Australian Competition and Consumer Commission v Air New Zealand Limited

First objection: markets not pleaded 1 Objection is taken by Garuda and Air New Zealand ('AirNZ'), on grounds of relevance, to a quantity of materials referred to by Mr Halley SC in his opening of the Commission's market case. These materials consist, in the main, of documents which tend to suggest particular market structures in markets ranging beyond those which are pleaded by the Commission. 2 The Commission, in effect, pleads markets at three levels as against AirNZ: (i) markets out of Hong Kong and Singapore to anywhere in the world; (ii) markets out of Hong Kong and Singapore to Australia; and (iii) markets out of Hong Kong and Singapore to identified ports in Australia. 3 The Commission seeks to obtain from the materials objected to certain propositions about the relationships between carriers, freight forwarders, integrators and shippers. The opening indicated that the relations between those four sets of entities is complicated and depends upon a number of factors, including but not limited to the size of the shippers, the sophistication of the freight forwarders and the comparative strength in each port of the carriers. 4 The material proposed to be relied upon by the Commission not only extends beyond the markets which it has pleaded - such as where the origin is in New Zealand and the destination is in Hong Kong - but extends also to market materials which lie outside the temporal range of the markets which have been pleaded by the Commission - that is, some of the materials pre-date 2002 and some of them post-date 2006. 5 These matters of geographical disconsonance and temporal incongruity formed the basis of the submissions made by AirNZ and Garuda that the material ought not to be received. Mr Owens (for AirNZ) and Mr Brennan (for Garuda) submitted that what happened in markets and at times beyond those pleaded by the Commission was not capable of being probative of anything about the markets which the Commission did allege. 6 In response, Mr Halley submitted that the material which went to the structure of these markets would be probative to the extent that it could be established that there were similarities between the markets. He submitted that the degree to which the material would be useful or of weight would ultimately depend upon the extent of the similarity between the markets. Viewed from that perspective, he was prepared to accept that that might mean that the evidence was contingently relevant in the sense used in s 57 of the Evidence Act 1995 (Cth). 7 Alternatively, he submitted that resort to the latest version of the Statement of Claim in each proceeding revealed that the Commission had made a series of allegations in which it set out what it said were the structures of the relevant markets. Here, the point which he sought to develop was that the way those pleadings had operated was not one which had tied the allegations as to structure to any particular markets. Quite apart from reasoning based on similarity, therefore, he submitted that the materials which had been referred to in his opening went directly to a pleaded case. 8 The relevance test is set out in s 55(1) of the Evidence Act and is as follows: The evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding. 9 I accept that evidence as to the structure and operation of markets other than those relied upon by the Commission in its case are relevant in that sense, although the weight they will ultimately be given will depend upon the extent of the similarity which is established. 10 I accept, as Mr Owens submitted, that - at least as we speak at the moment - there is no evidence of a similarity. But I do not accept that the Commission is required to lead such evidence. Ultimately, it will be possible, in my opinion, to come to a view as to the similarities between the markets for present purposes by an examination of those markets themselves. 11 I do accept that, because I have accepted what Mr Owens submits, an order under s 57 is required. 12 There is one aspect of the objection which I would uphold. In relation to those materials which post-date the allegations in the Commission's case, it seems to me - and it appeared to be accepted at the Bar table - that they could be divided into two categories. Into the first category would fall those documents which, although post-dating the Commission's allegations, nevertheless, were backward-looking in time. The second category would consist of those which post-dated the case and which either spoke to or looked at the present, or perhaps were even future-looking. 13 It seems to me that the second category can be of no assistance, but the first category can. This will mean that I do not accept the objection made by Garuda and AirNZ other than in relation to post-dating materials which are either present-looking or forward-looking. They will be admissible if they are backward-looking into the relevant period. The present-looking and forward-looking documents are, however, inadmissible.