CATCHWORDS Trade Practices - secondary boycott Section 45D - whether servants or agents of cornoration actina within score of their authority are liable when they cause that corporation to cease trading with the applicant. TRADE PRACTICES ACT 1974 Section 45D W.S.W. G.301 af 1984 TRAGTAND ETY LIMITED v. FON BOUSFIELD & OPS. St. John, J. 23 Gctober 1984 Svdney IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY eww ve GENERAL DIVISION BETWEEN : AND: OPDERS CORAM: ST. JOHN, J. DATE: 4 OCTOBER 1984 ELACE: SYDNEY THE COURT ORDERS THAT 1. The application 1s dismissed bo No. 301 of 1984 TRAZTAND PTY LIMITED Applicant RON BOUSTIELD First kespondent RICHARD HYDE - Second Respondent Third Respondent The applicant to pav the respondents costs. The orders of Northrop. J. made on 5 September 1984 are discharaged. The applicanc toa pay casts as reserved in the anterlocutorv motion before Northrop, J. Grder 3 above discharging orders made by Northrop, J. 1 Guspended for a period of twenty-one 121) days after publication of reaszan for dismissing the a application. IN THE FEDERAL COURT OF AUSTRALIA NEW _SONTH WALES DISTRICT REGISTRY No. 201 of 1984 GENERAL DIVISION BETWEEN : TRAZTAND PTY LIMITED Applicant AND: RON BOUSFTELD First Respondent RICHARD HYDE Second Pespondent Third Perrondent FEASONS FOR JURGMENT TOPAM: ST. JOHN. J. DATE: 22 OCTOBER 1984 ELACE: 2 TDNET On the 4 October 1984 T dismissed the arplication if the applicant companv and made consequential orders and indicated that I would later qive reasons for lwadment. The applicant company, Traztand Ptv. Limited. sought the following orders aqainst the respondent:- "L) An order that the respondents are in breach of Section 45D of the Trade Practices Act, An order that the respondents have wronatully and maliciously conspired and combined amounast (sic themselves to inqure the applicant ain its business. An arder that the respondents weonatully and with intent to iniire the Applicanr induced the State Fail Authoric7y, Christine Watkins and Facco Marando to beeak rheie respective contracts with the Applicant and to eeatuge to pertarm ar turther perrfarm Tame, An order thar fhe respondents have Malaiciousiy and "kenarully and with intent oco inquire the <tpeelicant p~- threats of Unlawful means intimidared the EEare bail Sathorarty csaici, Thevstine flarkin: ind Foose Maranan to break their Tontracks with the applicant and Fa Carte £9 deal with che Xpelicant, An order Fiat the wronatully and inrentis lo=5 ta the Avrli means. spondents T caused fank by wunlavtul An order restraining Fhe resrondenc 5 trom: 'ah ondagcinag in Fhe etnduer and activities boresersg Te in Piradtapns « 1-5), 'bi from PEeVSent ing the Feelicant e2CCLTIngT wwenarLoacten team the SOvernmant «fpe. Tnsuvance OF fp. TO CAREY wut repair WOtke. Sn order that nthe rrspondents Litt and renoave ail NaN against the Soplirant." ww The application was hased tipon an alleaed breach of 3.450 of the Trade. Fractices Act LO74d ' "the Act"™'. the relevant words of which ain sub-section eli ot £.450 are as follows: - "Subiece to this section. a person shall not, im concert with a second person. enqadge in conduct that hinders de prevents os. The acawisition of ... services by a third person from a fourth person ... where -- a) ree 'ii) the conduct is angaged in for the eurecase, and seuld tiave or be likely to have the effect, Or caucanma - (Ae substantial Loss or damage to the misiness of che fourth eersan: Alto ryelewranr ows suk-eectisn +62) cf thar Jeerien which beovides chan. fac the sures at The se tion. a person shall be jeemed te Le anaguved in comyst for aA Puccace mencirened in fnat -uc-seericon if he engages in than conauth Cor pupooses khat unclude that purpose, The three ressendents vece, at rhe rel2vant time, co of N.S.W. ¢ "che im}, rr emplavees af the Government Incurance of G.T.0."), a eratutary corporation whore business 15 insurance . in var1lous f16lds. ancluding insurance atainst loss of oar wl damade to motor vehicles. The applicant company carried on business az a panel beater and motor repairer, and the predecessors of the applicant company had reaistered a business name. Westfield Auto Bodv Prtpairs under which they traded. Zome time in 1982. the State Rail Authority of N.5.W. ("the S.R.A.") advertised far private firms fo be included as contractors to repair their metor vehicles and transport aquipment. The txo partners who were then reaistered as Westfieid Auto Bodv Pepairs, namely Mr. Mitvidaa iwho is now and was at the cslevance time a director of the applicant company) and Me. Sragcievic answered thar invitation by indicatina the amount ree hour. namely twelve deoilars 1412). that rhey would charge roe meron body werk, Ao ¥ resulk Fne- ted ag cemrractors sinder rhe ratesory 'canel beatinda. were LL i autamesiva paintina and vencral boav repatrs" and thereafter. the §.Rk.A. hat thar tye: of repair aane be thac cameany and, included in the vewares dang ro Les renicles. sas damaqe caused b Accident adainst which the ¢.F.S. "7428 insured with the 9.0.9. That tnsuvanee work was charged for ac a rate of eiahteen or nineteen dollars (418 or SL3! pet hour. we The G.t.0. seundagd worst sehicle walicy dave ch: insurer the opticn of rein.taring the -ehicle by encerina inta ca] a eontract with 2 motor repairer Cor That eurence, { aciesk che evidence chat 1 wat the weneral practic ta "akLsr7 tne insured 3 claim «under the policy by burs method. The procedure was thar che insured would take the damaged vehicle to a moter repairer, aA auotahion te TAKE OUT the renarres would be prepared, and an assessor from the u.1.0, would inspect the vehicle and. 1f approved, accept the auote. The work would be dene. the insured would be asked to sian i clearance and the moter cody repairer 'vould invoice the 3.f.0. direct and would be bald direcnly br the Latrer. The same practice was aprliad fe all aunsured vehicles uneludine accudent damage ta £.F.a. vehicles, In May 1384 4 vehicle. owned by a Mr. Belmonte ana inzured bv the G.0,9.- nad been damared in a motor car accident and reoaired bry the apeli ant comrany ocursuant to a claim made admainst the inzurer, The applicant company 5 auabaktan Coe the cwirk uncludad the wravittcn and imetailation or a new asrtle. The new axle wat nok un fact .nscalied, but vas charged for and the vehiclo ce-delivered ca Me. Belmonte arth damage tau either the ale cr rhe differential housing anda "His Phe vehicle wal being argiven. the wheel to whieh rie relevant axie chonld have heen ocinmecr td lame oft. in alccumtfances that toult have caused SEU amare ote tho vehicle or faq perztns. Bvawvenct "wa lead az tea tre ILrecumstances an whith fhe wemirsian t- fre the new asks eceurred., but [To danse pind if oecerttary ro make cumelii: Tindings as to who vat respontible, bur 1b ic noatable that rhe nt) th toveman apparentiv in charg@a ot the repare i4p was stiil emploved by the applicant company and -as not called to give evidence. wy At the time ot this imcident. the resrondent Hr Bousfieid was Chier Assessor in the Motor Vehicle Section of the G.I.0.; Mr. Hvde was a senior aseessor at the G.1.0,. in the Farramatta area; and the resnandent Mr. Raves was Acting Motor Vehicle Manager of the G.(.0,. in Svdnev. The G.T.0. ani other insurers in this State have a practice of what has been termed "suspending" motor repairers whose vorkmanshio has been found ca be not iw ro standard and, as a result of cmat ercUurread in er Latian to the ceparr of Me. Belmonte + vehicle the 3.0.9. tuspended Westfield Auta Body Pepairs. all Ener sb oh) respondents had a parh to play in the makiny of oe malntainina that decision, The #uspensiom C€.x@d uron war A oBrisd of 112 months and +. Lar of avidence? hat been decokad occa rhe decision-making pracess ind -Fho axplizank company 3 reauecr Tor a review ot the decision and the ulfimace rarural oc duck request. ALL yvespondents were crosi-Szaminer az be chete purpose or purposes in imposing the 'luspenzion fo the axtent that it became the central Cactual issne- in the Tounsel for the applicant company submitted that, because tne 3.0.9. had produced documentary evidence ef che policy of suspension, that the three respondents were acting without authority. Io find as a tact that. in deciding upon suspension, all three respondents were acting in accordance with a practice which was loner established and certainl: within the scove of their authority. As to the suadestion that the suspension was imposed in order to cause economic hardship to the applicant companv. [ am satisfied that that was not the purpose of anv ot the respondents and [ doubt whether thev considered at all the economic consequences of their action to the applicant in that wav. All three cespondents had a duty ro ensure that repairs were properly carried out and their motivation. az stated in evidence, was, to summarise 1t in veneral terms. £9 promote efficiencv. After the Belmoenre repale work and the incident of the wheel coming off, the 3.P.A. were notified by telephone us that the 33.1.0. would not arder work from the applicant company where chat work was the subject of an insurance claim. There 15 some evidence from Mr. Best. an insurance clerk with S.P.R., to the <ffect that, in that tclerenone call. the S.R.aA. "Jas advised not to give anv witk Fo the applleane company, but che follow ina Letter from tne 3.0.0. makes 10 w.Lrear char all Ehat rhe «5.0.0. was ecnesened with «ti Insurance work. The relevant part of thak Lrercker vii- The 3.1.9. ms nat orepared te accepk auotations from thie ficem untzl Ourher ackice. As well as repairing accident damaged vehicles owned by the S.R.A., the applicant company also did repairs within the cateqorv for which thev had been listed as contractors in maintaining vehicles and which was qenerallyv referred ta as maintenance work. In addition, when accident damaged vehicles 8. were beina repaired. some mechanical repairs were carried our. outside the insurance cover for the §.R.A. ain order "to save downtime". even though the applicant companv was not listed as a contractor for mechanical rewairs by the S.R.A. After the suspension bedqan, maintenance work was still done for the S.R.A. by the applicant company. but this represented onlv a very small percentage of work when comeared with the amount of insurance work done on S.F.A. vehicles. Reverting to the terms of §.45D of the Act, counsel Tor the applicant submitted that the three respondents acted un concert and identified the applicant company as the fourth person mentioned in that Section. The respondents were alleqed toa be the Cirsr and -':econi persons and the third eerzons were alleqed te be the &.fF.a.- two named rrivate person; whess vehicles fhe w.I.0. vstused fa reinstate 7 having repairers done br the apelitanc cumran', ana tne 0.1.9. rtself. As to the case bus cp a doupon the §.F.8. terng one of the a third persons, I fina as a tact rhar. in raseecr ko insurance werk, fhe applicant company uid not suppivy tervices co the 3.R.4. but supplied them co the G.1.0. 45 to the case based upon the G.I.G. beina one of the third persons, that statutory body can onlv act through its servants and agents and acting as thev did in relation to the applicant company. the three respondents were acting on behalf of the G.I.0G. and were not acting on the1rr own behalf. Counsel for the aprplicant's reliance upon Said iv. Butt C1920] 3 K.B. 497 to assert the w contrarv 1s ill-conceived. If servants or agents of a corporation, acting within the scope of their authority. together cause that corporation to cease tradina with another person or corporation, §$.45D does not afford that other person or other corporation a cause of action against the servants or agents. As to the two named private persons who were insured with the G.I.0.. the same principles apply. I am of the opinion that it was not the intention of the leqislature that circumstances such as arose in this case are within the purview of £.415D. Anv person or corporation who is in the habit of having services supplied by it pursuant to an agreement made in that behalf is not enjoined from ceasing ta anter into agreements for such services, For those reason: I dismissed the application and made the consequential orders. I certify chat this and the eidht '8) preceding pages are a true canv of the Peasons tor Judamenc herein of nis Honour fy. Justice St. John. Associate: WA Date: 23 October 1384