So NOT INTENDED FOR GENERAL DISTRIBUTION IU THE FEDERAL TCURT WF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION No. WA Gl0«z of 1986 BETWEEN: GULL PETROLEUM (W.A.) PTY. LTD. First Applicant and RAMILO NOMINEES PTY. LTD. Second Applicant and SINBADS NIGHTCLUB PTY. LTD. Respondent CORAM: TOOHEY J. 4 November 1986 EX TEMPORE REASONS FOR JUDGMENT There is before the Court a claim for an interlocutory infunction to restrain the respondent from engaging in certain conduct which is defined in the application. I am satisfied as to the Court's jurisdiction to entertain the application and the claim for an interlocutory injunction, on the basis that what is being asserted for the purposes of today's proceedings is an infringement of Part V of the Trade Practices Act 1974 and the common law tort of passing off, which is based essentially upon the same facts as are said to give rise to the claim under the Trade Practices Act. Two questions I have to consider this afternoon are these: one, whether there 15 a serious question to be tried. Unless the applicants make qoud that proposition, there 1s no justification for the granting of an interlocutory injunction. If they make good that proposition, the question becomes one of where the balance of convenience lies. Now, as to the first of those propositions, I am satisifed that there is a serious question to be tried. There are matters that remain unresolved, and will remain unresolved, I imagine, until the substantive hearing takes place. Perhaps the most important of them is the extent of the rights and obligations between the first applicant in particular and the respondent in terms of the purchase of products from the first applicant, and whether or not the respondent is committed to deal exclusively in the first applicant's products. So far as that is concerned, there is no evidence before me today that would justify a conclusion that the respondent is bound to deal only in the first applicant's products. I accept for the purposes of today's application that the first applicant has established a reputation in its own products. That is sufficiently evidenced by Mr. Green's affidavit. There is also evidence that for some considerable time the respondent has not been purchasing the products of the first applicant, although it continues to sell other products from premises which are painted according to the colours of the first 3. applicant and which carry a logo which 1s the logo of the first applicant. In response to that contention, the respondent says two things. The first is that the premises have been maintained in that condition, in those colours, because of a requirement by the second applicant that the premises be maintained in the same colours as they were when the lease was granted. And the respondent says secondly that, faced with that situation, it has endeavoured by signs on bowsers (at one time a sign that stated that the fuel being sold was BP petroleum and later a_ replaced sign which simply said "This is not Gull petroleum") to avoid giving customers, prospective customers, the impression that the service station was selling Gull petroleum products. These are issues of fact that cannot be resolved at this stage of the proceedings. There is enough to justify a finding that there is a serious question to be tried. I say that, having regard to the applicants' submission that the respondent undertook the obligations of a lease and a supply agreement with the second applicant and the first applicant respectively and that, if the respondent chooses not to deal in the first applicant's products, it does not become it to complain if the applicants themselves complain that the first respondent is conducting its business in such a way as to give the public the impression that it is a Gull service station. Having said that, I move to the question of the balance of convenience and that seems to me to give rise to several quite difficult matters, difficult 1n the sense that thev cannot be readily resolved on the evidence that 1s ava1rlable at the present time. From the applicants' point of view, it is said that the first applicant's reputation is being affected by the conduct of the respondent in qiving the impression that it 1s selling Gull petroleum products when in fact it is not. I accept that to be a consequence, or a likely consequence, of what the respondent is doing. On the other hand, it is conduct that has continued for some considerable time. I am not in any sense giving the Court's endorsement to what has happened. I am simply pointing out that, in terms of an interlocutory injunction, it is conduct that has been on foot for some time. I am not persuaded that there is any element of urgency about the present application. From the respondent's point of view, however, there are real problems if an injunction is granted, particularly in the terms sought. In saying that, I am again not giving any endorsement to what the respondent has been doing. But if I take as a starting point, as I think I must, that the respondent is not obliged to sell only the first applicant's petroleum products, then the mere act of selling other petroleum products of itself does not constitute a breach of the arrangement between the parties. Of course, 1f in selling those products the respondent misleads or deceives members of the public (and as to that there is some evidence), it runs the risk that its conduct will be restrained and that 1t will have to pay damages for anv loss that the applicants have sutfered. But in the context of an interlocutory application, 1t seems to me that there are these ditficulties in the applicants' path. The first is that the premises are painted in a way that is required by the terms of the lease and bears a sign that is required by the lease, both of which give the impression at least from a distance that the service station is a Gull petroleum service station. Now that can only be altered, it would appear, on application by the respondent to the second applicant to change the painting on the premises and to remove the sign. There is some debate in correspondence as to whether the second applicant has insisted upon the existing colours and sign being maintained or whether it simply replied to the respondent by requiring it to maintain the premises in the colours in which they were originally painted. But if I were to grant an injunction in the terms sought by the applicants, it would place the respondent in a_ very aifficult position of knowing just how and in what circumstances it could continue to operate on the premises as they are presently painted and signed. Maybe that can be resolved as between the parties; but at the moment it has not been resolved and that isa consideration I must have regard to. More importantly, though, I think that an injunction in the terms sought would necessarily be vague and would put the parties, and the respondent in particular, under the very heavy burden of assessing whether what the respondent was doing was in fact in breach of the injunction. That 15 a situation the Court 15 verv loath to countenance. The applicants seek an interlocutory injunction in two respects; one in para.i(b) enjoining the respondent from selling or offering for sale petroleum products which are not the products of the first applicant from any premises displaying the mark of the first applicant. There is simply no basis offered to me at the present time for granting an injunction in those terms, because I am not persuaded that selling products other than those of the applicant is of itself in breach of the agreement between the parties or of itself constitutes misleading or deceptive conduct. As to the injunction that is the more seriously pressed, namely an injunction in terms restraining the respondent from passing off or attempting to pass off petroleum products not the products of the first applicant as the first applicant's products, I am of the opinion that an injunction in those terms would do no more than have the parties back before the Court within a very short time, arguing as to whether conduct was or was not in breach of the injunction. I would not be prepared to grant an injunction in such broad terms and at the moment I have not been offered any more specific basis. Indeed it might be difficult to formulate a more specific basis at the present time because of the uncertainty that surrounds the situation as to the painting of premises and as to the Gull sign that is on the premises. e For those reasons 1t seems to me inappropriate at this Stage to arant an ainterlocutory auntunction. £I can envisaqe Clrcumstances in which an interlocutory iniunction - couched in specific terms aqainst a clearer factual backaground as to the position between the parties regarding exclusivity or non-exclusivity and the second applicant's response to any question of painting the premises in a different colour or removing the Gull sign - miqght appropriately be granted. But on the material presently before me and the submissions that have been addressed to the Court, I am not prepared to grant an interlocutory injunction. I certify that this and the preceding six pages are a true copy of the ex tempore reasons for judgment herein of his Honour Mr. Justice Toohey. a Associate Dated: 4 November 1986