civil contempt, unless the conduct be casual, accidental or unintentional: see Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd [1986] HCA 46 ; (1986) 161 CLR 98 at 106 to 107 and 112 to 113. However, the disobedience will amount to a criminal contempt if it involves 'deliberate defiance or, as it is sometimes said, if it is contumacious': see Witham v Holloway [1995] HCA 3 ; (1995) 183 CLR 525 at 530 ... However, as all proceedings for contempt are now regarded as criminal in nature, all of the charges must be proved beyond reasonable doubt: see Witham at 534." See also AMIEU v Mudginberri Station Pty Ltd [1986] HCA 46 ; (1986) 161 CLR 98 at 112-3; Heatons Transport v TGWU [1973] AC 15 at 109.


case_title: Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83 ; (2006) 149 FCR 494


case_title: Pattison v Bell [2007] FCA 137

case_text: Counsel for the District Registrar accepted that his client bore the onus of establishing that Mr Siminton had the capacity to comply with the Full Court's order and that his failure to comply with that order was wilful. He was correct to do so: see Australian Competition and Consumer Commission v World Netsafe Pty Ltd [2003] FCA 159 at [51] ; Pattison v Bell [2007] FCA 137 at [34] .


case_text: Siminton's attempts to conceal his use of funds, and his failure to complete a statement of affairs or provide books of account leads readily to an inference that Siminton has access to the funds in the account in the name of Holzheimer. ..." 20 Some of the transactions and other events on which the Deputy Registrar relies were also relied on by APRA in a separate but related contempt proceeding: see Australian Prudential Regulation Authority v Siminton (No 7) [2007] FCA 1609 (" Siminton (No 7 )"). • The transactions referred to in para 15 of the District Registrar's written submissions are explained and dealt with in Siminton (No 7) at [33] and [63]. • The transaction referred to in para 17 of the District Registrar's submissions is explained and dealt with in Siminton (No 7) at [28], [29] and [62]. • The direction referred to in para 19 of the District Registrar's submissions is explained and dealt with in Siminton (No 7) at [37]. The transactions referred to in para 16 of the District Registrar's submissions are, largely, in addition to those dealt with in Siminton (No 7) at [22]. They involved the use, by Mr Siminton, of the Visa card in the name of Holzheimer, to purchase goods and services from a garage, a Seven Eleven store, a cinema and a restaurant. 21 In oral submissions counsel for the District Registrar also drew attention to the use, by Mr Siminton, of the Holzheimer's Visa account, to pay legal fees totalling $19,500 in the period between 3 May 2006 and 16 August 2006. Nine separate transactions were involved. The details appear in Siminton (No 7) at [23]. Of these only one payment of $2,000 was made between 19 July and 2 October 2006. Counsel, however, submitted that the earlier payments provided evidence that Mr Siminton was in a position to draw on and did drawn on the account to satisfy his financial needs during 2006. 22 The District Registrar's invitation to the Court to draw inferences from the facts is made in circumstances in which neither Mr Siminton nor any other persons, such as the Holzheimers, who might reasonably have been expected to have knowledge of the various transactions and of his financial position, gave evidence. No adverse inference can be drawn merely because Mr Siminton has chosen not to give or call evidence in defence of the charge. The failure is nonetheless of potential significance. This is because, as the High Court explained in RPS v R [2000] HCA 3 ; (2000) 199 CLR 620 at 632-3: "...it will seldom, if ever, be reasonable to conclude that an accused in a criminal trial would be expected to give evidence. The most that can be said in criminal matters is that there are some cases in which evidence (or an explanation) contradicting and apparently damning inference to be drawn from proven facts could come only from the accused. In the absence of such evidence or explanation, the jury may more readily draw the conclusion which the prosecution seeks. As was said in Weissensteiner v The Queen: '[I]n a criminal trial, hypotheses consistent with innocence may cease to be rational or reasonable in the absence of evidence to support them when that evidence, if it exists at all, must be within the knowledge of the accused.' "(footnotes omitted)."


case_text: In any event, these arguments cannot avail Mr Siminton in contempt proceedings. As the Full Court pointed out in Siminton v Australian Prudential Regulation Authority [2006] FCAFC 118 ; (2006) 152 FCR 129 and 137-8: "An order made by a superior court of record stands and is bound to be observed even though it may ultimately be determined that the order should not have been made or was made without jurisdiction. Whilst the order stands, and it is not set aside, it must be observed and obeyed and any breach of contravention of such an order can give rise to a charge of contempt of failing to comply with it or observe it." Mr Siminton was, and remains, bound to comply with the order made by the same Full Court.


case_outcome: followed

case_title: ASIC v Southcorp Ltd [2003] FCA 804 , 46 ACSR 438

case_text: In ASIC v Southcorp Ltd [2003] FCA 804 at [21] , [2003] FCA 804 ; 46 ACSR 438 at 441 2 Lindgren J helpfully formulated the principles to be applied in a case such as the present. In particular, His Honour there formulated two of those principles as being: (3) Documents generated unilaterally by the expert witness, such as working notes, field notes, and the witness's own drafts of his or her report, do not attract privilege because they are not in the nature of, and would not expose, communications: cf Interchase [Corp Ltd (in liq) v Grosvenor Hill (Qld) Pty Ltd (No 1) [1999] 1 Qd R 141] at 161 2 per Thomas J. (4) Ordinarily disclosure of the expert's report for the purpose of reliance on it in the litigation will result in an implied waiver of the privilege in respect of the brief or instructions or documents referred to in (1) and (2) above, at least if the appropriate inference to be drawn is that they were used in a way that could be said to influence the content of the report, because, in these circumstances, it would be unfair for the client to rely on the report without disclosure of the brief, instructions or documents... 9 For the purposes of resolving the present claims for privilege, an inference may be drawn that the " handwritten annotations " of Ms Chylek most probably contain observations in respect to the email or the draft expert report then before her. The onus upon the Fifth Respondent of establishing privilege, albeit on minimal material, has been made out. Those handwritten annotations it is thus considered are privileged, as is Document 2, the email from Ms Chylek to the expert. 10 The documents, it may generally be accepted, were confidential. 12 Documents 9 and 11 are draft expert reports. The draft expert reports, however, are not considered to be privileged and the onus imposed upon the Fifth Respondent to establish the claim has not been discharged. A draft report from an expert, together with a communication from an expert to a solicitor, " do not attract privilege because they are not in the nature of, and would not expose, communications " per Lindgren J. Nor, if it be relevant, is there any evidence that the draft reports were given for the purpose of obtaining the input of the solicitors: New Cap Reinsurance Corp Ltd (in liq) v Renaissance Reinsurance Ltd [2007] NSWSC 258. That was a case arising under s 119 of the Evidence Act 1995 (Cth) and not the common law. All that is known of the draft reports in the present proceeding is simply that, namely they are " draft reports ". Nothing is known as to the reasons why such drafts were prepared and nothing is known as to whether the disclosure of a draft report prepared by the independent expert would disclose anything other than the contents of a draft of a report which was subsequently filed and served. Indeed, Senior Counsel for the Fifth Respondent accepted that privilege would not attach to a document if all that was known was that it was a " Draft Report " which was forwarded in confidence.


case_text: In Grant v Downs [1976] HCA 63 ; (1976) 135 CLR 674 at 688 9, it will be recalled that Stephen, Mason and Murphy JJ summarised the position as follows: It is well accepted that the court in allowing production and inspection of documents exercises a judicial discretion. In so doing it needs to scrutinize with care claims of privilege made on the ground now under consideration. It is for the party claiming privilege to show that the documents for which the claim is made are privileged. He may succeed in achieving this objective by pointing to the nature of the documents or by evidence describing the circumstances in which they were brought into existence. But it should not be thought that the privilege is necessarily or conclusively established by resort to any verbal formula or ritual. The court has power to examine the documents for itself, a power which has perhaps been exercised too sparingly in the past, springing possibly from a misplaced reluctance to go behind the formal claim of privilege. It should not be forgotten that in many instances the character of the documents the subject of the claim will illuminate the purpose for which they were brought into existence. This passage was cited with approval by Lockhart J in Trade Practices Commission v Sterling (1979) 36 FLR 244 at 247.


case_text: The description of the documents for which privilege has been claimed has been brief. But there was no cross-examination of Ms Chylek on her Affidavi t, as there could have been: National Crime Authority v S (1991) 29 FCR 203 at 211 per Lockhart J.


case_text: Documents 9 and 11 are draft expert reports. The draft expert reports, however, are not considered to be privileged and the onus imposed upon the Fifth Respondent to establish the claim has not been discharged. A draft report from an expert, together with a communication from an expert to a solicitor, " do not attract privilege because they are not in the nature of, and would not expose, communications " per Lindgren J. Nor, if it be relevant, is there any evidence that the draft reports were given for the purpose of obtaining the input of the solicitors: New Cap Reinsurance Corp Ltd (in liq) v Renaissance Reinsurance Ltd [2007] NSWSC 258. That was a case arising under s 119 of the Evidence Act 1995 (Cth) and not the common law. All that is known of the draft reports in the present proceeding is simply that, namely they are " draft reports ". Nothing is known as to the reasons why such drafts were prepared and nothing is known as to whether the disclosure of a draft report prepared by the independent expert would disclose anything other than the contents of a draft of a report which was subsequently filed and served. Indeed, Senior Counsel for the Fifth Respondent accepted that privilege would not attach to a document if all that was known was that it was a " Draft Report " which was forwarded in confidence.


case_title: Trade Practices Commission v Sterling (1979) 36 FLR 244


case_text: relevant principles to applications under ss 52 and 53(e) of the TP Act are well established: see eg Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44 ; (1982) 149 CLR 191 ( Parkdale ); Taco Company of Australia Inc v Taco Bell Pty Ltd [1982] FCA 136 ; (1982) 42 ALR 177 ( Taco Bell ). Whether a representation is likely to mislead or deceive is an objective question of fact, to be determined in all the circumstances: Taco Bell . It is sufficient if there is a real chance that the conduct or representation will mislead or deceive: Global Sportsman Pty Ltd v Mirror Newspapers Ltd [1984] FCA 180 ; (1984) 2 FCR 82 at 87. Importantly, whether conduct is misleading or deceptive or is likely to mislead or deceive must be determined in context. In Parkdale it was said at 199: It seems clear enough that consideration must be given to the class of consumers likely to be affected by the conduct. Although it is true, as has often been said, that ordinarily a class of consumers may include the inexperienced as well as the experienced, and the gullible as well as the astute, the section must in my opinion by (sic) regarded as contemplating the effect of the conduct on reasonable members of the class. The heavy burdens which the section creates cannot have been intended to be imposed for the benefit of persons who fail to take reasonable care of their own interests. What is reasonable will or (sic) course depend on all the circumstances. In my view, it is unlikely that a reasonable group of persons seeing those communications would think about the place of origin of those artworks. There is no express representation about their place of origin. There is no real reason why, beyond the clear representation as to the Aboriginality of the artist, the reasonable consumer would advert to their place of origin. In other words, the particular conduct which is said to give rise by implication to the representation that the place of origin of the particular artworks is Australia does not, in my judgment, give rise to that representation. Indeed, as was pointed out in Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (No 1) [1988] FCA 40 ; (1988) 39 FCR 546 at 555, s 52 is not expressed in terms of, and is not confined to, representations. The question is one of fact, namely whether the conduct complained of is likely "to lead into error" (per Gibbs CJ in Parkdale [1982] HCA 44 ; 149 CLR 191 at 198). Relevantly here, the question is whether the conduct, tested against ordinary and reasonable members of a section of the public, may have led into error those persons as to the place of origin of those particular artworks (as distinct from the Aboriginality of the artist). Campomar would indicate that the appropriate question is what would be the likely reaction of that section of the public to the particular conduct.


case_text: relevant principles to applications under ss 52 and 53(e) of the TP Act are well established: see eg Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44 ; (1982) 149 CLR 191 ( Parkdale ); Taco Company of Australia Inc v Taco Bell Pty Ltd [1982] FCA 136 ; (1982) 42 ALR 177 ( Taco Bell ). Whether a representation is likely to mislead or deceive is an objective question of fact, to be determined in all the circumstances: Taco Bell . It is sufficient if there is a real chance that the conduct or representation will mislead or deceive: Global Sportsman Pty Ltd v Mirror Newspapers Ltd [1984] FCA 180 ; (1984) 2 FCR 82 at 87. Importantly, whether conduct is misleading or deceptive or is likely to mislead or deceive must be determined in context. In Parkdale it was said at 199: It seems clear enough that consideration must be given to the class of consumers likely to be affected by the conduct. Although it is true, as has often been said, that ordinarily a class of consumers may include the inexperienced as well as the experienced, and the gullible as well as the astute, the section must in my opinion by (sic) regarded as contemplating the effect of the conduct on reasonable members of the class. The heavy burdens which the section creates cannot have been intended to be imposed for the benefit of persons who fail to take reasonable care of their own interests. What is reasonable will or (sic) course depend on all the circumstances.


case_text: a representation is likely to mislead or deceive is an objective question of fact, to be determined in all the circumstances: Taco Bell . It is sufficient if there is a real chance that the conduct or representation will mislead or deceive: Global Sportsman Pty Ltd v Mirror Newspapers Ltd [1984] FCA 180 ; (1984) 2 FCR 82 at 87. Importantly, whether conduct is misleading or deceptive or is likely to mislead or deceive must be determined in context. In Parkdale it was said at 199: It seems clear enough that consideration must be given to the class of consumers likely to be affected by the conduct. Although it is true, as has often been said, that ordinarily a class of consumers may include the inexperienced as well as the experienced, and the gullible as well as the astute, the section must in my opinion by (sic) regarded as contemplating the effect of the conduct on reasonable members of the class. The heavy burdens which the section creates cannot have been intended to be imposed for the benefit of persons who fail to take reasonable care of their own interests. What is reasonable will or (sic) course depend on all the circumstances.


case_text: test is an objective one for the Court upon the whole of the evidence. The test is whether an ordinary or reasonable person from the class of persons to whom the representation is made is likely to be misled or deceived: Campomar Sociedad Limitada v Nike International Ltd [2000] HCA 12 ; (2000) 202 CLR 45 ( Campomar ) at 85-7. In my view, it is unlikely that a reasonable group of persons seeing those communications would think about the place of origin of those artworks. There is no express representation about their place of origin. There is no real reason why, beyond the clear representation as to the Aboriginality of the artist, the reasonable consumer would advert to their place of origin. In other words, the particular conduct which is said to give rise by implication to the representation that the place of origin of the particular artworks is Australia does not, in my judgment, give rise to that representation. Indeed, as was pointed out in Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (No 1) [1988] FCA 40 ; (1988) 39 FCR 546 at 555, s 52 is not expressed in terms of, and is not confined to, representations. The question is one of fact, namely whether the conduct complained of is likely "to lead into error" (per Gibbs CJ in Parkdale [1982] HCA 44 ; 149 CLR 191 at 198). Relevantly here, the question is whether the conduct, tested against ordinary and reasonable members of a section of the public, may have led into error those persons as to the place of origin of those particular artworks (as distinct from the Aboriginality of the artist). Campomar would indicate that the appropriate question is what would be the likely reaction of that section of the public to the particular conduct.


case_text: a representation has been made in advertising material, it must be assessed not by a particular statement taken in isolation, but by the statement in its context and, where appropriate, in the surrounding circumstances: Trade Practices Commission v Optus Communications Pty Ltd & Optus Mobile Pty Ltd (1996) 64 FCR 326 at 336-8; Australian Competition and Consumer Commission v Thorn Australia Pty Ltd [2004] FCA 157 at [13] - [14] ; Australian Competition and Consumer Commission v Signature Security Group Pty Ltd [2003] FCA 3 at [25] - [28] .


case_title: Australian Competition and Consumer Commission v Thorn Australia Pty Ltd [2004] FCA 157


case_title: Australian Competition and Consumer Commission v Signature Security Group Pty Ltd [2003] FCA 3


case_text: QDSV Holdings Pty Ltd (t/as bush Friends Australia) v Trade Practices Commission [1995] FCA 1431 ; (1995) 131 ALR 493 ( QDSV Holdings ), the appellant was a wholesaler of soft toys. One of its products was a koala soft toy, which had a label attached to it with the words "Aussie Born" on one side, and the words "Made in Australia" on the other side, with smaller words "With Some Imported Components" beneath those words. The soft toys were designed in Australia, the components were manufactured in China, except for about 30% of the filling, and all the components were then imported into Australia, for assembly within Australia. The primary judge declared the labels were in breach of ss 52 and 53(eb) of the TP Act and made an order under s 80 of the TP Act. The Full Court dismissed an appeal from those orders and held that the labels were misleading and deceptive, although that the toys could fairly be described as having been designed and finished in Australia. Sackville J observed at 500: While it should not be assumed that purchasers are "extraordinarily stupid" ... neither should it be assumed that purchasers of products such as toy koalas will be scrupulous to analyse the nuances of the language the trader has chosen to use on labels attached to the merchandise ... The meaning conveyed by the labels will be assessed by construing the language employed, but will take account of such factors as the prominence given to particular slogans or phrases, the nature of the product itself and the expectations and likely understanding of consumers.


case_text: is no express representation that any of the carved wooden items were made in Australia. That has been the context in which a number of actions under s 53(eb) have been decided: see Australian Competition and Consumer Commission v Lovelock Luke Pty Ltd (1997) 79 FCR 63 ; Siddons Pty Ltd v Stanley Works Pty Ltd (1990) ATPR 41-044 ; QDSV Holdings ; Netcomm (Australia) Pty Ltd v Dataplex Pty Ltd (1988) 81 ALR 101. The representation is said to arise by implication from the way in which the carved wooden items were promoted on the Website, and by the way in which the carved wooden bird was promoted on eBay.


case_title: Siddons Pty Ltd v Stanley Works Pty Ltd (1990) ATPR 41-044


case_title: Trade Practices Commission v QDSV Holdings Pty Ltd [1995] FCA 1431 ; (1997) 59 FCR 301


case_title: Netcomm (Australia) Pty Ltd v Dataplex Pty Ltd (1988) 81 ALR 101


case_text: my view, it is unlikely that a reasonable group of persons seeing those communications would think about the place of origin of those artworks. There is no express representation about their place of origin. There is no real reason why, beyond the clear representation as to the Aboriginality of the artist, the reasonable consumer would advert to their place of origin. In other words, the particular conduct which is said to give rise by implication to the representation that the place of origin of the particular artworks is Australia does not, in my judgment, give rise to that representation. Indeed, as was pointed out in Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (No 1) [1988] FCA 40 ; (1988) 39 FCR 546 at 555, s 52 is not expressed in terms of, and is not confined to, representations. The question is one of fact, namely whether the conduct complained of is likely "to lead into error" (per Gibbs CJ in Parkdale [1982] HCA 44 ; 149 CLR 191 at 198). Relevantly here, the question is whether the conduct, tested against ordinary and reasonable members of a section of the public, may have led into error those persons as to the place of origin of those particular artworks (as distinct from the Aboriginality of the artist). Campomar would indicate that the appropriate question is what would be the likely reaction of that section of the public to the particular conduct.


case_text: do not consider those cases provide any real assistance in the circumstances. As Sheppard J said in Thorp v C.A. Imports Pty Ltd (1990) ATPR 40-996 at 50,966, the question is one of fact and degree depending upon a consideration of the entirety of the steps required to manufacture the object in question. Of course, in addition, it is now necessary to apply ss 65AB and 65AE. The evidence shows that the cost to ADC of the carved wooden bird (and like objects) was under $10. The amount paid to Mr Goodridge for painting it was in excess of $30. The precise figures varied, according to the size of the objects. Even allowing for shipment costs, I find that s 65AB(c) of the TP Act would be satisfied, if there had been a representation that those artworks were Australian in origin. The remaining issue is whether those items were substantially transformed by being painted in Australia: s 65AB(b). The alleged country of origin representations did not attract ss 65AC or 65AD, so s 65AB(d) was also satisfied. That is a question of fact, informed by s 65AE. In my judgment, those artworks including the carved wooden bird were substantially transformed by being painted in Australia. There was in evidence an example of the carved wooden bird, unpainted (it is then purely a flat white in colour). The difference is significant. As an unpainted object, it is quite unappealing. The shape itself seems to lack definition. The painting makes the object quite a different one: the shape emerges as clearly defined, and the colouring gives the object a real life and attractiveness. I think the description "new and different goods" is an appropriate one, even though fundamentally the shape itself does not change. It is, in a bland sense, and remains a carved wooden item but the qualities which make it an attractive object emerge only after it is painted. Analogy is always a little dangerous, but I essay one, albeit not a perfect one: a painter's canvas may be imported, and although it does not change size, the canvas is substantially transformed by being painted. The carved wooden bird shape is, of course, not the equivalent of a canvas. It is already shaped. However, the dramatic change in appearance, including that the painting seems to add definition to the shape, has to my mind a not dissimilar transformation.


case_outcome: related

case_text: basis of the disqualification application is that, in light of a judgment which I delivered at 9.45 am this morning ( Davis v Insolvency and Trustee Service Australia (No 1) [2009] FCA 562), I should not proceed to hear the Motion because I had come to final views in respect of matters which inevitably arise for decision on that Motion. In support of that submission, Counsel for the applicant drew my attention to several passages in this morning's judgment and submitted that, in those passages, I had travelled beyond what was required by the relevant principles and made conclusive findings of fact. At [48] and [49] of that judgment, I set out what I considered to be the relevant principles governing the grant of interlocutory injunctive relief in aid of private rights. Counsel for the applicant has repeatedly submitted that all that I was obliged to do was ascertain whether there was a triable issue in respect of the claims being advanced in support of the relief sought on 24 April 2009. I disagree. I made clear at [48] and [49] of the judgment delivered earlier this morning that the principles which are in play here are those set out in those paragraphs. What is required is more than a triable issue. In my view, in order to determine the application for interlocutory relief made by the applicant on 24 April 2009, it was necessary for me to consider whether there was a serious question to be tried in respect of the claims which were said to support that application and also to address, if necessary, the balance of convenience and justice. That is what I did. The substance of what has been put to me this morning in support of the disqualification application is that I have made definitive findings on matters which are up for consideration in the Motion which is to be called on before me shortly. I do not agree. As I have already mentioned, in the paragraphs to which my attention has been drawn, I was addressing whether or not there was a serious question to be tried. That was made clear by the heading to [61] and by the way in which I expressed the conclusion which I reached (at [73]) on the claim for an interlocutory injunction in respect of the s 72A Notice, that is to say, that the applicant had failed to establish that there was a serious question to be tried in relation to the relief sought. Given the types of arguments that were advanced in respect of the s 72A Notice which was the subject of the interlocutory application determined by this morning's judgment, in my opinion, I was required to look at that Notice and come to a view about those arguments for the purpose of considering whether or not there was any serious question to be tried. I do not think that being required to undertake that exercise in the context in which I did, precludes me from hearing the present application. For those reasons I decline to disqualify myself. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Foster. Associate: Dated: 1 June 2009 Counsel for the Applicant: Mr PE King Solicitor for the Applicant: McKells Solicitors The First Respondent did not appear Solicitor for the Second Respondent: Mr N Gouliaditis of Australian Government Solicitor The Third Respondent did not appear The Fourth Respondent did not appear Date of Hearing: 29 May 2009 Date of Judgment: 29 May 2009 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2009/589.html


case_outcome: approved

case_title: 71 Paisley Street Footscray Pty Ltd v Vineyards Estate Pty Ltd [1995] FCA 635 (unreported, Olney J, 18 August 1995)

case_text: Mr Bova's submission that the dispute was confined to the issues identified in the affidavit as read at the hearing does not take into account the purpose of the requirement in s 459G(3) that the supporting affidavit not only be filed within 21 days of the demand but also that, within that same period, a copy be served on the party making the demand. As Olney J stated in 71 Paisley Street Footscray Pty Ltd v Vineyards Estate Pty Ltd [1995] FCA 635 at [10] , the "purpose of the affidavit contemplated by s 459G(3) is to tell the creditor why it is said that the demand should be set aside". It follows that, if the discrepancy between the affidavit as read at the hearing and the affidavit that, in its entirety, had been served on the defendant, is such as to put forward materially different bases for seeking to set aside the statutory demand, the question whether the requirements of s 459G(3) have actually been met must arise. 22 Another difficulty with the affidavit is that it does not distinguish between the defendant and the partnership. It indicates in paragraph 3 that the defendant company will be referred to as "Anar" and then proceeds to refer to dealings with "Anar" (for instance in paragraph 8) that took place before the defendant was incorporated. I can only assume that in such cases Dr Chisholm is referring to the partnership. 23 The dispute between the parties centres on the supply of a particular dye, known in the industry as Direct Blue 290. This dye is a discrete chemical compound which was developed by Ciba Specialty Chemicals in the 1970s. Ciba's patent over the compound expired in the late 1990s. In early 2003, the plaintiff negotiated with Mr Choksi with a view to sourcing a chemical copy of Direct Blue 290. In April of that year, "Anar" (presumably the partnership) sent a sample dye to the plaintiff. The sample was apparently labelled "Direct Blue 290". Accompanying the sample was a material safety data sheet which also identified the product as "Direct Blue 290". Dr Chisholm asked Mr Choksi to carry out stability work on the dye "to ensure the product was stable under Indonesian conditions".


case_text: The defendant correctly states that there is no evidence that any claim has actually been made by Pindo Delhi. In Advance Ship Design Pty Ltd v DJ Ryan t/as Davies Collison Cave (1995) 16 ACSR 129, Master McLaughlin of the Equity Division of the Supreme Court of New South Wales held at 135 that: The claim must be one which exists at the present time, and it must be one which, if the plaintiff is able to prove the factual matters alleged ..., would result in the plaintiff being presently entitled to the damages claimed.


case_text: Although not established to the standard expected at final trial, it can reasonably be assumed, given the nature of this application, that the dye supplied by the defendant in early 2005 is the dye that generated problems from the middle of 2005. Given the difficulties that arose with this dye, I am thus satisfied that the plaintiff's claim to have an offsetting claim raises "a serious question to be tried"; Scanhill 47 FCR at 467. The threshold that the plaintiff must cross "is not a high one"; Federico's Restaurant Pty Ltd v Warwick Entertainment Centre Pty Ltd (1995) 18 ACSR 702 at 706. I am satisfied that the plaintiff has done more than simply assert a claim and some basis for it without more; Chadwick Industries (South Coast) Pty Ltd v Condensing Vaporisers Pty Ltd (1994) 13 ACSR 37 at 39.


case_text: While an offsetting claim does not have to be for a liquidated amount ( Classic Ceramic Importers 13 ACSR 263), "only a claim which is capable of being quantified as an amount of money can qualify as an 'offsetting claim'"; Chase Manhattan Bank Australia Ltd v Oscty Pty Ltd (1995) 17 ACSR 128, at 135.


case_text: In making this assessment, it is not appropriate to delve into the merits of the competing claims; Edge Technology Pty Ltd v Lite-On Technology Corporation [2000] NSWSC 471 ; (2000) 34 ACSR 301. There is authority for the view that the amount of the offsetting claim is simply that amount claimed in good faith by the plaintiff, ambit though such a claim may be; Jesseron Holdings Pty Ltd v Middle East Trading Consultants Pty Ltd (No 2) (1994) 122 ALR 717, per Young J at 722; see also Classic Ceramic Importers Pty Ltd v Ceramica Antiga SA (1994) 13 ACSR 263 at 270. 42 While an offsetting claim does not have to be for a liquidated amount ( Classic Ceramic Importers 13 ACSR 263), "only a claim which is capable of being quantified as an amount of money can qualify as an 'offsetting claim'"; Chase Manhattan Bank Australia Ltd v Oscty Pty Ltd (1995) 17 ACSR 128, at 135.


case_text: In making this assessment, it is not appropriate to delve into the merits of the competing claims; Edge Technology Pty Ltd v Lite-On Technology Corporation [2000] NSWSC 471 ; (2000) 34 ACSR 301. There is authority for the view that the amount of the offsetting claim is simply that amount claimed in good faith by the plaintiff, ambit though such a claim may be; Jesseron Holdings Pty Ltd v Middle East Trading Consultants Pty Ltd (No 2) (1994) 122 ALR 717, per Young J at 722; see also Classic Ceramic Importers Pty Ltd v Ceramica Antiga SA (1994) 13 ACSR 263 at 270. 58 There is some discrepancy between the profit margin of 30 per cent claimed in Dr Chisholm's first affidavit and his evidence in cross-examination. Whilst the Court does not require evidence of a standard expected on a final claim in applications of this kind, contradictions in evidence can be fatal if they make the claim as a whole implausible; see Edge Technology [2000] NSWSC 471 ; 34 ACSR 301. In the circumstances of Dr Chisholm's unexpected cross-examination, I am not willing to draw such a conclusion. It is accepted that the amount claimed by the plaintiff may have "elements of uncertainty"; Elm Financial Services [2004] NSWSC 560 at [19] . 59 In Edge Technology [2000] NSWSC 471 ; 34 ACSR 301, a bare assertion of an amount for loss of profits without further evidence as to how that amount was calculated was held to be insufficient to ground a genuine offsetting claim in that amount; see Edge Technology at 316. In my view, the present case is distinguishable. Dr Chisholm has given oral evidence as to the different profit margins on products from different sources sold in Indonesia, and, as I have noted, has annexed to his second affidavit a print-out of a spreadsheet from the plaintiff's accounting software detailing sales and profits relating to Pindo Delhi. The Court thus has sufficient evidence to say that the claim is genuine, whilst not seeking to assess the merits of the claim. 60 Mr DeBuse argued that any loss in business suffered by the plaintiff would not have been caused by the presence of Direct Blue 218 in the dye manufactured by the defendant, but rather by the plaintiff's own delay in informing Pindo Delhi of its presence. Dr Chisholm has given evidence that the plaintiff was aware of the presence of Direct Blue 218 from July 2005, but that Pindo Delhi and IndoAsia only discovered this when informed by a Japanese buyer in January 2006. Whilst there may be some substance to the submission that the plaintiff's failure to warn its clients contributed to any subsequent loss of business, I cannot say that it is it is "implausible and extremely unlikely" that any loss resulted from the defendant's conduct; Edge Technology 34 ACSR at 315. Accordingly, I am not prepared to reject the claim on this basis. 61 In my view the plaintiff has a genuine claim against the defendant for USD333,000 for loss of business with the Sinar Mas Group.


case_text: In Elm Financial Services Pty Ltd v MacDougal [2004] NSWSC 560 at [7] , Barratt J, echoing comments he had previously made in Process Machinery Australia Pty Ltd (t/as DCL Engineering) v ACN 057 260 590 Pty Ltd [2002] NSWSC 45 at [21] - [22] , said of the " Graywinter principle": What it means is that the application ... and the affidavit in support of that application, both filed and served within the 21 day period stipulated in s 459G(3) , must fairly alert the claimant to the nature of the case the company will seek to make in seeking to have the statutory demand set aside. The content of the application and affidavit must convey, even if it be by necessary inference, a clear delineation of the area of controversy so that it is identifiable with one or more of the grounds made available by ss 459H and 459J for setting aside statutory demands. The process of delineation may not be extended after the end of the 21 day period although it is open to the plaintiff to supplement the initial affidavit by way of additional evidence relevant to the area of controversy identified within the period. 19 In Hansmar Investments Pty Ltd v Perpetual Trustee Co Ltd (2007) 61 ACSR 321, White J expressed the view that test enunciated by Barratt J in Process Machinery [2002] NSWSC 45 and Elm Financial Services [2004] NSWSC 560 , in so far as it requires the ground of challenge to be raised expressly or by necessary inference, is too strict. His Honour accepted the implication from the statute that the grounds for applying to set aside a statutory demand must be raised in the supporting affidavit but observed at 326: It is one thing to draw that implication from the requirement that an application be accompanied by a supporting affidavit. It is quite another to imply from the requirement that there be a supporting affidavit anything as to the precision with which such a ground must be expressed, other than that it be raised. Whether it is raised expressly, by necessary inference, or by a reasonably available inference, provided it is raised, in my view the requirements of s 459G are satisfied. 30 In my view the first affidavit of Dr Chisholm meets the requirements of s 456G. It "promotes the company's case", and clearly stakes out the grounds of the dispute, namely the dual problems of thickening and composition afflicting the dye. Although the affidavit does not annexe invoices from the defendant, it is explicit that the plaintiff was dealing with "Anar" in 2005, after the incorporation of the defendant. The area of controversy has, by necessary inference, been clearly delineated; Elm Financial Services [2004] NSWSC 560 at [7] ; or is at the very least raised by a reasonably available inference; Hansmar Investments 61 ACSR at 326. 58 There is some discrepancy between the profit margin of 30 per cent claimed in Dr Chisholm's first affidavit and his evidence in cross-examination. Whilst the Court does not require evidence of a standard expected on a final claim in applications of this kind, contradictions in evidence can be fatal if they make the claim as a whole implausible; see Edge Technology [2000] NSWSC 471 ; 34 ACSR 301. In the circumstances of Dr Chisholm's unexpected cross-examination, I am not willing to draw such a conclusion. It is accepted that the amount claimed by the plaintiff may have "elements of uncertainty"; Elm Financial Services [2004] NSWSC 560 at [19] .


case_title: Federico's Restaurant Pty Ltd v Warwick Entertainment Centre Pty Ltd (1995) 18 ACSR 702


case_text: Section 459G(3)(a) states that an application to set aside a statutory demand can only be made if an "affidavit supporting the application" is filed within 21 days of service of the demand. Unless such an affidavit is filed and served in time, there is no application under s 459G and, consequently, s 459H will not apply. If there is no application, the Court has no jurisdiction and the situation cannot be remedied by filing further supporting material at a later stage; Graywinter Properties Pty Ltd v Gas & Fuel Corporation Superannuation Fund (1996) 70 FCR 452 at 455 and 459. If there is a valid application, further affidavits may be filed to supplement the case made in the initial supporting affidavit; Graywinter Properties at 460. The defendant submits that the affidavit filed on 21 December 2006 does not set out a genuine offsetting claim and is therefore not a supporting affidavit for the purposes of s 459G(3)(a). Consequently, it is submitted, the Court's jurisdiction to set aside the statutory claim is not enlivened. 16 The leading authority on the question of the minimum requirements for an affidavit to be a "supporting affidavit" as required by s 459G(3)(a) is generally accepted as being the decision of Sundberg J in Graywinter Properties. His Honour observed at 459: In order to be a "supporting affidavit", an affidavit must say something that promotes the company's case. An affidavit which merely says "I am a director of the company but am too busy at present to make a full affidavit, and I will do so later" would not support the application. It would in no way advance, further or assist the company's cause, which is to have the notice set aside. At the other extreme, the affidavit need not detail, in admissible form, all the evidence that supports the contention of a genuine dispute.... That evidence must be available at the hearing of the application to set aside, because that application is for final and not interlocutory relief... 17 In Elm Financial Services Pty Ltd v MacDougal [2004] NSWSC 560 at [7] , Barratt J, echoing comments he had previously made in Process Machinery Australia Pty Ltd (t/as DCL Engineering) v ACN 057 260 590 Pty Ltd [2002] NSWSC 45 at [21] - [22] , said of the " Graywinter principle": What it means is that the application ... and the affidavit in support of that application, both filed and served within the 21 day period stipulated in s 459G(3) , must fairly alert the claimant to the nature of the case the company will seek to make in seeking to have the statutory demand set aside. The content of the application and affidavit must convey, even if it be by necessary inference, a clear delineation of the area of controversy so that it is identifiable with one or more of the grounds made available by ss 459H and 459J for setting aside statutory demands. The process of delineation may not be extended after the end of the 21 day period although it is open to the plaintiff to supplement the initial affidavit by way of additional evidence relevant to the area of controversy identified within the period. 36 The plaintiff also relied on a supplementary affidavit of Dr Chisholm filed on 10 August 2007. Annexed to this affidavit are purchase orders, bills of lading and invoices relating to the dye supplied by the defendant in early 2005. The affidavit provides additional factual detail in support of the plaintiff's claim to have an offsetting debt. Given that the first affidavit had clearly indicated the general nature of its case it is entirely legitimate for the plaintiff to expand the factual grounds on which it relies in this way; SMEC International 38 ACSR at 599, Graywinter Properties 70 FCR at 460.


case_text: In Hansmar Investments Pty Ltd v Perpetual Trustee Co Ltd (2007) 61 ACSR 321, White J expressed the view that test enunciated by Barratt J in Process Machinery [2002] NSWSC 45 and Elm Financial Services [2004] NSWSC 560 , in so far as it requires the ground of challenge to be raised expressly or by necessary inference, is too strict. His Honour accepted the implication from the statute that the grounds for applying to set aside a statutory demand must be raised in the supporting affidavit but observed at 326: It is one thing to draw that implication from the requirement that an application be accompanied by a supporting affidavit. It is quite another to imply from the requirement that there be a supporting affidavit anything as to the precision with which such a ground must be expressed, other than that it be raised. Whether it is raised expressly, by necessary inference, or by a reasonably available inference, provided it is raised, in my view the requirements of s 459G are satisfied. 30 In my view the first affidavit of Dr Chisholm meets the requirements of s 456G. It "promotes the company's case", and clearly stakes out the grounds of the dispute, namely the dual problems of thickening and composition afflicting the dye. Although the affidavit does not annexe invoices from the defendant, it is explicit that the plaintiff was dealing with "Anar" in 2005, after the incorporation of the defendant. The area of controversy has, by necessary inference, been clearly delineated; Elm Financial Services [2004] NSWSC 560 at [7] ; or is at the very least raised by a reasonably available inference; Hansmar Investments 61 ACSR at 326.


case_text: In making this assessment, it is not appropriate to delve into the merits of the competing claims; Edge Technology Pty Ltd v Lite-On Technology Corporation [2000] NSWSC 471 ; (2000) 34 ACSR 301. There is authority for the view that the amount of the offsetting claim is simply that amount claimed in good faith by the plaintiff, ambit though such a claim may be; Jesseron Holdings Pty Ltd v Middle East Trading Consultants Pty Ltd (No 2) (1994) 122 ALR 717, per Young J at 722; see also Classic Ceramic Importers Pty Ltd v Ceramica Antiga SA (1994) 13 ACSR 263 at 270.


case_text: In Royal Premier Pty Ltd v Taleski [2001] WASCA 48 at [57] , Ipp J observed that it was not necessary for there to be evidence of damage "in meticulous detail" however his Honour insisted that "there must be at least some material upon which the court can conclude that some damage has been sustained and which will enable the court to make a reasonable assessment as to the amount thereof." Clearly, the plaintiff cannot be presently entitled to damages to compensate it for unquantified losses incurred in litigation that has not yet commenced. Accordingly, I do not accept the potential claims arising from the presence of Direct Blue 218 in the dye supplied by the plaintiff as "genuine claims" for the purposes of s 459H. I am fortified in this view by the decision of the Full Court in John Shearer Limited v Gehl Company (1995) 60 FCR 136, where claims that were inadequately particularised and that had not been pursued in the year since the dispute commenced were held not to be genuine claims.


case_title: Lighting Sciences Australasia Pty Ltd v Southgate (1997) 15 ACLC 632


case_text: The plaintiff submits that its offsetting claim amounts to USD781,900. The defendant has taken issue with the amounts claimed by the plaintiff, asserting that they are not supported by the evidence. The defendant relies on Macleay Nominees Pty Ltd v Belle Property East Pty Ltd [2001] NSWSC 743. 41 In Macleay Nominees at [15], Palmer J was explicit that perceived frailties of evidence will not prevent a claim from being a "genuine claim" for the purposes of s 459H. His Honour held at [18] that both the cause of action and the amount claimed must be advanced in good faith. His Honour continued: "Good faith" means arguable on the basis of facts asserted with sufficient particularity to enable the Court to determine that the claim is not fanciful. In a claim for unliquidated damages for economic loss, the Court will not be able to determine whether the amount claimed is claimed in good faith unless the plaintiff adduces some evidence to show the basis upon which the loss is said to arise and how that loss is calculated. If such evidence is entirely lacking, the Court cannot find that there is a genuine offsetting claim for the purposes of s 459H(1) and s 459H(2). 62 Clearly, the evidence in relation to each component is not overwhelming, however, as Palmer J held at [28] in Macleay Nominees [2001] NSWSC 743 : Many such claims at this stage of proceedings would appear to be tenuous, but if they are genuine then the alleged debtor company is entitled to the benefit of CA s.459G and s.459H.


case_text: As Mr Bova himself submitted, quoting from the judgment of Windeyer J in Olsson v Dyson [1969] HCA 3 ; (1969) 120 CLR 365 at 388: Novation is the making of a new contract between a creditor and his debtor in consideration of the extinguishment of the obligations of the old contract: if the new contract is to be fully effective to give enforceable rights or obligations to a third person he, the third person must be a party to the novated contract. In Olsson , Barwick CJ and Windeyer J dissented from the decision of the majority (Kitto, Menzies and Owen JJ) in finding, on the facts, that there had been a novation of a contract of loan. Nothing in the reasons of the three majority judges detracts from Windeyer J's discussion of the history and principles of novation. 12 The fact that the defendant company, apparently, took over the business of the partnership does not, in itself, indicate that it assumed the obligations of the partnership. As Windeyer J makes clear, for there to be a novation that released the partnership from its obligations and imposed equivalent obligations on the defendant company the partnership, the defendant company and the plaintiff would have to be parties to the contract. The fact that Dr Chisholm was unaware of the incorporation of the defendant company and the fact that it was supplying the dyes is evidence that tends against, rather than in support of, an implied novation. 13 Whether the partnership was dissolved following the incorporation of the defendant company is presently irrelevant as are any rights the plaintiff may have against the partnership. If the plaintiff is to succeed in this action to set aside the statutory demand of the defendant company it will be necessary for it to show that it has an offsetting claim against that company.