Australian Competition & Consumer Commission v IT & T AG [2002] FCA 561

FEDERAL COURT OF AUSTRALIA

Australian Competition & Consumer Commission v IT & T AG [2002] FCA 561

PROCEDURE – service outside the jurisdiction – non-convention country – whether court has jurisdiction in the proceeding – whether Federal Court Rules O 8 r 1 applies to the proceeding – whether prima facie case for relief – whether leave should be granted for service outside the jurisdiction Trade Practices Act 1974 (Cth) s 5(1), 52, 55A, 64(2A), 64(3) Federal Court Rules Div 3 O 8, O 8 r 1, O 8 r 1(a), O 8 r 2(2), O 8 r 13 Bray v F Hoffman–La Roche Ltd [2002] FCA 343 referred to AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v IT & T AG W96 of 2002 RD NICHOLSON J 3 MAY 2002 PERTH

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA W96 of 2002

DISTRICT REGISTRY

BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

APPLICANT

AND: IT & T AG

RESPONDENT

JUDGE: RD NICHOLSON J

DATE OF ORDER: 3 MAY 2002

WHERE MADE: PERTH

THE COURT ORDERS THAT: 1. The applicant's motion dated 1 May 2002 be allowed. 2. Leave be given to the applicant to serve its application and statement of claim, both dated 28 March 2002, on the respondent in Switzerland in accordance with Division 3 Order 8 of the Federal Court Rules. 3. Costs reserved. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA W96 of 2002 DISTRICT REGISTRY

BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

APPLICANT

AND: IT & T AG

RESPONDENT

JUDGE: RD NICHOLSON J

DATE: 3 MAY 2002

PLACE: PERTH

REASONS FOR JUDGMENT 1 On 1 May 2002 the applicant filed an ex parte notice of motion seeking leave to serve its application and statement of claim dated 28 March 2002 on the respondent in Switzerland in accordance with Div 3 O 8 of the Federal Court Rules. That motion was granted on 2 May 2002. These are the reasons why the Court acceded to the motion. 2 Order 8 r 2(2) of the Federal Court Rules specifies the requirements for the grant of such leave in the following terms: "2(2) The Court may, by order, give leave to serve originating process outside the Commonwealth in accordance with Division 2 or 3 of this Order or, subject to subrule (2B), on such terms and conditions as it considers appropriate, if the Court is satisfied that: (a) the Court has jurisdiction in the proceeding; and (b) rule 1 applies to the proceeding; and (c) the party seeking leave has a prima facie case for the relief sought by the party in the proceeding." The relevant division is Div 3 which applies to service of judicial documents in a non-convention country: O 8 r 13. 3 The notice of motion was supported by affidavit of a senior investigation officer of the applicant. From examination of portions of that affidavit I find that the respondent is not an organisation which is registered in Australia or has an address for service in Australia. From the same evidence I also find that Switzerland is a non-convention country for the purpose of the Federal Court Rules. 4 In its application the applicant seeks declarations that the respondent has engaged in conduct that was misleading or deceptive or likely to mislead and deceive in contravention of s 52 of the Trade Practices Act 1974 (Cth) ("the Act") and has contravened the provisions of ss 64(2A), 64(3) and 55A of the Act. Further remedies are sought by way of injunction. An order requiring an advertisement and website notice and certain notifications, along with provision of information and participation in a trade practices compliance program. 5 The conduct said to contravene s 52 of the Act is alleged to be comprised in three main forms. The first are false representations to the following effect: "6.1 each of the companies and businesses carrying on business within Australia listed therein ("the Australian Businesses") had corresponded with the Respondent with a view to becoming a listed member in the Internet Directory; and 6.2 each of the Australian Businesses had given their authority or consent for their names, addresses and particulars to be entered in the Internet Directory." 6 The second are allegedly false representations said to have arisen from certain invoices to the following effect: "(a) payment for entry as a listed member in the "Fax Directory International", the Internet Directory and/or the CD-ROM Directory was due and payable to the Respondent from the date of the invoices; (b) if payment was made within fourteen (14) days, the amount due and payable to the respondent would in each case be reduced by 3%; (c) that the Respondent had a presently existing right to payment in the sum specified in the Invoices; and (d) each of the Invoices was a bill, invoice or statement of account due, based upon an existing or prior business relationship between the Respondent and the company or business to whom each of the Invoices was addressed in each case." 7 The third component relates to conduct concerning the manner in which certain small print conditions appeared on the invoices. It is pleaded that at all material times the true facts were that the sums claimed in the invoices were not due and owing and the respondent had no right to payment of such sums claimed and the companies and businesses were misled or deceived or likely to have been misled or deceived into believing the sums claimed were in fact due and owing and the respondent had such a right. 8 On the question whether this Court has jurisdiction in the proceeding there is evidence to provide prima facie support to the claim that the respondent has conducted business within each of the States and Territories of Australia and across the boundaries of those States and Territories in the way pleaded, namely: "3.1 the publication, promotion, distribution, supply and/or maintenance on the Respondent's website of an International Fax and Business Directory under the style or title "it&t International Fax Directory" and "IT&T directories" ("the Internet Directory") to consumers, inter alia, within the States and Territories of Australia; 3.2 the publication, promotion, distribution and/or supply of an International Fax and Business Directory in CD-ROM format under the style or title "Fax Directory International" or "International Fax Directory", including the same or substantially the same listings and information as found in the Internet Directory ("the CD-ROM Directory"), to consumers, inter alia, within the States and Territories of Australia; and 3.3 the distribution and supply of documents to companies and businesses within the States and Territories of Australia whose names, addresses and particulars are or were listed in the Internet Directory and/or the CD-ROM Directory, or alternatively, whose names were proposed by the Respondent to be listed in the Internet Directory and/or the CD-ROM Directory, such statements being headed "it&t international business directories", and in the form of invoices or demands for payment ("the Invoices")." 9 The conduct alleged to have been engaged in by the respondent raises the prima facie case which, if made out, would be translated into a finding of fact that the respondent's conduct constituted engaging in conduct in Australia. Insofar as the claims for relief by the applicant are based upon conduct by the respondent outside Australia, the extraterritorial operation of s 5(1) of the Act would apply if the respondent carried on business in Australia. 10 There is apparent reason why O 8 r 1 applies to the proceeding. Order 8 r 1(a) permits originating process to be served outside the Commonwealth in the case "where the proceeding is founded on a cause of action arising in the Commonwealth". Subparagraph (j) provides for such service "where the proceeding is for an injunction as to anything to be done in the Commonwealth or against the doing of any act in the Commonwealth, whether damages are also sought or not". 11 The affidavit evidence before the Court establishes a prima facie case for relief sought by the applicant: Bray v F Hoffman–La Roche Ltd [2002] FCA 343 at [27] per Merkel J. 12 For these reasons I was satisfied that the requirements of O 8 r 2(2) were met. Accordingly, I granted the motion. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice RD Nicholson J.