Devenish v Jewel Food Stores Pty Ltd

Devenish v Jewel Food Stores Pty Ltd - [1991] HCA 7 - HCA 1989 case summary — Zoe

[63]

As a matter of the literal effect of the words of s. 45D(1), the conduct in concert comes within the prohibition of the sub-section even if the ulterior purpose of hindering or preventing Jewel from selling Victorian milk to its New South Wales customers be ignored. The acts in concert of the milk vendors were intended to bring pressure upon Jewel by preventing its customers from acquiring New South Wales milk from it with the consequence that it would lose sales which it would otherwise have made to some of the customers who wished to buy milk from it either because those customers insisted upon New South Wales milk or because of the inadequacy of the supplies of Victorian milk. It follows that the hindering or preventing of the acquisition of New South Wales milk by Jewel's customers from Jewel is properly to be seen as an immediate purpose of those acts in concert. It was also their immediate effect. In these circumstances, it is possible to say that, as a matter of the plain words of s. 45D, each milk vendor ("a person"), in concert with the other milk vendors and the Association ("a second person"), engaged in conduct that hindered or prevented the acquisition of New South Wales milk by Jewel's customers ("a third person") from Jewel ("a fourth person" which "is a corporation"). In this Court, it was not disputed that that conduct would "have or be likely to have the effect" of causing substantial loss or damage to the business of Jewel. Nor was it sought to challenge the finding of the Full Court of the Federal Court that the conduct was "engaged in for the purpose" of causing such substantial loss or damage. The reason for that is presumably to be found in s. 45D(2) which provides that "a person shall be deemed to engage in conduct for a purpose mentioned in [s. 45D(1)] if he engages in that conduct for purposes that include that purpose". Obviously, a purpose of the conduct was to cause such damage to the business of Jewel by withholding supplies of New South Wales pasteurized milk that Jewel would succumb to the pressure and stock only New South Wales milk.

[65]

There is considerable force in the argument which is developed in the judgment of Spender J. in the Federal Court to the effect that s. 45D should, in its context in the Act, be construed as applying only to cases which can properly be seen as involving what is often loosely described as a "secondary boycott". On the other hand, there is nothing unusual about a literal construction of a statutory prohibition which has the effect that one set of conduct can be analyzed in a number of different ways, each of which involves a contravention of the relevant provision. In such a case, the one set of conduct will constitute but one contravention of the provision notwithstanding that the different analyses disclose that the conduct breaches the provision for a number of distinct reasons (cf., as to the case where particular conduct breaches different statutory provisions, s. 76(3) of the Act). Ultimately, and after some vacillation, I have come to the conclusion that the literal effect of the words of s. 45D should not be confined in a way which would exclude from the scope of the section any conduct which does not satisfy some superimposed requirement ascertained by reference to a perception of the kinds of conduct with which the section is primarily concerned. I am influenced in reaching that conclusion by a number of considerations. For one thing, I do not think it is possible to define with any precision the limits of those kinds of conduct. Certainly, such a precise definition is not to be found in the phrase "secondary boycott" which, as the authors of the first edition of the Restatement commented in explaining why they had avoided its use, "has such an uncertain meaning and is so frequently applied to such diverse situations" (Restatement of the Law of Torts (1939), ch. 38, s801, p. 152). For another thing, I am not persuaded, on balance, that it is possible to discern in s. 45D, read in its context in the Act, a clear legislative intent that the section should be so confined. In that regard, I am influenced by the provision of s. 45D(2) which clearly indicates that the reference to "the purpose" in s. 45D(1) should not be construed as referring only to what can be identified as the "real", "dominant" or "ultimate" purpose.

[66]

If the provisions of s. 45D are not to be confined to fit within some preconceived notions of what constitute paradigm cases of secondary boycott, there is not, in my view, any basis for confining them in a way which would negative the decision of the Full Court of the Federal Court in the present case. Once such preconceived notions are put to one side, there remain two main characterizing features of the conduct in concert which s. 45 proscribes. The first lies in the focus, in the primary identification (in the opening words of s. 45D(1)) of the conduct, upon its effect upon relations between persons other than those acting in concert: the conduct must hinder or prevent the supply or acquisition of goods or services by "a third person" to or from "a fourth person". The second lies in the superimposed requirement of both a purpose and a likely effect of an essentially ulterior or consequential kind. It does not suffice that the conduct hinders or prevents the supply or acquisition of goods or services by the third person to or from the fourth person. It must be engaged in for the purpose and have or be likely to have the effect of either causing substantial loss or damage to the business of the fourth person or causing a substantial lessening of competition in a market in which the fourth person trades. When it is viewed in the light in which the Full Court viewed it, the conduct in concert in the present case clearly exhibited the first of those two characterizing features. The focus of the primary identification of the conduct in concert was upon its effect in hindering or preventing the acquisition of New South Wales milk by Jewel's customers from Jewel, they being persons other than those acting in concert. It was engaged in for the purpose and was likely to have the ulterior or consequential effect of causing substantial loss or damage to the business of Jewel. The fact that there was a further and even more remote purpose or motive - namely, that the actuality or likelihood of that substantial loss or damage would cause Jewel to cease to stock the competing Victorian product with the result that the competition of that product in the New South Wales market was eliminated or reduced - did not negative the existence of those characterizing features or take the case outside the clear words of s. 45D.

[76]

A contract, arrangement or understanding between the appellants that had the purpose of preventing, restricting or limiting the sale of pasteurized milk to the respondent might, if any of the appellants was a corporation, appear to fall within s. 45 of the Act, read with the concept of "exclusionary provision" appearing in s. 4D. Nevertheless, no claim based on s. 45 could have succeeded because, due to the system in New South Wales which regulates the retail sale of milk in zones, the appellants were not in competition with each other. Now the fact that conduct falls within one section of the Act does not mean that it may not fall within another section. The Act contemplates that the same conduct may infringe more than one provision of Pt IV, because s. 76(3) prevents more than one pecuniary penalty attaching to conduct constituting a contravention of two or more provisions of Pt IV. It is true that some provisions are expressly excluded from applying where more specific provisions operate. For example, s. 45(5)(a) and (b) excludes s. 45 from applying to covenants to which s. 45B applies. But s. 45 makes no attempt to exclude from its operation conduct proscribed by s. 45D(1). And s. 45D is expressly stated not to affect the operation of any other provision in Pt IV: see s. 45D(7). However, all this means no more than that it is no answer to a claim under s. 45D(1) to show that the conduct complained of falls within s. 45. The question still remains - did the appellants act in contravention of s. 45D(1)(b)? This is not merely a case of attaching labels to conduct which is in breach of the Act. The notice of appeal is expressed in terms only of s. 45D(1)(b) and the appeal was fought in terms only of that paragraph. No question arose as to the liability of the appellants under some other provision. Nor could it, in the absence of findings of fact relevant to such a liability. We are back to the point made at the outset of these reasons - if the conduct of the appellants did not fall within s. 45D(1)(b), the appeal must succeed.

[83]

s. 45D(1) deals separately with supply of goods to a "fourth person" and acquisition of goods from a "fourth person". It would be inconsistent with the structure and evident intent of the provision to treat an interference with supply to the [respondent], not under that part of the provision which deals with supply to it, but as an indirect interference with acquisition from it. Again, subject to a caveat as to the use of the term "indirect", what his Honour said is, in my view, the inevitable consequence of the proper construction of s. 45D(1)(b) within the framework of that sub-section. To construe the paragraph in the way for which the respondent contends is to eliminate the distinction expressed so clearly in the sub-section between conduct which hinders or prevents supply to a "fourth person" and conduct which hinders or prevents acquisition from a "fourth person". Because the distinction is expressed so clearly, it does not advance the respondent's case to argue for a literal construction of the provision. Conduct which hinders or prevents the supply of goods to a "fourth person" is not necessarily conduct which hinders or prevents the acquisition of goods from that "fourth person". No doubt, some conduct may satisfy both descriptions but the conduct of which the respondent complains does not. It is true that, by reason of the appellants' conduct in not supplying their milk to the respondent, there was no New South Wales milk which the respondent's customers could acquire from it. But that is not conduct which, in terms of s. 45D(1), hindered or prevented the acquisition of pasteurized milk from the respondent; something more is required to maintain the distinction which s. 45D(1) draws so clearly. It may be tempting to contrast s. 45(2) and s. 45D(1) by reference to the terminology "primary" and "secondary" boycotts. But these are in truth labels and may mislead. Nevertheless, it is apparent that the two provisions are generally concerned with different conduct and that each has a different place in the scheme of Pt IV of the Act. The conclusion reached by the majority in the Full Court would tend to render s. 45(2) otiose because of the need to find persons who are competitive with each other before that sub-section may operate.

At a glance

Court

Decision date

Before

Source

Judgment (84 paragraphs)

Parties