IN THE FEDERAL COURT OF AUSTRALIA No. G164 of 1982 ) ) NEW SOUTH WALES DISTRICT REGISTRY ) ) ) GENERAL DIVISION IN THE MATTER of the TRADE PRACTICES ACT, 1974 BETWEEN : BRYAN JOHN MILNER AND ORS. . Applicants AND: DELITA PTY. LIMITED ROGER McMILLAN GLASSON and MORRIS WALTER LEWIN Respondents and First Cross-Claimants AND: ROBERT CHARLES GOOCH MORRISON and JOHN CHRISTOPHER BENNETT First Cross-Respondents and Second Cross-Claimrants AND: ROGER McMILLAN GLASSON and MORRIS WALTER LEWIN Second Cross-Respondents No. G85 of 1983 BETWSEN : ALLAN JAMES GILL & ORS. Applicants AND: DELITA PTY. LIMITED ROGER McMILLAN GLASSON MORRIS WALTER LEWIN Respondents and First Cross-Claimants 2. AND: ROBERT CHARLES GOOCH MORRISON and JOHN CHRISTOPHER BENNETT. First Cross-Respondents ~ and Second Cross-Claimants AND: ROGER McMILLAN GLASSON and MORRIS WALTER LEWIN Second Cross-Respondents 16 October 1985 REASONS FOR JUDGMENT LOCKHART J. On 19 September 1985 I published my reasons for judgment in this matter but deferred making any final orders so that the parties could consider the implications of my reasons, make any further submissions and bring in short minutes of order. On Friday last, 11 October 1985, counsel for all parties told me that they had agreed on all matters to give effect to my reasons for judgment save one, namely, the question of damages in the nature of interest. I said in my reasons for judgment of 19 September 1985 that the language of ss. 82 and 87 of the Trade Practices Act 1974 is apt to authorise an award of damages by way of interest, not to recoup loss due entirely to delay in, the payment of money ultimately held to be due, but to recoup loss suffered as a direct consequence of the conduct which contravened s. 52 including the cost of borrowing the money lost or the cost of terminating an earlier investrent. I said that the entitlement of a successful applicant to recover damages * fe under this head must depend on the circumstances of the case. I heard submissions last Friday on the question of damages in the nature of interest. It was common ground between the parties that there was either no evidence or insufficient evidence upon which reliance could be safely placed to determine the entitlement of any Particular applicant to damages of this kind if this matter were to be determined with reference to the individual position of each applicant. Counsel for the applicants submitted that the Court should approach this question, not with reference to the particular position of each applicant (of whom there are many), but on the basis of the applicants as a whole. It was said that each applicant had contributed funds, whether to the property trusts or the partnerships (no distinction was drawn by any of the parties between them for this purpose), as a business venture and that they did so directly or indirectly on the recommendation of Messrs. Robert Morrison & Associates who were professional investment advisers. Whether the applicants used funds from sources that had previously been used for investment purposes or not and whether those funds would have been used for profit making purposes, if not used for investment in the guava projects, were said to be immaterial considerations. Counsel for the applicants submitted that the appropriate measure for computing interest was either the yearly rates of interest at relevant times (1980-1985) regarded as appropriate to guide the Supreme Court of New South Wales as published in that Court's Practice Note No. 30 of 12 December 1984, or the rates of interest available on term deposits with the Commonwealth Bank during 1980-1985 or the rates of interest customarily charged by the Commonwealth Bank during the same period on overdrafts of less than $100,000. Counsel further submitted that, if the Court determined that matters should be taken into account to reduce the amount of damages that otherwise would be awarded under this head (for example income tax on the gross amount of interest received or receivable and possible failure in whole or in part of or poorer return from other ventures in which the applicants may have invested their funds) this should be done by discounting the award of damages. It was submitted that the fair approach would be to award each applicant interest on the amount for which judgment would be entered (exclusive of interest) at the rate of 13.5% over a four year period (from the end of December 1980 to the end of December 1984). It was agreed by all parties that 13.5% was a fair rate of interest during that period and that the period of four years itself was fair in the circumstances of the case. If I were to award interest along the lines suggested by counsel for the applicants I would do so on the basis suggested of 13.5% over four years from 1 January 1981 to 31 December 1984. I would discount the figure that emerged by a percentage to reflect the possibility that the returns would be less than 13.5% due to matters such as failure of investments or the making of poorer investments that otherwise might have octurred. In the result, I would allow a discount from the rate of 13.5% of 3% thus giving an effective rate of 10.5% over the four year period. I realise, of course, that the selection by the applicants and the acceptance by the respondents of ae eee 8 ~ ae ee a ee the rate of 13.5% and of the four year period to which that rate applies itself embodies an element of discount because the rate of 13.5% was the lowest of the rates referred to in the Practice Note of the Supreme Court of New South Wales over the same period and the monies were invested by the applicants generally by instalments over a period of more than four years. I emphasise that this is the approach that I would take if I were to accede to the submissions of counsel for the applicants. Counsel for the respondents objected to any damages in the mature of interest being awarded on the ground that there was no evidence of any applicant having sustained loss under this head. In my opinion the submission of counsel for the respondents is correct. Although there are many applicants, it is not permissible to determine damages in the nature of interest otherwise than hy reference to the evidence adduced in favour of each applicant who claims damages under this head. It is well established, of course, that the fact that it is not possible for the Court precisely to calculate the extent of loss or damage suffered is no bar to the right of a successful party to recover that loss or damage: Chaplin v. Hicks (1911) 2 K.B. 786; Biggin & Co. Limited v. Permanite Limited (1951) 1 K.B. 422; Callaghan v. William C. Lynch Pty. Limited (1962) N.S.W.R. 871 and Enzed Holdings Limited v. Wynthea Pty. Limited (1984) 57 A.L.R. 167. There are, however, too many variables and possibilities to justify the global approach upon which the applicants rely in support of their contention that damages in the nature of interest should be assessed in this case. Although damages of this kind must be viewed ultimately from the point of view of each applicant, I encourage the parties to co-operate for the purpose of taking some course, for example, a sampling process to determine the facts relating to this branch of the case. I am prepared to allow the applicants to reopen their case to lead evidence on this question and to give them a reasonable time to adduce it. But the evidence should be by affidavit unless the parties agree on some more informal approach. t certify that tus ard trie tive (5) preceding pages ave a true copy of the ' ae, ated Reasons fer Jucg~srt herein cf fs Fonour / Mr. Justice Lockhart. x Kou Darke. Assoc.ate Dated: (CH, October (985.