Trade Fractices - application under s.82 of Trade Practices Act and accrued jurisdiction - alleged contravention by respondents of s.45 of the Act - first and second respondents incorporated under Associations Incorporation Act - whether trading corporations in terms of $.4(1) of Trade Practices Act - summary of relevant principles - whether jurisdiction of the Court conditional upon existence of a trading corporation - disqualification of applicant from district cricket consequent upon applicant's participation in South African cricket tour - applicant disqualified pursuant to amended Cricket Council rule - no provision in original rule for disqualification for breach of rule - rule amended by resolution at Cricket Council meeting - Council's understanding of operation of original rule in relation to South African cricketers the subject of a resolution at an earlier meeting - whether conduct of Council members at relevant meetings constituted a contract arrangement or understanding in terms of 5.45 of the Act - resolution to amend found to amount to an understanding between first, second and third respondents - whether understanding contained an exclusionary provision 1n terms of ss.45 and 4D of the Act - meaning of 'purpose' in s.4D - competition between second and third respondents for services of cricketers - whether second and third respondents 'competitive with each other' in terms of s.4D - disqualification provision directed inter alia at applicant and other 'rebel cricketers' - whether 'particular persons' in terms of s.4D - exclusion of South African cricketers from district cricket competition as a result of rule - whether likely effect thereof to substantially lessen competition in terms of s.45 - meaning of 'substantial lessening of competition' - consideration of relevant markets - decision by Cricket Council to reject motion for reinstatement of applicant - whether decision constitutes giving effect to an exclusionary provision or a provision likely to substantially lessen competition in terms of s.45 - contravention of s.45 by first respondent ~ whether second and third respondents involved in the contravention in terms of s.75B ~ disqualification provision automatic in operation and indefinite in duration - whether unreasonable restraint of trade - whether in breach of applicant's alleged right to work - rule prohibits participation in unrecognised matches without the consent of the Cricket Council - permission to play in South Africa sought by applicant - no reply received - whether failure by Council to give any or proper consideration to applicant's application for consent - whether decision to disqualify ultra vires ~ alleged agreement between respondents to injure or punish applicant by disqualifying him from district competition ~ whether a conspiracy between respondents - whether respondents acted in bad faith or as a result of bias - allegation that applicant disqualified for political reasons - whether disqualification contrary to the Equal Opportunity Act - first respondent party to deed in settlement of litigation concerning effect of South African tour on applicant's participation in test and interstate cricket - whether disqualification of applicant from grade cricket in breach of express or implied term of deed - religt@ep - measure of damages poMSKVED 29 OCT 1986 FEDERAL COURT AUSTRALIA OF PRINCIPAL REGISTAY Trade Practices Act 1974 s5s.4(1), 4D, 4E., 45 Equal Opportunity Act 1984 (W.A.) ss.4, 53, 154 KIMBERLEY JOHN HUGHES v. WESTERN AUSTRALIAN CRICKET ASSOCIATION (INC. ) and MI. LAWLEY DISTRICT CRICKET CLUB (INC.); MELVILLE CRICKET CLUB (INC.); NORTH PERTH CRICKET CLUB (INC.); SUBIACO FLOREAT CRICKET CLUB (INC.); BAYSWATER-MORLEY CRICKET CLUB (INC.); PERTH CRICKET CLUB (INC.); FREMANTLE DISTRICT CRICKET CLUB (INC. ); CLAREMONT-COTTESLOE CRICKET CLUB (INC.); SOUTH PERTH CRICKET CLUB (INC.); MIDLAND-GUILDFORD CRICKET CLUB (INC.); WANNEROO DISTRICT CRICKET CLUB (INC. ) and LESLIE ANNISON (sued on behalf of himself and all other members of the Southern District Cricket Club); GREGORY BUNNEY (sued on behalf of himself and all other members of the Scarborough Cricket Club); MICHAEL SNELL (sued on behalf of himself and all other members of the Nedlands Cricket Club); PHILLIP CLIFFORD (sued on behalf of himself and all other members of the University Cricket Club) and KEVIN MORRIS TAYLFORTH (sued on behalf of himself and all other members of the Cricket Council of Western Australia Australian Cricket Association (Inc. ) TOOHEY J. PERTH 27 OCTOBER 1986 Til THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT PEGISTEY GENERAL DIVISION ' (lo. WA G14 of 1386 BETWEEN KIMBERLEY JOHN HUGHES Applicant and WESTERN AUSTRALIAN CRICKET ASSOCIATION (INC. ) First Respondent MI. LAWLEY DISTRICT CRICKET CLUB (INC.); MELVILLE CRICKET CLUB (INC.); NORTH PERTH CRICKET CLUB (INC.); SUBIACO FLOREAT CRICKET CLUB (INC. ); BAYSWATER-MORLEY CRICKET CLUB (INC.); PERTH CRICKET CLUB (INC.); FREMANTLE DISTRICT CRICKET CLUB (INC. ); CLAREMONT-COTTESLOE CRICKET CLUB (INC. ); SOUTH PERTH CRICKET CLUB (INC.); MIDLAND-GUILDFORD CRICKET CLUB (INC.); WANNEROO DISTRICT CRICKET CLUB (INC. } Second Respondents LESLIE ANNISON (sued on behalf of himself and all other members of the Southern District Cricket Club); GREGORY BUNNEY (sued on behalf of himself and all other members of the Scarborough Cricket Club); MICHAEL SNELL (sued on behalf of himself and all other members of the Nedlands Cricket Club); PHILLIP CLIFFORD (sued on behalf of himself and all other members of the University Cricket Club) Third Respondents KEVIN MORRIS TAYLFORTH (sued on behalf of himself and all other members of the Cricket Council of Western Australia Australian Cricket Association (Inc.) Fourth Respondent CONTENTS Introduction The parties The applicant's concern Rules of the Cricket Council The background Trading corporations Is the W.A.C.A. a trading corporation? Are the incorporated clubs trading corporations? Jurisdiction Section 45 of the Trade Practices Act Was there a contract? Was there an arrangement or understanding? Exclusionary provision Substantially lessening competition Giving effect to ... Restraint of trade Right to work Ultra vires Conspiracy Equal Opportunity Act 1984 Bad faith and bias Deed of Settlement Jurisdiction revisited Relief Summary of findings and conclusions ba na WwW ~I 36435076889298106109 IN THE FEDERAL COURT YF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION CORAM: TOOHEY J. 27 October 1986 No. WA G14 of 1986 BETWEEN: KIMBERLEY JOHN HUGHES Applicant and WESTERN AUSTRALIAN CRICKET ASSOCTATION (INC. ) First Respondent MI. LAWLEY DISTRICT CRICKET CLUB (INC.); MELVILLE CRICKET CLUB (INC.); NORTH PERTH CRICKET CLUB (INC. ); SUBIACO FLOREAT CRICKET CLUB (INC.); BAYSWATER-MORLEY CRICKET CLUB (INC.); PERTH CRICKET CLUB (INC.); FREMANTLE DISTRICT CRICKET CLUB (INC.); CLAREMONT-COTTESLOE CRICKET CLUB (INC.); SOUTH PERTH CRICKET CLUB (INC.); MIDLAND-GUILDFORD CRICKET CLUB (INC.); WANNEROO DISTRICT CRICKET CLUB (INC.) Second Respondents LESLIE ANNISON (sued on behalf of himself and all other members of the Southern District Cricket Club); GREGORY BUNNEY (sued on behalf of himself and all other members of the Scarborough Cricket Club); MICHAEL SNELL (sued on behalf of himself and all other members of the Nedlands Cricket Club); PHILLIP CLIFFORD (sued on behalf of himself and all other members of the University Cricket Club) Third Respondents KEVIN MORRIS TAYLFORTH (sued on behalf of himself and all other members of the Cricket Council of Western Australia Australian Cricket Association (Inc.) Fourth Respondent REASONS FOR JUDGMENT Introduction In his opening address, counsel for the applicant described this case as one of immense technical difficulty but having at its core the right of a person to earna living in a chosen trade or profession in the country and state of his choice. By way of riposte, counsel for the respondents said in his opening address that the case had nothing whatsoever to do with the applicant's right to work, that it concerned the obligation of the applicant to play the game of cricket according to its rules and that, notwithstanding the applicant's attempt to dress up his case in a wide variety of the most complex technical and legal attacks upon the conduct of the respondents, it would be found that the respondents were doing no more than exercising their responsibilities in a democratic fashion. Of one thing there can be no argument. The applicant's case as presented was indeed complex, both as to fact and law. It invoived the meaning and operation of several difficult provisions of the Trade Practices Act 1974, coupled with a detailed examination of a number of common law causes of action, in particular restraint of trade, conspiracy, ultra vires, bad faith and bias anda claim under the Equal Opportunity Act 1984 of Western Australia. At the forefront of the proceeding was a challenge to the jurisdiction of this Court to entertain the application. The hearing occupied twenty-one davs and was preceded by a number of interlocutory applications relating to pleadings, discovery, interrogatories and the issue of a subpoena duces tecum returnable before the hearing. No doubt the hearing would have been longer had it not been for two considerations. The first was that, by agreement between the parties, evidence was admitted on affidavit. Twenty-four affidavits were filed on behalf of the applicant and twenty-seven on behalf of the respondents. Most of the deponents were cross-examined and the respondents attacked much of the contents of the affidavits filed on behalf of the applicant. As aresult a number of paragraphs and parts of paragraphs were disallowed. The second consideration related to the admission of documentary evidence. The Court was presented with files containing 459 documents which the parties had agreed as to authenticity. However they reserved their rights to object to the admission of documents on the ground of relevance and otherwise. In a number of cases objections were made and upheld and in other cases counsel did not press for the admission of documents. In the end 223 documents were tendered in this way; other documents were tendered through witnesses. The parties It is necessary now to say something about the parties to this litigation. The applicant is a professional cricketer, that much is admitted. It is also admitted that he is and was at all material times engaged as a professional cricketer by Subiaco Floreat Cricket Club (Inc.), though the terms of his engagement assume some importance. That is a matter to which I wake Oe shall refer later. He first plaved A grade cricket as a sixteen vear old in 1969. He first plaved for Western Australia in the 1974-75 season and for Australia in 1976. He was captain of the Western Australian side in 1980-81 and thereafter until the commencement of the 1985-86 season. He captained Australia in the second test against Pakistan in 1978-79 at the W.A.C.A. qround. The applicant's reputation as a cricketer 1s unquestioned. The first respondent ("the W.A.C.A.") and the second respondents are bodies incorporated under the provisions of the Associations Incorporation Act 1895 of Western Australia. That Act provides for the incorporation of a range of associations but 1t has no application to "associations for the purpose of trading or securing pecuniary profit to the members from the transactions thereof"(s.2). One question that will arise for consideration in these reasons is the significance of incorporation under the Associations Incorporation Act for the argument that the respondents are trading corporations within the Trade Practices Act. The W.A.C.A. is responsible for the promotion of cricket in Western Australia. Each of the second respondents is responsible for club cricket in a particular district. The third respondents are cricket clubs and are similarly responsible but they are not incorporated. The fourth respondent, Mr. Taylforth, is the chairman of the Cricket Council and was sued in a representative capacity. I shall refer to the fourth respondent as the Cricket Council and to Mr. Taylforth by name when it is his conduct that 5. 1s under consideration. The Cricket Council is established bv r.35 of the rules of the W.A.C.A. which reads: "There shall be a Cricket Council consisting of the Chairman for the time being of the Council, the delegates elected annually by the several clubs associated with the Council (herein referred to as the Associated Clubs), two delegates appointed by the Executive, and such other delegates as the Council may from time to time admit in accordance with the rules framed by it under the power in that behalf herein conferred on it". Rule 36 of the rules of the W.A.C.A. empowers the Cricket Council to make by-laws and regulations for the control and management of matters within its own jurisdiction and to issue its own rules under separate cover. Rule 37 sets out the functions of the Cricket Council, the first of which is the control and management of all associated club matches. (There is a difference in the numbering of these rules as they appear in Ex.10 and in "The Western Cricketer", a publication of the W.A.C.A. I have followed counsel in using the numbering in the latter.) The second and third respondents comprise the Associated Clubs. While the Cricket Council is established by the rules of the W.A.C.A., the executive of the W.A.C.A. appoints delegates to the Council. It was the applicant's case that the Cricket Council was an autonomous body and that, while the first, second and third respondents were responsible for whatever was done by their delegates, the Council was not in any sense an agent of the W.A.C.A. The respondents did not appear to dissent from this view of the matter. But they did contend that the members of the Cricket Council, though appointed by the W.A.C.A. and the Associated Clubs, were not their agents. The applicant alleges that the W.A.C.A. and the incorporated clubs are trading corporations within the meaning of the Trade Practices Act. This 1s denied by those respondents. The issue is quite crucial to the application of the Trade Practices Act. The respondents say that 1t 18 crucial also to the jurisdiction of this Court to entertain any of the applicant's claims. The applicant contends that the jurisdiction of this Court does not depend upon upholding the claim that one or more of the respondents 1s a trading corporation, so long as the Court 1s satisfied that the claim is a hona fide one. This is a matter to which I shall return. With four exceptions, the respondents were represented by the one firm of solicitors and by the same counsel and have common interests. The exceptions are Subiaco Floreat Cricket Club (Inc.) (of which the applicant is a member), Claremont-Cottesloe Cricket Club (Inc.), Gregory Bunney who is sued on behalf of members of Scarborough Cricket Club and Phillip Clifford who is sued on behalf of University Cricket Club. These four respondents were content to abide by any order the Court might make. No claim for damages or costs was pursued against them but the applicant seeks to have them bound, together with the other respondents, by any declaratory or injunctive relief that may be granted. The applicant's concern In essence the applicant's concern is that, by reason of his decision to play cricket in South Africa between 1 November 1985 and 31 March 1986 and again between 1 October 1986 and 31 March 1987, he has been barred from test cricket, Sheffield Shield cricket (that 1s, interstate cricket) and club or district cricket. The playing of club cricket is not a legal prerequisite to the playing of shield and test cricket. But there 1s no doubt that a player who 1s not available for club cricket may lose the chance to maintain his skills, 1s away from the eyes of the selectors and therefore has a reduced chance of selection for shield and test cricket. And in a more general way his skills as a cricketer may suffer. I accept the applicant's statement in an affidavit filed in these proceedings: "District cricket not only provides me with valuable match practice and training for the purposes of pursuing my career generally but also affects my capacity to fulfil sponsorship obligations and also to attract future Australian sponsorship". The applicant's disbarment from playing test and shield cricket was not directly involved in these proceedings. It was however the subject of litigation in the Supreme Court of Victoria and the terms upon which that litigation was settled have relevance to the issues with which this Court is presently concerned. The applicant's disbarment from playing club cricket, which it is said resulted from a decision of the Cricket Council, is the matter of which direct complaint is now made. Rules of the Cricket Council To understand how the applicant's disqualification from club cricket is said to have arisen, reference must be made to ¥.2:38:1 of the rules of the Cricket Council. This rule was amended on 4 November 1985; it 1s necessary to have regard to its original form and its form as amended. Originally it provided: "No Club or Affiliated Association and no member of any Club or Affiliated Association and no player registered as such under these Rules shall arrange or take part in any cricket match within or without the State of Western Australia other than a match recognised by the Australian Cricket Board or the Association without first obtaining the consent in writing of the International and Interstate Cricket Committee of the Association provided that: This Rule shall not apply to the arranging of or taking part in any match declared by the International and Interstate Cricket Committee to be a social match". In its amended form, r.2:38:1 reads: "No Club or Affiliated Association and no member of any Club or Affiliated Association and no player registered as such under these Rules shall arrange or take part in any cricket match within or without the State of Western Australia other than a match recognised by the Australian Cricket Board or the Association without first obtaining the consent in writing of the Cricket Council of the Association provided that: This Rule shall not apply to the arranging of or taking part in any match declared by the International and Interstate Cricket Committee to be a_ social match. Any player found in breach of this rule is automatically disqualified until reinstated by the Cricket Council". The amended rule differs from the original rule in two important respects. First, the amended rule substituted the Cricket Council for the International and Interstate Cricket Committee ("the I. and I. Committee") as the body whose consent is required. The I. and I. Committee is also a creation of the rules of the W.A.C.A. It consists of seven members, to be elected annually, and a general manager (r.39). Its primary function is to arrange and control all international and interstate matches, but 1t also appoints the W.A.C.A. representatives to the Australian Cricket Board (r.42). The second difference is that the original rule said nothing as to the consequences for a player who was in breach of the rule. The amended rule provides automatic disqualification until the player is reinstated by the Cricket Council. Reference must also be made to r.2:39:5 of the Cricket Council rules, which has not been amended. It reads: "If a club allows a player disqualified pursuant to these Rules or disqualified by order of the Council, to play in a match in a team of that club after notice of that player's disqualification has been received by the club the club commits an offence and if the offence is proved upon complaint to the Council the club shall be liable to a fine and shall be deemed to have lost the match to the opposing club. If the match is so lost the Council shall declare the match to have been a first innings win or an outright win with first innings lead to the opposing club. A complaint under this Rule may be lodged by the Grade Committee or the opposing club". As the rules of the Cricket Council stood before 4 November 1985 (and as they stand now), there was provision for disqualifying a player whose name appeared in a list of defaulters furnished by the secretary of a club (r.2:39). There was and is provision for the prosecution of a player "for an act or omission deemed to be an offence under these rules" (r.2:24). Rule 2:24 contains the procedure which must be followed in such a case - a complaint, followed by a hearing - and r.2:25:2 empowers the Council to impose the prescribed penalty or if none is prescribed "such penalty ... as it thinks fit". But none of these rules is relevant to the situation of the applicant. I conclude that 10. before 4 November 1985 playing in an unrecognised match could not result in disqualification of the player from playing in club matches, at any rate not without following the procedure in r.2:25. That procedure was not followed in the applicant's case. The background Despite the welter of evidence led on both sides, the events giving rise to this application fall within a fairly narrow compass. To a large extent the facts are not in dispute though questions of credibility arise, particularly in regard to meetings of the Cricket Council held on 25 September, 4 November 1985 and early in 1986. On 15 May 1985 the applicant executed an agreement with The South African Cricket Union ("S.A.C.U."). He agreed to take part in cricket tours in South Africa during the periods 1 November 1985-31 March 1986 and 1 October 1986-31 March 1987. In addition to meeting costs associated with the applicant's movements to and from South Africa and costs associated with the tours, S.A.C.U. agreed to pay the applicant $A200,000. This amount was expressed to be free of tax; it is umnecessary to mention the formula by which income tax was taken into account. Other Australian cricket players entered into comparable agreements about the same time, probably a little earlier. In or about May 1985 the Australian Cricket Board (of which the W.A.C.A. was a member along with other state cricket associations) and Frederick William Cecil Bennett, the Chairman of ll. the Cricket Board, instituted proceedings in the Supreme Court of Victoria. There were two actions, No. 1497 of 1985 relating to players other than the applicant, and No. 1811 of 1985 relating to the applicant. In each case the plaintiffs sought injunctions, damages and other relief so as to restrain the defendants from giving effect to their agreements with S.A.C.U. The basis of the actions lay in the contention that the defendants were then bound to the Cricket Board and had undertaken not to play ina cricket match, other than a match controlled by the Cricket Board or one of its constituent members or approved by the Cricket Board, and in particular had contracted not, without the permission of the Cricket Board, to play cricket outside Australia. Those proceedings were defended. The Victorian actions were settled right at the death knock and a deed of settlement dated 29 July 1985 was executed by all concerned including the applicant. It will be necessary, later in these reasons, to refer to certain parts of the deed because one cause of action upon which the applicant relies is that the W.A.C.A. is in breach of the deed. For the purpose of this recital of facts, it is enough to note that a consequence of the deed was that the applicant might participate in the South African tours without being in breach of any contract between himself and the plaintiffs in the actions (which included the W.A.C.A.), but that he accepted the lawfulness of bans imposed by the Australian Cricket Board rendering him ineligible tobe a member of a team representing an Australian state before 1 October 1987 and rendering him ineligible to be a member of an Australian 12. team before 1 October 1988. The deed made no reference to the playing of cricket at club level. By letter dated 11 November 1985 Robert John Parry, who was the applicant's business manager as well as being club coach for Bayswater-Morley Cricket Club (Inc.), wrote to the chairman of the Cricket Council. He did so in the name of the applicant, pursuant to a power-of-attorney which he held. The applicant was then in South Africa. The letter read: "I refer to Cricket Council Rule 2.38.1 concerning the playing by a club member in a match other than one organised by the Australian Cricket Board or your Association. Accordingly I wish to seek your Councils consent to allow me to play in such games as have been organised by The South African Cricket Union during this 1985/86 summer season." Paragraph 26 of the statement of claim pleads that the fourth respondent failed to reply to the applicant's request. Paragraph 27 pleads that the fourth respondent failed to give any or any proper consideration to the request. Paragraph 17 of the defence denies paras.26 and 27. Such a denial, without any positive affirmation that the fourth respondent did reply or did give proper consideration, offends the rules of pleading and would have been struck out, had application been made to this end. No such application was made. It is quite clear that the Cricket Council did not reply to the request. Whether it gave any or proper consideration thereto will be looked at later in these reasons. 13. By 11 November 1985 several important events had occurred. In particular there had been two meetings of the Cricket Council, one on 25 September and one on 4 November. At the meeting on 25 September, which was a special meeting, it was resolved: "That the Cricket Council has come to an understanding that the Rule regarding unrecognised matches cannot be invoked until the players take part in such matches." It was common ground that this was a reference to r.2:38:1. There was a further resolution: "The Cricket Council, at this time, does not intend taking any action against the proposed South African tour players. The Rules as they stand would prevent them from playing upon their return; however, there has been notice given of a proposed notice of motion to review the applicable Rules prior to that time". At the meeting on 4 November r.2:38:1 was amended in the two respects already noted. First, the Cricket Council was substituted for the I. and I. Committee as the hody whose consent to play in an unrecognised match was required. Second, the following words were added to the rule: "Any player found in breach of this Rule is automatically disqualified until re-instated by the Cricket Council". In its amended form r.2:38:1 gives rise to several questions. When is a match "recognised" by the Cricket Board or the W.A.C.A.? What is meant by "found" in breach of the rule? What is meant by "automatically disqualified"? These questions ld, must be looked at, but at this stage I shall continue with the sequence of events. As at 4 November 1985 the applicant had not (nor for that matter had anv of the players contracted to plav in South Africa) taken part im a tour match. The first match he plaved in South Africa was on 9 November 1985. There was an ordinary meeting of the Cricket Council on 6 Januarv 1986. A number of matters were canvassed. Towards the end of the meeting there was amotion by Mr. Burgess, the president of Subiaco Floreat Cricket Club (Inc.) which was seconded by Mr. Bunney, the president of Scarborough Cricket Club (to which Thomas George Hogan and Gregory Shipperd, other South African tour players belonged) that: "... the South african tourists be re-instated to W.A.C.A. Grade and Toyota Cup fixtures on their return so that they may fulfil their obligations to their clubs". The minutes of the meeting report the fate of that motion in the following terms: "The Fremantle Club/A. Dougan was opposed to their re-instatement this season. F. O'Driscoll considered that re-instatement would be in direct opposition to the motion carried by Council on the A.C.B. Code of Behaviour. P,. Clifford supported the motion on legal grounds. The motion was put and LOST." 15. Mr. Dougan was the delegate to the Cricket Council of Fremantle District Cricket Club (Inc.). Mr. O'Driscoll was the President of Mt. Lawley Cricket Club (Inc.) and its delegate to the Council. On 3 February 1986 there was held what the minutes describe as "special and ordinary meetings of the Cricket Council". Item 26.2 of the minutes, under the heading of "Special Business", deals with "Players undertaking unofficial tours of South Africa". As to that matter, the minutes record: "MOVED (D. Fitzgerald/M. Parr) that T. Hogan, G. Shipperd, K. Hughes and T. Alderman be reinstated so that they may participate in Swan Gold League and Toyota Cup following their return from South Africa and enable them to fulfill their obligations to their respective District Clubs. In support of the motion D. Fitzgerald read from a prepared statement. Following discussion the motion was put and LOST (7/8). The University, Scarborough, Subiaco-Floreat and Claremont-Cottesloe delegates requested that the minutes record that they had voted in favour of the motion". Mr. Fitzgerald was the delegate of Scarborough Cricket Club. Mr. Parr was the delegate from Subiaco Floreat Cricket Club (Inc.), the club to which the applicant belonged. Mention has been made already of Messrs. Hogan and Shipperd. Terrence Alderman was a member of the applicant's club. There was a further special meeting of the Cricket Council on 19 February 1986. The meeting was requisitioned when it was learned that Charles Arthur Bull, the delegate to the Cricket Council from South Perth Cricket Club (Inc.), had at the 16. meeting on 3 February voted against reinstatement contrary to the unstructions of his club. At the meeting on 19 February Mr. Bull explained that he had misunderstood how he should vote. Mr. Taylforth., as chairman of the meeting, ruled that the Cricket Council had "no authority or power to deal with a matter concerning a delegate and his club and therefore the matter... was outside the jurisdiction of the Council". Mr. Burgess and Mr. Bunnev moved and seconded respectively a motion of dissent to the chairman's ruling but that motion was lost six votes to eleven. The chairman then declared the meeting closed. The circumstances in which Mr. Bull apparently misunderstood his club's instructions and voted against reinstatement rather than for it were not explained satisfactorily. Mr. Bull gave evidence in which he denied that the vote he cast in error was any more than a misunderstanding of what had taken place at the meeting of his club preceding the Cricket Council meeting on 6 January. It was not his club's practice to arm its delegate with written instructions as to how to vote on matters arising or likely to arise at a meeting of the Cricket Council. But its delegate was expected to vote in accordance with the views of the club as made known at its meetings. Despite cross-examination and re-examination of Mr. Bull, I am by no means clear what he meant by saying that he had misunderstood his instructions. Did he mishear what he was told at the meeting of the club, did he hear correctly and then become confused or did he simply forget what he had been told by the club? Later in these reasons I shall say more about Mr. Bull's conduct, in the context that the members of the Cricket 17. Council were acting in bad faith and were biased. At this stage I voice my concern that, on such an important matter, the explanation forthcoming went little further than that there had been a misunderstanding. Had Mr. Bull voted in accordance with the views of his club, the motion to reinstate the applicant would have been passed eight votes to seven. While one cannot forecast what might have happened thereafter, at least in terms of +.2:38:1 and while the motion for reinstatement stood the applicant would not have been disqualified from playing for his club. This might have had the further consequence that this long and costly piece of litigation could have been avoided. Trading corporations The jurisdiction of the Federal Court is attracted by reason of the claim made under the Trade Practices Act. Put shortly, the claim is that the conduct of the respondents at each of the meetings on 25 September and 4 November 1985 constituted a contract, arrangement or understanding which contained an exclusionary provision contrary to sub-para.45(2)(a)(i) of the Act and that a provision of that contract, arrangement or understanding had as its purpose, or had or was likely to have the effect, of substantially lessening competition in contravention of sub-para.45(2)(a)(ii) of the Act. Furthermore, it is said, their conduct thereafter gave effect to each such provision in contravention of sub-paras.45(2)(b)(i) and (ii) of the Act. 18. Sub-section 45(2) strikes at conduct by a corporation. The applicant contends that all the incorporated respondents are trading corporations, hence corporations within sub-s.4(1) the Trade Practices Act. But he says that inany event it is sufficient if there be one corporation that engaged in conduct in breach of the sub-section. It is enough, he says, if the W.A.C.A. be a trading corporation even 1f, contrary to his submission, the incorporated clubs are held not' to be. The respondents, while recognising a distinction between the activities of the W.A.C.A. and the clubs, contend that none of the incorporated respondents is a trading corporation. The last few years have seen several decisions, particularly by the High Court, in which the notion of a_ trading corporation has been examined. It is not my intention to refer to those decisions in great detail but rather to state the principles that appear to emerge from them and then to apply those principles to the facts of the present case. 1. The mere fact that a corporation trades does not mean that it is a trading corporation. Reg. v. Trade Practices Tribunal; Ex parte St. George County Council (1974) 130 C.L.R. 533 at 543, 562 ("St. George County Council"); Req. v. Federal Court of Australia; Ex parte W.A. National Football Leaque (1978-1979) 143 C.L.R. 190 at 219, 234 ("Adamson"). 2. The purpose of incorporation, propounded in St. George County Council, is no longer a valid test. The test is one of the current activities of the corporation. Adamson; State 19. Superannuation Board v. Trade Practices Commission (1983) 57 A.L.J.R. 89 at 96 ("State Superannuation Board"). But the current activities test 1s not the sole criterion for determining whether a corporation is a trading corporation. Thus where a corporation has not begun to trade, its character may be found in its constitution. Even when there are current activities, the corporation's constitution is not completely aurrelevant Fencott v. Muller (1982-1983) 152 C.L.R. 570 at 602. Views as to the necessary extent of trading activity have varied. It must be a substantial corporate activity (Barwick C.J. in Adamson at 208); the trading activities must form a sufficiently significant proportion of the corporation's overall activities (Mason J. in Adamson at 233, with Jacobs J, concurring at 237); the trading activities should not he insubstantial (Murphy J. in Adamson at 239); the corporation must carry on trading activities on a significant scale (Mason, Murphy and Deane JJ. in State Superannuation Board at 96; Deane J. in Commonwealth v. Tasmania (1983) 46 A.L.R. 625 at 833). An incorporated sporting body can be a trading corporation if its activities meet the required test. Adamson. In particular, incorporation under a statute such as the Associations Incorporation Act does not prevent a corporate 20. body from being a trading corporation if its activities warrant that description. Adamson at 232. 7. Trading denotes the activity of providing, for reward, goods or services. Re Ku-ring Gai Co-operative Building Scciety (No. 12) Ltd. (1978) 22 A.L.R. 621 at 624-625; St. George County Council at 569-570; Bevanere Pty. Ltd. v. Lubidineuse (1985) 7 F.C.R. 325 at 330-331. 8. The Trade Practices Act itself draws a distinction between trading corporations and financial corporations; nevertheless the two classes are not mutually exclusive. State Superannuation Board at 96. Adamson repays closer consideration for it is the nearest on the facts to the case now before the Court. It concerned a professional football player who was registered with the West Perth Football Club (Inc.) ("West Perth"), a body incorporated under the Associations Incorporation Act 1895. The ciub was amember of the Western Australian National Football League ("the W.A. League") which was incorporated under the same Act. Adamson received an offer inviting him to play with the Norwood Football Club (Inc.) ("Norwood") in South Australia, a body which was incorporated under the Associations Incorporation Act 1956 of that state and which was a member of the South Australian National Football League ("the 8.A. League"), also incorporated under that Act. The W.A. League and the S.A. League were members of the National Fvotball League of Australia, a 21. company limited by quarantee incorporated under the Companies Act 1961 of Victoria. The case concerned the refusal of West Perth and in turn the W.A. League to grant a clearance to Adamson to play for Norwood. Adamson sued West Perth, the W.A. League and the S.A. League in the Federal Court, alleging that they were trading corporations and that their actions in relation to the clearance application were breaches of sub-s.45(2) of the Trade Practices Act. At this point of these reasons for judgment, I am concerned only with the view taken by the majority of the High Court - Barwick C.J., Mason, Jacobs and Murphy Jd., with Gibbs, Stephen and Aickin JJ. dissenting - that West Perth and the W.A. League were trading corporations. Mention has already been made of the tests propounded in Adamson for determining whether an incorporated body is a trading corporation. In the course of his reasons for judgment, Mason J. considered in some detail the activities of the relevant bodies. It is in that regard that the facts of Adamson have particular application to the present case. In finding that the W.A. League had trading activities so extensive as to leave no doubt that it was a trading corporation, Mason J. said at 234: "The W.A. League has as its principal object the promotion, control, management and encouragement of Australian Rules football matches and competitions. It controls and manages the competition between the Perth clubs, adjudicating on disputes between clubs and on complaints against officials and players, imposing 22. penalties where they are considered appropriate. The clubs are members of the League and pay aie small subscription to it. The proceeds of each League competition match are received by the League. Under its constitution the W.A. League retains 20 per cent of these proceeds or such greater percentage as it may require, and the balance 1s equally divided among the member clubs. soe Apart from gate receipts from competition matches the League has a variety of other sources of income. They include: (a) receipts from interstate and other matches which it promotes or arranges; (b) receipts from broadcasting and television rights granted in respect of games which it promotes or arranges; (c) income from promotion, sponsorship and advertising; (d) rent for use of part of its premises; {e) catering rights at Subiaco Oval in Perth which it holds on lease; (f) income from the sale of, and advertising revenue from, its weekly programme". His Honour rejected the argument that the trading activities of the League were incidental to its main objects viz. the promotion and encouragement of the sport as a recreation. He continued at 235: "This to my mind is an inversion of the true position. To me it seems that the sport is promoted = and encouraged aS a means of ensuring the receipt of the large financial returns which are associated with it. The financial revenue of the Leagues is so great and the commercial means by which it is achieved so varied that I have no hesitation in concluding that trading constitutes their principal activity. In saying this I treat all their activities which I have listed and which produce revenue as trading activities. I do not limit the concept of trading to buying and selling ata profit; it extends to business activities carried on with a view to earning revenue". Mason J. recognised that West Perth stood in a somewhat different category to the W.A. League. Its principal objects were to foster Australian Rules Football, to provide facilities for playing it and to provide recreational and sporting facilities for its members. At 236 he said: 23. "West Perth derives income from two main sources: first, from the operations of its football team in the competition run by the W.A. League; secondly, from various trading activities which it conducts. The first source of income includes the distribution received by it as a member club of the W.A. League and membership fees for admission to matches in which 1ts teams participate. The second source of income is from bar trading and catering ... a third and minor source of income 1s revenue from the sale of club ties, objects and souvenirs. The fact that West Perth is a club and that therefore its sales of liquor and food are largely made to members does not in my view affect its character as a trading corporation. There is mo reason why an incorporated club which is heavily engaged in trading activities should not be held to be such a corporation, despite the fact that its trading activities are related to its character as a club and that it provides social functions, amenities and services for its members. The principal activity of the Club is its participation as a member club of the W.A. League in the competitions which it runs. Indeed, that is West Perth's major source of income. The comment which Fletcher Moulton L.J. made of the Crystal Palace Club in Walker v. Crystal Palace Football Club Ltd. £19103 1 K.B. 87 applies with equal force to West Perth. His Lordship said at p.92: 'Here is a company that carries on the game of football as a trade, getting up and taking part in football matches'. The only qualification to be made is that West Perth does not arrange or manage the competition matches". In State Superannuation Board at 96, Mason, Murphy and Deane JJ. referred with approval to what Mason J. had said in Adamson at 233 when he noted that "trading corporation" is essentially: ",.. a description or label given to a corporation when its trading activities form a sufficiently significant proportion of its overall activities as to merit its description as a trading corporation". 24. While the authorities to which I have referred seek to define or describe a tradina corporation, they do not in express terms offer a process by which the question whether a corporation is a trading corporation may be determined. Mr. Archer, of counsel for the respondents, suggested what he described as a "three-stage test". This involved identifying the totality of the activities of the corporation, identifying those activities properly characterised as trading activities and then evaluating the extent of the trading activities against the totality of activities. That approach seems to me consistent with what the High Court said in Adamson and other cases and I am content to adopt 1t. But as I shall point out, especially in relation to the Clubs, there are difficulties involved in comparing economic and non-economic activities. Against the background of the general principles to which I have referred and the detailed analysis by Mason J. in Adamson, I now look at the position of the W.A.C.A. and thereafter at the incorporated clubs. Is the W.A.C.A. a trading corporation? Much of the W.A.C.A.'s activities can be gleaned from The Western Cricketer, its 1984-85 year book, and from the affidavit of Peter Brian Rakich, its treasurer, to which are exhibited a number of documents relating to the association's financial affairs. 25. The total revenue derived by the W.A.C.A. during 1984-85 was $3.2 million and its expected revenue for 1985-86 is $3.4 million. The income for the earlier vear produced a surplus of $195,000; a surplus of about $100,000 1s expected for the latter vear. It 15 revenue rather than profit to which the courts' look 1n determining the character of a corporation. That 1s not to say that profit is irrelevant; but clearly the amount of profit may not, for various reasons, reflect the extent of trading activities. The income of the W.A.C.A. 1s derived principally from ground revenue (it receives 15% of gate takings for international and interstate matches conducted by the Australian Cricket Board), membership subscriptions, bar trading and bottle shop, sponsorship (including perimeter advertising and sponsors' boxes), interest on investments, money from such sources as the lease of indoor cricket nets, fund-raising and catering facilities. As well it receives a distribution from the Australian Cricket Board of the W.A.C.A.'s share, not only of gate receipts but of sponsorship and advertising and the sale of television rights for international and interstate matches. The activities producing these sources of income closely resemble those of the W.A. League considered in Adamson. One point of distinction is that, while it is clubs that constitute membership of the W.A. League, the W.A.C.A. has members in the ordinary sense. They are persons who pay annual subscriptions which entitle them to use the various facilities of the 26. association including attendance at interstate and international matches without charge. Persons do not join the W.A.C.A. to plav cricket but rather to watch it. If they wish to play, they join clubs. The income derived from the W.A.C.A. 1s expended mainly in administration costs, the expense of maintaining stands and other equipment, the cost involved in approaching sponsors and arranging promotions, and depreciation. Wathin this overall picture of income and expenditure, the W.A.C.A. treats as separate entities the I. and I. Committee and the Cricket Council. According to Mr. Rakich, the costs of the I. and I. Committee generally exceed the revenue it generates. Its sources of revenue comprise a distribution from the Australian Cricket Board, sponsorship of the Sheffield Shield team and a proportion of gate receipts for interstate and international matches held at W.A.C.A. ground. The expenses of that committee relate to coaching and administering the Sheffield Shield team, paying out prize money to the state team, some of the expense of staging shield and international matches and paying state players for their involvement in shield cricket. The revenue of the Cricket Council is derived mainly from sponsorships received for district cricket competition as a whole. Its expenses relate to the costs of organising fixtures and the competition at district cricket level. 27. As I understand the picture from the evidence of Mr. Rakich and the various documents tendered in evidence, the I. and I. Committee and the Cricket Council donot operate at a profit and their losses are absorbed by the W.A.C.A. itself. For the purpose of determining whether or not the W.A.C.A. is a trading corporation, it 1s appropriate to look at the overall situation of the W.A.C.A. Counsel for the parties did not suggest otherwise in the course of their final addresses. The W.A.C.A.'s income of $3.2 million for 1984-85 included membership fees amounting to $650,000 or thereabouts and a distribution from the Australian Cricket Board of $375,000. Because of the way in which various statements of revenue and expenditure have been prepared, it is not easy to set out all the relevant information in a concise manner. But by way of illustration, the income from members' catering was $224,345, the income from the public bar was §119,112, and $249,155 came from what was described as members' club trading. The anticipated figures for 1985-86 reflect much the same pattern. The president of the W.A.C.A.'s review, in his annual report for 1984-85 (The Western Cricketer 66-67), speaks of a dream to transform the W.A.C.A. ground into an international stadium beginning to come true. It speaks of an expectation that league football will be played at the W.A.C.A. in 1987; of plans for the America's Cup season that include an England Australia test match, a W.A.C.A. international tournament as part of a festival of sport, a commemorative mass to welcome the Pope to Western Australia - ""dramatising the W.A.C.A.'s exceptional 28. facilities for the handling of huge crowds at maior public events"; and of what are described as three "huge night-time spectaculars under the new floodlights - a New Year''s Eve Concert with leading world artists, an America s Cup Ball, and a Military Tattoo climaxing the 1987 Festival of Perth - all in the open aur on the historic Oval". I accept that, in accordance with its rules, a primary object of the W.A.C.A. is the promotion and control of cricket in Western Australia (r.3(a)). However its objects do include the promotion of "recreation entertainment and amusement" in general terms (r.3(d)) and the availability of the ground "for the purposes of public recreation, gatherings of societies, concerts, entertainments and amusements" (r.3(f)). It is apparent that a very substantial part of the activities of the W.A.C.A. are of a trading character, involving the provision of goods and services not only to its members but to the large numbers of the public who make use of those facilities. I do not accept the submissions of counsel for the respondents that the only trading activities of the W.A.C.A. are "the conducting of the bar and catering facilities". In promoting and controlling cricket in Western Australia the W.A.C.A. has found itself a complex and sophisticated organisation, receiving and disbursing large sums of money, forever expanding the scope of its activities beyond cricket to other forms of entertainment, charging admission to its ground for cricket and other activities, providing bar and restaurant facilities for all who attend (not just members) and generally engaging in many activities that are of a trading Mature. By any test those activites are substantial. 29. I find that the W.A.C.A. is a trading corporation. Are the incorporated clubs trading corporations? The position of the incorporated clubs must now be considered. While some of their activities have a counterpart in the activities of the W.A.C.A., there are important differences. The membership of the clubs is mainly made up from those interested in playing cricket although some members are supporters only. The clubs donot charge entrance fees to their games; anyone may watch a club game without payment, though bar facilities are only available to members and their guests in accordance with the licensing provisions of Western Australia. There are differences in degree, though not in kind, in the activities conducted by different clubs. With the clubs, a comparison of activities is more difficult than in the case of the W.A.C.A. Where all activities are income producing, it may not be hard to single out some as trading activities and quantify their signficance, even if only in a broad way. But where some activities are income producing and others are not, the exercise is not so straight-forward. For instance, it is apparent that most of the time spent by members of the clubs. is on the playing of cricket, whether at training sessions or at matches. This is an activity which does not directly produce income at the club level though of course it has incidents such as sponsorships which are income producing. How then is the comparison to be made? The amount of revenue produced 36. from a particular activitv may not be a_ satisfactory quide. A trading activity may represent a siqnificant part of a club's income but be relatively insiaqnificant in an overall consideration of the club's activities. There is no ready answer to these difficulties; 1n the end, I must come back to what Mason J. said in Adamson at 233: "'Prading corporation' is not and never has been a term of art or one having a special legal meanina. eae Essentially it is a description or label given to a corporation when its trading activities form a sufficiently significant proportion of its overall activities as to merit its description asa trading corporation." The clubs' incomes are derived from a number of sources. They include subscriptions (there are different rates for players and non-players), a grant from the W.A.C.A., prize money from competitions in the Swan Gold League and Toyota Cup games for A grade players, donations, fund-raising, interest on investments, bar trading, sponsorship and advertisements. It will be necessary to look at sponsorships when considering whether there is a relevant market for the purpose of s.45 of the Trade Practices Act. At this point in the reasons for judgment their relevance lies in the income that they provide to clubs. At the time of the hearing the Swan Brewery Co. Ltd. sponsored each cricket club, though it did so through an arrangement made with the W.A.C.A. Individual clubs have their own sponsors. For instance, during the 1985-86 season Subiaco Floreat Cricket Club (Inc.) had as sponsors Town & Country W.A. Building Society, Kimberley N.Z.I. Finance Ltd., Fortron l. aw Automotive Treatments Pty. Ltd., Ledae Leasing Pty. Ltd., Ray Fitzgerald & Co., The York Motor Museum and Settlers House Pty. Ltd. In most, but by no means all, cases sponsors have their Place of business within the district of the particular cricket club. And in most cases sponsorships are obtained through some personal connection with a player or club supporter. Counsel for the applicant prepared graphs showing, in respect of the clubs for which fiqures were available, their gross incomes for 1985 and 1986 and the break up of those incomes. Because of the significance attached by the applicant to these figures, I shall set out in a summary way their import. Bayswater-Morley Cricket Club (Inc.) 1986 Gross income: $27,207.79 Players subscriptions: 11.77% Investment interest: »L5% Fund-raising: 7.06% Sponsorship and advertisements: 11.92% Bar trading: 63.94% Other: 5.16% Claremont-Cottesloe Cricket Club (Inc.) 1985 Gross revenue: $38,693 Subscriptions: 15.85% Non-playing members: 2.22% W.A.C.A. grant 7.75% Prize money: 2.61% Investment interest: 2.40% Fund-raising: 18.69% Sponsorship and advertisements: 8.96% Bar trading: 32.40% Other: 9.12% Fremantle District Cricket Club (Inc.) 1986 Gross income: $63,970.17 Subscriptions: 3.89% Non-playing membership: 3.56% W.A.C.A. financial grant: 6.22% Donations: 54% Fund-raising: 7.53% Sponsorships and advertising: 12.93% 32. Bar trading: Other: 56.48% 8.85% Midiland-Guildford Cricket Club (Inc.) 1985 Gross income: Subscriptions: Non-plaving membership: W.A.C.A, financial aqrant: Prize monev: Investment interest: Donations: Fund-raising: Bar trading: Other: Mt. Lawley District Cricket Club (Inc.) Gross revenue: Subscriptions: Non-playing membership: W.A.C.A. financial grant: Prize money: Investment interest: Donations: Fund-raising: Sponsorship and advertisements: Bar trading: Other: Mt. Lawley District Cricket Club (Inc.) Gross revenue: Subscriptions: Non-playing membership Prizes: Grants: Sponsorship and advertisements: Donations: Investment interest: Bar trading: Other: North Perth Cricket Club (Inc.) 1985 Gross revenue: Subscriptions: Non-playing members: Registration and ball fees: W.A.C.A. grant: Sponsorship and donations: Investment interest: Bar sales: Other trading sales: Other: $52,683.67 7.61% 1.14% 5.69% 9.32% -13% 7.42% 16.36% 46.64% 5.69% $50,202 11.23% 2.76% 6.51% 5.58% 1.82% 1.55% 6.58% 5.88% 52.66% 5.43% $56,383 9.36% 4.03% 2.48% 6.38% 19.55% 1.10% 2.38% 42.28% 12.44% $32,152.85 11.88% 1.21% 3.84% 9.33% 11. 76% 1.45% 19.34% 37.85% 3.34% 33. Perth Cricket Club (Inc.) 1985 Gross income: $30,871 Subscriptions: 28.1% W.A.C.A. financial grant and prize money: 13.8% Donations: 8.18% Fund-raising: 1% Bar trading: 49.82% South Perth Cricket Club (Inc.) 1985 Gross revenue: $22,428 Subscriptions: 14.36% Non-playing membership: 2.14% Prize money: 14.31% Investment income: ~95% Donations: 14.7% Fund-raising: 13.70% Bar trading: 33.35% Other: 6.49% Similar statistics were provided for some non-incorporated clubs but they cannot be treated as relevant for present purposes. It is apparent that bar trading represents a substantial source of revenue to the clubs, ranging from 19% to 63% approximately. In Adamson Mason J. referred to the income of West Perth from bar trading in 1976 and 1977 and its net profit on trading in those years. Counsel for the present applicant sought to adduce evidence relating to other aspects of West Perth's finances in 1976 and 1977, with a view to showing the relationship between bar trading and other sources of income and then making some comparison of the percentages involved with those relating to the cricket clubs. The object of this exercise was to show that, if West Perth was held to be a trading corporation by reference to its activities, the inference could properly be drawn that the cricket clubs were likewise trading corporations. Counsel for the 34. respondents objected to this course on the ground that it was an impermissible attempt to put before the Court evidence that did not emerge from the judgments themselves. I allowed the material relating to West Perth on the ground that it might afford some basis for comparison between the football club and the cricket clubs but not, as it were, to supplement the reasons for judgment. They must speak for themselves and any inferences to be drawn from them must be found within the four corners of the reasons. In any event, neither Mason J. nor the other members of the court in Adamson made percentage comparisons. It was enough for Mason J. that West Perth was "heavily engaged in trading activities" (at 236), It is clear from Adamson that the fact that a corporation's trading activities are related to its character as a club in the provision of social functions, amenities and services for its members does not prevent it from being a _ trading corporation. Nevertheless there are important differences between the situation in Adamson and that existing here. Underlying the decision in Adamson is the acceptance by the High Court that the playing of football by West Perth was a means of ensuring large financial returns, that its players were all paid and that the club's principal activity was its participation as a member of the W.A. League in the competitions which it ran. The cricket clubs are basically amateur bodies and their activities are essentially directed to the playing of cricket. They make no charge for admission to matches. Except in the case of someone who is a player coach, the general rule is that 35. payments are not made to players other than to those in A grade. Within A grade some clubs pay an incentive related to runs scored, wickets taken or the like. But the amounts involved are small indeed and in no way capable of providing a living for a player. The evidence revealed cases of particular players in particular clubs who were paid a fixed amnual fee. Usually they were player coaches who were paid because of the time they were required to spend in coaching activities. There were instances of players, sometimes brought from outside Australia, who were paid for services as ameans of improving the position of the club in competition. But even then the amounts involved were minimal by contemporary sporting standards and the player depended upon the provision of a job outside cricket to obtain a livelihood. Melville Cricket Club (Inc.) did not pay its players incentive payments. Midland-Guildford Cricket Club (Inc.) offered no incentive scheme. Its players in the successful Toyota Cup team in 1985 secured one-third of the prize money in the form of cash and free attendance at the club's annual dinner. Wanneroo District Cricket Club (Inc.) offered no incentive scheme; its only payment was to its coach. The respondents drew no distinction between particular incorporated clubs in terms of their character as a trading corporation. The applicant submitted that while all the incorporated clubs were trading corporations, it was open to the Court to find that some were and some were not. The principal activity of the clubs is the playing of cricket, a game which is played for pleasure rather than reward, though the playing of district cricket is undoubtedly the means by which players are 36. selected for shield matches and in turn for test matches, at which point reward becomes an important consideration. Although the clubs have activities which are of a trading nature, in particular the provision of bar facilities, I do not regard these as so significant as to impose on the clubs the character of a trading corporation. To point, as the applicant did to the revenue of particular clubs and the percentage of that income derived from bar sales is relevant but not overly persuasive. It does not sufficiently account for the time spent by the clubs in activities that are not income~producing viz. the playing of cricket which is their primary function. None of the clubs carries on the game of cricket as a trade. Though the extent of particular activities varies from club to club, there is no basis for drawing a distinction between them for the purpose of the present analysis. The applicant has failed to establish that any of the incorporated clubs is a trading corporation. Jurisdiction As already mentioned, the respondents challenged the jurisdiction of this Court to entertain any of the applicant's claims. The applicant submitted that the Court had jurisdiction, attracted by reason of the claim made under the Trade _ Practices Act whether or not that claim succeeded and whether or not the Court found that any of the respondents was a trading corporation. 37. Section 86 of the Trade Practices Act confers on the Federal Court jurisdiction to hear and determine actions, prosecutions and other proceedings under Part IV of the Act, being the part concerned with restrictive trade practices and into which s.45 falls. That jurisdiction 1s expressed to be exclusive of the jurisdiction of any other court other than the High Court under s.75 of the Constitution. The effect of s.86 1s to confer upon the Federal Court jurisdiction to hear and determine not only claims arising under Part IV of the Trade Practices Act but also other claims, federal or non-federal, arising out of the same matter or controversy. Philip Morris Inc. v. Adam P. Brown Male Fashions Pty. Ltd. (1981) 148 C.L.R. 457; Fencott v. Muller supra. This additional jurisdiction is part of the accrued jurisdiction of the Court; it does not derive from s.32 of the Federal Court Act whereby, to the extent that the Constitution pernits, jurisdiction is conferred on the Federal Court "in respect of matters not otherwise within its jurisdiction that are associated with matters in which the jurisdiction of the Court is invoked". The exercise of this accrued jurisdiction is discretionary. Stack v. Coast Securities (No. 9) Pty. Ltd. (1983) 57 A.L.J.R. 731. ' The jurisdiction of the Federal Court is attracted whenever there is before it a claim arising under a law of the Parliament in respect of which the Parliament has conferred jurisdiction on the Court. This is the effect of ss.75, 76 and 77 of the Constitution, read with sub-s.19(1) of the Federal Court of Australia Act 1976. When the Court has before it a claim arising under a law made by the Parliament in respect of which jurisdiction has been conferred upon the Court, the determination 38. of the claim or matter is itself sufficient to attract the federal Jurisdiction essential for the complete adjudication of the matter. Once jurisdiction 1s acquired, it is not lost by reason of the rejection of the claim or the matter attracting federal jurisdiction R. v. Carter; Ex parte Kisch (1934) 52 C.L.R. 221 at 224; R. v. Bevan; Ex parte Elias and Gordon (1942) 66 C.L.R. 452 at 466. Nevertheless the claim or matter attracting federal jurisdiction must be raised bona fide. But I do not accept the applicant's submission that it is enough, for this Court to exercise jurisdiction, that there be an arguable case that one of the respondents is a trading corporation. The existence of a trading corporation is essential. The point is made succinctly by Gibbs J. (as he then was) in Adamson at 215: The fact that a person whose conduct is said to be regulated by s. 45 of the Act is a trading corporation within s. 51 (xx.) of the Constitution is a condition of the jurisdiction of the Federal Court in a case such as the present. If that were not so, the investiture of jurisdiction on that Court would be pro tanto invalid. In the present case the question whether the prosecutors are trading corporations is therefore a jurisdictional, preliminary or collateral fact which this Court must decide for itself on an application for prohibition". As Gibbs J. pointed out, the Federal Court must decide for itself whether a corporation is a trading corporation for the purpose of determining whether it has jurisdiction in the application before it. Its decision however is not conclusive. In the present case I have found that the W.A.C.A., which is said to have acted in 39. contravention of s.45 of the Trade Practices Act, 18 a trading corporation. When I have dealt with the issues arising under s.45 of the Trade Practices Act I shall turn to the other causes of action upon which the applicant relies. It will then be necessary to consider whether those claims truly arise under the accrued jurisdiction of the Court and perhaps whether the notion of pendent party jurisdiction is relevant to the position of those respondents which are not trading corporations. For the moment, it is a sufficient basis for exercising jurisdiction in regard to the claims under the Trade Practices Act that one of the respondents alleged to have acted in contravention of the Act is a trading corporation. Section 45 of the Trade Practices Act Section 45 of the Trade Practices Act finds its place in Part IV ~- Restrictive Trade Practices. By way of introduction I refer to some remarks of Deane J. in Refrigerated Express Lines (A/asia) Pty. Ltd. v. Australian Meat and Live-stock Corporation (No. 2) (1980) 44 F.L.R. 455 at 460-461: "The general purpose and scope of the Part can be described by saying that it contains provisions which proscribe and regulate agreements and conduct and which are aimed at procuring and maintaining competition in trade and commerce. Broadly speaking, those provisions either control or proscribe the making of certain contracts or arrangements or the reaching of certain understandings, the giving or extracting of certain covenants in relation to land, the engaging in conduct involving a secondary boycott, engaging in the practices of monopolization, exclusive dealing or resale price maintenance, engaging in predatory price 40. discrimination, and the increasing of market share by means of a take-over or merger". Sub-section 45(2) contains several prohibitions. Paragraph (a) prohibits a contract, arrangement or understanding if: (i) the proposed contract, arrangement or understanding contains an exclusionary provision; or (11) a provision of the proposed contract, arrangement or understanding has the purpose, or would have or be likely to have the effect, of substantially lessening competition. Paragraph (b) prohibits the giving effect toa provision of a contract, arrangement or understanding if that provision: (i) ais an exclusionary provision; or (ii) has the purpose, or has or is likely to have the effect, of substantially lessening competition. The statement of claim pleads conduct on the part of the respondents both in terms of making a contract or arrangement or arriving at an understanding falling within para.45(2)(a) and giving effect to a provision of a contract, arrangement or understanding falling within para.45(2)(b). The conduct of the respondents at the meeting of the Cricket Council on 25 September 1985 is said to have constituted a contract, arrangement or understanding which contained an exclusionary provision and which 41. also had as its purpose, or had or was likely to have the effect of substantially lessening competition. This 1s a reliance upon sub-paras.(i) and (ii) of para.45(2)(a). The conduct of the respondents at the meeting of the Cricket Council on 4 November 1985 1s likewise pleaded as having been in contravention of sub-paras.(1) and (ii) of para.45(2)(a). There 1s a further pleading that since December 1985 the respondents have given effect to the contracts, arrangements or understandings reached at the meetings on 25 September and 4 November, in particular by their conduct at the Cricket Council meetings on 6 January, 3 February and 19 February 1986. In so doing, it is said, the respondents acted in contravention of sub-paras.(i) and (ii) of para.45(2)(b). Sub-section 45(2) contains a number of concepts, some of which are defined in the Act. "Exclusionary provision" is defined in s.4D as a provision of a contract, arrangement or understanding between competitors which has the purpose of restricting either the supply of goods or services by all or any of those competitors to particular persons or the acquisition of goods or services by all or any of those competitors from particular persons. "Competition" itself is defined in sub-s.45(3) to mean competition in any market in which a corporation that is a party to the contract, arrangement or understanding supplies or acquires, or is likely to supply or acquire, goods or services or would, but for the provision, supply or acquire, or be likely to supply or acquire, goods or services. 42. "Market" 1s defined in s.4E, when used in relation to goods or services, to i1mclude a market for those goods or services and other qoods or services that are substitutable for, or otherwise competitive with, those goods or services, The application of s.45 to a given set of facts can he and often is a difficult exercise. But the starting point must be a consideration of whether there was any contract, arrangement or understanding within the terms of the section. The terms "contract", "arrangement" and "understanding" are not defined in the Trade Practices Act. Contract has been taken to have its ordinary meaning of something that is enforceable at law. A number of decisions have tended to treat arrangement and understanding as synonymous, being something less than a binding contract or agreement. See Trade Practices Commission v. Tubemakers of Australia Ltd. (1983) 47 A.L.R. 719 at 734-735 where the cases are noted. It has been generally accepted that, for there to be an arrangement or understanding, there must be some communication between the parties concerned and each must raise an expectation in the mind of the others. Whether each must accept an obligation qua the others is debatable. In Morphett Arms Hotel Pty. Ltd. v. Trade Practices Commission (1980) 30 A.L.R. 88 at 91 Bowen C.J. commented: "As at present advised, it seems to me that one could have an understanding between two or more persons restricted to the conduct which one of them will pursue insofar as the other party or parties to the understanding are concerned". 43. See also Trade Practices Commission v. T.N.T. Management Pty. Ltd. (1985) 58 A.L.R. 423 at 446-449 ("the T.N.T. case"). Recently, in Trade Practices Commission v. David Jones (Australia) Pty. Ltd. £1986] A.T.P.R. 40-671, Fisher J. said at 47,416 in relation to sub-para.45(2)(a)(i1): --.- IT am of opinion that a person may be a party to the understanding provided he is aware of although not necessarily committed to each provision". I respectfully adopt that approach. Was there a contract? Thus the first question to be answered in relation to s.45 is - was there a contract, arrangement or understanding between the respondents or any of them at the meeting on 25 September 1985 or at the meeting on 4 November 1985? Reference has already been made to the constitution and ruies of the W.A.C.A. and also of the Cricket Council. The primary object of the W.A.C.A. is the promotion and control of the game of cricket in Western Australia (r.3(a)). The objects of the Cricket Council include the control and management of Associated Club matches, the selection of teams to represent the W.A.C.A. in international, Sheffield Shield and other representative matches, and the regulation and administration of the registration, qualification and eligibility of players to play in matches between the Associated Ciubs (r.37(f)). The Cricket Council is empowered by r.36 to make by-laws and regulations for the control 44, and management of matches within 1ts lurisdiction. The second and third respondents in the present proceeding (fifteen clubs in all) comprise the Associated Clubs. Their deleqates, together with the Chairman of the Council, two delegates appointed by the executive of the W.A.C.A. and such other delegates as the Council may admit, constitute the Cricket Council (r.35). While the rules of every club were not tendered in evidence, a number were. Allowing for differences in terminology, each of those tendered referred to the affiliation of the club with the W.A.C.A. It is a reasonable inference that all the respondent clubs, incorporated and unincorporated, have a similar provision. Certainly there was no suggestion to the contrary. A resolution of the Cricket Council made pursuant to its rules is binding upon the Associated Clubs. That much is clear from the overall structure of the rules of the Cricket Council and the place of clubs within that structure. In principle too I think a resolution is binding upon the W.A.C.A., though it is hard to know what action could be taken against that body to enforce the resolution. There was some debate by counsel as to whether the W.A.C.A. and the clubs, as opposed to their delegates, were the members of the Council. I am of opinion that, by appointing delegates, there was no "denudation of power and authority", to borrow the words of Lord Coleridge C.J. in Huth v. Clarke (1890) 25 Q.B.D. 391 at 394. A delegate, as generally understood, "means little more than an agent" (Wills J. in Huth v. Clarke at 395). To the extent that conduct at a meeting of the Cricket Council does give rise to a contract, arrangement or understanding between those present, it 18 a contract, arrangement or understanding by 45. which the W.A.C.A. and the Associated Clubs would ordinarily be bound or be parties to. As to the fourth respondent - Mr. Taylforth in his representative capacity - I do not see the Cricket Council itself being a party to a contract, arrangement or understanding, independently of the W.A.C.A. and the Associated Clubs who comprise it. Does it follow that a resolution of the Cricket Council constitutes a contract between the constituent members? This must be a question of intention. Whether the rules of an organization form part of a contract between its members depends upon the existence of an intention that the rules "should give rise to enforceable legal relations". Buckley v. Tutty (1971) 125 C.L.R. 353 at 374. In the present case I think one needs to be careful in applying too readily judicial decisions and statements relating to an individual member of a particular industrial union or club. Whether the rules of a particular club constitute a contract between its members is not necessarily the same question as whether the rules of the Cricket Council give rise to a contract between its constituent members. The position is somewhat complicated because r.24(2)(c) of the W.A.C.A.'s rules provides that a person who is a financial playing member of one of the Associated Clubs may be elected as an ordinary member of the W.A.C.A. Nevertheless the question here arises, not vis-a-vis a player and his club or a player and the W.A.C.A., but as to the W.A.C.A. and the clubs vis-a-vis each other. When a club becomes an Associated Club, it undoubtedly assumes obligations which are intended to have contractual effect. It undertakes to provide and maintain to the satisfaction of the Council various facilities (Cricket Council r.2:16:3) and there are fines and penalties provided for a breach of those obligations (re.2:24, 2:31). And a club that allows a disqualified player to play 1n amatch, after notice of disqualification, commits an offence. If the offence 15 proved upon complaint to the Council (a complaint may be lodged by the Grades Committee of the opposing club), the club 1s liable to a fine and is deemed to have lost the match to the opposing club (¥.2:39:5). Of course a club obtains benefits in return. In my view the rules of the Cricket Council are capable of giving rise to legally enforceable rights and obligations between the Council and the Associated Clubs. But what of the W.A.C.A.? The rules are silent as to its rights and obligations except perhaps f¢r.2:38:l1 which, as already noted, speaks of a match "recognised by the Australian Cricket Board or the Association". The W.A.C.A. stands in a peculiar position within the framework of the Cricket Council Rules. It is conceivable that in a particular situation the W.A.C.A. may be a party to a contract made by reason of something done at a meeting of the Council. But I do not think that an amendment to rules of itself involves a contract to which the W.A.C.A. is a party. In any event I am of the opinion that the resolutions at the meeting of the Cricket Council on 25 September 1985 did not constitute a contract between those taking part. One resolution was that "the Cricket Council has come to an understanding that the rule Er.2:38:11 regarding unrecognised matches cannot be 47. invoked until the players take part in such matches". This was no more than an expression of understanding as to what the rule meant. It was then resolved that the following statement would be 1ssued on behalf of the Cricket Council: "The Cricket Council, at this time, does not intend taking any action against proposed South African tour players. The Rules as they stand would prevent them from playing upon their return; however, there has been notice given of a proposed notice of motion to review the applicable Rules prior to that time". The further resolution was, I think, no more than a consequence of the earlier resolution anda statement of present intention and advertance as to the future. Neither gave rise to enforceable legal relations. But it seems to me that the resolution of 4 November 1985, amending r.2:38:1 by including a provision for automatic disqualification, did constitute a contract between the Associated Clubs. It was certainly intended to affect not only the members of the clubs but the clubs themselves. By reason of r.2:39:5, a club permitting a disqualified player to play risked the serious sanctions contained in that rule. Iam satisfied that, in the language of Buckley v. Tutty, it was intended that the amendment "should give rise to enforceable legal relations" between the clubs. Mr. Archer submitted that in reality the decisions made at the meeting on 4 November did no more than "give teeth" to r.2:38:1. But the words added to r.2:38:1 went much further than that. They imposed on an offending player automatic 48. disqualification until reinstated by the Council, a provision that hitherto did not exist. However, 1£ the W.A.C.A. was not a party to the contract, there cannot have been a contract in contravention of sub-s.45(2). I deal later with the relationship between ss.82 and 75B of the Act. For the present it is enough to say that a contract made between parties who are not corporations within the meaning of the Act cannot be a contract to which sub-s.45(2) applies. It follows that, notwithstanding the existence of a contract between the Associated Clubs, no corporation made a contract in contravention of sub-s.45(2). This part of the applicant's claim must fail. Was there an arrangement or understanding? In my opinion the resolutions at the meeting on 25 September did not constitute a relevant arrangement or understanding between the members of the Cricket Council. They may have constituted an understanding as to what r.2:38:1 meant and when it could he applied. But, that was not an understanding within sub-s.45(2) of the Trade Practices Act. It was merely an understanding as to what was the situation under a particular rule of the Council. In the applicant's submission, those present at the meeting on 25 September misunderstood r.2:38:1. Perhaps they did. But any misunderstanding carried no consequences; it merely 49. evidenced a state of mind that might become relevant at some later date. I am satisfied that there was an understanding at the meeting on 4 November 1985, an understanding that, by reason of the decision to amend r.2:38:1, the applicant (as well as other players) would be prevented from playing district cricket in Western Australia because of his participation in the South African tour. There was undoubtedly communication between the delegates to the Cricket Council at the meeting and a consideration by them of events giving rise to what was seen as justification for the amendments to r.2:38:1. At the meeting on 25 September Mr. Rigg (chairman of the executive of the W.A.C.A., chairman of the I. and I. Committee and a delegate from the W.A.C.A. to the Australian Cricket Board) had in the words of the minutes of that meeting - "presented a resume of events regarding discussions concerning the rebel cricketers to tour South Africa. He pointed out that of the other States South Australia and New South Wales had banned their rebel players from participating in club cricket". There was an expectation in the minds of all present that the W.A.C.A. and the Associated Clubs would abide by the decisions reached. True it is that the W.A.C.A. is unable to enforce a Cricket Council rule; it is the Council itself that takes that course. Nevertheless there was an assumption of obligation on the part of the clubs anda recognition by all delegates that the amendments, with which they would abide while they remained part of the rules, had important consequences for 50. the playing of cricket in Western Australia. That, in my view, was sufficient to constitute an understanding between all those present. In short then, I am of the opinion that there was an understanding reached by those present at the meeting on 4 November 1985 on behalf of the organizations they represented. The next question must be ~- did that understanding contain an exclusionary provision or did a provision of the understanding have the purpose, or have or be likely to have the effect, of substantially lessening competition within sub-s.45(2) of the Trade Practices Act? Exclusionary provision Section 4D defines what is an exclusionary provision. In the context of sub-s.45(2), an exclusionary provision has been described as a collective boycott. Of s.4D, Franki J. said in the T.N.T. case at 498-501: "Section 4D(1) may be divided into the following elements each of which must be established:- (1) There must be a provision of an arrangement or understanding made between persons, any two or more of whom are competitive with each other ... (2) The provision must be for the purpose of preventing, restricting or limiting one of the acts referred to in s.4D(1)(bD) ... (3) The requirement of s.4D(1)(b)(i) and (ii) that 'the purpose of' relates to the supply of services to or the acquisition of services from particular persons in particular circumstances or in particular conditions must be satisfied". For the conditions of s.4D to be met, there must be two or more parties to a contract, arrangement or understanding, at pent ee ee 51. least one of which 1s a corporation as defined in the Act and at least two of which are competitive with each other. Those persons must be in competition with each other in relation to the supply er acquisition of goods or services to which the relevant provision of the contract. arrangement or understanding relates. While it is necessary that there be only one corporation, a party to a contract, arrangement or understanding who is not a corporation is not liable under s.45 except through s.82 read with s.75B. The latter section provides that a person involved in a contravention of Part IV in terms of s.82 means a person who has aided, abetted, counselled or procured the contravention; has induced, whether by threats or promises or otherwise, the contravention; has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention; or has conspired with others to effect the contravention. The exclusionary provision need not restrict all of the parties to the understanding; sub-s.4D(1) speaks of "all or any of the parties". In the applicant's submission, all of the district clubs, incorporated and unincorporated, are competitive with each other, both for the services of cricketers and for other services including patronage and commercial sponsorship. The applicant concedes that the W.A.C.A. is not a competitor of the clubs in this respect. But, it is said, if the W.A.C.A. is a trading corporation and if one or more of the provisions of a contract, arrangement or understanding are exclusionary, then the W.A.C.A., as a party to that understanding, is in contravention of 52. sub-paras.(a)(1) and (b)(1) of sSub-s.45(2). Any club that is a party, but 15 not a trading corporation, is liable by reason of s.75B. I accept the general tenor of these submissions. I have found the W.A.C.A. to be a trading corporation. If ait made a contract or arrangement or arrived at an understanding in contravention of sub-s.45(2), 1ts liability derives from s.82. Any liability on the part of the other respondents must derive from 5.82, read with s.75B. Section 75B 1s not a source of liability; its function is to define the words "person involved in the contravention" used in sub-s.82(1). See Nella v. Kingia Pty. Ltd. £19863 A.T.P.R. 40-723 at 47,920-47,921. The applicant concedes that the W.A.C.A. is not competitive with the clubs in any relevant respect. But if the clubs are competitive with each other and are parties to a contract, arrangement or understanding that is in contravention of sub-s.45(2), the W.A.C.A. and the clubs (incorporated and unincorporated) may all be liable to the applicant. However there are a number of steps the applicant must take before he achieves that end. The clubs are in my view competitive with each other for the services of cricketers. For reasons that I shall explain later, I am not persuaded that they are competitive for patronage and commercial sponsorship. Certainly the competition for the services of players is low key and is conducted to a large extent in a manner consistent with the notion of club cricket as an amateur activity. A player is usually sounded out as to his interest in joining another club before any formal approach is e 53. made. The incentive offered 1s not always financial; it may be the prospect of playing for a club that has qood morale and is enjoying some success in district cricket. But naturally winning 1s seen as important and if a team's chances will be enhanced by the addition of a player from another club, overtures are undoubtedly made. I give some examples. The minutes of the committee meeting of Nedlands Cricket Club held on 25 June 1985 list several players as possible transferees from other clubs. Mr. Davis, who was the president of North Perth Cricket Club (Inc.) in 1985 agreed that his club recruited players from other clubs. The approach was usually made by the president or secretary or someone knowing the player and a "key player" might be offered remuneration. Mr. Vodanovic, the president of Perth Cricket Club (Inc.), spoke of the club's recruitment committee which sought to attract mature players from other clubs. Mr. Robinson, the delegate of Bayswater-Morley Cricket Club (Inc.) to the Cricket Council, agreed that his club approached players from time to time to join the club. The financial incentives available to players were made known to then. Mr. Robinson instanced an approach made during the 1981-1982 season to Mr. Baker who was then playing for Melville Cricket Club {Inc.). Mr. Baker was offered $2,000 plus incentives to join Bayswater-Morley Cricket Club (Inc.). Mr. Annison, who was president of Southern District Cricket Club in 1985, agreed that his club received from Fremantle District Cricket Club (Inc.) $2,000 as a transfer fee for Mr. Porter. Mr. Newby, the president of Melville Cricket Club (Inc.), spoke of an offer of $2,500 to Mr. Maguire to leave his club and join Melville Cricket Pi pee ot PRCT wee 8 gry ge wand, Py my ah fe 54. Club (Inc.) as captain/coach of the A grade team. These examples can be multiplied. Financial and other constraints preclude an aqdressive programme of luring players from one club to another but I am satisfied, for the reasons given, that the clubs are competitive with each other for the services of players. For s.4D to operate in the present case, the exclusionary provision must have the purpose of preventing, restricting or limiting the supply or acquisition of goods or services by all or any of the parties to the contract, arrangement or understanding. Pursuant to s.4F, a provision of an understanding has a particular purpose if the provision was included in the understanding "for that purpose or for purposes that included or include that purpose" and "that purpose was or is a substantial purpose". It is apparent, from the use of the word "substantial", that the purpose in question need not be the only nor the dominant purpose. Various views have been expressed as to the meaning of "substantial" - see Festival Industries Pty. Ltd. v. Mikasa (N.S.W.) Pty. Ltd. £€1972-19733 A.L.R. 921 at 929; Peter Williamson Pty. Ltd. v. Capitol Motors Ltd. (1982) 41 A.L.R. 613 at 620-621. The term imports a notion of relativity and suggests something that is more than trivial or minimal. Tillmanns Butcheries Pty. Ltd. v. Australasian Meat Industry Employees' Union (1949) 42 F.L.R. 331 at 338-339, 348 ("Tillmanns case"). It is the immediate rather than the ultimate purpose that is to he considered Barneys Blu-Crete Pty. Ltd. v. The Australian Workers' Union £19793 A.T.P.R. 40-139 at 18,509; Tillmanns case at 338. 55. There has been a difference of judicial opinion as' to whether "purpose" 1s to be ascertained subjectively or objectively. In Tilimanns case at 348, Deane J. spoke of purpose in s.45D(1) as "the operative subjective purpose of those engaging in the relevant conduct in concert". In the T.N.T. case at 500 Franki J. said, in relation to para.4D(1)(b), that "the word 'purpose' is used objectively ...". In regard to s.47 of the Trade Practices Act, Fox J. in O'Brien Glass Industries Ltd. v. Cool and Sons Pty. Ltd. £19831 A.T.P.R. 40-376 at 44,455 took the view that a subjective test was appropriate. He acknowledged that if there was no evidence of an express purpose, purpose had to be implied by considering what was done and intended and what would be the natural consequences of that conduct. In Dandy Power Equipment Pty. Ltd. v. Mercury Marine Pty. Ltd. £19823 A.T.P.R. 40-315 Smithers J. contrasted s.47 of the Act with s.45D and, noting what Deane J. had said in Tillmanns case, was of the view that the former was "dealing with the nature of conduct rather than the minds of actors" (at 43,899). I accept the view that it is the subjective purpose of those engaging in the relevant conduct with which the Court is concerned. All other considerations aside, the use in sub-s.45(2) of "purpose" and "effect" tends to suggest that a subjective approach is intended by the former expression. The application of a subjective test does not exclude a consideration of the circumstances surrounding the reaching of the understanding. In resisting the argument that any understanding reached at the meeting on 4 November 1985 contained an exclusionary 56. provision, the respondents contended that r.2:38:1 protected the interests of the W.A.C.A. and the Cricket Council in ensuring the proper control and regulation of district cricket in Western Australia, in ensuring the fairness of district competition, in protecting resources spent in organising district cricket competition and in providing for all district cricket players clear and certain rules of the competition in which they engage. That submission is sound as far as it goes but it does not present the complete picture. The respondents argued that they were not competitive within s.4D for they were not in competition with each other for the services of the applicant. The submission was elaborated by the proposition that r.2:38:1 operates only when a player has breached the rule. And, so the argument ran, there was simply no evidence of competition between any of the respondents for the services of a player who breached the rule. But it is a provision of the contract, arrangement or understanding with which sub-s.45(2) is concerned. The question is whether a provision is exclusionary and was reached between persons who were relevantly competitive. In my view it is not to the point to ask whether the respondents were competitive for the services of a cricketer who is in breach of Fr.2:38:1. The question is whether they were competitive for the services of a cricketer affected by the operation of the rule and whether they entered into a contract or arrived at an understanding (more accurately, a provision of the understanding) for the purpose of preventing, restricting or limiting the supply of services from the applicant. 57. In the applicant's submission, while the protection of the interests of the W.A.C.A. and the Cricket Council may have been the ultimate purpose of r.2:38:1, there was ample evidence that the rule was amended on 4 November 1985 for the purpose of preventing the supply of services by cricketers to their clubs or the acquisition of services by their clubs, in the case of those players who played in unrecagnised matches in South Africa. This, it was said, affected not only the applicant but also members of other clubs who had made agreements with S.A.C.U. - Messrs. Alderman, Shipperd and Hogan. Counsel for the applicant referred to the affidavits sworn by Mr. Taylforth on 27 February and 12 June 1986. In those affidavits Mr. Taylforth deposed that, if the applicant were permitted to play club cricket, it was conceivable other states would retaliate in a political way by influencing the Australian Cricket Board, through their delegates, to withdraw support from the W.A.C.A. They might, for instance, influence the Cricket Board to withhold funding for the America's Cup Festival of Sport week in January 1987. He contended that the other mainland states have restrained the South African tourists from playing at club level and that they would take "a dim view" of Western Australia permitting the tourists to participate in club competition in order to protect and advance their own interests. He referred to those people "who strongly oppose personal benefit being derived by individuals from providing services to a country which practises a racial policy condemned by most of the civilised western world". 56. Referring to the meeting on 25 September 1985, Mr. Tavlforth deposed that 1t was a special meeting convened to consider the position of the South African tourists in relation to district cricket. It was agreed among the deleaates that the matches to be played by the South African tourists in South Africa would be "unrecoqnised matches" for the purposes of r.2:38:1. None of the delegates wanted to qo so far as to say that the players would be banned as from the date of the meeting; but all agreed that, once the tourists had played in South Africa, they would be disqualified from playing district cricket. Mr. Taylforth also deposed that the discussion on 25 September was only in the context of the interpretation and application of the rules of the Cricket Council and was not directed to any notion of causing harm to the tourists, in particular to the applicant. Nevertheless, the applicant submitted, the immediate purpose of the understanding reached at that meeting was to prevent the acquisition of the services of the four players concerned. I have already found that at the meeting on 25 September 1985 there was no contract and there was no relevant arrangement or understanding. The meeting on 4 November 1985 calls for further consideration in the light of my finding that there was an understanding between the clubs and the W.A.C.A. through their delegates, reflected in the amendments to r.2:38:1. The minutes of that meeting provide evidence that the purpose of amending the rule was to exclude any player who played in an unrecognised match from district cricket competition. In its terms the amendment was not confined to those who played in South Africa. Nevertheless, there is no doubt that a substantial purpose of the amendment was 59. to disqualify the applicant. among others, from playing club cricket 1f he plaved in South Africa. Sub-paragraph 4D(1)(b)(1) was amended by the Trade Practices Revision Act, which was assented to on 13 May 1986 and took effect as from 1 June. But, in 1ts unamended form which is the form relevant to this proceeding, the sub-paragraph refers to the purpose of preventing, restricting or limiting the supply of services to or the acquisition of services from "particular persons", not particular "classes of persons". The identity of the persons excluded must be known or capable of ascertainment. The provision is not directed to the exclusion of the entirety of the available body of persons who could conceivably be called upon to perform the relevant services. The question is one of fact. Bullock v. The Federated Furnishing Trades Society Australasia £19853 A.T.P.R. 40-577. In the T.N.T. case Franki J. held at 500 that the class of persons in question was not sufficiently particular. Certainly the amended rule does not refer to individual cricketers and is of general application. Nevertheless, all the circumstances establish the existence of four cricketers from Western Australia (Messrs. Hughes, Alderman, Shipperd and Hogan) who were and who were known by the respondents to be directly affected by the amendment to r.2:38:1. The background of the "rebel cricketers" had been explained by Mr. Rigg at the meeting on 25 September 1985 and that was the background against which the amendment was passed. In my view the existence or otherwise of "particular persons" is to be determined as a matter of substance mm — oe TENTS, * te vr ae ane TE ayn 7 oF eee Bice oO Pan] and not of form. There can be no doubt that the amendment was aimed at the applicant as well as others. Paragraph 4D(1)(b) vefers inter alia to "services". This term 1s defined by sub-s.4(1) to include ».- any rights ..., benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce. and..., includes the rights, benefits, privileges or facilities that are, or are to be, provided, aranted or conferred under - (a) a contract for or in relation to - (i) the performance of work (including work of a professional nature) whether with or without the supply of goods; (1i) the provision of, or the use or enjoyment of facilities for, amusement, entertainment, recreation or instruction; ... but does not include rights or benefits being the supply of goods or the performance of work under a contract of service". The applicant was not, at the relevant times, employed under a contract of service. A sportsman may be engaged under a contract of service - see for instance Commissioner of Taxation of the Commonwealth Vv. Maddalena (1971) 45 A.L.J.R. 426. Professional footballers may be engaged under a contract of service as was held in Maddalena and as appears to have been assumed by Northrop J. in Adamson. The applicant is in rather a different position. The arrangement he has with Subiaco Floreat Cricket Club (Inc.) 1S set out ina letter from the club to him dated 1 June 1985 which reads: 6l,. "We confirm your financial playing arrangements with our Club for 1985/86 and 1986/87 A Grade Pennant matches are as follows: Per Match Played (1) One dollar for everv run scored. (2) Fifty dollars additional for a win. Monies due to you will be paid at the end of each season". The arrangement places no obligation on the applicant to play in any particular match. There are no provisions from which the right of control, which has been significant in such contract of service cases as Zuijs v. Wirth Bros. Pty. Ltd. (1955) 93 C.L.R. 561; Humberstone v. Northern Timber Mills (1949) 79 C.L.R. 389; Queensland Stations Pty. Ltd. v. Federal Commissioner of Taxation (1945) 70 C.L.R. 539 may be inferred. The applicant's services to the club to which he belongs fall within sub-para.(a)(1i) of the definition of "services" in sub-s.4(1). The applicant derives income from the playing of sport and from activities connected with his playing, in particular the income he derives from Town & Country W.A. Building Society through public appearances and the like, from the commercial endorsement of products and from media activities. In this respect, the services he provides are services in trade or commerce. The applicant is employed by Perth Rentors Pty. Ltd. of which he is a director. That company has entered into an agreement with Town & Country W.A. Building Society to provide the applicant's services to the society as a marketing consultant. At the time of the hearing the applicant was on leave without pay from the society. Perth Rentors Pty. Ltd. has also entered into 62. contracts of sponsorship bv virtue of which the applicant 15s obliged to promote sporting goods, in consideration of which the company receives an annual payment. At the time of giving evidence the applicant said that he was aware of only one existing sponsorship arrangement, that made with the Gray Nicholls Group for the promotion of cricketing equipment. I accept the evidence of the applicant that his income is directly or indirectly related to his cricketing activities. I also accept his evidence that he regards district cricket as the basis for pursuing his career as a cricketer, notwithstanding that over the last few years he has not participated in district cricket to any great degree. It provides him with the opportunity to maintain his skills as a cricketer, to earn some money from incentive payments and more broadly to keep his name before the public through media reports of his performances. Once it is found that there is a contract, arrangement or understanding, any provision having the purpose of preventing, restricting or limiting the acquisition of the services of particular sports persons by any club will be an exclusionary provision. I am not aware of any decision that goes so far as to apply the exclusionary provision to a person in the position of the applicant. That may be simply a reflection of the embryonic state of this part of the law. But if on the proper construction of the relevant sections of the Trade Practices Act and a correct application of the sections to the facts of the case there appears to have been a contravention of sub-para.45(2)(a), novelty is no 63. sufficient reason for refusing to hold that there has been a contravention. I am of the opinion that the decision to amend £.2:38:1 reached at the meetinqag on 4 November 1985 constituted an understanding between the clubs and the W.A.C.A., which understanding contained an exclusionary provision within sub-s.45(2) of the Trade Practices Act. All were parties to the contravention so far as the understanding was concerned; hence s.82, in the case of the W.A.C.A., and s.82 read with s.75B in the case of the clubs, render all liable. See Yorke v. Lucas (1985) 61 A.L.R. 307. Substantially lessening competition The other limb of s.45 upon which the applicant relies is the "substantially lessening competition" provision to be found in sub-paras.(a)(ii) and (b)(1i) of sub-s.45(2). Again, certain of the concepts involved are defined in the Act. "Competition" is defined in sub-s.45(3) to mean: ».. competition in any market in which a_ corporation that is a party to the contract, arrangement or understanding ... or any body corporate related to such a corporation, supplies or acquires, or is likely to supply or acquire, goods or services or would, but for the provision, supply or acquire, or be likely to supply or acquire, goods or services". "Market" itself is not truly defined, though s.4E identifies market as a market in Australia and provides that, when 64, used in relation to any qoods or services, the term "includes a market for those goods or services and other goods or services that are substitutable for, or otherwise competitive with, the first mentioned aqoods or services". Sub-section 45(4) provides that, for the purposes of the application of s.45 in relation to a particular corporation, a provision of a contract, arrangement or understanding is deemed to have or be likely to have the effect of substantially lessening competition if that provision and the other provisions of the contract, arrangement or understanding together have or are likely to have that effect. There is a provision in the interpretation section of the Act, sub-s.4(1), that "competition" includes "competition from imported goods or from services rendered by persons not resident or not carrying on business in Australia". That provision has no relevance to the present proceeding. It is as well to keep in mind some remarks by Northrop Jd. in Adamson v. West Perth Football Club Incorporated (1979) 27 A.L.R. 475 at 503: "The word 'competition' when used in a commercial or economic sense is not to be confused with the word 'competition' when used ina sporting sense when the word has a different meaning. Sporting teams compete with each other to win a sporting event. Football teams engage in matches. They compete against each other to win a premiership ... care must be taken to ensure that the use of the word 'competition' does not cause confusion". 65. At the heart of this limb of s.45 1s the notion of market. In Trade Practices Commission v. Ansett Transport Industries (Operations) Pty. Ltd. (1978) 32 F.L.R. 305 at 311 Northrop J. referred with apparent approval to what had been said by the Trade Practices Tribunal in Re Queensland Co-operative Milling Association Ltd. (1976) 25 F.L.R. 169 at 190: "We take the concept of a market to be basically a very simple idea. A market is the area of close competition between firms or, putting 1t a little differently, the field of rivalry between them. ... Within the bounds of a market there is substitution - substitution between one product and another, and between one source of supply and another, in response to changing prices. Soa market is the field of actual and potential transactions between buyers and sellers amongst whom there can be strong substitution, at least in the long run, if given a sufficient price incentive". See also Trade Practices Commission v. Nicholas Enterprises Pty. Ltd. £19793 A.T.P.R. 40-126 at 18,355-8 and the T.N.T. case at 507-511. In the present case the applicant pleads relevant markets for the purpose of s.45 in these terms: (i) the market for club membership and subscriptions from playing and non-playing members (ii) the market for patronage of club facilities and services for which charges are made (iii) the market for sponsorship of club activities by commercial organizations including prize-money 0) Ta reese 7 wt ? <0 eat "ET we tee TA ee t Pte wtae f- ' and the market comprised by these three markets taken together as a single market (iv) the market throughout Western Australia in which cricketers sell their skills or services and clubs buy the skills or services of the cricketers. In the applicant's submission, the first three markets have not been specifically broached before. However, they were pleaded as part of the "spectator" market in Walsh v. Victorian Football League £1983] A.T.P.R. 40-422 ("Walsh v. V.F.L."). In Adamson the applicant pleaded three markets - the "spectator market", being the market in and around Adelaide in which clubs competed for spectators to attend football matches; the "club-to-club market", being the market throughout Australia in which clubs bought and sold the right to the transfer of football players from one club to another; and the "club to footballer market", being the market throughout Australia in which clubs competed with each other to attract professional footballers to provide their services to the club. At the hearing before Northrop J., following the proceedings in the High Court, his Honour rejected the first two as relevant markets for the purpose of 5.45. He rejected the club-to-club market on the basis that such a market depended for its existence on the clearance and permit regulations of the various clubs and leagues and, if those regulations did not exist, there would be no club-to-club market within the framework of the 67. remaining rules and regulations (27 A.L.R. at 504). The applicant had no quarrel with this approach. Northrop J. rejected the spectator market on similar grounds, reasoning that 1n so far as the clubs were in competition with each other, they were in competition at the direction of the S.A. League which staged matches between clubs, determined which clubs should be admitted to the League and the admission prices to be charged. The Leaque also determined the order in which matches were to be played, ina way conducive to attracting as many spectators to matches as possible. Northrop J. said "The sporting entertainment is provided by the league, the clubs being used as pawns directed by the league" (27 A.L.R. at 503). Counsel for the applicant submitted that Northrop J. was wrong in this approach, contending that a spectator market is a relevant market for the purpose of s.45. In his submission, the fact of a regulated activity does not prevent room for competition in all situations. The S.A. League did not choose the players engaged by the clubs, even though those players were registered with the League. Clubs might compete to attract footballers in an attempt to improve the quality of their teams and this had a tendency to attract more spectators to the matches in which those teams played, thereby increasing the financial returns to the clubs through gate receipts and ancillary activities. In that sense, no individual club had control over spectator attendance by its choice of players. A spectator market was also pleaded in Walsh v. V.F.L., relating not only to the selling of club memberships and seats at <e v ser TT RT TP VEN ET rere ri STE TOME 68. games, but also to the receipt of commercial sponsorship, the sale of television and broadcasting rights and the qranting of concessions to refreshment sellers and others. As the hearing was of an interlocutory nature, Woodward J. did not find 1t necessary to express a concluded view on this matter. In Adamson v. West Perth Football Club Incorporated Northrop J. accepted the club-to-footbalier market for the purpose of s.45, It was a market in which footballers sold their skills or services and football clubs bought them. The view taken by Northrop J. was that the W.A. League and West Perth, by complying with the permit and clearance provisions, were parties to a contract, arrangement or understanding whereby a footballer was not free to play for the club of his choice. It followed that the provisions substantially lessened competition. The reason why Northrop J. rejected Adamson's claim was because of a finding that he was employed under a contract of service. Returning to the present case, the applicant argued that the fourth market is relevant since the applicant was not employed under a contract of service. At the same time, the services he provided fell within the definition in sub-s.4(1). In the applicant's submission, it is not necessary for all of the parties to a contract, arrangement or understanding to be in competition with each other for the purpose of sub-s.45(3). It is necessary only that two of the parties be in competition, in 69. which event all who are trading corporations will be primarily laable for a contravention of the second limb of s.45 and those who are not may be liable through s.75B. The basis for this submission 1s the language of sub-s.45(3) itself and the construction placed on the provision in Trade Practices Commission v. David Jones (Australia) Pty. Limited at 40-671. As indicated earlier, I accept that submission. The Trade Practices Act does not define what 1s meant by "substantial lessening of competition". The term is one of relativity. Dandy Power Equipment Pty. Ltd. v. Mercury Marine Pty. Ltd. at 43,887-43,888; Radio 2UE Sydney Pty. Ltd. v. Stereo FM Pty. Ltd. £19823 A.T.P.R. 40-318 at 43,918. In the present case, the applicant conceded that there was little evidence that any contract, arrangement or understanding within the second limb of sub-s.45(2) was made expressly for the purpose of substantially lessening competition. Nevertheless he contended that the purpose of the Cricket Council in amending r.2:38:1 and in coming to an understanding that the applicant was disqualified from club games, was to disqualify the South African tourists from competing at club level. This, it is said, could have the effect or likely effect of substantially lessening competition, even though the Cricket Council did not expressly assess the effect of this conduct. Thus, "purpose", "effect" and "Likely effect" are closely linked. Counsel for the applicant accepted the existence of a difficulty in establishing that there had been a_ substantial ree 70. lessening of competition because the issues in the case did not emerge until three weeks before the end of the 1985-86 cricketing season. Counsel therefore fastened onto the likely effect of such a provision. "Likely effect" was considered in Tillmanns case. Bowen C.J. thought it meant "more probable than not" or "more than a remote or bare chance" (42 F.L.R. at 339). Deane J. thought that it involved the idea of a real chance or possibility (42 F.O.R. at 347). The applicant's case was that the effect of the amendments to r.2:38:1 was to disqualify, not only the applicant, but also Messrs. Alderman, Hogan and Shipperd. In his counsel's submission the evidence established, so far as the player market is concerned, that players of the standing and calibre of Messrs. Hughes, Alderman, Hogan and Shipperd have a direct influence on the on-field success of a club at district level s0 that clubs are eager to acquire their services; that in some cases the better known and more talented players attract transfer fees, thereby evidencing some competition between clubs for the services of such players; and that there was evidence from cricketers and club officials of economic rivairy between clubs to acquire the services of players from other clubs for valuable consideration. The submission continued that it was clear that the removal of the four players from the cricket competition by operation of r.2:38:1 and the agreement of the Cricket Council on 25 September 1985 will have an effect on the economic competition whereby the clubs engage in economic rivalry in seeking to attract players and to acquire their services. 71. In answer to a submission on behalf of the respondents that only 4 out of approximately 900 players were affected by the provisions and that this could inno way be said to involve a substantial lessening of competition, the applicant argued that there were only some 150 A grade cricketers playing each week and of these only few were sufficiently talented to be selected for state and test teams. Hence, the removal of four cricketers who are well known as' successful, experienced and talented players could be enough to substantially lessen competition in the player market. The applicant further contended that r.2:38:1 operated, not only to disqualify Messrs. Hughes, Alderman, Shipperd and Hogan from playing club cricket, but had the potential to affect all players who play in unrecognised matches. As to the markets for club membership, patronage, and sponsorship, the applicant made these submissions. The evidence established that clubs with players of the ability and standing of Messrs. Hughes, Alderman, Shipperd and Hogan attracted substantial levels of sponsorship, patronage and member support because those players were members of their clubs. If those players remain disqualified, the level of sponsorship, patronage and support of their clubs will fall. Conceding that there was little evidence that existing patrons and members of clubs are actively solicited by other clubs, the applicant argued that there was evidence that patrons and members were attracted to attend games at clubs other than their own clubs when players of high reputation were Sree ene + 72. participating. There was evidence that clubs engaged in keen economic rivalrv in seeking out sponsors and potential patrons and members. If the disqualifications resulted in only some of the existing or potential sponsors withdrawing their services, the effect would be to hinder or lessen competition. And so, it was argued, the likely effect of r.2:38:1 and the understanding reached on 25 September 1985 will be to substantially lessen competition in the four markets pleaded. It followed that the making of those provisions and the giving effect to them by the Cricket Council was conduct in contravention of sub-paras.(a)(ii) and (b)(ii) of sub-s.45(2). I have set out at some length the applicant's submissions in regard to this limb of sub-s.45(2) because of the novelty of the present situation. Not surprisingly, the respondents took issue with the applicant on the various arguments to which I have referred. I am satisfied of the existence of a market in Western Australia in which clubs compete to attract cricketers, both generally and from within other clubs. My reasons for reaching this conclusion are set out at some length earlier in this judgment and I shall not repeat what appears there. The applicant has failed to persuade me of the existence of the other markets pleaded. I shall deal with each of those markets in turn. The evidence did not establish a market for club membership and subscriptions from playing and non~playing members. By and large, persons become members of the cricket club in the 73. district in which they live. A person may wish to retain membership of a club with which he has been associated for many vears, even after leaving the district. But in such a case there 15 no relevant market for he is not susceptible to overtures from the club in the district to which he has moved. In this respect there is no "field of rivalry" between the clubs; if there is, it is of such a limited extent as to be insignificant. Likewise, the evidence did not establish the existence of a market for patronage of club facilities amd services for which charges are made. Indeed it is rather hard to distinguish this alleged market from the one just considered. Clubs do not set out to attract patrons by reason of the facilities they offer, as opposed to the interest they engender through the playing of cricket. Certainly some clubs had higher bar trading figures than others and the percentage of income derived from bar trading differed considerably from club to club. But there were various explanations for these differences, including the population of the district, the sophistication of the facilities offered and the hours of bar trading. But the evidence did not warrant a conclusion that, as between themselves, the clubs competed for patrons. I have said already something about the sponsorship of club activities. Much evidence was adduced by affidavit and through cross-examination as to the number of sponsors each club had, the whereabouts of the sponsors and the financial benefit that could be expected from them. It is unnecessary to canvass this evidence in great detail but some references are useful. ve = ET OE ms rh sae ey x "Te Re TT eer SREB rs + FRR FET eye | ee eee cee 74. When considering the evidence led as to sponsorship, I have kept un mind that the 1ssue is whether there 15 a relevant market for sponsors. There was a great deal of evidence as to the sort of benefits sponsors might get, ranging from substantial signs on score boards and sight screens to logos on shirts worn by players. But it 1s not enough, to establish a market, to show that sponsors benefit from sponsorship. The question is whether the clubs compete for sponsors. Counsel for the applicant placed some emphasis on evidence such as that of Mark Robert Lawrence, the managing director of Phoenix Motors Pty. Ltd., whose business is within the area of Wanneroo District Cricket Club (Inc.). Mr. Lawrence's company sponsors that club and Scarborough Cricket Club. In an affidavit sworn on behalf of the applicant Mr. Lawrence deposed that, if the applicant and Messrs. Hogan, Shipperd and Aiderman were prevented from participating in district cricket, his company would reconsider its position regarding sponsorship of the two clubs. Phoenix Motors Pty. Ltd. has no connection with Subiaco Floreat Cricket Club (Inc.), the club to which the aplicant and Mr. Alderman belong, but I took Mr. Lawrence to be saying that the reconsideration would come about because the absence of such players would reduce spectator interest in district cricket. But Mr. Lawrence did not say that his company would consider transferring its sponsorship to a club that had outstanding players. And this points up that, while in some cases sponsorship of a club produces a financial return to the sponsor and while clubs do make efforts to attract sponsors, there is in truth no e 75. competition between the clubs vis-a-vis particular sponsors. Thus there is no relevant market. It is clear from the evidence of such witnesses as Alan David Bolton, one of the vice-presidents of Subiaco Floreat Cricket Club (Inc.), Roy Parnaby Davis, the president of North Perth Cricket Club (Inc.) and Kenneth John Oates, the president of Wanneroo Cricket Club (Inc.) that there 1s very often a personal connection between the sponsor and a member of the club. Some of the amounts paid by sponsors are very small indeed and are looked on as little more than a donation. The applicant has failed to establish a market for club membership and subscriptions, or for patronage of club facilities and services, or for sponsorship of club activities, or indeed a market comprised of all three. The applicant has established a market in which the services of cricketers are sought by clubs in circumstances involving a financial incentive. But I do not accept that the understanding reached at the meeting on 4 November 1985 had the purpose or had or was likely to have the effect of substantially lessening competition within sub-para.45(2)(a)(ii). The amendment to r.2:38:1 excluded the applicant from playing for any club. It may be that the absence of outstanding players from district cricket lessens spectator interest in that cricket. But I am not persuaded that their absence lessens competition between the clubs, for all clubs are deprived of access to their services. This claim must fail. Bre rare § Ey Giving effect to ... Paragraph 41 of the statement of claim pleads that since December 1985 the respondents have qiven effect to the contracts, arrangements or understandings pleaded earlier. This 185 a reference to para.45(2)(b) of the Act. This allegation adds little to the body of the statement of claim. If there was no contract, arrangement or understanding at either of the meetings on 25 September and 4 November 1985, there was nothing to give effect to. If there was a contract, arrangement or understanding at either or both of those meetings, it is hard to see how giving effect thereto advances the applicant's case. One can imagine particular circumstances in which giving effect to a contract, arrangement or understanding might strengthen an applicant's entitlement to an injunction or justify some particular head of damage. But that is not the case here. Paragraph 41 of the statement of claim sets up by way of particulars paras.30-32 which relate to the meetings of the Cricket Council held on 6 January, 3 February and 19 February 1986. At the first two meetings the Council rejected a motion for reinstatement of the applicant and at the third of those meetings Mr. Taylforth, as chairman, ruled that the Council had no authority to consider Mr. Bull's failure to implement his' club's instructions. 77. The words "give effect to" are not technical words and should be given their ordinary meaning, though they are defined in sub-s.4(1) to include "do an act or thing in pursuance of or in accordance with or enforce or purport to enforce". As there was no contract, arrangement or understanding within sub-~s.45(2) arising from the meeting on 25 September, there was nothing to qive effect to. I have found that, arising from the meeting on 4 November, there was an understanding containing an exclusionary provision. The decision to reject the motion for reinstatement of the applicant was, I think, giving effect to an exclusionary provision though it adds nothing to the applicant's case to say so. Furthermore, those clubs whose delegates supported reinstatement cannot be said to have given effect to the understanding. At the meeting on 3 February the delegates from University Cricket Club, Scarborough Cricket Club, Subiaco Floreat Cricket Club (Inc.) and Claremont-Cottesloe Cricket Club (Inc.) asked that the minutes record that they had voted in favour of the motion for reinstatement. In the circumstances it is unnecessary to say anymore about this aspect of the clain. So far as the meeting on 19 February 1986 is concerned, I do not accept that the chairman's ruling or the decision to reject a motion dissenting from that ruling gave effect to the understanding arising from the meeting on 4 November. It was a procedural matter and no more. 78. Restraint of trade Amona the many causes of action invoked by the applicant, that which comes closest to the s.45 claim is a cause of action based on restraint of trade. I have some sympathy with the respondents' complaint that, in support of this cause of action as well as others, the applicant's counsel furnished a great deal of written material relating to a number of decided cases, many of which had little to do with the issues involved in this proceeding. It is important therefore to identify precisely the case pleaded against the respondents and to focus only on those judicial decisions that have relevant factual resemblances to the present proceeding or which contain statements of principle that may properly be applied here. Paragraph 39 of the statement of claim pleads that if the Cricket Council has disqualified the applicant in accordance with the provisions of amended r.2:38:1, a proposition which is denied, the amended rule or the giving effect to it "constitutes an unreasonable restraint of trade in relation to him and is void and/or unenforceable and by reason thereof the Applicant is not lawfully disqualified". There is an alternative plea that the amended rule or giving effect to it "constitutes a breach of the Applicant's right to work and is void on the grounds that it is contrary to public policy". The alternative proposition is one that goes beyond the notion of restraint of trade and must be dealt with separately. The respondents deny para.39 of the statement of claim and say further that the amended rule does not, in its terms, impose a restraint of trade or, 1f it does, it isa restraint "which 15 reasonable 1n the circumstances in that 1ts purpose is to control and regulate the game of cricket in Western Australia and is a legitimate protection of the First and Fourth Respondents' interest therein ..." (defence, para.26}. In further and better particulars of defence, they identify those interests as: "(1) the interest of ensuring the proper control and regulation of district cricket in Western Australia; (2) the interest of ensuring the fairness of the district cricket competition; (3) the interest of protecting the resources spent in organising the district cricket competition; (4) the interest of providing for all district cricket players clear and certain rules of the competition". It is now well established that the doctrine of restraint of trade may operate in the case of sports persons who derive income from the sport they play. Eastham v. Newcastle United Foothall Club Limited £19641 Ch. 413; Buckley v. Tutty at 353; Greig v. Insole £19782 1 W.L.R. 302; Blackler v. New Zealand Rugby Football League £19683 N.Z.L.R. 547. As the High Court pointed out in Buckley v. Tutty at 371, it is unnecessary to consider whether a professional sports person, who habitually plays the game for reward, practises a trade within the ordinary 80. meaning of that expression. "The doctrine regarding restraint of trade is not limited to any category of skilled occupations but applies to employment qeneraliv". It 1s not essential that the sports person derive his or her entire income from practising the sport. Many of the cases have concerned footballers who played for reward but who were gainfully employed in other occupations as well. It is not to the point that many, if not most, of those playing the sport in question do so as amateurs, so long as the person whose rights or interests are said to have been affected is a professional. In that regard, the respondents admit in their defence that the applicant is and was at all material times "engaged as a professional cricketer by Subiaco Floreat Cricket Club (Inc.)". It is true that the applicant's direct earnings from district cricket itself are meagre indeed. He said in evidence: "Last year, I would say it would be about the first time I received money for playing grade cricket in my whole career, and I think that sum was about $230 or something". But playing club cricket is an entry, if not the entry, to shield cricket and thence to test cricket. The income the applicant derived and continues to derive from Town & Country Building Society and from media contacts undoubtedly stems primarily from his reputation as an international cricketer. But it is not possible or realistic to attempt some dissection of the levels at which he plays with a view to assigning income to particular levels. For the purposes of the notion of restraint of trade, the 8l. applicant 1s a professional cricketer whose livelihood 1s likely to be affected by his inability to play club cricket. The applicant gave particulars of his income from varlous sources since 1979. I shall not set out this information in its entirety and shail restrict it to the last two vears. The applicant identified three categories: (1) direct sporting income, including match playing fees, prizes and bonuses 1983-1984 $48,977.00 1984-1985 $35,379.00 (ii) aundirect sporting income, including key player agreements, product endorsements, television appearances and sponsor payments 1983-1984 $20,490.00 1984-1985 $19,782.00 (iii) other income, including wages and salary from regular employment 1983-1984 $21,409.00 1984-1985 $18,907.00 In this regard, there was a submission made on behalf of the respondents that cannot be accepted. It was said that, STINE STE ER ET B82. because of his large earninas from playing cricket in South Africa, the disqualification of the applicant at club level had no impact on his financial return from playing cricket. But it is no answer to a claim that a contract or rules operate in restraint of trade, to point to income earning activities that may be carried out elsewhere. In the present case the applicant has played cricket all his life in Western Australia save for those occasions on which he has played shield and test cricket outside the state including, of course, the recent occasions on which he has played in South Africa. If in truth there has been conduct in restraint of trade so far as the playing of cricket in Western Australia 1s concerned, that conduct is not saved by an argument that the applicant may earn as much, indeed more, by playing cricket elsewhere. The existence of a restraint and its reasonableness must be judged with reference to the activities that the applicant carries and proposes to carry out. There is another matter of a preliminary nature, though it goes very much to the question whether restraint of trade can apply in the present case at all. It is the conduct of the Cricket Council of which the applicant complains. The applicant himself is not a member of the Council; it is the W.A.C.A. and the Associated Clubs whose delegates comprise the Council. The Council is established by the rules of the W.A.C.A. and the applicant 1s not a member of that body. At any rate there was no evidence of his membership. Can he then be heard to say that a rule of the Council is void as being in restraint of trade? 83. In my view he can be so heard. It 15 not necessary for an applicant to show that rules which he seeks to impugn constitute a contract between him and the association in question. Eastham v. Newcastle United Football Club Limited at 441-442; Buckley v. Tutty at 375; Greig v. Insole at 345; Foschini v. V.F.L. and South Melbourne Club Limited (unreported judgment of Supreme Court of Victoria delivered 15 April 1983); Nagle v. Ferlden (19663 2 Q.B. 633 at 644, 650. In Buckley v. Tutty at 381 the High Court said that since the respondent was a member both of the New South Wales Rugby Football League and the Balmain District Rugby League Football Club, McEllistrim v. Ballymacelligott Co-operative Agricultural and Dairy Society Ltd. [19191 A.C. 548 and Dickson v. Pharmaceutical Society of Great Britain £19701 A.C. 403 were sufficient authority for the view that the Supreme Court had power to make a declaration and grant an injunction. The Court continued: "However, since we have said that we regard the question, what persons are members of the League, as not altogether clear, we would add that even if the respondent had been a stranger to those organizations he would have had a right to relief". Counsel for the respondents invited me to decline to follow this dictum of the High Court and the dictum of Wilberforce J. in Eastham v. Newcastle United Football Club Ltd. at 446, on which it was based. This would indeed be a bold course. Even if what the High Court said was obiter, it was obiter ina joint 84, judament of the five members constituting the court. In any event, the dictum 1s 1n my respectful view entirely in accord with the principle that, where the rules of an association place an unjustifiable restraint on the income earning activities of a person, a court 1s not precluded from granting appropriate relief merely because that person is not a member of the association. Against that background I turn to consider whether r.2:38:1 as amended constitutes an unreasonable restraint of trade so far as the applicant is concerned. It is for the applicant to show that r.2:38:1 as amended is in restraint of trade. If he makes good that case, it is for the respondents to establish circumstances which show that the restraint affords no more than adequate protection to their interests. "It is a question of law whether the circumstances justify the restraint" (Buckley v. Tutty at 377). 2 am of opinion that r.2:38:1 is in restraint of trade so far as the applicant is concerned. Its effect is to preclude him from taking part in any cricket match within or without Western Australia other than a match recognised by the Australian Cricket Board or the W.A.C.A., without first obtaining the consent in writing of the Cricket Council. The fact that he takes part with the approval of his club is of no account. If found in breach of the rule, he is automatically disqualified until reinstated by the Council. There is a question whether "found" in the rule implies some hearing at which it is formally determined that a player is in breach of the rule or whether 1t means no more than that a 85. player who 1S in breach of the rule is thereby disqualified and remains so until reinstated. The use of the term "automatically disqualified" suggests that the rule is to operate by its own force and effect and that no formal finding of the Cricket Council 1s required. There can be no doubt that the members of the Cricket Council treated the rule as having an automatic operation. If this were not so, the motion considered at meetings of the Council on 6 January and 3 February 1986 for reinstatement of the applicant and other players would have been a pointless exercise. Whichever view is taken of the way in which the concluding words of the rule operate, they involve the disqualification of a player who 1s in breach, a disqualification that is indefinite in its duration. The impact of the rule is made all the clearer by r.2:39:5, whereby a club allowing a disqualified player to play for that club commits an offence, is liable to afine and is deemed to have lost the match to the opposing club. Thus r.2:38:1 operates so that a player who is in breach is effectively precluded from playing for his club. This in turn has the likely, even if not direct, consequence that the player will not be selected for shield cricket or in turn for test cricket. The impact on a player's capacity to earn money from Playing cricket is apparent. The next question is ~ have the respondents made good their defence that the restraint was reasonable in the circumstances, having as its purpose the control and regulation of B86. cricket in Western Australia? As already noted, the functions of the Cricket Council include the control and management of all Associated Club matches. Thev also include the selection of teams to represent the W.A.C.A. 1n all international and shield matches and also the regulation and administration of the reqistration, qualification and eligibility of players to play in matches between the Associated Clubs (r.37). It is clear then that the Cricket Council reaches heyond the clubs themselves to the players. The broad proposition that the Cricket Council has a responsibility for the orderly playing of cricket in Western Australia may readily be accepted. But 1s that purpose served by a provision that a player who plays in an unrecognised match, without the necessary consent, 1s disqualified? Is it reasonable that his fate turn on such an uncertain expression as "a match recognised by the Australian Cricket Board or the Association"? Is it reasonable that he be disqualified for an indefinite time? Is it reasonable that the rule operate to impose an automatic disqualification without giving the player an opportunity to be heard? Is it reasonable that there be no right of appeal from a refusal of the Cricket Council to give its consent or from a disqualification itself? Is it reasonable that a player be precluded from playing overseas by an automatic disqualification provision? Is it reasonable that the rule operate retrospectively so that a player who contracted to play in an unrecognised match without the required consent before 4 November 1986, when no automatic disqualification existed, is nevertheless automatically disqualified by reason of the amendment? 87. It is relevant that, so far as the applicant is concerned, the amendment to r.2:38:1 had a retrospective operation - see Greig v. Insole at 352. It 1s true that as at 4 November 1985 the applicant had not played @ match in South Africa (his farst match was on 9 November). But he had contracted to play as early as May 1985 and the existence of a contract with S$.A.C.U. was certainly known to the respondents by November 1985. They were also aware in a general way of the settlement of the Victorian litigation and none of the respondents suggested that the amendments to £r.2:38:1 were by way of implementing that settlement. Clearly they were not. The totality of these considerations leads me to conclude that the operation of r.2:38:1 goes beyond a restraint reasonably related to the objects of the Cricket Council and those who comprise its membership and that it is void. That consideration is reinforced by reference to the public interest which lies, I think, in having every opportunity to see first class cricketers in action. The rule is the product of the actions of the first, second and third respondents through their delegates. The applicant has made good this cause of action against them and against the Cricket Council. 88. Right to work This conclusion makes 1t unnecessary to deal with the so called "riaght to work" pleaded in para.39 of the statement of clain. In any event I am not persuaded that there 1s such a right, at least in the broad and unqualified terms argued for on behalf of the applicant. Certainly there is Nagle v. Feilden in which it was held that the practice by the Jockey Club of Great Britain in refusing trainers licences to women on the basis of sex discrimination as opposed to merits, constituted a prima facie case of interference with a person's right to work at his trade or profession. But that case and other cases can be explained by reference to the particular facts and the nature of the disqualification and the circumstances in which it was imposed. In my view there cannot be inferred from that decision or any other some over-arching principle whereby any interference with a person's entitlement to work constitutes a tort or otherwise gives rise to a cause of action. Ultra vires I turn now to the other causes of action pleaded on behalf of the applicant. I do so with the general observation that there is much overlapping and profusion of pleading that together make it difficult at times to discern precisely what is being said on the applicant's behalf. 89. First there must be considered what the applicant's counsel described as procedural ultra vires, an arqument' that there had been a failure to comply with the mandatory requirements of the rules of the Cricket Council. The relevant pleading 1s to be found in paras.25-27 and 33-38 of the statement of clain. The first complaint 1s that by letter dated 11 November 1985 the applicant sought the consent of the Cricket Council to play in South Africa and that the Council failed to reply to that request or to give it any proper consideration. It 1s then said that the respondents failed to inform the applicant or his club of the fact of his purported disqualification; that the Cricket Council made no finding as required by r.2:38:1; that the applicant has never been in breach of that rule; that at all material times the South African tour games were recognised by the Australian Cricket Board; that, if they were not, the Council failed to make the necessary finding; and that in consequence' the applicant was not lawfully disqualified from playing cricket for his club. I accept, as I have said earlier in these reasons, that the Cricket Council did fail to respond to the applicant's letter of 11 November 1985. It is also clear that the Council gave no consideration to that request. Why the Cricket Council did not reply is not at allclear. Both Mr. Taylforth, the chairman of the Council and Mr. Sweetapple, its secretary, deposed that it was not the practice of the Council to supply written replies to correspondence from a member of a club. Whether this 1s the SESE SN SRG OP ITE at aban Ss TOT Sir 90. Council's practice (and there was evidence from Mr Rigg, the chairman of the Executive Committee and chairman of the I. and I. Committee of the W.A.C.A. that @ similar application by Mr. Alderman had been the subiect of a written reply) is not greatly in point. If a player seeks the consent in writing required by ¢+.2:38:1, surely he or his clubis entitled to a written reply? In any event, there was no reply of any kind to the applicant's letter of 11 November. While the Cricket Council's failure to reply to the applicant's letter was an act of discourtesy, it does not follow that 1t had any legal implications as between the applicant and the Cricket Council. Indeed, in my view, it had none, Nevertheless it has evidentiary implications, for a failure to reply might go some distance to proving that the Cricket Council gave no proper consideration to the application for consent contained in the letter of 11 November. The contention that the respondents failed to inform the applicant of his "purported disqualification" depends upon establishing that there was in fact a purported disqualification. Paragraph 35 of the statement of claim pleads that at none of the meetings of the Cricket Council since 4 November 1985 was' there a finding that the applicant was in breach of r.2:38:1. Paragraph 22 of the defence denies this allegation. This is another unsatisfactory plea since it is apparent from the way in which the case was argued that the respondents contend that no finding was necessary. They did not suggest that a finding had been made. I have already said something about the operation of the concluding 91. portion of £.2:38:1. One thing is clear - the Cricket Council certainly proceeded on the basis that the applicant had been disqualified. The motions for his reinstatement would have made no sense otherwise. It 1s apparent from the evidence of those who attended the relevant meetings of the Cricket Council, in particular Messrs. Tavlforth, O'Driscoll, Sweetapple, Beech and Rigg that the members of the Cricket Council gave no particular consideration to what was meant by an unrecognised match. They proceeded on the basis that. by playing in South Africa, the applicant had played in an unrecognised match and that, at any rate following the amendment to r.2:38:1 at the meeting on 4 November 1985, he was thereby disqualified in terms of the rule. It was part of the applicant's case on the question of ultra vires that the delegates to the Cricket Council reached a decision to disqualify him without any detailed knowledge of the terms of the deed of settlement of the Victorian litigation. it may be accepted that the delegates, at any rate most of them, had no detailed knowledge of the terms of settlement of that litigation. But I am unable to see the relevance of that matter to the considerations of the meetings of the Council. Nevertheless I am satisfied that at none of its meetings did the delegates to the Cricket Council give consideration to the applicant's letter of 11 November 1985. The letter itself sought consent "to play in such games as have been organised by The South African Cricket Union during this 1985/86 summer season". By then the applicant had played in South Africa so, strictly speaking, the application should have been for reinstatement. But since the 92. respondents gave no consideration to the letter, the distinction 1s not, I think, vital to the applicant's case. On this aspect of the case, the appropriate relief 15 to remit that matter to the Cricket Council for its consideration. Since the applicant has made qood other causes of action warranting wider relief, I need sav no more about procedural ultra vires. Conspiracy The next cause of action to be considered is that of conspiracy. In The Law of Torts 6th ed. 663, Professor Fleming Says: "Today, the tort of conspiracy is regarded as anomalous, if not anachronistic. It is therefore kept within the narrowest limits of compelling precedent. Its principal remaining role is to strike at those rare combinations whose predominant motive is not self-interest but injury to the plaintiff or the promotion of some other 'unjustifiable' end". While a malevolent intent is not an essential ingredient of the tort (Crofter Handwoven Harris Tweed Co. v. Veitch [19427 A.C. 435 at 471-472), it does involve a combination the real purpose of which ""... is the inflicting of damage on A as distinguished from serving the bona fide and legitimate interests of those who so combine" (Crofter Handwoven Harris Tweed Co. v. Veitch at 443). Like fraud, it is not an allegation that should lightly be made. Paragraph 42 of the statement of claim pleads that since July 1985, the respondents between themselves in conjunction with 93. others "wronqfullv and maliciously conspired and combined amongst themselves to iniure the Applicant in his said business as a professional cricketer". The particulars provided of the alleged conspiracy are simply a repetition of paras.29A-32 of the statement of claim which, broadly speakina, plead the various meetings of the Cricket Council to which reference has already been made and the disqualification of the applicant from club cricket. But at' the very heart of acclaim for conspiracy is the existence of an agreement between two or more persons, made for the purpose of injuring another. Where is the agreement from which the alleged conspiracy is said to derive? The applicant's submissions focused very much upon the requirement of intention to injure. They asserted that the intention of the respondents was to disqualify the applicant from grade cricket and that thereby the applicant suffered damage. But an intention to injure is not an element independent of the agreement made or combination entered into; it must be found in that agreement or combination. In my view the applicant failed to show that there was any agreement made between the respondents, or any of them to injure him. There was conduct that injured him and it was' the conduct of the respondents. But more is required before the respondents can be held to have conspired. For this reason I am of the opinion that there is little to be gained by referring to the many cases mentioned by counsel for the applicant that deal with the notion of intention to injure, the concept of purpose and the nature of the damage that may be suffered. These matters only 94, arise once a relevant agreement has been proved and this' the applicant failed to do. In fairness to the respondents I should sav that I do not think thev did conspire to injure the applicant. They were acting in what they saw as the best interests of cricket though, in doing so, they acted in contravention of the Trade Practices Act and in restraint of trade. Conspiracy is a serious allegation to make and it was not sustained. I would add this comment. The claim for conspiracy includes a claim for exemplary damages. Exemplary damages may be awarded in actions for tort if it appears that the respondents' conduct in committing the wrong exhibited a contumelious disregard of the applicant's rights. Uren v. John Fairfax & Sons Pty. Ltd. (1965-1966) 117 C.L.R. 118; Australian Consolidated Press Limited v. Uren (1968) 117 C.L.R. 185. But the statement of claim did not in terms claim exemplary damages and no evidence was offered to provide a basis for such an award. The claim in conspiracy must fail. Equal Opportunity Act 1984 Paragraph 43 of the statement of claim pleads that, if the Cricket Council disqualified the applicant in accordance with the provisions of amended r.2:38:1, "such conduct is unlawful in that it constitutes discrimination against the Applicant on the grounds of religious or political conviction contrary ta provisions of the Equal Opportunity Act 1984 (W.A.)"". 95. The respondents made a number of answers to this claim, some, of fact and some law. Their primary answer was to point to sub-s.154(1) of the Act which reads: "A contravention of this Act shall attract no sanction or consequence, whether criminal or civil, except to the extent expressly provided by this Act". The respondents drew attention to the Commissioner for Equal Opportunity, an office established by the Act, s.80 of which empowers the Commissioner to do various things including investigate complaints. They pointed also to the Equal Opportunity Tribunal established by the Act which may hear complaints and order the payment of damages by way of compensation. Nowhere in the Act, they said, is there any entitlement to relief by reason of any discrimination, other than that to which I have just referred. The applicant's answer is that sub-s.154(1) is concerned with attempts to enforce the provisions of the Act by the imposition of penalties. He says that "consequence" must be read ejusdem generis as referring to an attempt to enforce a provision of the Act by the imposition of a penalty. Whatever sub-s.154(1) means, there is no justification, in my view, for giving the term "consequence" other than its natural meaning. The terms "sanction" and "consequence" are expressed disjunctively and there is simply no genus to control those words. The applicant arqued that the power of the Federal Court, conferred by s.21 of the Federal Court of Australia Act 96. 1976, to make declarations is not ousted by sub-s.154(1) of the Equal Opportunity Act. A declaration does not impose a sanction Or consequence; 1t simply involves a statement of the existing law. His counsel referred to Forster v. Jododex Australia Pty. Ltd. (1972) 127 C.L.R. 421 and London Borough of Ealing v. Race Relations Board €19721 1 All E.R. 105. Cf. Kessell v. Human Rights Commission £19861 E.0.C. 92-146, a decision of the High Court of New Zealand. In my view it 1s clear that the Act intends no consequences to arise from conduct which contravenes it, except through the Act itself. It is not that the jurisdiction of the Federal Court is ousted. Nor for that matter is the jurisdiction of the Supreme Court ousted, for clearly that Court may grant declaratory relief in regard to conduct of the Commission or the Tribunal. But the Act gives rise to no rights or obligations vis-a-vis others except through the machinery of the Act itself. That conclusion is enough to dispose of the applicant's claim under this head. As to the merits of the claim, sub-s.53(1) of the Equal Opportunity Act provides that a person discriminates against another on the ground of religious or political conviction if, on the ground of the religious or political conviction of the aggrieved person, "the discriminator treats the aggrieved person less favourably than in the same circumstances or in circumstances that are not materially different, the discriminator treats or would treat a person of a different religious or political conviction". Sub-section 4(3) construes "religious or political bd 97. conviction" so as to include "a lack or absence of religious or political conviction". The applicant arqued that the South African tour involved strong political issues and beliefs on the part of the respondents. He pointed to The Western Cricketer where, at p.8, reference 15 made to the proposed South African tour as running "counter to the policy of the Australian Cricket Board and its member States, which have decided against sporting links with South Africa. In making the tour, the players are also in complete conflict with the Australian Government's policy on South Africa as highlighted in the Gleneagles Agreement". This view, the applicant said, was reinforced by the evidence of Mr. Taylforth who referred to the applicant's "commitment to play in South Africa against the policy of the present and previous Government, and against the policy of the Australian Cricket Board and the Western Australian Cricket Association". Mr. Taylforth also referred to "those who strongly oppose personal benefit being derived by individuals from providing services to a country which practises a racial policy condemned by most of the civilised western world". The applicant said that he held no relevant political conviction and I accept that evidence. There is no doubt that r.2:38:1 was amended against the background of the South African tour which had then begun. Nevertheless I am not persuaded that there was any discrimination against the applicant by reason of political convictions which he held or did not hold. Rather the Sy eee Fey cv ¥ Ra 98. W.A.C.A. saw the tour as inimical to cricket, as appears from a further passage on p.8 of The Western Cricketer: " The 'rebel' tour poses a clear threat to Australian cricket, firstly by promoting an alternative competition to the Australian Cricket Board's International Programme and thereby weakening its standing in terms of other sports and entertainment activities. Secondly, 1t must inevitably weaken the standard of the Australian domestic competition and thus weaken Australia's competitive position against other cricket nations". Both on the law and on the facts this claim must fail. Bad faith and bias The applicant made a further complaint, of bad faith or bias on the part of the respondents. This is pleaded in para.44 of the statement of claim by reference to what is described as the agreement and understanding arrived at by the Cricket Council on 25 September 1985 and the subsequent disqualification of the applicant. This is said to have been a decision made in bad faith and to have been affected by bias. The particulars given of this plea are not easy to follow. First, the applicant repeats paras.33-38 of the statement of claim, being the paragraphs that relate to the failure of the respondents to inform the applicant or his club of his purported disqualification; the failure on the part of the Cricket Council to make a finding in accordance with r.2:38:1; the contention that the decision to disqualify the applicant was ultra 99. vires; and the arqument that the South African tour qames were recoanised by the Australian Cricket Board. The particulars then refer to the applicant's disqualification for an unlimited duration; the circumstances surrounding the settlement of the Victorian litigation; the role of certain persons in relevant proceedings; the argument that the decision to disqualify the applicant was contrary to the legitimate objects of the W.A.C.A. and was not made in the best interests of the respondents but for the purpose of punishing the applicant; the fact that the decision was made in the course or furtherance of the conspiracy alleged; the failure on the part of the Cricket Council to reply to the applicant's request of 11 November 1985 or to give any proper consideration to that request; the agreement on the part of the Cricket Council to prevent the applicant and Messrs. Alderman, Hogan and Shipperd from playing district cricket in Western Australia at a time when r.2:38:1 did not provide for their disqualification; and a repetition of the proposition that the Cricket Council made that agreement or reached that understanding without full knowledge of the terms of settlement of the Victorian litigation and without knowledge of whether the South African tour matches were recognised matches. The particulars of bad faith or bias are complex and unnecessarily confusing. Equally, many of the cases to which counsel for the applicant referred in the written submissions filed are of little assistance. 100. In so far as the applicant relies upon procedural ultra vires, I have dealt with that matter. It seems to me to add little to the applicant's claim to plead that matter as constituting bad faith or bias. In so far as the particulars qo beyond procedural ultra vires to what the applicant describes as substantive ultra vires, I am not persuaded that any decision reached was contrary to the legitimate objects of the W.A.C.A. Whether such a decision advanced those objects is another matter. In the same way, to argue that there was a decision made to disqualify the applicant and that it was made in the course or furtherance of the alleged conspiracy, adds nothing to the applicant's claim. In any event I have rejected the conspiracy claim. As I suggested to counsel for the applicant during the course of final address, if the Court found a conspiracy as alleged, it would have little difficulty in finding that the respondents had acted in bad faith or were biased. But it would serve no purpose to make such a finding if a conspiracy was established. Certainly a purpose of the amendment of r.2:38:1 was, borrowing Mr. O'Driscoll's phrase, to give it teeth. That is apparent also from the evidence of Messrs. Moody, Vodanovic, Edwards and Taylforth concerning the meeting on 4 November 1985. But that does not mean that its purpose was to punish the applicant. Furthermore if that was the purpose of the amendment, 1t does not follow as a matter of course that any decision taken was made in bad faith or was biased. There can be no doubt that many of those concerned with the administration of cricket in Western Australia saw r.2:38:1 as operating for the protection of wy oe y st ist. a en $ 101. grade cricket and in turn shield and test cricket. They may have been wronq in that view but being wrong 1s not equivalent to acting in bad faith or with bias. This plea of bad faith or bias also involved, as' the case was presented, questions of natural justice. The applicant pointed to the fact that the meetings which led to his disqualification were attended by Mr. Taylforth and Mr. O'Driscoll, who were executive members of the W.A.C.A., and by delegates of the W.A.C.A., which was a member of the Australian Cricket Board. In the circumstances, it is said, Mr. Taylforth, Mr. O'Driscoll and the delegates should not have participated in the decision to disqualify. It is said that they hada prior involvement or prejudgment of the matter in question, that they exhibited prejudice or personal animosity to the applicant and that generally their conduct reflected bad faith or bias on their part. 1 do not accept this submission. Unquestionably Mr. Taylforth and Mr. O'Driscoll had views, and at léast in Mr. Taylforth's case strong views, on Australian cricketers playing in South Africa. But one was the chairman of and the other a delegate to the Cricket Council. They were entitled to be present and to express their views although, in Mr. Taylforth's case, consistently with his position as chairman. There was no hearing of a charge against the applicant; he was disqualified by reason of the operation of r.2:38:1 as amended. 102. In his closing address, counsel for the respondents criticized strongly the alleqations of bad faith and bias on the qround that the applicant's counsel had fa1led to put to the respondents relevant witnesses questions aimed at establishing bad faith and bias on their part. There is force ain this criticism. When there 1s an atilegation of bad faith and an allegation of actual bias (which was the case here), not only is it proper to put those allegations to the relevant witnesses but failure to do so must cast a real cloud over the genuineness of the claim. It may also carry the consequences arising from what is known as the rule in Browne v. Dunn (a reference to Browne v. Dunn (1894) 6 R. 67), that is, acceptance of the other party's evidence on the matter. I am not suggesting that it is necessary to put in so many words to a witness that he acted in bad faith or was biased; it is enough to ask questions from which it is clear that the witnesses' motives are under attack. But in my view the cross-examination of witnesses such as Messrs. Taylforth, O'Driscoll, Rigg and Bull fell short of what was required. For instance, in final address counsel for the applicant invited the Court to find that Mr. Bull voted contrary to his club's wishes at the instigation of Mr. Taylforth or other members of the executive committee of the W.A.C.A. Had Mr. Bull done so, it would have been a serious matter and gone very much to strengthen the applicant's claim of bad faith on the part of the respondents. If the Court was to be invited to draw this conclusion, it was imperative that the matter be put to Mr. Bull as well as to other relevant witnesses. Mr. Bull was asked in cross-examination whether he had any discussions with 103. Mr. Taviforth about any matters on the Cricket Council agenda during the period with which this case 1s concerned. He was also asked whether he had anv discussions with Mr. Taviforth about the way in which he should vote. But it was not put to Mr. Bull that he voted contrary to the instructions of his club at the instigation of Mr. Taylforth or anyone else. In my view that Matter should have been put directly to Mr. Bull if it was intended to ask the Court to draw the inference referred to by counsel in address. For all these reasons, the claim of bad faith and bias must fail. Deed of Settlement Finally, it is necessary to say something about the claim that the W.A.C.A. breached certain of the terms of the deed of settlement reached in the Victorian litigation. Paragraph 23 of the statement of claim pleads that it was an express or implied term of that deed that the W.A.C.A. "would take no further action against the Applicant arising out of his participation in the said South African tours and in particular would not impose or seek to impose restrictions upon his eligibility to play District Cricket within the State of Western Australia". Paragraph 23A gives particulars of the way in which the W.A.C.A. 15 said to have breached the deed. It alleges that the 104. imposition of a disqualification on the applicant constituted the making of a claim or alternatively the taking of further action against the applicant "arising out of his participation in the said South African tours". This claim can be disposed of quite shortly. There was certainly no express term of the deed that precluded the W.A.C.A. imposing or seeking to impose restrictions upon the playing of district cricket by the applicant. Of course the W.A.C.A. could not do so in any event except through the Cricket Council. Counsel for the applicant was unable to point to any provision of the deed which in express terms or as a matter of construction precluded the W.A.C.A. from taking the action it is said to have taken. As appears from its recitals, the deed is concerned with the playing of test and interstate cricket and the actions of the defendant players in contracting with S.A.C.U. By cl.2.2 of the deed the plaintiffs (the W.A.C.A. and other state associations together with Mr. Bennett as chairman of the Australian Cricket Board) agreed, not directly or indirectly, "(a) to institute any court proceedings seeking orders restraining or having the effect of restraining any member of the team from playing or participating in the first and second tours or restraining or having the effect of restraining S.A.C.U. from giving effect to and carrying out its contractual obligations to the defendant players and the remaining players ('any further court proceedings'); (b) to counsel, encourage or assist any person in commencing or prosecuting any further court proceedings". s re "7; REPSOL aa Srna ur aie ely 'ne ss Ee Are ve 105. There is nothing in this undertaking or in any other undertaking by the plaintiffs which can fairly be construed as a prohibition against disqualification from club cricket bv reason of participation in the South African tours. Before a term mav be implied in a contract, it must be necessary to give business efficacy to the contract. It is not enough that it be reasonable to imply the tern. See Codelfa Construction Pty. Ltd. v. State Rail Authority of N.S.W. (1981-1982) 149 C.L.R. 337, especially Mason J. at 346~347. The implication of the term sought to be implied by the applicant is mot necessary to give business efficacy to the deed of settlement nor 1s it so obvious that, in the language of the cases, "it goes without saying". The deed of settlement refers expressly to test and interstate cricket matches. It makes no reference to club matches, no doubt because this matter was left to the clubs themselves and to bodies such as the Cricket Council, none of which was a party to the deed. I accept the submission of counsel for the respondents that the deed is directed towards alleged breaches by the applicant and other players of their obligations to the Cricket Board and through the Board to its individual constituent associations. The release contained in the deed is not concerned with district cricket nor with the entitlement of the applicant and the other players to play in any matches other than those in which they were contracted with the Cricket Board to play. The claim under the deed must fail. 106. Jurisdiction revisited I have found the W.A.C.A. to be a trading corporation. If, as I have found. the W.A.C.A. was in contravention of sub-s.45(2) of the Trade Practices Act, the other second and third respondents may be liable as parties to a contract, arrangement or understanding in breach of that provision or if they otherwise come within s.75H of the Act. No particular question of jurisdiction arises in this regard. As to the various common law causes of action invoked by the applicant, I am of opinion that there is in this case "a single justiciable controversy of which a federal issue forms an integral part" (Stack v. Coast Securities (No. 9) Pty. Ltd. at 742). And it is appropriate for this Court to deal with those causes of action since there is a common substratum of facts relevant to them. Indeed, with the possible exception of the claim under the Equal Opportunity Act 1984, the facts relating to each of the causes of action pleaded are very much the same. It is unnecessary therefore to consider the doctrine of pendent party jurisdiction to which counsel for the applicant referred, relying upon Kennedy v. Australasian Coal and Shale Employees Federation (1983) 50 A.L.R. 735. See the discussion in Allen v. Sideris (1984) 9 I.R. 68 at 80-81. In regard to the contravention by the first, second and third respondents of sub-s.45(2) of the Trade Practices Act, the applicant 1s entitled to declaratory relief. I propose to hear from counsel as to the form of the declaration or declarations and also whether injunctive relief 15 appropriate. The applicant claimed damages pursuant to sub-s.82(2) of the Trade Practices Act and other orders (undefined) pursuant to s.87 of the Act. There is also a claim for damages at common law. Other than the claim for exemplary damages for conspiracy (which I have rejected), the applicant drew no particular distinction between the damages to which he claimed to be entitled under the Act and at law. However the only damages to which the applicant is entitled are under the Act. The respondents argued that, in view of the moneys' the applicant will receive under his contract with §.A.C.U., there was no justification for any award of damages in favour of the applicant, whatever cause of action he might succeed in. Certainly the evidence did not warrant an award of other than minimal damages. That is not directly due to the payments to be made under the 5.A.C.U. contract. Rather, because of his commitment to the South African tours, the applicant's availability for district cricket in the 1985-86 and 1986-87 seasons must necessarily be very limited. What may happen thereafter is a matter of speculation. 108. I approach the assessment of damages on the basis that, because of the applicant's disqualification from club cricket, he has lest the verv small amount he stood to win from incentive payments in the 1985-86 season. If I am right in the view I have taken of matters arising under sub-s.45(Z) and restraint of trade, the applicant will not be precluded from playing district cricket hereafter by reason of r.2:38:1. Hence no further damage may be suffered. Counsel for the applicant accepted that damages for future loss were inappropriate. A reasonable assessment of the loss incurred would be, I think, $250. The evidence did not justify any wider award of damages; nor were damages at the forefront of the applicant's case. Because of what was said by counsel for the applicant when the case began, a matter referred to earlier in these reasons, no damages are payable by Subiaco Floreat Cricket Club (Inc.), Claremont-Cottesloe Cricket Club (Inc.), Gregory Bunney and Phillip Clifford. Nor are damages payable by the fourth respondent for it was the conduct of the W.A.C.A. and the Associated Clubs that was in contravention of sub-para.45(2)(a(i) of the Trade Practices Act. As to my finding that r.2:38:1 as amended is void, the applicant is entitled to declaratory relief to that effect against all respondents. Whether a declaration that the applicant has not been disqualified from playing district cricket is necessary or appropriate is a matter on which I shall hear from counsel. t ~ ory Bs ner TyDy x , 109. Summary of findings ana conclusions Because of the complexity of this matter. it mav_ be helpful to set out in a summary way my findings and conclusions. Before doing so, I would just say this. It 1S apparent from the evidence in this case and what has been said and written over the last twelve months that strong views are held as to the propriety of the applicant and others playing cricket in South Africa. That is not a matter with which the Court is concerned. Its task 1s to find the relevant facts and ascertain the relevant legal principles (relevancy being determined by the pleadings filed), then apply those principles to those facts. That is the nature of the judicial process. I now summarise, while making it clear that what follows is by way of summary and must be read in the light of the reasons for judgment generally. (1) The Court has jurisdiction to deal with all the applicant's claims. (2) The W.A.C.A. is a trading corporation. (3) None of the incorporated clubs is a trading corporation. (4) At the meeting on 25 September 1985 there was no contract, arrangement or understanding within sub-s.45(2) of the Trade Practices Act 1974. (6) (7) (8) (9) (10) (11) (12) (13) 110. At the meeting of the Cricket Council on 4 November 1985 there was an understanding between the W.A.C.A. and the Associated Clubs. That understanding was one that, by reason of the decision to amend r.2:38:1, the applicant would be prevented from plavindg district cricket in Western Australia because of his participation in the South African tour. The understanding reached at the meeting on 4 November 1985 contained an exclusionary provision in contravention of sub-para.45(2)(a)(i) of the Act. The understanding did mot contain a provision having the purpose, or having or likely to have the effect, of substantially lessening competition within sub-para.45(2)(a)(ii) of the Act. Rule 2:38:1 as amended at the meeting of the Cricket Council on 4 November 1985 is in restraint of the applicant's trade as a cricketer and the rule is void. The claim for breach of right to work fails. The claim based on procedural ultra vires succeeds. The claim based on conspiracy fails. The claim under the Equal Opportunity Act 1984 fails. lil. (14) The claim based on bad raith and bias fails. (15) The claim based on the deed of settlement fails. (16) The applicant 1s entitled to damages inthe sum of $250, payable by the first. second and third respondents, other than Subiaco Floreat Cricket Club (Inc.), Claremont-Cottesloe Cricket Club (Inc.), Gregory Bunney, Phillip Clifford. (17) The applicant is entitled to declaratory relief in respect of v.2:38:1 against all respondents, I shall hear from counsel, at a time to be fixed, as to the form of judgment to which the applicant is entitled in the light of these reasons for judgment including the question of anjunctive relief. I shall also hear at that time as to the question of costs. I certify that this and the preceding 110 pages are a true copy of the reasons for judgment herein of his Honour Mr, Justice Toohey. fe Atl Associate Dated: 27 October 1986