Australian Competition & Consumer Commission v Jutsen

Background 1 The hearing of this proceeding commenced yesterday. Until late last week the three respondents were represented by solicitors and counsel. It was only on Friday of last week (with the hearing due to commence the following Monday) that the respondents' solicitors contacted the Court and advised that their instructions had been withdrawn and that they had ceased to act. Counsel appeared at the commencement of the hearing yesterday for the purpose of seeking leave to file a Notice of Ceasing to Act. I granted that leave. 2 The matter was then called outside the Court. None of the respondents appeared. Mr Howard then made an application for leave to appear at the hearing on behalf of the three respondents. None of the respondents was present in Court at the time that application was made. It appears that they stayed away from Court on Mr Howard's advice. I refused to grant Mr Howard the leave he sought. These are my reasons for doing so. 3 In this proceeding the applicant seeks various forms of relief against the respondents including injunctions and pecuniary penalties in respect of alleged contraventions by the respondents of Division 1AAA of Part V, of the Trade Practices Act 1974 (Cth) (the Act). The gist of the applicant's case against the respondents is that they participated in a pyramid selling scheme and that they induced, or attempted to induce, others to participate in such a scheme. It is not necessary for me to refer to the relevant provisions of the Act in any detail. I would mention, however, that while the terms of s 65AAC of the Act prohibit a corporation from engaging in such conduct, the applicant proposes to rely upon s 6 of the Act. Various provisions of the Act are given an extended operation by s 6. The applicant says it will rely on s 6(2) and (3). 4 The proceeding is fixed for a hearing extending over five days. The applicant's evidence in chief is to be given by affidavit. Some of the applicant's witnesses have been required for cross-examination. A notice of the respondents' objections to the applicant's affidavit evidence has also been served. It appears to have been prepared by the legal representatives who were previously acting for the respondents. 5 At the last directions hearing I acceded to an application made by the respondents to vacate a consent direction previously made requiring them to file and serve affidavits by a particular date. Counsel who then appeared for the respondents drew my attention to the fact that pecuniary penalties were being sought and argued that the respondents should not be required to file and serve affidavits until after the applicant had closed its case. I do not know at this stage whether the respondents propose to call evidence and, as presently advised, I do not propose to require them to make any election in that regard until the applicant's case is closed. 6 On the basis of my review of the pleadings and the relevant statutory provisions it seems to me that this is likely to be a relatively complex piece of litigation. There are a number of points of statutory construction likely to arise.