(iv) Computerad's Wasted Expenditure:
$747,114 by way of current liabilities being creditors and other borrowings of Computerad.
41. If, as it has threatened to do, Chemdata informs licensees under the Chemdata Licence that they will be in breach of the Chemdata Licence by using the Computerad system, Chemdata will engage in conduct in trade or commerce which is misleading or deceptive or which is likely to mislead or deceive contrary to section 52 of the Act in that any such information will be incorrect.
42. Further or alternatively, if, as it has threatened to do, Chemdata informs licensees under the Chemdata Licence that they will be in breach of Chemdata's copyright in the Chemdata software or in breach of the Chemdata Licence by using the Computerad system, Chemdata will, in connection with the supply or possible supply of the Computerad system or in connection with the supply or possible supply of Chemdata software have made a false or misleading representation in trade or commerce concerning the existence or effect of a right contrary to section 53(g) of the Act.
43. By the entry into the Chemdata Licence with, and the subsequent provision of the Chemdata software to, pharmacists with the provisions of clause 8 in the Chemdata Licence, and without Chemdata or Amfac telling pharmacists that such provisions were unlawful as exclusionary provisions, such conduct since 1988 in all the circumstances was misleading or deceptive or likely to mislead or deceive contrary to section 52 of the Act.
44. The applicants have suffered loss and damage by the breach referred to in paragraph 43 above by being denied the opportunity to deal with pharmacists without the wrongful threat of enforcement of an unlawful contractual provision.
45. Each of:
(a) Amfac;
(b) IMS (from February 1994);
(c) the fourth to sixth respondents as directors of Chemdata until February 1994;
(d) the seventh respondent as director of Chemdata;
(e) the ninth and tenth respondents as directors of Amfac until February 1994;
(f) the eight and eleventh respondents as directors of Amfac;
(g) the twelfth respondent since about 1991,
has aided, abetted, counselled or procured and was directly or indirectly knowingly concerned in the contraventions of the Act referred to herein.
Particulars
(i) As to the second respondent, the applicants restate the particulars provided and given in relation to breaches of sections 45(2)(b)(ii), 46(1)(b), 46(1)(c) and 52 of the Act herein.
(ii)Amfac was at all material times the agent of Chemdata for Dispensary Software Licence Agreements and by such conduct was a person directly or indirectly knowingly concerned, within the meaning of section 75B of the Act, in the contraventions by Chemdata of Parts IV and V of the Act in that by reason of paragraph 18, Amfac was the agent for Chemdata and was directly or indirectly knowingly concerned with the conduct of Chemdata set out in paragraphs 35, 36, 37, 39 and 43 herein, causing the applicants to suffer continuing loss and damage including the loss of opportunities to obtain commercial advantages and profits in markets in Australia, Canada, the United States of America, the United Kingdom and Ireland by such conduct in breach of the Act.
(iii)As to the third respondent, the applicants restate the particulars provided and given in relation to breaches of sections 45(2)(b)(ii), 46(1)(b), 46(1)(c) and 52 of the Act herein.
(iv)Since February 1994 IMS has owned and controlled Chemdata and Amfac and by such conduct is a person directly or indirectly knowingly concerned, within the meaning of section 75B of the Act, in the contraventions by Chemdata and Amfac of Parts IV and V of the Act in that by reason of paragraph 5 IMS was directly or indirectly knowingly concerned with the conduct of Chemdata set out in paragraphs 35, 36, 37, 39 and 43 herein, causing the applicants to suffer continuing loss and damage including the loss of opportunities to obtain commercial advantages and profits in markets in Australia, Canada, the United States of America, the United Kingdom and Ireland by such conduct in breach of the Act.
(v) As to the fourth, fifth, sixth, seventh, eighth, ninth, tenth and eleventh respondents, the applicants restate the particulars provided and given in relation to breaches of sections 45(2)(b)(ii), 46(1)(b), 46(1)(c) of the Act herein.
(vi)At all material times the fourth, fifth, sixth and seventh respondents were directors of Chemdata, and the eighth, ninth, tenth and eleventh respondents were directors of Amfac, and by such conduct were persons directly or indirectly knowingly concerned, within the meaning of section 75B of the Act, in the contraventions, as set out in paragraphs 35, 36, 37 and 39 herein, by Chemdata of Part IV of the Act causing the applicants to suffer continuing loss and damage including the loss of opportunities to obtain commercial advantages and profits in markets in Australia, Canada, the United States of America, the United Kingdom and Ireland by such conduct in breach of the Act.
(vii)As to the twelfth respondent, the applicants restate the particulars provided and given in paragraph 29 in relation to breaches of section 46 of the Act herein.
(viii)The twelfth respondent was actively involved with Chemdata and Amfac, and was a person who, directly or indirectly, was knowingly concerned within the meaning of section 75B of the Act, in the contraventions by Chemdata and Amfac of Part IV of the Act, in that by reason of the letter of 6 June 1992 in paragraph 29 herein, the twelfth respondent was a person who was directly or indirectly, knowingly concerned in the contraventions by Chemdata and Amfac of Part IV of the Act causing the applicants to suffer
continuing loss and damage including the loss of opportunities to obtain commercial advantages and profits in markets in Australia, Canada, the United States of America, the United Kingdom and Ireland by such conduct in breach of the Act."
Counsel for the respondents argued that the only basis on which the statement of claim asserts that Mr Morwood has a cause of action is as a shareholder of Computerad. (It is agreed that Mr Morwood has 90% of the issued share capital of that company.) It was argued that in these circumstances there is no cause of action known to the law on which Mr Morwood can rely. I have been referred to various cases including Elna Australia Pty Limited v International Computers (Aust) Pty Limited (No 2) (1987) 16 FCR 410 especially at 418; Janssen-Cilag Pty Limited v Pfizer Pty Limited (1992) 109 ALR 638 at 643 and 647; also Kaze Constructions Pty Limited v Housing Indemnity Australia Pty Limited (1990) 12 ATPR 41-017. These cases were referred to also as authority for the proposition that for a claim for damages to be sustained under s. 82 of the Act, there must be some sufficient cause or nexus linking the conduct said to contravene the Act with the recoverable loss or damage. It was argued that there is no such cause or nexus with respect to any claim by Mr Morwood.
The claim by Mr Morwood for damages (para 40(b) of the statement of claim) is for the reduction in value of his shares in Computerad or the loss of the opportunity of obtaining value in his shares in Computerad, that loss of opportunity being both as to the capital value of the shares and the recurrent value of dividend from the shares. These damages are said to be directly referable to the damage to Computerad of lost business opportunities.
In my opinion Mr Morwood is not entitled to recover damages in the circumstances as pleaded in the statement of claim. In Prudential Assurance Co Limited v Newman Industries Limited (No 2) [1982] 1 Ch 204 it was held at 210:
"A derivative action is an exception to the elementary principle that A cannot, as a general rule, bring an action against B to recover damages or secure other relief on behalf of C for an injury done by B to C. C is the proper plaintiff because C is the party injured, and, therefore, the person in whom the cause of action is vested. This is sometimes referred to as the rule in Foss v Harbottle (1843) 2 Hare 461 when applied to corporations, but it has a wider scope and is fundamental to any rational system of jurisprudence."