Midland Metals Overseas PTE Limited v Australian Cablemakers Association Limited

1. [1]

   GLEESON JA: I agree with Payne JA. I would add the following brief comments by way of emphasis.

2. [2]

   It is fundamental that a party seeking to advance for the first time on appeal a new ground not taken at trial will be precluded from doing so if the new ground could possibly have been met by calling evidence at the hearing or if, had the ground been raised below, the respondent might have conducted the case differently at trial: Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438; [1950] HCA 35; Coulton v Holcombe (1986) 162 CLR 1 at 7-9; [1986] HCA 33.

3. [3]

   That principle applies in the present case insofar as the appellant failed at trial on a misleading and deceptive conduct claim framed on a particular basis and sought to sidestep that result by reframing its case on appeal and alleging misleading and deceptive conduct on a wider and different basis which could possibly have been met by the respondents calling evidence at the trial.

4. [4]

   Next, there is a wider principle that even when no question of further evidence is admissible, it may not be in the interests of justice to allow a new point to be raised on appeal, particularly if it will require a further trial of the action: Whisprun Pty Ltd v Dixon [2003] HCA 48; (2003) 77 ALJR 1598 at [51] referring with approval to MultiCon Engineering Pty Ltd v Federal Airports Corp (1997) 47 NSWLR 631 at 645-6; [1997] NSWCA 214.

5. [5]

   Applied to the present case, the appellant elected to advance a case at trial based on concessions by the respondents as to certain errors in letters sent by the first respondent to Commonwealth and State Ministers responsible for safety regulation. The appellant cannot be heard to complain on appeal that the primary judge did not address parts of the pleaded case that were not pressed at trial, let alone were not the subject of relief sought at trial, nor on appeal.

6. [6]

   Finally, it is to be acknowledged that the remarks of Payne JA, with which I agree, on the question of whether the relevant conduct by the first respondent was in trade and commerce, are obiter. The remarks should not be taken out of context; they reflect the particular factual circumstances of the present case.

7. [7]

   PAYNE JA: In these proceedings the appellant, a Singapore-based manufacturer of electrical cables, sued the first respondent, an industry representative association for certain Australian-based electrical cable manufacturers, for conduct which was allegedly misleading or deceptive.

8. [8]

   The case brought by the appellant was a narrow one. As framed at trial, it relied on conduct solely comprised of the sending of letters in identical terms by the first respondent (and signed by the second respondent who was then the Chairman of the company) to the Ministers in each State and Territory responsible for the safety of electrical cables. Declarations and injunctive relief, but not damages, were sought.

9. [9]

   The primary judge, McDougall J, dismissed the appellant’s claim on the basis that it had not established that the conduct of the respondents had a tendency to lead any of the Ministers responsible for safety regulation into error. The primary judge found it unnecessary to decide whether sending a letter raising a safety issue about one type of electrical cable to the Minister responsible for regulation of the safety of electrical cables was, of itself, conduct in trade or commerce.

10. [10]

    At the heart of the appellant’s case below was the allegation that the Ministers who received the letters were responsible for decisions about purchasing electrical cables by certain electrical distribution entities, many of which were at the time State-owned. That case was correctly rejected by the primary judge on the facts. Although the premise of that case, ministerial responsibility for electrical cable purchasing decisions, was the subject of the appellant’s written submissions, the case ultimately presented in this Court sought to move away from that case and address a case which was not agitated below. Further, a number of the issues raised by the appellant were not the subject of relief sought by the appellant at the trial nor were they issues identified in the notice of appeal.

11. [11]

    For the reasons that follow the appeal should be dismissed with costs.

Relevant facts

1. [12]

   The appellant, Midland Metals Overseas PTE Limited, is a company incorporated in Singapore that sold, and continues to sell, electrical cable and related products to electricity distributors in Australia. The first respondent is an unlisted not-for-profit public company limited by guarantee, incorporated in Australia. Its stated objects include representing its members, who are Australian-based electrical cable manufacturers, and enforcing and upholding electrical cable safety standards.

2. [13]

   On 10 February 2016, at a board meeting of the first respondent, it was resolved that the laboratory testing results obtained by one of the first respondent’s member companies in relation to one of the appellant’s cables, the LOBAC 95mm² aerial bundled cable, raised safety concerns which should be communicated to the relevant safety regulators.

3. [14]

   On 28 April 2016, the first respondent sent a letter in identical terms to each of the Ministers of the States and Territories responsible for electrical safety regulation. The letter was signed by the first respondent’s Chairman, the second respondent. The letter was in the following terms:

4. [15]

   On 12 May 2016, the Electrical Regulatory Authorities Council (ERAC) met and formed the view that there was no safety issue with the appellant’s LOBAC 95mm² aerial bundled cable and that the credibility of the test results described in the letter was questionable. Before the primary judge, the first respondent accepted that three components of the 28 April letter, taken in isolation, were not accurate or were not supported by expert analysis:

   1. (1)

      the implication that compliance with the heat radiation test is mandatory;

   2. (2)

      the suggestion that the testing conducted was compliant with the relevant Australian standard; and

   3. (3)

      the suggestion that dripping molten polymer in a bushfire made the cable unsafe as the impact on a bushfire of any molten polymer would be insignificant.

The primary judgment

1. [16]

   On 21 June 2018, McDougall J delivered his judgment: Midland Metals Overseas v Australian Cablemakers Association [2018] NSWSC 938. The parties had agreed that the following issues arose in the proceedings:

2. [17]

   The primary judge found that, as the appellant failed in respect of issue (c), it was unnecessary to resolve any of the other issues.

3. [18]

   The appellant had sought declarations that the first and second respondents, in sending the letters to the Ministers, engaged in conduct in trade or commerce that was misleading or deceptive, or likely to mislead or deceive, in contravention of s 18 of the Australian Consumer Law (“ACL”) – Sch 2 of the Competition and Consumer Act 2010 (Cth). Section 18 provides, relevantly:

4. [19]

   The primary judge found that the appellant’s claim failed because the conduct was not misleading or deceptive, nor was it likely to mislead or deceive. For conduct to be characterised as misleading or deceptive, or likely to mislead or deceive, it must have a tendency to lead into error. There must be some sufficient causal link between the identified conduct and the likelihood of error on the part of the person to whom it is directed.

5. [20]

   The primary judge noted that whether conduct is to be characterised as misleading or deceptive is a question of fact, which analysis involves the examination of the conduct as a whole “by reference to the alleged conduct in the light of the relevant surrounding facts and circumstances … [and] … is an objective question that the court must determine for itself”: Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; [2004] HCA 60 at [109] per McHugh J, cited with approval in Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304; [2009] HCA 25 at [102] by Gummow, Hayne, Heydon and Kiefel JJ.

6. [21]

   The letters were sent only to the Ministers responsible for electrical safety in each State and Territory. The primary judge found that “it is clear (and common ground on the pleadings) that each Minister to whom the letter and its attachments were sent had ministerial responsibility for the electrical safety regulator in his or her State. There is no evidence that any of those Ministers had any responsibility, ministerial or otherwise, for purchasing decisions made by electricity distribution utilities”.

7. [22]

   The significance of this last finding was that the case conducted by the appellant sought to characterise the respondents’ conduct as misleading or deceptive or likely to mislead or deceive on the basis that the Ministers who were the recipients of the letters also had responsibility for purchasing decisions made by electricity distribution utilities. That is, that the conduct in sending the letters had the capacity to lead the Minister into error in that it may engender a false belief about the safety of the appellant’s LOBAC 95mm² aerial bundled cable, causing a delay in purchasing decisions about that cable whilst the safety issue was investigated.

8. [23]

   The primary judge posed the relevant question as being the capacity of the relevant conduct to lead the person to whom it was directed into error. This was a test accepted by both parties. The primary judge found that, viewed prospectively, it was “unlikely to the point of inconceivability” that any Minister would have acted upon the letter without first taking advice. His Honour observed that this was, in fact, what ultimately occurred. It was also likely, viewed prospectively, that when the Minister referred the letter for advice, the departmental official charged with the reference would consult the electrical safety regulator for that State. Again, his Honour observed, that was in fact what occurred.

9. [24]

   The primary judge found that, even if the letter had made all the representations that the appellant said that it did, and even if all the representations were incorrect, it was unlikely that the letter by itself could have led a Minister into error.

The notice of appeal and notice of contention

1. [25]

   The notice of appeal contained 15 grounds and numerous sub-grounds. A number of the grounds did not reflect the way that the case was argued below and should be rejected for that reason alone. The notice of appeal set out the grounds as follows:

2. [26]

   The first respondent relied on a notice of contention which sought to uphold the decision of the primary judge on the basis that the relevant conduct was not in trade or commerce.

Consideration

1. [27]

   Despite the prolixity of the notice of appeal, senior counsel for the appellant, Mr Coles QC, accepted at the hearing of the appeal that the issues could be considered under essentially four headings:

   1. (1)

      grounds 1-9 and 15 - the tendency of the conduct to lead the recipients of the letters into error;

   2. (2)

      ground 10 - the failure by the primary judge to give any, or any adequate, reasons in rejecting the appellant’s claim that the respondents had alleged that the cable offered for sale by the first respondent’s members complied with the heat radiation test and that the claim was misleading or deceptive;

   3. (3)

      ground 11 - the failure by the primary judge to determine which of the thirteen pleaded representations had been made and which had not; and

   4. (4)

      grounds 12, 13 and 14 - that the primary judge uncritically accepted the evidence of Mr Mennie, and that the primary judge was wrong to find the statements in the letters were statements of opinion rather than statements of fact.

2. [28]

   It is convenient to address the grounds of appeal in this order.

3. [29]

   The appellant submitted that his Honour:

   1. (1)

      was wrong to conclude that, because the Ministers had expert advice available to them, they would not form any conclusion upon receipt of the 28 April letters;

   2. (2)

      was wrong to conclude that, because the Ministers took further advice, they had come to no conclusions on the subject matter of the 28 April letters before they received that advice; and

   3. (3)

      should have found that the conduct of the first respondent was misleading or deceptive in that the letters were liable to create in the recipient Ministers an impression that there was a risk, requiring further investigation, that all Midland cable failed to comply with the relevant standard and for that reason was unsafe and a bushfire risk and should not be used while that further investigation was carried out.

4. [30]

   The appellant submitted that the question of whether conduct viewed as a whole has a tendency to lead a person into error is an anterior question to whether or not any loss has been suffered as a result of that conduct: Australian Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640; [2013] HCA 54 at [49] (French CJ, Crennan, Bell and Keane JJ). The appellant submitted that the expectation that consumer recipients of information might be anticipated to obtain a clear understanding of the true state of affairs before acting to their detriment conflates the question of actual loss with the question of characterisation of the tendency of the impugned conduct to lead a person into error. The appellant submitted that the primary judge erred in failing to recognise and apply that distinction.

5. [31]

   The appellant submitted that the primary judge assumed that the letters could produce no other tendency than that of inviting Ministers to take advice. The appellant submitted that, contrary to this assumption, the letters had a tendency to:

   1. (1)

      cause Ministers to devote time and resources to expert examination of the claims made in the letters under the erroneous impression that the content of the letters required immediate attention and raised serious safety concerns;

   2. (2)

      erroneously induce concerns on the part of government departments about the appellant and its products (and erroneously induce a reticence to enter into commercial negotiations with the appellant, at least for the time taken to dispel erroneous impressions);

   3. (3)

      induce an erroneous belief that the first respondent’s members’ cable should be preferred to the appellant’s imported cable;

   4. (4)

      induce an erroneous supposition that the cable produced by the first respondent’s members would comply with the relevant heat radiation test; and

   5. (5)

      induce the erroneous belief that the first respondent was a reliable, responsible and objective organisation on which Ministers could rely.

6. [32]

   The appellant submitted that, where conduct is directed to particular persons, attention must be directed to the relationship between those people and the entity propagating the conduct, the context in which the statement was made, and the matters of fact which each knew about the other: Butcher v Lachlan Elder Realty Pty Ltd at [37] (Gleeson CJ). The appellant submitted that, having regard to the prior dealings between the first respondent and the relevant Ministers, it can be inferred that the Ministers treated the letters as authoritative statements of the matters contained in them.

7. [33]

   In Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191 at 199; [1982] HCA 44, Gibbs CJ said that:

8. [34]

   In Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357; [2010] HCA 31, French CJ and Kiefel J held that s 52 of the Trade Practices Act 1974 (Cth) (TPA) (and now s 18 of the ACL):

9. [35]

   In TPG Internet, French CJ, Crennan, Bell and Keane JJ explained these observations and said:

10. [36]

    In Campbell v Backoffice Investments Pty Ltd, French CJ said:

11. [37]

    The primary judge appreciated and applied the distinction between conduct which has a tendency to lead into error and the actual loss based on that conduct. The appellant’s principal complaint has no substance. The primary judge stated the test he was applying in terms drawn from TPG Internet, which the appellant accepted as the correct approach. There is no passage or finding in the judgment of the primary judge that obscures the distinction between conduct which has a tendency to lead into error and the actual loss based on that conduct. The distinction was never pressed on the primary judge by the appellant below as being relevant here. It is thus unsurprising that his Honour did not refer to any submission made by the appellant about the topic.

12. [38]

    The evidence supports the finding of the primary judge that, viewed prospectively, the Ministers who received the letters would not act on the assertions in the letters but would cause experts to investigate the matters raised by the letters and form their own view based on that advice. There was no finding by the primary judge that the recipient Ministers even read the letter. That is not a promising foundation for a case which was expressly limited to errors that the letters were capable of inducing in the minds of the relevant Ministers.

13. [39]

    The appellant encouraged the primary judge to have regard to the prior dealings between the first respondent and the relevant Ministers about safety matters. That submission was repeated on the appeal: see [32] above. If regard is paid to such limited evidence as there was about those prior dealings, concerning Infinity cables in 2013 and ECABLES in 2014, [1] the finding of the primary judge that the letters would cause Ministers to ask experts to investigate the matters raised by the letters and form their own view based on advice received from those experts was correct.

14. [40]

    The case advanced by the appellant before the primary judge was encapsulated in its written submission: “The 28 April communications were directed to Government ministers throughout the country with responsibility for overseeing the acquisition from time to time of substantial quantities of electrical cable products”. That case was rejected by the primary judge on the facts. The appellant did not demonstrate that his Honour erred in so finding.

15. [41]

    If it matters, the primary judge was correct to observe that in each case, the Ministers who received the 28 April letter sought advice. The evidence was that ERAC met on 12 May 2016, shortly after the letters were sent, and formed the view that there was no safety issue and that the credibility of the test results described in the letters was questionable. ERAC’s conclusions were available to all Ministers.

16. [42]

    The appellant’s complaint, made in writing and repeated orally in this Court, that the primary judge overlooked the tendency of the letters to lead into error because of concerns which were likely to arise in the minds of “others who read or heard” of the letters, is outside the pleaded case and was not a submission put to the primary judge. The case pleaded was not that any third party acted or was likely to act on the contents of the letters. The conduct identified by the appellant was limited to the making of the representations allegedly contained in the letters sent to Ministers. That case was that the Ministers would cause the cable purchasing entities in each State to halt the purchase of the appellant’s cables whilst an investigation was conducted. That case was rejected by the primary judge. The primary judge correctly rejected the contention that the recipient Ministers had any responsibility or influence over electricity distributors’ purchasing decisions. The appellant cannot now reframe its case by reference to the likely conduct of third parties whose conduct was not in issue below: Metwally v University of Wollongong (No 2) [1985] HCA 28; 59 ALJR 481 at 483. I accept, as Mr Izzo SC who appeared for the respondents submitted, that if this issue had been raised before the primary judge he could and would have led evidence about the characteristics of potential purchasers of the appellant’s LOBAC 95mm² aerial bundled cable.

17. [43]

    Nor was it put by the appellant below, as the appellant submitted in this appeal, that the letters could lead persons into error simply by causing Ministers needlessly to spend time and public money investigating the matters raised by the respondents in the letters. After the submission was advanced in this Court the appellant was asked:

18. [44]

    The appellant was granted leave to file a note after the oral hearing to identify where it was said that this second contention was actually put to the primary judge. The two passages identified by the appellant in the written note dated 1 April 2019 do not identify such a case. The first passage identified by the appellant is addressing reasons in support of Mr Coles’ colourful proposition that “the plain object of this exercise is ‘don’t you deal with these people until you have had an investigation’”. That is, the letters could lead recipient Ministers into error in that he or she may cause an electrical distributor to delay purchase of the appellant’s LOBAC 95mm² aerial bundled cable pending an investigation. That is consistent with the case advanced by the appellant that the recipient Ministers had responsibility for or influence over electricity distributors’ purchasing decisions. It is quite a different submission to the one sought to be advanced in this Court. The second passage relied upon makes a different point. After summarising, and reframing, the respondents’ argument at some length, Mr Coles in that passage tested the respondents’ argument by reference to evidence given by various officers of the first respondent about their present belief about the safety of the appellant’s LOBAC 95mm² aerial bundled cable. The appellant did not suggest in those passages that the letters could lead recipients into error simply by causing Ministers needlessly to spend time and public money investigating the matters raised by the respondents in the letters.

19. [45]

    The second situation referred to in paragraph [43] was not a submission made to the primary judge. The appellant should not be permitted to reframe its case in this Court in this way. In Coulton v Holcombe at 7, Gibbs CJ, Wilson, Brennan and Dawson JJ stated:

20. [46]

    The fact that the case was not put below in the way now sought to be advanced on appeal is why the “tendencies” now advanced by the appellant (set out at [31]) were not specifically addressed by the primary judge.

21. [47]

    Viewed prospectively, the contents of the letter were likely to do no more than induce a Minister to believe that an industry body had made claims that may or may not be accurate, and which should be investigated. In the narrow way the case was framed and argued before the primary judge, his Honour was correct to find that the letters “could produce no other tendency than that of inviting the Ministers to take advice”.

22. [48]

    Grounds 1-9 and 15 should be dismissed.

23. [49]

    The appellant submitted that the primary judge failed to give any, or any adequate, reasons addressed to whether the respondents represented that the cable offered for sale by the first respondent’s members complied with the heat radiation test (AS/NZS 3560.1).

24. [50]

    The appellant submitted that the primary judge had impermissibly speculated that the second respondent generally held the opinion that this representation was correct. The appellant submitted that the second respondent gave no evidence justifying the primary judge’s conclusion, and was aware that compliance with the heat radiation test was not mandatory for electrical cable.

25. [51]

    There was no occasion for his Honour to make any finding about pleaded representation 12. This is because in the course of the trial the appellant made it clear that it sought no relief about the alleged representation that “the cable offered for sale by the first respondent’s members complied with the heat radiation test (AS/NZS 3560.1)”. Perhaps by reason of the concessions made by the first respondent about the content of the letter set out at [15] above, most of the pleaded representations were not pressed by the appellant as part of the relief it sought. During the trial senior counsel for the appellant handed up an amended form of declaratory relief sought by the appellant which tracked closely the concessions made by the first respondent recorded at [15] above:

26. [52]

    The appellant’s case was limited to declaratory relief about representations made about the appellant’s LOBAC 95 mm2 cable. No relief was sought about any alleged representation that the cable offered for sale by the first respondent’s members complied with the heat radiation test. That issue was not relevant to the issues his Honour was asked to decide.

27. [53]

    The matter was equally irrelevant to the issues on the appeal. The appellant sought in this Court the following declaration (and only this declaration):

28. [54]

    No relief was sought in this Court about any alleged representation that the cable offered for sale by the first respondent’s members complied with the heat radiation test. It was an irrelevant issue. Although nothing was said in chief about this issue, the topic of pleaded representation 12 was raised in reply by Mr Coles and the following exchange ensued:

29. [55]

    There is nothing arid or insensitive to the justice of this case in ensuring that the issues litigated on appeal are, at least in a broad sense, relevant to the relief sought by an appellant in a notice of appeal. Ground 10 should be dismissed.

30. [56]

    The appellant submitted that the primary judge failed to determine which of the 13 pleaded representations had been made and which had not.

31. [57]

    There was no error in his Honour not considering separately each of the 13 representations pleaded by the appellant.

32. [58]

    As already explained, the case as it was ultimately put by the appellant did not seek relief based on all 13 representations but rather was confined in the manner recorded at [38] of the judgment below which I have set out at [51]. In this Court no relief based on 13 representations was sought: see [53] above. Perhaps for that reason nothing was said orally about this matter.

33. [59]

    Ground 11 should be dismissed.

34. [60]

    The appellant submitted that the primary judge erred in uncritically accepting the evidence of Mr Mennie, the secretary of the first respondent at the relevant time, namely that he believed the representations in the letter to be true at the time the letters were sent. The appellant submitted that Mr Mennie’s evidence was completely inconsistent with the Energysafe Investigation Report, and also with the evidence of the second respondent that he was aware that the first respondent’s members’ cable did not comply with the heat radiation test. This was ground 12.

35. [61]

    The appellant submitted that the primary judge was wrong to find the statements in the letters were statements of opinion rather than statements of fact and opinion if his Honour relied on this distinction to come to the conclusion that the letters were not misleading or deceptive. This constituted grounds 13 and 14.

36. [62]

    There was no error in the primary judge finding that Mr Mennie believed the contents of the letters to be true. Although Mr Mennie was cross-examined, his evidence as to his belief was not challenged in cross-examination. The fact that the opinions in the letters were not supported by the test results and were inconsistent with other evidence does not mean that, without putting those test results and other evidence to him, Mr Mennie’s evidence about the content of his beliefs should be rejected. The ground of appeal in any event does not address the primary judge’s dispositive reasoning. This finding about Mr Mennie’s belief was not part of the ratio of the primary judge’s decision and did not affect any matter of substance in his Honour’s judgment.

37. [63]

    Grounds 13 and 14 are also irrelevant to any dispositive issue. The primary judge’s observation that the letters contained statements of opinion rather than fact is beside the point, in light of the primary judge’s dispositive reasoning that no Minister was likely to be led into error by the contents of the letters. That dispositive finding was based on the explicit assumption at [54] of the judgment below that the letter contained all of the representations that the appellant said it did.

38. [64]

    Grounds 12, 13 and 14 should be dismissed.

The conduct was not in trade or commerce

1. [65]

   Given his Honour’s conclusions about the issue just addressed, the primary judge did not find it necessary to determine if the relevant conduct was in trade or commerce. This issue was agitated on appeal by the respondents’ notice of contention. Given that the issue was fully argued, this Court should address it: Kuru v New South Wales (2008) 236 CLR 1; [2008] HCA 26 at [12] (Gleeson CJ, Gummow, Kirby and Hayne JJ).

2. [66]

   As already observed, the appellant’s case below was a very limited one. The appellant submitted below that making the representations in the 28 April letters was conduct in trade or commerce since those letters were directed to Ministers “with responsibility for overseeing the acquisition of substantial quantities of electrical cable products”, and since the first respondent was a representative body one of whose functions was to “support and grow” the commercial interests of its members.

3. [67]

   As earlier observed, the primary judge correctly rejected the critical underpinning of that submission; no recipient Minister had any responsibility for electrical cable purchasing decisions. On the appeal, Mr Coles accepted that the appellant’s case about trade and commerce was encapsulated in two paragraphs of his written submissions. The first paragraph asserted that the letter was seeking to denigrate the appellant’s cable and encourage the purchase of cables produced by the first respondent’s members. The second paragraph asserted that the letter was comprised of “promotional material”.

4. [68]

   In Concrete Constructions (NSW) Pty Limited v Nelson (1990) 169 CLR 594 at 603; [1990] HCA 17, Mason CJ, Deane, Dawson and Gaudron JJ said of s 52, the statutory predecessor to s 18 of Schedule 2 that the phrase “in trade or commerce” refers only “to conduct which is itself an aspect or element of activities or transactions which, of their nature, bear a trading or commercial character.” So construed, “the words ‘in trade or commerce’ refer to ‘the central conception’ of trade or commerce and not to the ‘immense field of activities’ in which corporations may engage in the course of, or for the purposes of, carrying on some overall trading or commercial business”. At 604 their Honours said:

5. [69]

   Conduct by a corporation which does not otherwise bear a trading or commercial character is not brought within s 18 simply because it may be thought in some way to benefit the corporation’s business: Village Building Company Pty Ltd v Canberra Airport Pty Ltd (2004) 139 FCR 330; [2004] FCAFC 240 at [55]. As the Court observed in Village:

6. [70]

   In this case, the primary judge found that:

7. [71]

   The basis of the appellant’s claim that the conduct should be characterised as being in trade and commerce, and that it was designed to achieve a commercial advantage for members of the first respondent by delaying purchasing decisions in relation to the appellant’s cable, was rejected.

8. [72]

   It is no doubt correct that many, perhaps even most, cases of complaints about the safety of a competitor’s product may be capable of being characterised not merely as safety complaints but as attempts in whole or in part to secure a commercial advantage. Each case will involve a question of careful characterisation. The relationship between the Ministers and the first respondent was not of a trading or commercial character. It was a relationship between a Minister responsible for electrical safety regulator and an industry body representing Australia-based members of a regulated industry or business. The first respondent’s representations were not made as part of the process designed to secure approval to a commercial transaction or dealing. The only commercial advantage for the members of the first respondent identified by the appellant was a matter upon which it failed, being that the Ministerial recipients of the letters were directly or indirectly responsible for electrical cable purchasing decisions. In carrying out the required characterisation here I have concluded that the conduct relied upon as misleading or deceptive – sending a letter to Ministers responsible for safety regulation about the safety of one type of electrical cable – was not conduct in trade or commerce for the following reasons:

   1. (1)

      first, the primary judge’s unchallenged finding was that each of the recipients of the letter was responsible for safety and not for cable purchasing decisions. The letters were sent by the first respondent to the Ministers with responsibility for electrical cable safety and, deliberately, not to cable purchasing entities or to the public at large;

   2. (2)

      secondly, the first respondent demonstrated that it sent the letters because of a genuinely held concern about the safety of the appellant’s cable and not to secure any commercial advantage. This is illustrated by the language of the letter which demonstrates that it is directed to compliance and safety concerns; and

   3. (3)

      thirdly, the letters were sent in the discharge of the first respondent’s safety and compliance functions, which do not bear any trading or commercial character. The first respondent’s objects include the “approved cables initiative” whose purpose is to promote safety standards by arranging performance testing of Australian and foreign manufactured cables in the Australian market and enforcing and upholding Australian cable specifications and standards. The sending of the letters was consistent with the rules of the “approved cables initiative”, that where a cable fails testing and is considered to be unsafe, government Ministers and State regulators must be informed. The first respondent took similar action when it formed the view that products produced by “ECABLES” and “Infinity” were unsafe.

9. [73]

   The appellant has not discharged the onus, which it bore, of demonstrating that the impugned conduct was in trade or commerce. The sending of the letters did not have the necessary commercial character; it was not “conduct which is itself an aspect or element of activities or transactions which, of their nature, bear a trading or commercial character”.

10. [74]

    This case is readily distinguishable from Tobacco Institute of Australia v Australian Federation of Consumer Organisations (1992) 38 FCR 1, which was relied upon heavily by the appellant in asserting that the letters comprised “promotional material”. In that case, the Full Court of the Federal Court emphasised that the relevant conduct conveyed a message favourable to the consumption of cigarettes which was placed in a number of national newspapers. As a matter of characterisation, the published material had the overall character of an advertisement designed to promote or maintain sales of cigarettes. It is true that in the joint judgment in Concrete Constructions the plurality observed that certain promotional activities bear a trading or commercial character. But the joint judgment said, at 604, only that such activities include:

11. [75]

    Conduct by a corporation which does not otherwise bear a trading or commercial character is not brought within s 18 of the ACL simply because it may be thought in some way to benefit the corporation’s business or because it can be labelled as “promotional”.

12. [76]

    The relevant conduct in this case, expressly limited as it was, was not shown to be in trade and commerce.

Relief

1. [77]

   Assuming, contrary to my conclusions, that the appellant was otherwise entitled to succeed, this is not a case where the relief sought should be granted.

2. [78]

   Injunctive relief would not be justified in this case. The relevant circumstances here are:

   1. (1)

      the conduct occurred almost three years ago;

   2. (2)

      the first respondent has not republished the contents of the letters; and

   3. (3)

      it may confidently be concluded on all of the evidence that the first respondent has no intention of republishing the contents of the letters.

3. [79]

   The absence of any continued or threatened contravention of the ACL provides a powerful consideration against granting injunctive relief: ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR 248 at 256-257 (Lockhart J, French J agreeing).

4. [80]

   A declaration should not be made. The first respondent accepted that the letters contain information which is not correct in the ways explained at [15] above. The first respondent has not, for some years, pressed the concerns expressed in those letters. All of the relevant decision makers are in possession of the expert reports which address the issues raised by the letters. A declaration will not be granted where it would produce no foreseeable consequences: Truth About Motorways Pty Ltd v Macquarie Investment Infrastructure Management Ltd (2000) 200 CLR 591; [2000] HCA 11 at [51]-[52] (Gaudron J). The present is such a case.

5. [81]

   To the extent that the appellant sought relief on the appeal against the second respondent, that relief should not be granted. The second respondent is no longer the Chairman of the first respondent. A declaration in relation to the second respondent’s conduct would for this additional reason produce no foreseeable consequences.

Conclusion and proposed orders

1. [82]

   I propose the following orders:

   1. (1)

      Appeal dismissed;

   2. (2)

      Appellant to pay the respondents’ costs of the appeal.

2. [83]

   SACKVILLE AJA: I agree with Payne JA and the additional observations of Gleeson JA.