FEDERAL COURT OF AUSTRALIA Australian Competition & Consumer Commission v Ithaca Ice Works Pty Limited (ACN 010 201 180)[2001] FCA 497 TRADE PRACTICES - restrictive trade practices – price fixing – anti-competitive arrangements or understandings – price fixing arrangements by various persons engaged in the ice market – proof of arrangement or understanding – enforcement and remedies – need for proportionality to be maintained in various penalties imposed Trade Practices Act 1974 (Cth) Re British Basic Slag Ltd's Agreements [1963] 2 All ER 807 referred to TPC v Service Station Association Ltd (1993) 44 FCR 206 referred to Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd (1975) ATPR 40-004 referred to Trade Practices Commission v JJ & YK Russell Pty Ltd (1991) 13 ATPR 41-132 applied Briginshaw v Briginshaw (1938) 60 CLR 336 referred to Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd (1992) 67 ALJR 170 referred to AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v ITHACA ICE WORKS PTY LIMITED (ACN 009 660 306), QUEENSLAND ICE SUPPLIES PTY LIMITED (ACN 010 201 180), ANSONGUARD PTY LIMITED (ACN 010 589 929), KENNETH JOHN SMITH, ANTHONY JOHN MEE, GREGORY PAUL MEE, BRIAN BRADLEY, LEO GREVIS, GARY JOHN GREVIS, RODERICK IAN MATHESON AND JACK NUMAN BERRY Q 216 OF 1999 DOWSETT J 2 MAY 2001 BRISBANE IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 216 OF 1999 BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION APPLICANT AND: ITHACA ICE WORKS PTY LIMITED (ACN 009 660 306) FIRST RESPONDENT QUEENSLAND ICE SUPPLIES PTY LIMITED (ACN 010 201 180) SECOND RESPONDENT ANSONGUARD PTY LIMITED (ACN 010 589 929) THIRD RESPONDENT KENNETH JOHN SMITH FOURTH RESPONDENT ANTHONY JOHN MEE FIFTH RESPONDENT GREGORY PAUL MEE SIXTH RESPONDENT BRIAN BRADLEY SEVENTH RESPONDENT LEO GREVIS EIGHTH RESPONDENT GARY JOHN GREVIS NINTH RESPONDENT RODERICK IAN MATHESON TENTH RESPONDENT JACK NUMAN BERRY ELEVENTH RESPONDENT JUDGE: DOWSETT J DATE OF ORDER: 2 MAY 2001 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The application as against the third, eighth and ninth respondents is dismissed. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 216 OF 1999 BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION APPLICANT AND: ITHACA ICE WORKS PTY LIMITED (ACN 009 660 306) FIRST RESPONDENT QUEENSLAND ICE SUPPLIES PTY LIMITED (ACN 010 201 180) SECOND RESPONDENT ANSONGUARD PTY LIMITED (ACN 010 589 929) THIRD RESPONDENT KENNETH JOHN SMITH FOURTH RESPONDENT ANTHONY JOHN MEE FIFTH RESPONDENT GREGORY PAUL MEE SIXTH RESPONDENT BRIAN BRADLEY SEVENTH RESPONDENT LEO GREVIS EIGHTH RESPONDENT GARY JOHN GREVIS NINTH RESPONDENT RODERICK IAN MATHESON TENTH RESPONDENT JACK NUMAN BERRY ELEVENTH RESPONDENT JUDGE: DOWSETT J DATE: 2 MAY 2001 PLACE: BRISBANE REASONS FOR JUDGMENT 1 On 26 July 2000 I fixed penalties in this matter as against the second and seventh respondents, the tenth respondent and the fourth respondent. On 4 December I fixed the penalty as against the eleventh respondent. The relevant circumstances appear from the reasons published on those occasions. I am now concerned to dispose of the balance of the proceedings. The applicant and the first, fifth and sixth respondents have reached substantial agreement as to the facts of the case, although some matters remain in dispute. The third, eighth and ninth respondents deny any breach of the Trade Practices Act 1974 (Cth) (the "Act"). First, Fifth and Sixth respondents 2 Although the facts as agreed are not substantially different from those which I have recorded in my earlier reasons, I will summarize them. 3 The case concerns the supply of ice in Brisbane, the Sunshine Coast, the Gold Coast, Ipswich and Tweed Heads to major users such as nightclubs, caterers, the food industry, bait and fishing outlets, airlines and ice retailers. In mid-1993 there were approximately sixteen ice manufacturers supplying the market but by the end of 1996, there were about thirteen. The first respondent was a major manufacturer and supplier in the market in which it had participated since about 1926. Between August 1993 and September 1996 it acquired three other businesses. Since late in 1996 it has acquired three more businesses. The annual turnover of the ice market in 1993 was $4 - $4.5 million and in 1996, $5.5 - $6 million, and its current turnover is about $7.5 million. 4 In August 1993 the first respondent supplied approximately 30 – 35 per cent of the market and was the largest supplier. The next largest supplier supplied approximately 20 per cent of the market and was about 60 per cent of the size of the first respondent. By July 1996 the first respondent had increased its market share to about 60 per cent, largely through acquisitions. By this stage it was about three times the size of its largest competitor. Since July 1996, the first respondent has further increased its market share through acquisitions and by attracting customers who were previously supplied by others. Of course it has also lost customers. It is now about five times larger than the next largest supplier. 5 Its turnover and "before" and "after" tax profits are shown in the table below. Year Value of turnover Before Tax Profit After Tax Profit Year ending 30 June 1993 $1,355,701 $214,413 $138,650 Year ending 30 June 1994 $1,668,269 $447,924 $309,991 Year ending 30 June 1995 $2,391,865 $125,175 $88,246 Year ending 30 June 1996 $3,510,115 $105,175 $49,798 Year ending 30 June 1997 $3,925,999 $216,863 $157,578 Year ending 30 June 1998 $4,592,464 $256,310 $195,050 Year ending 30 June 1999 $5,239,918 $282,648 $194,830 Year ending 30 June 2000 $5,535,115 $322,715 $184,802 (draft) (draft) (draft) 6 The first respondent's total assets as at 30 June 2000 were just under $6 million. Its net assets were about $2.6 million. 7 Since some time prior to 1993 the fifth and sixth respondents have been primarily responsible for the conduct of the affairs of the first respondent. They are sons of the two directors James Anthony Mee and Shirley Mee. The fifth respondent is responsible for administration and marketing, whilst the sixth respondent is responsible for distribution. Between mid-1993 and September 1996 the first respondent manufactured and supplied the following products: · 3.5 kg bags of party ice; · 5 kg bags of party ice; · 10 kg bags of party ice; · 18 kg bags of party ice; · 5 kg blocks of compressed party ice; · bulk ice by the tonne; and · dry ice. 8 From 1985 until 1993 there was strong competition in the ice market in South-East Queensland. By mid-1993 there was a price war. According to the first respondent, the lowest price at which it offered a 3.5 kg bag of ice prior to August 1993 was 30 – 40 cents. The applicant asserts that the first respondent was supplying at prices as low as 25 cents. This matter remains in dispute between the parties. At the Gold Coast the first respondent was offering to supply 3.5 kg bags at 35 cents per bag and 5 kg blocks at 45 cents per block. These prices were lower than those being charged by the first respondent to some of its customers in Brisbane. Suppliers also competed by offering "free fills" of ice cabinets upon their initial installation in retail facilities. They also offered fixed prices for specified periods. Suppliers actively canvassed the customers of other suppliers, offering to supply at lower prices or on better terms. 9 In mid-1993 James Anthony Mee asked Kenneth Smith, who was the president of the Packaged Ice Association of Australia ("PIAA"), to organize a meeting between himself and Mr Malcolm Hicks of Gold Coast Ice Supply because of concerns that the latter was taking customers away from the first respondent. Mr Smith arranged a meeting of all, or substantially all of the suppliers in the identified market area. It took place at the Beenleigh/Yatala Motor Inn on 13 August 1993 and was the first of a number of such meetings. The fifth and sixth respondents and their sister, Ann-Louise Connolly, attended. She is a solicitor. Various "agreements" were reached including: · that from 13 August 1993 participants would not compete with the other participants to supply ice to existing customers; · that from 14 August 1993 participants would supply ice to new customers at agreed prices and would supply prices for "door sales" as agreed; bulk ice would also be provided at prices fixed at the meeting; and · that participants would not supply "free fills". 10 The agreed prices were substantially higher than those currently being charged by participants to at least some customers. It was also agreed that: · participants would not approach existing customers of any other participant with a view to supplying them; · if any existing customer of a participant approached another participant seeking supply, the participant so approached would advise the other participant; · if an existing site re-opened after renovations with the same management, participants would not seek to displace any previous participant/supplier; · if a site re-opened with new management any participant could tender to supply ice at the agreed prices; and · where a contract for supply held by a participant was due for renewal, other participants would quote for supply at the agreed prices. Ms Connolly told the meeting that price fixing was illegal. 11 The second meeting was held on 5 October 1993, again at the Beenleigh/Yatala Motor Inn. Mr Smith allegedly encouraged other participants to give effect to the agreements previously reached. The participants also agreed that for the future, if they were going to charge a fee for ice storage cabinets supplied to customers, the charge would be $10 per month. Terms of the agreements previously reached were outlined to those in attendance who had not been at the first meeting. All agreed to adopt those agreements for the future. Arrangements were made to communicate the terms of the agreements to suppliers who were not present. It was also agreed that any new supplier in south-east Queensland should be informed of the agreements and invited to implement their terms. 12 The third meeting took place on 7 December 1993 at the same venue. Participants were told that the Trade Practices Commission had instituted proceedings against Sydney ice suppliers in respect of alleged minimum base price agreements. It was suggested that the Trade Practices Commission be invited to address the next meeting. There is some suggestion that this was seen as a way of deflecting the interest of the Commission away from the Queensland industry. 13 The first respondent implemented the agreements to some extent. It increased charges to existing customers and on occasions, quoted the agreed prices when approached by new customers or customers of other participants. On other occasions it quoted sufficiently high prices to such customers to deter them from changing suppliers. It also, on occasions, informed other suppliers of approaches by their customers. It gave effect to the agreements for a period of twelve to eighteen months and thereafter gave sporadic effect to it until September 1996. The first respondent believed that other participants were not poaching its customers during this period. It did not give effect to the "free fill" agreement or the agreement as to rental fees for ice storage cabinets. On at least one occasion the first respondent sought to enforce the agreements against another participant by seeking mediation within the industry. It also sought support from other suppliers to prevent supply to one customer to whom the first respondent wished to supply on a "no payment - no supply" basis. There also appears to have been collusion concerning quotations by the first respondent and one of its competitors for supply to Shell service stations on the Gold Coast and to Qantas. At some time after the third meeting the fifth respondent informed a representative of the Trade Practices Commission that there was no price fixing in the ice industry in south-east Queensland. 14 At a fourth meeting held on 15 February 1994 it was suggested that the parties should destroy their copies of the minutes of the first and second meetings because of concerns as to the application of the Act. The agreements were discussed at subsequent meetings. It seems that after the Shell and Qantas tenders previously mentioned, the participants effectively ceased to implement the agreements, probably from about July 1996. 15 The factual dispute between the applicant and the first, fifth and sixth respondents involves two issues, the first being whether or not the first respondent sold ice at a price as low as 25 cents per 3.5 kg bag at some relevant time, and the second being the capacity of the first respondent to pay any pecuniary penalty, having regard to its current financial position. In the end I do not see either issue as being of substantial relevance in this case, given that I have already dealt with five "co-offenders". The conduct alleged against the various respondents is involvement, in one way or another, in the same agreements contrary to the terms of the Act. There are minor variations in the degrees of involvement arising out of the number of meetings attended and the relatively vague evidence as to the extent to which each participant gave effect to the agreements, but in the end they were all parties to the same illegal conduct. 16 Given that I have already dealt with five of the respondents, fairness dictates that a primary consideration in fixing penalties for the first, fifth and sixth respondents must be relative equality of treatment. It would be embarrassing in the administration of justice if this were not substantially achieved. For this reason there is little point in looking closely at the procedures adopted internally by the first respondent to give effect to the agreements as this was not done in the material put before me with respect to the other respondents. As to the question of capacity to pay that, in my view, will only be relevant if it is suggested that a respondent in question is unable to meet what would otherwise be an appropriate penalty. The level of appropriate penalty should not be increased by reference to the assets which might be available to a respondent. However, where the benefit to be derived from the misconduct in question was substantially greater in the case of one respondent than in the case of another, that may be a relevant factor in fixing penalty. 17 As is disclosed in the agreed facts, the first respondent's largest competitor was Queensland Ice Supplies Pty Ltd, the second respondent. In August 1993, the first respondent was supplying 30 – 35 per cent of the market and the second respondent, about 20 per cent. It was therefore about 60 per cent of the size of the first respondent. By July 1996, Ithaca had increased its share to approximately 60 per cent, which was almost three times that of the second respondent. It should not be inferred that the expansion was a result of the agreements, although they may have contributed to some extent. During the period in question the first respondent had acquired other ice supply businesses. The applicant and the second respondent agreed that in the case of the second respondent, an appropriate penalty was the sum of $25,000. The seventh respondent, Brian Bradley was, in effect, the owner of the second respondent and was alleged to have been concerned in the breaches. The applicant submitted that it was appropriate that no penalty be imposed upon him. 18 Apart from the relative sizes of the operations of the first and second respondents, the substantial difference between the positions of the second and seventh respondents and those of the first, fifth and sixth respondents was that the seventh respondent actually alerted the applicant to the conduct in question. This occurred some time in 1999 although, as I have said, the offending agreements were abandoned in the middle of 1996. The applicant considered that the degree of cooperation provided by the seventh respondent was unusually high, and there can be no doubt that the agreed penalty reflected this. I should add that it has now been disclosed that the seventh respondent's "cooperation" was at least partially motivated by the fact that he was involved in a dispute with the first respondent and/or the fifth and sixth respondents. I am not sure that I would have taken quite as favourable a view of his "cooperation" had I known that when dealing with him and the second respondent. 19 The first, fifth and sixth respondents admitted their involvement at a relatively early stage, once confronted with the relevant allegations, and made appropriate disclosures. Thus they too are entitled to some credit for their cooperation with the investigating authority. The penalty imposed on the second respondent was reduced somewhat because of its financial position. 20 Counsel for the applicant has submitted that the penalty to be imposed on the first respondent ought be in the range of $300,000 - $550,000. This range has been calculated largely by reference to the penalty imposed upon Mr Matheson, the tenth respondent. He was of advanced years, and his business was very small. The penalty was said to be the lowest consistent with providing an adequate deterrent. The size of his business was such that a penalty based upon it, and consistent with the penalties imposed on others would not have been adequate. Again, this penalty was agreed between the parties. It seems to me that the penalty imposed upon the second respondent gives a better guide to that appropriate to the first respondent, given that of all those participating in the offending conduct, the former was nearest in size to the latter. I consider that the appropriate penalty in the case of the first respondent will be substantially higher than that imposed on the second respondent. In a short-hand way it is convenient to say that this reflects the higher turnover of the first respondent's business compared with that of the second respondent. Really, it is because higher turnover reflects a greater capacity to benefit from the illegal conduct and to persist in it. The first respondent appears to be in a substantially stronger financial position than was the second respondent. 21 In the circumstances I consider it appropriate to impose upon the first respondent a pecuniary penalty of $100,000. As to the fifth and sixth respondents, I impose upon each a pecuniary penalty of $7,500. There was some attempt in the course of argument on behalf of the applicant to distinguish between them in terms of their responsibility for the first respondent's misconduct, but I see no real justification for that view. Both appear to have been generally aware of what was happening, although one may have been more involved in the detail than the other. I will hear submissions as to time to pay and as to costs. THIRD, EIGHTH AND NINTH RESPONDENTS 22 The eighth and ninth respondents are father and son respectively and were, in 1993, directors of the third respondent. It operates an ice works at Miami on the Gold Coast. It denies any conduct in breach of the Act. The eighth and ninth respondents deny that they were knowingly concerned in any such conduct. 23 There is no doubt that both the eighth and ninth respondents attended the meeting held on 13 August 1993 and that the eighth respondent, but not the ninth respondent attended the meeting held on 5 October 1993. The only factual dispute is as to the extent of participation in each meeting. The minutes do not suggest that either man spoke at the August meeting or that the eighth respondent spoke at the October meeting. The minutes do not expressly record that either of them voted, but they suggest that all participants supported some resolutions. 24 The thrust of the applicant's case against the third, eighth and ninth respondents is to be found in the minutes of the August and October meetings. It is appropriate to commence with a summary of those minutes and then to consider the evidence of the eighth and ninth respondents concerning their involvement in those meetings. I will then consider the evidence of the other participants and Mr Stewart, an employee of the applicant, who interviewed the eighth respondent by telephone. The minutes – 13 August 1993 25 Seventeen people are showing as attending, including the eighth and ninth respondents. The meeting commenced at 9.30 am with an "address" from the president Mr Smith. He said that the meeting was called to discuss problems facing participants, that it was not a fault-finding witch hunt and that accusations would not be tolerated. He asked each participant to accept each business and their customer-base "as is". He said that they might then "move on to discuss ways of building a trust and working relationship towards each other". 26 The minutes then record: Moratorium on approaching other suppliers customers. 90 percent of the meeting agree instantly. 27 Various matters were then discussed but there is no suggestion that either the eighth or ninth respondent participated in the discussion. On p 2 of the minutes this passage appears: Hazel Sawyor asked if a site that she had serviced for 8 years closed down for renovations and a new manager was appointed was that a new site or did the meeting feel that was still her site (no answer at this stage). The chairman asked that the meeting would resume previous discussion. 28 The relevance of this matter will appear presently. There was then discussion as to prices. Mr Smith then asked the meeting whether: … after all the discussion and as from todays date, that there would be agreement not to canvas other suppliers customers. 29 The minutes then record: MOTION MOVED: by Jim Midgley SECOND: by Bill Wood 100% of the meeting was in favour of this motion. 30 There was further discussion concerning a recommended wholesale price and then it is recorded that: The meeting agreed that as of 14th August there would be no under cutting of the recommended wholesale rate. The recommended wholesale prices were then set out. 31 Ms Sawyor again raised the question of sites closing for renovation. It is recorded that: The meeting felt that if a current site is closed for renovations and the management is the same there should be no change of ice supplier unless the management requests a new supplier. If new management is engaged for the refurbished site it would then become a new site to which all manufacturers can tender at the recommended wholesale price. The tendering then comes down to approach to supplier, servicing and marketing with NO FREE FILLS. The new management is a current customer of an ice manufacturer, the ice manufacturer is entitled to continue current business. 32 The eighth respondent claimed that he and the ninth respondent arrived at the meeting during these discussions. 33 There was then discussion concerning "ice box charging", insurance for ice boxes and other matters of general interest. Brian Bradley is then recorded as having said: … some ice manufacturers have current written contracts with customers if the contract is not legal then the letter is only as good as the writers word. It was discussed that when contracts come up for renewal the customer can ring around for prices but he can only be quoted the recommended wholesale price by other suppliers. 34 There was further discussion concerning storage cabinets and of a rental agreement used in South Australia. The next meeting was fixed for 5 October 1993 at 9.30 am at the same venue. The meeting closed at 11.45 am. The minutes – 5 October 1993 35 The meeting commenced at 9.30 am with fourteen people in attendance, including the eighth respondent. The minutes of the previous meeting were discussed. This part of the minutes concludes with the following: Brian Bradley suggested we have a list of each of the ice works in alphabetical order. Moved by: Hazel Sawyer, Second Ian Matherson. It has been generally assumed that this motion was for adoption of the minutes. It was passed. 36 The next item was general business. There was again discussion as to ice box rental. On p 2 this passage appears: A show of hands was required for agreeing to a box rental charge, the floor agreed in principle but felt that it was too close to the price rise and we should wait for a while. Mal Hicks said that he would like to charge a few customers but the floor said it should be all or none. 37 Discussion followed concerning the question of how to stop clients changing manufacturers when rental was charged. Ms Sawyer suggested that "… it should be the same as the ice sales, have a recommended price". 38 The following passage then appears: Brian Bradley moved that there be a rental of $10.00 charged per month on boxes no stipulation for size and it be up to the individual company if they wish to charge it. For all customers that are not currently buying from you a rental may be quoted for new business. Second David Sawyer. 100% of the meeting was in favour of this motion. 39 There was then discussion concerning Yellow Pages listing and cost, supplying sporting events and other major functions. It was suggested that the recommended wholesale price may not be appropriate to those activities. Mr Brotherston was asked to pass on to other ice manufacturers on the north coast, "… what was happening with the meetings". It is then recorded that: … and Ken reiterated the presidents to new members. I do not understand this. 40 Mr Bradley asked what would happen if a new manufacturer started up in "our area". It is recorded that: … the floor thought to asked them along to the next meeting so as to have no illusions of their competition. 41 There was then discussion about prices. Mr Hicks moved that the base price for new business be increased from 80 cents to $1 for a 3.5 kg bag. This was seconded by Mr Sawyer. The minutes record that six voted for and six, against this motion. As I have said, according to the minutes there were fourteen in attendance at the meeting, including Ms Sawyer, but not David Sawyer. It seems that both attended. Mr Bradley and the eighth respondent claim to have abstained from voting. 42 Mr Mee was asked to approach his sister (who was a solicitor) with regard to an appropriate agreement incorporating insurance and other matters. Mr Smith raised the possibility of their forming a sub-branch of PIAA. The next meeting was fixed for 7 December 1993. The eighth and ninth respondents' evidence 43 Mr Leo Grevis (eighth respondent) was, as at November of last year, aged 76 years. He has been involved in the ice industry on the Gold Coast for all of his life. His father was in the industry before him. He and Gary Grevis (ninth respondent) who is his son were, in 1993, the directors of the third respondent. The ninth respondent had no actual involvement in the conduct of the business. He had his own business as an electrical contractor. The ice business was run entirely by, and for the benefit of the eighth respondent. By August 1993 the third respondent was supplying small shop owners, restaurants, marinas, Gold Coast apartments, three service stations and four hotels. It was also supplying large blocks of clear ice for ice sculpture. 44 There had a been a price war amongst ice manufacturers in Brisbane and the Gold Coast as a result of which the third respondent had lost a number of customers to other manufacturers. In August 1993 the eighth respondent received a telephone call from Mr Ken Smith, the proprietor of a business called North Coast Ice. He was informed that there was to be a meeting of manufacturers on 13 August at the Yatala Motor Inn to discuss the price war. The eighth respondent initially indicated that he would not be able to attend as he was recuperating from a hip replacement operation and was on crutches. As matters turned out, the ninth respondent was going to Brisbane on the morning of 13 August on business of his own, and so the eighth respondent took the opportunity of travelling to Yatala with him for the meeting. The ninth respondent also went to the meeting. He said in his own evidence that the reason for this was that he thought it better to wait than to pick his father up on his return trip from Brisbane. The latter alternative could have resulted in his father having to wait for a considerable period of time by himself. 45 According to the eight respondent, they arrived at the meeting at about 10.30 am and found it already in progress. He sat next to Mr Hicks, and the ninth respondent sat on his other side, but a little away from the table. At that time, Ms Sawyer was asking about sites closing for renovation and re-opening with the same management. About twenty minutes after their arrival, the meeting broke for morning tea. The meeting concluded about an hour after their arrival. The eighth respondent remembered the following matters being discussed: · whether "free fills" should be provided to new customers; · whether there should be charges for ice boxes; · whether PIAA should be regarded as a sub-branch (presumably, whether they should form a sub-branch of PIAA); · the prices which could be quoted when customer contracts came up for renewal; and · the painting of storage cabinets in corporate colours. 46 He said that he found none of these matters to be of relevance to him. He had never provided "free fills" to customers and had no intention of doing so, nor had he ever charged for ice boxes. He had no interest in PIAA. He had no formal contracts with customers and so was not interested in discussions concerning contracts. He had never been asked to paint a cabinet. He said that he did not speak to anybody during the meeting, nor did he signify any agreement to the matters discussed. During the morning tea break he had a conversation with Mr Tony Mee (the fifth respondent) concerning his family. He received a copy of the minutes of the August meeting by post and attended the October meeting by himself. He had, by this time, recuperated from his operation. He did not vote at that meeting. He attended the meeting because he was interested to see what the other manufacturers proposed to do and whether they proposed to formalize the agreements recorded in the minutes of the August meeting. He did not recall the discussions concerning motions passed at that meeting, save that he recalled discussion concerning ice box rental. The chairman adopted the practice with respect to voting of asking for "those in favour", then immediately asking for "those against." and announcing "carried". The chairman did not invite those abstaining to indicate. 47 The next meeting was fixed for 7 December 1993. The eighth respondent indicated to the chairman that he would not be attending. He decided that he did not wish to have any further association with the group. He did not give effect to any of the resolutions adopted at either meeting. He did not change his prices or methods of operation in any way and did not attend any further meetings. Other aspects of his affidavits are relevant to the evidence of some of the other witnesses. I will deal with what he says concerning their evidence when I have considered it. 48 The eighth respondent agreed in cross-examination that he would have liked to see an end to price cutting. I have no doubt that such was the case. He was cross-examined about his time of arrival at the meeting. He said that he based his estimate of that upon the fact that his son had telephoned him at about 8.30 or 8.45 to tell him that he was going to Brisbane on business and to suggest that he could take him to the meeting. The eighth respondent had to go home to get changed and then return to work to close down the plant. He said that it would have taken him about ten minutes to get home, about ten minutes to a quarter of an hour to change and ten minutes to get back to the plant. He would then have required time to close down. It would have taken between three-quarters of an hour and an hour to get to Yatala. 49 The eighth respondent was also cross-examined about his assertion that when he arrived, Ms Sawyer was discussing outlets which reopened after renovation. His attention was drawn to the fact that this matter is referred to at two different places in the minutes. It was suggested that he may have arrived as the matter was raised for the first time. The eighth respondent's account of the business transacted after he arrived suggests that he arrived as the matter was being raised for the second time. He was quite confident that he was not present when the meeting adopted the motion concerning canvassing of other suppliers' customers or for the discussion concerning recommended wholesale prices. He said that he did not enquire about discussions concerning price cutting which may have occurred prior to his arrival, although that presumably was his major interest. Nobody told him what had been agreed. It did not occur to him to ask. Although it is superficially surprising that he should not have inquired as to any prior discussion concerning pricing, it is likely that the gist of prior discussions emerged from the subsequent discussion of other matters. Recommended wholesale prices were mentioned after the time at which the eighth respondent claimed that he arrived, as was the question of canvassing other suppliers' customers. These passing references may well have been sufficient for the eighth respondent's purposes. It was suggested to him that morning tea had followed the completion of the meeting. He disagreed with this. 50 The eighth respondent agreed that prior to the October meeting, he received the minutes for the August meeting. He read them but did not take them to the meeting. He did not contact the secretary, Sue Garrett, to indicate disagreement with any aspect, although they suggested that he and the ninth respondent were present for the whole meeting. He also did not raise this matter when the minutes were discussed at the October meeting. He said (TS 333): I couldn't confirm whether those minutes were a true record, because I wasn't there at the meeting, the first half of the meeting, so how could I - how could I say that there was a true record? 51 It was put to him that he had not questioned the minutes because he wanted to give the impression to others present that he accepted their correctness. He denied this. Although there may be circumstances in which a participant in a meeting would think it important that the minutes record that he or she was or was not present at a particular time, there is nothing in the evidence which suggests that the eighth respondent should have held that view concerning the August meeting. Both meetings appear to have been relatively informal. Further, there is nothing unlikely about the eighth respondent's assertion that he attended to keep an eye on the other participants rather than to have any input himself. In those circumstances it is understandable that he did not take any point about the fact that he and his son had been late in arriving at the August meeting. 52 Exhibit 5 contains answers to interrogatories delivered on behalf of the applicant. In those interrogatories, it is said that the representatives of the third respondent had morning tea after the close of the meeting and then left. This seems to be inconsistent with Mr Grevis's evidence as to the time of morning tea, but in view of the passage of time, that is hardly surprising. 53 The ninth respondent, Gary John Grevis, said that he had been a director of the third respondent from 12 September 1985 until 24 July 2000. Prior to its incorporation, the eighth respondent had conducted his ice business whilst the ninth respondent had conducted his own business as an electrical contractor. After incorporation, the third respondent provided an "umbrella" for the conduct of both businesses, although they were conducted quite separately. The ninth respondent assisted in maintaining the equipment in the ice business but had no other involvement in it. In 1986 the ninth respondent incorporated his own company but continued as a director of the third respondent until 24 July 2000. They were then advised that it was no longer necessary that the third respondent have two directors. He ceased to be a director. 54 In August 1993, when the eighth respondent was recovering from a hip operation, the latter told the ninth respondent that there was to be a meeting of ice manufacturers and that he would not mind attending but could not do so because of his capacity. On the date of the meeting the ninth respondent found that he had to go to Brisbane and offered to take his father to the meeting. The ninth respondent decided to stay with him at the meeting because otherwise he might have to remain at the motel for some time after the meeting concluded, awaiting the ninth respondent's return from Brisbane. They arrived at about 10.30 am. There was a tea break about half an hour after they arrived. During the tea break somebody approached the eighth respondent, asking him about his leg. The meeting concluded at 11.30 am and they left immediately. The ninth respondent said that he did not participate in any discussion, nor did he vote. He did not attend any other meetings although he was invited to attend a meeting in 1995. He had installed a radio system for the business conducted by Mr Hicks, another ice supplier and witness in these proceedings, and had been invited to speak to the meeting concerning such equipment. He was unable to go because his wife was expecting a child. 55 In cross-examination he agreed that prior to the August meeting, he had been aware that his father was losing customers as a result of a price war and that this was causing concern. His estimate of 10.30 am as the time of arrival at the meeting was based upon enquiries made of Telecom concerning telephone records which indicated that he was still in his own office at about 9 am on that morning. His office at the Gold Coast was only about half a kilometre from the third respondent's ice works. It would have taken a bit more than half an hour to travel to Yatala. It took about forty-five minutes to get to a client's premises in Beenleigh, which was about five kilometres, as the crow flies, from Yatala. The ninth respondent had little recollection of the meeting. The only topic which he recalled was the question of "free fills". In re-examination he said that he thought a woman had spoken about "free fills". Evidence from other participants in the meetings 56 Brian Bradley is a director of the second respondent and is himself the seventh respondent in these proceedings. As I have mentioned in other contexts, both the second and seventh respondents have been dealt with, no penalty having been sought by the applicant as against the seventh respondent. For present purposes Mr Bradley's relevant evidence concerned only the meetings in August and October. 57 Mr Bradley's affidavit disclosed no specific participation in the August meeting by either the eighth or ninth respondent or by the eighth respondent in the October meeting. However he asserted on numerous occasions that all persons at the meetings agreed to particular proposals. He was unable to say how participants may have indicated such agreement. In the course of cross-examination he acknowledged that he had not kept notes of the meetings and had relied upon the minutes. He swore his affidavit in September 1999. He abstained from voting in the tied vote at the October meeting. He first met the eighth respondent at the August meeting. He did not recall him saying anything at the meeting, nor did he know whether the ninth respondent had said anything. Mr Bradley denied that they had been late for the meeting. He asserted that he remembered everybody in the meeting voting for the resolution which was said in the minutes to have been adopted by 100 per cent of those present. Agreement was generally indicated by show of hands but that method was not always adopted. On some occasions the vote was "on the voices". At TS 243 ll 21 – 25, he was asked and responded: Is it correct to say that your best recollection is this? That in respect of any particular motion, any motion whatsoever which was made at the first meeting or the second meeting, that in effect what was said was by someone, the Chairman perhaps, "Does anyone disagree?" and no-one said anything so it was noted as 100 percent? --- That's correct. 58 However he said that there were also shows of hands. He could not say whether any particular motion had been adopted by a show of hands or "on the voices". He asserted that at the second meeting, he was concerned to see how everybody voted. In re-examination he said that he had expressly abstained from the tied vote at the second meeting because it involved 3.5 kg bags which he did not sell. If anybody had abstained from voting at the first meeting, he would have asked why. He then said that he could not be "absolutely 100 percent positive" as to whether everybody voted in favour of each proposal at the first meeting, but he was confident as to the second meeting. I must say that I was not greatly impressed by Mr Bradley's evidence. He was not sure whether votes were taken by show of hands or "on the voices". It is difficult to accept that nonetheless, he noted how others voted. Mr Bradley agreed that he had approached the applicant in February 1999 because proceedings had been commenced against him by the first respondent or possibly, the fourth and fifth respondents. I found it difficult to avoid the conclusion that Mr Bradley was influenced in his evidence and in his co-operation with the applicant by the existence of those proceedings. He has certainly benefited from his co-operation by virtue of there being no penalty imposed upon him personally in connection with his involvement in these meetings. I gained the impression that he was quite hostile towards the eighth and ninth respondents. It is not necessary that I say more about his evidence, save that to the extent that he sought to assert any active involvement by either the eighth or ninth respondent in either meeting, I was not persuaded that such was the case. 59 Anthony John Mee, the fifth respondent, and one of the persons responsible for the day-to-day operation of the first respondent gave evidence against the third, eighth and ninth respondents. He did not recall anybody arriving late at the August meeting. He remembered at least one vote being taken by a show of hands. At the October meeting, the minutes of the August meeting were adopted by "nod". He recalled the motion at the October meeting which was tied, "six all". In cross-examination he agreed that he was largely dependent upon the minutes for his recollection of the two meetings. He had not met Mr Leo Grevis prior to the August meeting, nor had he met Mr Gary Grevis. He could not recall whether they had arrived late. He was unable to say whether, at the August meeting, either had voted for or against any motion. Similarly, he was unable to say whether the eighth respondent had voted for or against any motion at the October meeting. 60 Gregory Paul Mee is also involved in the conduct of the business of the first respondent. He attended the August meeting but not the October meeting. He did not recall anybody arriving late at the August meeting but agreed that this recollection could be inaccurate. He could not remember any vote being taken and so was unable to say whether everybody present voted. The meeting was very informal. Contrary to his affidavit he said in cross-examination that he may have been at the October meeting. This seems unlikely. 61 Kenneth John Smith is the fourth respondent. He operated a business called North Coast Ice. He had been a member of PIAA for some years and in July 1993, was elected president. At the request of Tony Mee he organized a meeting of manufacturers in South East Queensland to discuss the price war. He telephoned a number of manufacturers saying: I'm Ken Smith of North Coast Ice. I've been asked to set up a meeting of ice manufacturers in south-east Queensland to work out a way to stop this price war and bring some sanity back into the industry. 62 He may also have mentioned that Tony Mee, Brian Bradley and Mal Hicks would be there. At the meeting, participants agreed not to supply ice to new customers at prices below agreed prices. Participants also agreed as to "free fills" and not to canvass other suppliers' customers. He recalled the agreement to charge $10 for the hire of ice storage cabinets and the tied vote. He used his casting vote as chairman to defeat that motion. In par 43 of his affidavit he asserted that he believed that the matters set out in pars 18 – 26, 28 and 29 of the statement of claim were correct with certain exceptions. I am not sure what I am to make of that. It seems very much like swearing to the issue. 63 Roderick Ian Matheson was the tenth respondent. He is the co-owner and manager of Caboolture Ice Works which supplies ice to areas which are north and west of Brisbane. He asserted in par 28 of his affidavit that the matters set out in pars 18 – 30 of the statement of claim were true and correct. Again I'm not sure what is to be made of such a statement of belief. He recalled discussions at the meetings concerning "free fills" and ice box rental. There was some discussion about packaging and health issues. He was not particularly interested as he was planning to leave the ice industry. 64 John Bell Brotherston is a director and shareholder of Brotherston Distributing Pty Ltd, trading as Suncoast Cold Stores. He attended the October meeting. At that meeting Mr Smith outlined the agreements reached at the previous meeting and he, Mr Brotherston indicated that he would abide by them. The meeting commenced with a discussion of the minutes of the earlier meeting. Ms Garrett asked "Did every one receive a copy of the minutes?" and "Have you read them?" Participants replied to the effect that they had. Ms Garrett asked "Is there anything from the minutes that needs to be discussed?" Various matters were raised. The minutes were then adopted. There was no objection to the them. 65 Discussion occurred concerning rental fees for ice storage cabinets. To the best of the witness's recollection, everyone agreed that there should be a charge of $10 if anything was to be charged. This matter may have been voted on by show of hands. Mr Brotherston was asked to recruit members from amongst suppliers on the north coast. He said in cross-examination that he could not recall whether votes at the October meeting were taken by show of hands or "on the voices". It may have been by show of hands. He agreed that he would not necessarily know whether people had voted. 66 Suzanne Lorraine Garrett was previously associated with A1 Ice Services. She took the minutes at both the August and October meetings and verified their accuracy. She could not recall whether voting was by show of hands or "on the voices". The chairman may simply have asked if there were any dissent from a proposed motion. She said that her description of resolutions as having been adopted unanimously reflected "the feeling of the meeting". She thought that the eighth and ninth respondents had probably not been at the August meeting when it started. She would normally have signed the attendance sheet last. As their names follow hers on it, they obviously signed after she had done so. She thought that at least one vote at the October meeting was by show of hands. As to the resolution which was allegedly supported by 100 per cent of those in attendance, she was unable to say how she would have determined that this was so. 67 Malcolm Edward Hicks was the director of Berong Poultry Farmers Pty Ltd which traded as Gold Coast Ice Supply. He attended both meetings. He was of the opinion that the ninth respondent had been invited to discuss two-way radio systems at the October meeting. It seems however that he was in error and that this was arranged for a meeting in 1995. Mr Gary Grevis said that his wife had a baby in 1995 and for that reason, he was not able to attend the meeting pursuant to the understanding that he had reached with Mr Hicks. Mr Hicks did not recall anybody arriving late at the August meeting. He said that if anybody arrived late, it was by no more than half an hour. He recalled both the eighth and ninth respondents making comments to other participants during the August meeting and that Mr Leo Grevis made comments during the October meeting. However he did not recall any of these comments. In the circumstances I am not willing to infer that anything which was said by either man was relevant to these proceedings. It is curious that Mr Hicks should have asserted that, although he could not recall anybody arriving late, if they did so, they were no more than half an hour late. There is no logic in this proposition. He did not know how any particular person voted at either meeting. 68 Ann-Louise Connolly, sister of Anthony John and Gregory Paul Mee, recalled the August meeting. A man and his son arrived after the meeting had started. She thought that they were present for a substantial part of the meeting, including the discussion concerning canvassing customers, prices and ice boxes. However she was not certain. She recalled morning tea being served after the meeting. In cross-examination she agreed that the latecomers had arrived neither shortly after the meeting commenced, nor shortly before it concluded. She agreed that morning tea may have occurred during the meeting. 69 Jack Numan Berry is the co-owner and manager of Ipswich Ice Supplies. He attended the October meeting. His evidence merely verified the minutes. Other evidence 70 Cameron Ross Stewart was previously an employee of the applicant and its predecessor, the Trade Practices Commission. On 25 July 1994 he spoke to the eighth respondent by telephone and made hand-written notes of the conversation. The eighth respondent said that he had attended a meeting at about that time in the previous year, at the Yatala Motor Inn. The price war had been discussed, and it was proposed that they should cease cutting prices and bring prices back to normal, which he thought was about 65 cents per 3.5 kg bag. Mr Smith had discussed forming an association but the eighth respondent had not wished to join. He also said that Mr Smith had discussed the possibility of charging rent for ice boxes. Mr Stewart read the following passage to him: It was brought to my notice that a meeting of all parties was the desired approach. This was done and by being here you have shown a concern and desire to discuss the problems facing us today. This meeting will not be a fault finding witchhunt nor will accusations be tolerated. I am asking each of you to start as from today to accept each business and its customer base as is. With this acceptance I feel we can move on to discuss ways of building a trust and working relationship towards each other. 71 This seems to have been a paraphrase of Mr Smith's introductory remarks at the August meeting. Mr Stewart did not tell the eighth respondent the source of the extract. The eighth respondent said that he had a vague recollection but he could not be certain that Mr Smith had said those words. He thought that at the meeting there had been some talk about removing the 3.5 kg bag from the market and selling 5 kg bags. There was another meeting in August 1993 which he had not attended because he had to go to hospital for hip surgery. Eighth respondent's reply 72 Mr Grevis said of Mr Stewart's affidavit that his recollection of Mr Smith's comments was derived from the minutes of the meeting rather than from his having actually heard them. He thought that he may have told Mr Stewart that the first meeting was in August and the second, in September. In either event, he appears to have been mistaken. The eighth respondent also expressly denied aspects of the evidence of various other witnesses, but it probably will not add much to this summary to deal with those matters in detail. Resolution of factual disputes 73 I should first resolve the question of when the eighth and ninth respondents arrived at the meeting. It is clear to me that their evidence as to this matter should be accepted. Ms Garrett found objective support for their account in the fact that their names appear after hers on the attendance list. Ms Connolly expressly recalls a man and his son arriving late. It is likely that Ms Connolly's recollection of their late arrival is more reliable than the assertion of others that nobody had arrived late. A specific recollection of an event will often be more credible than a general denial of it. Once this is accepted, it follows that there is no reason to reject the eighth and ninth respondent's evidence as to when they arrived. They are, after all, in a better position than anybody else to give such evidence. I accept their evidence as to the approximate time of their arrival. I also accept the eighth respondent's evidence as to the business under discussion at that time. The ninth respondent seems to have taken little interest in the meeting. I also accept the latter's evidence that he played no active part in the management of the third respondent's business, took no part in the August meeting and had no interest in it. 74 The circumstances in which the eighth respondent came to arrive late invite the inference that he also did not consider the meeting to be of great importance. Although he wanted to see an end to the price war, he was a victim of it rather than a participant. There was little he could do about it. The evidence as to his participation in the meeting has to be seen in this light. There is no reason to reject his evidence that he did not vote on any resolution. Nobody, with the possible exceptions of Messrs Bradley and Hicks, actually claims to recall seeing or hearing him vote, although a number of witnesses had the impression that there was general agreement as to certain matters. The meeting was of such a size as to render it difficult for one participant to perceive the responses of the others. I do not accept the evidence of either Mr Bradley or Mr Hicks where it conflicts with that of the eight or ninth respondent. It would be unfair to say that I thought them biased, but they displayed a general hostility to any suggestion that the eighth respondent had not participated in the meeting. I found this difficult to understand. 75 I should add that neither respondent claims to have expressly disapproved of any proposed motion or any statement of opinion at either meeting, nor did the eighth respondent claim to have challenged the correctness of the minutes of the August meeting when they were presented for adoption at the October meeting. The question for resolution is the effect of their silence. 76 It is appropriate now to consider the nature of the conduct necessary to constitute a contract, arrangement or understanding for the purposes of the Act. There is, I think, little disagreement as to the appropriate test to be applied. In Re British Basic Slag Ltd's Agreements [1963] 2 All ER 807 at 819, Diplock LJ (as his Lordship then was) said: "Arrangement" is not a term of art; and in s 6(3) of the Act [the Restrictive Trade Practices Act, 1956] I agree with my lords that it bears the meaning that an ordinary educated man would ascribe to it. It involves a meeting of minds because under s 6(1) it has to be an arrangement "between two or more persons" and, since it must be an arrangement "under which restrictions are accepted by two or more parties", it involves mutuality in that each party, assuming he is a reasonable and conscientious man, would regard himself as being in some degree under a duty whether moral or legal to conduct himself in a particular way or not to conduct himself in a particular way as the case may be, at any rate so long as the other party or parties conducted themselves in the way contemplated by the arrangement. No necessary or useful purpose would be served by attempting an expanded and comprehensive definition of the word "arrangement" in s 6(3) of the Act. Cross J said ([1962] 3 All ER 247 at p 255): "… all that is required to constitute an arrangement not enforceable in law is that the parties to it shall have communicated with one another in some way and that as a result of the communication each has intentionally aroused in the other an expectation that he will act in a certain way." I think that I am only expressing the same concept in slightly different terms if I say without attempting an exhaustive definition, for there are many ways in which arrangements may be made, that it is sufficient to constitute an "arrangement" between A and B, if (i) A makes a representation as to his future conduct with the expectation and intention that such conduct on his part will operate as an inducement to B to act in a particular way; (ii) such representation is communicated to B, who has knowledge that A so expected and intended, and (iii) such representation or A's conduct in fulfilment of it operates as an inducement, whether among other inducements or not, to B to act in that particular way. 77 In the same case Willmer LJ said at 814: To deal first with the meaning of the subsection, I think it is highly significant that Parliament did not see fit to include any definition of "arrangement". I infer from this that it was intended that the word should be construed in its ordinary or popular sense. Though it may not be easy to put it into words, everybody knows what is meant by an arrangement between two or more parties. If the arrangement is intended to be enforceable by legal proceedings, as in the case where it is made for good consideration, it may no doubt properly be described as an agreement. But the statute clearly contemplates that there may be arrangements which are not enforceable by legal proceedings, but which create only moral obligations or obligations binding in honour. … For, when each of two or more parties intentionally arouses in the others an expectation that he will act in a certain way, it seems to me that he incurs at least a moral obligation to do so. An arrangement as so defined is therefore something "whereby the parties to it accept mutual rights and obligations". 78 Whether there must be mutual obligations in order that there be an arrangement or understanding for the purposes of s 45 is unresolved. See TPC v Service Station Association Ltd (1993) 44 FCR 206 at 229 – 231. However much of the language of British Basic Slag has been adopted for such purposes. In Top Performance Motors Pty Ltd v Ira Berk (Qld) Pty Ltd (1975) ATPR 40-004 at 17,116, Smithers J (Evatt J concurring) referred with apparent approval to the judgment of Diplock LJ, saying: Section 45 (of the Act) is not in the same terms as sec 6 of the Restrictive Trade Practices Act, 1956 which is the section referred to in these remarks, but by parity of reasoning it would follow that the existence of an arrangement of the kind contemplated in sec 45 is conditional upon a meeting of the minds of the parties to the arrangement in which one of them is understood, by the other or others, and intends to be so understood, as undertaking, in the role of a reasonable and conscientious man, to regard himself as being in some degree under a duty, moral or legal, to conduct himself in some particular way, at any rate so long as the other party or parties conducted themselves in the way contemplated by the arrangement. It seems to me also that an understanding must involve the meeting of two or more minds. Where the minds of the parties are at one that a proposed transaction between them proceeds on the basis of the maintenance of a particular state of affairs or the adoption of a particular course of conduct, it would seem that there would be an understanding within the meaning of the Act. 79 Section 45 refers to a "contract, arrangement or understanding". These words are not infrequently used in conjunction where the objective is to prohibit parties from acting in concert. The existence of a contract must be demonstrated by objective evidence of intention. Arrangements or understandings having no contractual effect necessarily involve proof of actual intention on the part of the participants. Whilst that intention may be inferred from objective evidence, any such inference may be rebutted by direct evidence of actual state of mind, if it is accepted. 80 A situation similar to the present was considered by O'Loughlin J in Trade Practices Commission v JJ & YK Russell Pty Ltd & Ors (1991) 13 ATPR 41-132, where Russell had played an integral part in organizing a meeting of petrol retailers at which it was alleged that his company became a party to an arrangement or understanding concerning the price of petrol. The Commission's evidence was discredited in cross-examination, leading his Honour to observe at 52, 942: Without credible evidence of what Mr Russell said and did at the meeting, that part of the case for the Commission collapses. Attempts to impute guilt by inference cannot, in the circumstances of this case, succeed. There are occasions when a Court may be prepared to draw an inference that certain identified retailers have entered into an arrangement or arrived at an understanding, notwithstanding the absence of admissions or direct evidence … . Circumstantial evidence can, at times, be so strong as to be overwhelming. But such is not the case in these proceedings. … Obviously prices were discussed at the meeting that led to Messrs Pappas and Sayer admitting that they and their companies were parties to some arrangement or understanding. But that is not enough. The presence of Mr Russell at a meeting of service station proprietors that he had convened and at which some identified and some unidentified persons came to an understanding that the price of petrol would be increased on the following Thursday to 62.9 cents per litre does not prove that Mr Russell or his company was a party to any arrangement or understanding – and that is so notwithstanding that his company increased its price to the proposed figure at the proposed time. It would have been legitimate for a person to attend such a meeting and to increase his price lawfully on the following Thursday – if the reason for the increase was because of market forces and not because of his involvement in some understanding or arrangement. 81 In that case Russell gave evidence denying that his company was a party to any such arrangement or understanding and claiming that the change in price was the result of market forces. Similar considerations apply to the present case. 82 Prior to the August meeting the eighth respondent had been suffering as a result of the price war, but there is no evidence that he was participating in it. There can be no doubt that he wanted to see an end to it, but as he was not participating in it, there was nothing that he could do to bring about that result, save perhaps to encourage others to take appropriate steps. It seems that he did not consider the August meeting to be a matter of great importance to him. He did not intend to go until, at the last minute, an opportunity presented itself. There is no suggestion that he spoke at the meeting. Further, I accept his evidence that he did not vote. I also accept that the ninth respondent did not speak or vote. There is no evidence to suggest that either in any way encouraged others to enter into any contract, arrangement or understanding. Their conduct was consistent with their having attended solely as observers. I conclude that none of the conduct by either the eight or ninth respondent at the August meeting caused the third respondent to be party to any contract, arrangement or understanding, nor was either man directly knowingly concerned in, or party to any breach of the Act. 83 As to the second meeting, I accept the eighth respondent's evidence that he did not speak or vote. For reasons which I have given, this disposes of the possibility that he may have entered into any new contract, arrangement or understanding at that meeting, unless he did so by his endorsement of, or failure to challenge the minutes of the August meeting. I accept that he did not vote on the motion to adopt the minutes, but it is argued that by allowing them to be adopted without actively dissenting, he in some way endorsed or adopted the arrangements made at the earlier meeting. It is unlikely that the participants in the October meeting understood their conduct in adopting the minutes as affirming any prior contract, agreement or understanding. It seems more likely that they thought that they were adopting the draft minutes as a true record. Of course, that included adoption of the list of persons attending. For this reason, the minutes as adopted might suggest to a casual observer that those present had participated in all votes described as "unanimous" or similarly described. However the eighth respondent knew that he had not been present at the time of the specific resolutions adopted at the August meeting and had not otherwise actively participated in it. He could reasonably have expected other participants to have known these things. The minutes were prepared for the purposes of the participants, not for those of third parties. In any event, the record of those attending and the recorded voting results are accurate as far as they go. It is only if they are read together that a possible inaccuracy arises. It is most unlikely that the other participants, acting reasonably, could have concluded that by not seeking to vary the minutes, the eighth respondent was endorsing on behalf of the third respondent contracts, arrangements or understandings made before his arrival at the August meeting. 84 As to the business dealt with after his arrival at that meeting, the only relevant "resolution" appears to be the "feeling of the meeting" concerning the matter raised by Ms Sawyer. Failure to challenge that statement in the minutes hardly implied his agreement to proceed in accordance with it. The minutes suggest that subsequent discussions involved statements of opinion. There were also resolutions concerning payment of room hire and for refreshments and arrangements for the next meeting. They are irrelevant for present purposes. I do not accept that the eighth respondent deliberately tried to mislead other participants at either meeting or did anything which might have had that effect. I think it more likely that some of them expected, or hoped for unanimity and therefore convinced themselves that it had been achieved. 85 In seeking to establish the case against the third, eighth and ninth respondents, the applicant undertook a heavy burden. The onus of proof is the civil standard, tempered as necessary by decisions such as Briginshaw v Briginshaw (1938) 60 CLR 336 and Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd (1992) 67 ALJR 170. Nonetheless it will always be difficult to demonstrate intention on the part of somebody who has said and done nothing, especially in proceedings commenced so many years after the event. 86 It follows that the application as against the third, eighth and ninth respondents must be dismissed. I certify that the preceding eighty-six (86) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett . Associate: Dated: 2 May 2001 Counsel for the Applicant: Mr G Gibson QC Ms E Ford Solicitor for the Applicant: Australian Government Solicitor Counsel for the First, Fifth and Sixth Respondents: Mr P McMurdo QC Solicitor for the First, Fifth and Sixth Respondents: James Watt & Co Counsel for the Third, Eighth and Ninth Respondents: Mr R Douglas SC Solicitor for the Third, Eighth and Ninth Respondents: Thompson Hannan Counsel for the Eleventh Respondent: Mr K Varley Solicitor for the Eleventh Respondent: M A Kent & Associates Dates of Hearing: 4, 6, 7, 18 December 2000 Date of Judgment: 2 May 2001