NB : NOT APPROPRIATE FOR REPORTING OR FOR GENERAL CIRCULATION Trade Practices - breach of contract ana negligence alleged - federal and non-frederali aspects - non-federal claim substantive - federal claim trivial - wnether striking out of statement of claim appropriate Trade Practices Act 1974 (Cth) ss.52, 53, 71, 72, 74 Fencott v Muller (1983) 46 ALR 41 Stack v Coast Securities (No.9) Pty Ltd (1983) 49 ALR JOHN JAMES HERBERT v ACTIVE LEISURE (AUSTRALIA) PTY MITED ic Ki No. NSW G.240 of 1984 Davies, uo 9 October 1984 Canberra IN THE FEDERAL COURT OF AUSTRALIA ) NEW SOUTH WALES DISTRICT REGISTRY ) No. GENERAL DIVISION JUDGE MAKING ORDER DATE _OF ORDER WHERE MADE ORDER ) ) ) Davies, J 24 September 1984 Sydney 1. The statement of struck out. 2. The applicant respondent's motion. G.240 of 1984 BETWEEN JOHN JAMES HERBERT Applicant AND : ACTIVE LEISURE 'AUSTRAZLIA) PTY LIMITED Respondent ORDER snalil pay tne costs i IN THE FEDERAL COURT OF AUSTRALIA ) NEW SOUTH WALES DISTRICT REGISTRY ) No. G.240 of 1984 ) GENERAL DIVISION ) BETWEEN 3 JOHN JAMES HERBERT Applicant AND : ACTIVE LEZTSURE (AUSTRALIA) PTY LIMITED Responaent ORDER JUDGE MAKING ORDER : Davies, J DATE OF ORDER 3 9 October 1984 WHERE MADE : Canberra CRDER : By consent (1) The applicant shall fiie and serve an amendec statement of claim on or fHefore 23 Octoper 1984; (2) Save as to (a), the rroceedings are staved until further oraer IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. G.240 of 1984 GENERAL DIVISION BETWEEN 3 JOHN JAMES HERBERT Applicant AND : ACTIVE LEISURE (AUSTRALTA) PTY L=MITED Resroncent REASONS FOR JUDGMENT (ex tempore) CORAM : Davies, J 24 Sepntember 1984 I do not think any purpose would be served by reserving mv decision. I am of the view that the non-federal aspects of the matter should be struck from the statement of claim ana, consequent thereon, that the wnole statement of cia:im as presently pleaded should be struck out. Iwill discuss witn counsel later what further steps should pe taken. Very briefly. the substance of the dispute arises froma purchase made by the applicant from the respondent of ski boots and skis. The ski boots, 1t appears, had been marked by tne respondent with the letter 10, to indicate that site. thougr tne Hed boots supplied were in fact of different sizes, one seing size il and the other size i0-1/2. The bindings of the skis were adjusted by the respondent, by testing the bindings oy reference only to the iarger of the boots. In the result. tne applicant alieges that the binding was too loose safely to secure the right boot and, as a resuit. when he skied using the boots and skis. his right boot came loose from the binding and he fell and suffered injury. That in substance is a traditional claim within the jurisdiction of tne state courts. Reliance can pe placed both on a cause of action arising from contract and also a cause of action in tort for negligence. In this court and also in state courts, the applicant may also rely upon matters arising unaer ss.71, 72 and 74 of the Trade Practices Act 1974 (Cth). They, of course, simply assist the claim for breach of contract. The applicant has brought his action in this ccurt seeking damages, interest and costs. To activate the Jurisdiction of tne court, he has made a claim pased upon ss.52 and 53 of the Irade Practices Act as well as relying upon the other matters I have referred to. It was put to me with some force by Mr D.M. Yates, of counsel, who appeared for the respondent, that no claim under either of those sections, at least no claim as presentiyv pleaced, could be established under either of those sections. In considering that submission, I do not thank 1t is proper to isok too closely at the precise manner in which the statement of claim nas been pleaded. It seems to me that 1t 1s possible to nut forward an argument that the marking of poots with incorrect KB sizes, the selling of boots of different sizes and the sei ing of skis adjusted to fit only one of tne boots were acts tnacs included an act that was likely to mislead. Iam also of the view that any matter so put would arise out of facts common to the claims arising under state law. Having said that, however, 1t does not seem to me tnat the claims under ss.52 and 53 add any significant matter to tne claims that can be put under state iaw. It does not seem to me from anything tnat 18s pleaded tnat a ciaim could se supstantiated under either of those sections if tne act relied upon was neither negligent nor a preach cf contract. It seems to me that a court would not uphold the federal claim until the court was satisried that the act relied upon was an act done negligently or in breach of a contractual duty arising between the parties. I do not put that asa statement of law but from my own judgment of the matter. I therefore do not see anything in the facts pieadea wnich would give rise to an effective claim under ss.52 ana 53 if there were not also established a claim under state law. It follows, I think, that the substantial claim in tnis action is che claim wo . under state law. In Fencott v Mulier (1983) 46 ALR 41 at4 Justices Mason, Murvhy, Brennan and Deane said : "However, tederal judicial power 1s attractec to the whole of a controversy only if tne federal claim is a substantial aspect of that controversy. A federai claim which is a trivial or insubstantiai aspect of the controversy must, or course, itself be resolved in federal jurisdiction, but 1t would be neither appropriate nor convenient 1n such a case to transiate to federal jJurisdicticn the determination of the substantial aspects of tne controversy from the jurisdiction to wnich they are subject in order to determine the trivial or insupstantial feaeral aspect. Aqgain, impression ana practicai judanent must determine whetner 1t 1S appropriate ana convenient that the whole controversy be determined by the exercise of federal judicial power." More recently, the view expressed in Fencott v Muller has been applied and restated in Stack v Coast Securities itNo.9) Dry Limited (1983) 49 ALR 193. At p.215, Justices Mason, Brennan and Deane said : Within the terms of that statement, I am of the view tnat, "In this, as in other cases, the recurrent problem 1s to identify what 1t 1s tnat falis within tae Federal Court's accrued jurisdiction. The majority judgment in Fencott v Muller (46 ALR at 68; 57 ALJR at 331-2). provides this assistance in reaching an answer : 'Wnat 1s and what 1S not part of the one controversy cepends on what the parties have done, the relationships between or among them and the laws which attach ridghts or liabilities to their conduct ana relationships. The scope of a controversy which constitutes a matter 1s not ascertained merely by reference to the proceedings which a party may institute, but may be illuminated by the conduct of those proceedings and especially by the pleadings in which the issues in controversy are defined and the claims for relief are set out. bur in the end, it 15 a matter of impression and of practical judgment whether a non-federal ciaim and a federal claim joined in a proceeding are within tne scope of one controversy and thus within the ambit cf a matter'." this matter, there is only one controversy. Their Honours 2n went on to express a view similar to that which I have already cizead from ».69 of Fencott v Muller. Their Honours said, at »p.21 167] "Barwick CJ in Phiiip Morris (33 ALR at 474; 3 ALJUR at 125) had expressed a similar idea, statin that the exercise of the accrued jurisdiction is discretionary and not mandatory'. in expressing this opinion, Barwick CJ expressiy acknowledced that the Federal Court had a discretion to ailow the non-federal claims to be determined ina State court. His Honour was speaking with varticular reference to the exercise by the Federal Court of the jurisdiction conferred by 3 86." Q Ui Their Honours then went on to consider wnat natters should ce taken into account in the exercise or the a:scretion anc WNAat should be done in the particular case. In the present case, 1t seems to me that the appropriate court for dealing with controversy raised in this action 18a state court. The issue in dispute 1s a traditional clazm under state law and is Tar removed from the matters tnat are traditionally raised under the Trade Practices Act. The rules cf the state courts have been developed expressly to deal witn claims arising from personal injuries, and state courts are properly geared to deal with disputes cf that type. ic seems to me that, in the present case, the federal 1ssues wiil add nothing of practical value to the applicant's claim. i do not say that matters cannot be raised under ss.52 ana 53, out 1t seems to me that they are not likely to succeed uniess causes of action arising under state law are also established. It seems to me that the federal claim can be described as trivial or insubstantial in the sense that 1t adds nothing of reai value to the claims under state law. For this reason, I tnank that this court snouid not accept jurisdiction to deal with the matters which arise under state law and accordingly that ali the non-federal issues shouid be struck out from the statement of claim. in the lignt of that, I tnink that, 1r the matter is to proceed in this court, 1¢ would se desirable that the statement of claim be wholly repleaaed. i would, therefore, accede to the respondent's submission that the statement or claim as awnole snould be struck out, reseryvin C 4] leave to replead. a | certify thot teeaead the § preceding pages are a true copy of the reasons for judgment herein of The Honour- able Mr, Justice 5 9 DAWES Associate Deted = i1//0/S4 Ce vag