Knights of Video Pty Ltd v Pacific Seven Pty Ltd & Ors [1984] FCA 154

Federal Court of Australia|1984-06-15|Before: Jenkinson J

Application for interlocutory injunctions to restrain conduct which would, as the applicant contends, contravene s.47 of

Hereafter I state facts as though found and state findings on questions of fact and opinions on questions of law. Of course my function in determining this application is not to reach any concluded finding, but to see whether the applicant has made out "a prima facie case", in the sense in which that expression has been expounded in a number of authorities binding

upon me. (See, for example, T.W.U. v. Leon Laidley Pty. Ltd. (1980) 28 A.L.R. 589). To avoid unnecessary repetition I make it

clear that all the facts are stated hereafter only in that sense,

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and that the opinions expressed on questions of law have been formed only for the purpose of resolving whether the application

The applicant ("Knights") conducts, under the business name "The Allnite Video Company", a 'business of the retail hiring of material which may be utilised in cocibination with other appropriate equipment to screen plays and other entertainment in domestic television receivers. Reference zs made to the material and its container as a pre-recorded video cassette. One mode of carrying on that business is by-contracting with a retail shopkeeper, in whose shop other goods are offered for sale, for display and hiring of the cassettes by the shopkeeper as Knights' agent to customers in the shop, and for diwasion between Knights and the shopkeeper of the hiring charges. Under such arrangements Knights supplies to the shopkeeper a stock of cassettes, advertising material, hiring contract forms and what was described in evidence as "a computer". The shopkeeper's rights in the chattels are those of a bailee. The computer records each hiring transaction by coupling in record a number assigned to the hirer and another number assigned to the cassette hired. The computer may be operated to furnish information comcerning the recorded hiring transactions. The hirer is offered what was described in evidence as an Allnite registration card, possession of which entitles him to take cassettes on hire on payment of the amount payable in respect of one day's hire, but only from the shopkeeper

through whom the first hiring from Knights hes been effected.

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The first respondent professes a right to grant licences

to occupy certain shops and to conduct therein retail businesses of a particular kind. These shops are known as "7-Eleven" shops. They sell food and drink and other goods by retail, they are open for many hours of every day, they display the same trade mark and they look alike. In respect of each shop the first respondent grants to one or to several persons jointly a licence to use the shop solely for the purpose of conducting-a business of the kind which by elaborate contractial | provision is described in the written agreement - for the licence. The agreement expressly

declares the parties' "intention and understanding" that the licensees be "independent contractors"; the profits of the business, after payment to the first respondent of a percentage of gross profit, are theirs; and they are not required, the agreement expressly provides, to buy their stock in trade from persons

recommended by the first respondent, or to sell at prices

On 17 May, 1984 Knights supplied to Michael Milinkovic cassettes, advertising material, hiring contract forms and 4a computér, pursuant to an agreement in writing dated 15 May, 1984 of the kind which I have described. Mr. Milinkovic carries on business in a 7-Eleven shop in Geelong West under an agreement in writing with the first respondent. That agreement is of the kind

which I have described. That agreement includes a term (Article

4(e)) that Mr. Milinkovic "shall not add any improvements,

fixtures or equipment to" the shop or to a chattel or a fixture "installed upon™ the shop "or affix to" the shop or "display thereon any additional signs or i@entification ...... without the prior written consent of" the first respomdent. Mr. Milinkovic

has not obtained that respondent's consent to the presence in the

shop of any of the chattels provided te him by Knights in performance of the agreement made between tam and Knights" ("the agency agreement"). Having been apprisea . of the presence in Milinkovic's shop of the chattels Knights had delivered to him in pursuance of the agency agreement, the first respondent caused two of its servants, Messieurs Moon and Miller, to call on 18 May 1984 at -the shop, where they gave him to understand that the first respondent regarded him as in breach of the agreement between him and the first respondent ("the franchise agreement"), by reason of the addition to the shop of "equipment" Kmights had delivered - namely the computer and advertising material - without the first respondent's prior written consent. Breach oz that term of the franchise agreement empowers the first respamdent to terminate the franchise agreement by giving the other party "not less than 20

days notice of termination" (Article 25). Although no agent of the first respondent has explicitly threatened exercise of the power, the whole of the evidence justifies a finding that, if Mr. Milinkovic does not cease performance of the agency agreement and remove from the shop the computer and advertising material

delivered to him by Knights, the first respondent will probably give him such a notice, as well as a fimfiing that Milinkovic's

conversations with Moon and Millex on and shortly after 18 May

1984 induced in his mind a belief, for which he had reasonable grounds, that such a notice would be givem if he did not cease performance of the agency agreement and remove those things from

Some of those things were removed from the shop by Milinkovic, with the approval and physical assistance of Mcon and

Miller, on 18 May 1984. After he learnt that an interim order had

been made by me, in this proceeding on 25 May 1984, to restrain

(i) threatening to withdraw from Michael Milinkovic of 7-®levan store Geelong West any goods or services if he, the said Michael Milinkovic, showld use in the course of the business comducted in the said 7-Eleven store the business system referred to in the Affidavit of Lucian Anceschi sworn this day as the '''Allnite Video System';

. Pamela McDonald of 7-Elevem store Geelong North any goods or services if they, the said Brian & Pamela McDonald, should use in the course of the business conducted in the said 7-Eleven store, the business system referred to in the Affidavit of Lucian Anceschi sworn this day as the 'Allnite Video System';

(iii) touching or damaging gooGs or fixtures, the property of the Applicant on the premises known as 7-Elevem store Geelong West or on the premises kmown as 7-Eleven store Geelong North,

he restored those articles to his shop and resumed, and has

There is in Geelong another 7-Eleven shop, a licence in relation to which was granted by the first respondent to Brian Douglas McDonald and his wife Pamela Margaret McDonald. The shop is at Geelong North. Mr. and Mrs. McDonald are parties to an agreement with the first respondent and to an agreement with

Knights, each of which is for present purposes indistinguishable

in its terms from the franchise agreement and the agency agreement respectively to which Mr. Milinkovic is party. And in relation to Mr. and Mrs. McDonald events have occurred which are

indistinguishable for present purposes from those which I have

Some of the provisions of s.47 of the Trade Practices Act

"(1L) Subject to this section, a corporation shall . not, in trade or commerce, engage in the practice of exclusive dealing.

(2) A corporation engaged in the practice of exclusive dealing if the corporation -

(a) supplies, or offers to supply, goods or services;

(b) supplies, or offers to supply, goods or services at a particular price; or

or credit in relation to the supply or proposed supply of goods or services by the operation,

on the condition that the person to whom the corporation, supplies, or offers or proposes to supply, the goods or services or, if that person is

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a body corporate, a body corporate related to that body corporate - .

(d)} will not, or will mot except to a limited extent, acquire goods or services, or goods ox services of a particular kind ox description, directly or indirectly from a competitor of the corporation or from a competitor of a body corporate related to the corporation; .

(3) A corporation also engages in the practice ef exclusive dealing 1f the corporation refuses - -

(a} to supply goods or services to a person; . (b) to supply goods or services to a

{c) to give or allow a discount, allowance, rebate or credit in relation to the supply or proposed supply of goods or services to a person,

for the reason that the person or, if the person is a body corporate, a body corporate related to that body corporate -

(da) has acquired, or has not agreed not to acquire, goods ar services, or goods or services a= a particular kind or descriptiom, directly or indirectly from a campetitor of the corporation or from a competitor of a

(8) A corporation also engages in the practice of exclusive dealing if the corporation grants or renews, or makes Zt known that it will not exercise a power or right to terminate, a lease of, or a licence in respect of, land or a buildimg or part of a building on the condition thst another-party to the lease or licence or, if that other

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party is a body cerporate, a body corporate related-to that body corporate -

(a) will not, or will mot except to a limited extent -

goods or services of a , particular kind or description, directiy or indirectly from a competitor of the corporation or from a competitor of a body

! e eee rere ewramevrereeecnowereseseruncavece (9) A corporation also engages in the practice

.: Of exclusive dealing if the corporation refuses to grant or renew, or excercises a power or right to terminate, a lease of, or a licence in respect of, land or a building or part of a building for the reason that another party to ths lease or licence or, if

that other party is a body cerporate, a body corporate related tc that bacdy corporate -

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(10) Sub-section (1) Goes not apply to the practice of exclusive dealing constituted by a corporation engaging in comauct of a kind referred to in sub-sections (2), (3), (4) or (5) or paragraphs {8)(a) or {b) or (9)(a), (b) or (c) unless -

' that conduct has the purpose, or has or is likely to have the effect, of substantialiy lessening competition; or

(b} the engaging by the corporation in that conduct, and the engaging by the corporation, or by @ body corporate related to the corporation, in other conduct of the same or a similar kind, together have or are likely to

\ have the effect of substantially lessening ccmpetition.

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a reference to a condition shall read as a reference-to any condition, whether direct or indirect and whether having legal or equitable force or not, and includes a reference to a condition the existence or nature of which is ascertainable only by inference from the conduct: of persons or from other relevant circumstances;

a reference to competition, in relation .to conduct to which a provision of this section other than sub-sections (8) or (9) applies, shall be read as" a reference to competition. in any market in which -

(i) the corporation engaging in the conduct or any body corporate related to that corporation; or

(ii) any person whose business dealings are restricted, limited or otherwise

circumscribed by the conduct or, if that person is a body corporate, any body corporate related to tnat body corporate,

supplies or acquired, or is likely to supply or acquire, goods or services or would, but for the conduct, supply 'er acquire, or be likely to supply or acquire, goods or services; and

a reference to competition, in relation to conduct to which sub-sections (8) or (9) applies, shall be read as a reference to competition in any market in which the corporation engaging in the conduct or any other corporation the business dealings of which are restricted, limited or otherwise circumscribed by the conduct, or any body corporate related to either of those corporations, supplies or acquires, or is likely to supply or acquire, goods or services or would, but for the conduct, supply or

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acquire, or be likely to supply or ' acquire, goods or services."'

One of the submissions advanced in support of the application for interlocutory injunctive relief was that the evidence showed that the first respondent was proposing to exercise, in contravention of s.47(9)(a), its power to terminate the licence granted by the franchise agreement in respect of each of the two 7-Eleven shops in Geelong for the reason that in each case the other party, the licensee, has acquired goods and

services from a competitor of the first respondent, namely

Knights. In what respect, then, may Knights and the first

During 1983 Knights and the first respondent engaged in negotiations with respect to the possible installation in 7-Eleven

shops of a system for hiring _pre-recorded video cassettes. The

system in contemplation by those parties was that which I have

already described or a similar system which Knights might devise in co-operation with the first respondent. While those negotiations were in train such a system was installed in ll of the 55 7-Eleven shops which are in Victoria. The licensees of those shops enjoy the system under contractual arrangements which the evidence did not clearly disclose, but to which it seems that both Knights and the first respondent | are parties. Another 11 of the shops are presently utilising a similar system installed by

the first respondent pursuant to agreements between it and the

licensee of each shop respectively. The megotiations have not resulted in any comprehensive 'agreement with respect to 7-Eleven shops and by writ issued out of the Supreme Court of Victoria on 21 March 1984 Knights claimed injunctive amd other relief against the first respondent and a licensee of a 7-Eleven shop at Bentleigh in respect of what Knights alleges to have been wrongful

use of information about its system, which it claims to have

communicated to the defendants in confidence only for the purpose

of enabling the first respondent to decide whether -.to use Knights'

system in 7-Eleven shops and to enable the negotiation of an

agreement between Knights and the first respondent and licensees

of, 7-Eleven shops concerning the installatzon and operation in

those shops of that system. The wrongful use alleged is the installation "in several of" the 7-Eleven sons of what is alleged

to be "a colourable imitation of" Knights' system, which imitation is alleged to have been achieved by use of the information. The action is pending. The first respondent demies that it has made wrongful use of confidential information and claims that no impediment exists to its installing, pursuamt to any contract it may be able to make with the licensee, its own system in a 7-Eleven shop. No application for interlocutory relief has been

It was submitted by Mr. Chernov Q.C., who appeared with Mr. G. B. Johnston for Knights, that Knights and the first

respondent were competitors for the custom of 7-Eleven shop

licensees as suppliers of the goods and services which may be

compendiously labelled a video hiring system. What the customer obtains is the right to negotiate with members of the public frequenting his shop contracts, in the making of which he acts as agent of the supplier, for the hire of video cassettes to those members of the public by the supplier of the service, possession in his shop of the cassettes to be hired, possession of materials, such as advertising matter, contract forms and registration cards and a "computer", by the use of which in the shop those contracts

may- be induced, recorded and made the subject of informative

There was uncontradicted evidence, which I accept, that the first respondent is not presently offering a video hiring system to any person, but is evaluating the systems presently installed in 7-Eleven shops, including one system, installed in a J-Eleven shop in Brisbane, which includes no "computer", but involves handwritten recording of each hiring. It may be that upon evaluation the first respondent will offer to 7-Eleven shop licensees a system of that latter kind, rather than a system which includes a computer. But it is, as I find, very probable that in the immediate future the first respondent will offer to the licensees of some 7-Eleven shops in Victoria a video hiring system of one or another of the two kinds under present evaluation. So also will Knights offer such a system, including computer, to the licensees of some 7-Eleven shops in Victoria. It is probable that

some of those licensees will receive offers from both Knights and

the first respondent. If it cannot presently be said of Knights

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that it is competing with the first respondent, because the first respondent is not presently offering what Knights is offering, it ean, as I find, be said that in the immediate future they will be offering similar goods and services to the same persons and will be competing for the custom of those persons. Although the express reference of paragraphs (b) and (c} of s.47(13) might be said to be only to "competition", and not to "competitor", I am inclined to think that a consideration of those two paragraphs leads to the conclusion that the word "oompetitor" in s.47(9) comprehends corporations and bodies corsorate likely in the immediate future to be supplying goods or services in a market in which at the same future time the corporatZon to which reference is first made in that sub-section is likely to be supplying those

No prohibition of the conduct deseribed in s.47(9)(a) is effected by s.47(1) unless the engaging by a corporation in that conduct "has the purpose, or has or is likeiy to have the effect, of substantially lessening competition", or unless the engaging in that conduct and the engaging by the same corporation (or by a body ,corporate related to that corporation} "in other conduct of the same or similar kind together have or are likely to have the effect of substantially lessening competition" : see s.47(10).

The effect of the conduct on competition ran be judged only by reference to "the market" in which the casypestition occurs. The evidence did not suggest that the first respondent would offer a

video hiring system to any person who was mot the licensee of a

7-Eleven shop, or for use in any place except a 7-Eleven shop. Knights, on the other hand, offers, or at all events is likely in the immediate future to offer, its video hiring system to other shopkeepers, as do other suppliers. There is a market in relation to which shopkeepers in Victoria f{and, perhaps, in an area of which Victoria is a part) who trade in the evening and during Saturday and Sunday are the customers, and in relation to which Knights and several others are the competing suppliers. The subjects of commerce in that marxet are video hiring systems as hereinbefore described. In that market the first respondent offers to supply only 7-Eleven shoos. In Victoria there are about 33 .potential customers who conduct 7-Elevem shops and in whose shops video hiring systems are not yet installed. Mr. Chernov submitted, but Mr. Uren Q.C., who appeared with Mr. Houghton for the respondents, denied, that there was a merket in relation to

which those 7-Eleven shopkeepers are the customers, and in

relation to which the first responcéent, Knights and several cthers

Merely by limiting suppiy to a class within the larger class of customers for some species of goods or services a supplier does not bring about. the resuit that a market is recognised, differentiated from other markecs by reference to that smaller class of customers. But the fact what a supplier of such a species of goods or services does so limit his supply may, as I think, be a circumstance which in combination with other

circumstances defines a market Sy reference to the class of

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customers to which supply is limited, or by reference to another

7-Eleven shops fall within a numerically small class to which reference was made in evidence by the expression "convenience stores". Precise definition cf that class was not attempted in evidence, and would no doubt be difficult to achieve. But the 'cardinal characteristics of the convenience store may be identifieé. It is open seven days a week and for all or nearly all of the 24 hours each day. It is substantially larger than the "milk bar and mixed business" with which -it competes. The range of merchandise offered for sale is generally more extensive than the range offered by the milk bar and mixed business. The convenience store is brightly illuminated, attractively laid out for "self-serve" shopping, and is kept very clean and neat. Most convenience stores in the metropolitan area of Melbourne and in large country centres trade under a group name, such as 7-Eleven

and Food Plus. Those within a group look alike. The licensees of 7-Eleven shops who are potential customers for a video hiring system enjoy occupancy of the shops on such restrictive terms, the evidence established, that the terms of a contract for provision o£ the system to such a licensee by a supplier other than the first respondent would have to be drawn with particular regard to the franchise agreement between the licensee and the first

respondent. The evidence did not disclose the terms on which

The principal affidavit in support of Knights' application for interlocutory .relief imcludes the following

paragraphs (wherein Knights is called "the Company"):

"6. The Company has thrived on the development and concept of a computerised hiring system for pre-recorded video cassettes. The system is so designed that it is appropriate to any retailer engaged in the business of hiring

cassettes to the public. The Company has to the present time however adepted a policy of providing its Allnite Video System essentially to convenience stores. The system has been sc well received that the Company has deliberately adopted such a policy so as "to ensure the -maximum provision of the system to members of the public and for this, reason the Compary has opted to maintain the implementation of the system into 24 hour convenience stores. *

Of the franchisors of convenience stores in Victoria Pacific-Seven Pty. Ltd. has the greatest number of stores in its chain. Food Plus Pty. Ltd. also conducts business of 24 ' hour convenience stores and 22 has a total of approximately 34 stores in Victoria. The Company has cortracted with Food Plus and has installed the Alinite Video System in some 24 : of its said stores. The Company has been approached by many other organisations who have expressed interest in installing the Allnite Video System inta various retail outlets.

. In general terms, prior to the introduction of the Allnite Video System, the outlets servicing consumers were specialised video library outlets which purchased cassettes from large distributing houses and hired them out to members of the public. The Company was responsible for the introdcéuction of video hiring facilities in convenience stores on the basis, inter alia, where the hirer to the public, i.e. the store-keeper, did not have to buy video cassetces from hiring houses or at all. Thus, the introduction of the Allnite Video System meant that competition

in the hiring of video cassettes at the retail level has been increased. Competition now alsa exists -between the Company and Pacific-Seven Pty. Ltd. in the supply of a video system to convenience stores and has created a new market in the imdustry.

Besides Pacific~Seven Pty. itd. a further competitor is West-Sub Video which hires a number of cassettes to smalE retailers such

as service stations and milk bars. These cassettes can, as I understand the . arrangement, be exchanged from time to time.

West-sub Video da not however provide a computerised hiring system nor do they provide the many ancillary services offered

by the Company. . 12. To my knowledge, there is no other organisation providing = system in

competition with the Company other than Pacific-Seven Pty. Ltd. as G@escribped below and West-Sub Video. Although it is not possible to provide precise anticipated turnover which the Company may enjoy in the next 12 months tt is thowght that the turnover will be measured in hundreds of

I would find that there is a market in relation to which shopkeepers in Victoria (and, " perhaps, in an area of which Victoria is a part) whose shops are convemience stores are the customers, and in relation te which Knights and the first

respondent and whatever person or persons are identified in the

affidavit as "West~-sub Video", and perkaps others, are the

suppliers. The subjects of commerce in that market are video hiring systems. If that finding be justified, conduct by the first respondent of the description specified in s.47(9)(a) would be likely to have the effect of substantially lessening

competition in that market if 1t occurred in relation to several

7-Eleven shops. The number of potential customers in the market thus defined is so small that, although elimination of Mr.

Milinkovic and Mr. and Mrs. McDonald from that number might not

constitute such a lessening of competition in that market as could

"be characterised as "substantial", the elimination of a very few

more potential customers would. 'And the evidence justified the conclusion that the first respondent would behave towards other 7-Eleven shop licensees who sought. to acquire video hiring systems from Knights in the same way as that respondent is likely, es I

have found,' to-behave towards the licensees of the two shops at

"Mr. Chernov submitted that there was another market, competition in which was likely to be substantially lessened by the conduct of the first respondent which he said 'was within the description specified in s.47(9)(a). The subjects of commerce in this suggested market are video cassettes for hire to consumers. The geographical area of the market is the Geelong area. The potential customers are those who are within or close to the geographical area and who have access to the equipment (television receiver and video cassette recorder) by means of which video cassettes may be played. The suppliers are those who at a place within that geographical area offer to hire video .cassettes to customers. At the two 7-Eleven shops in Geelong Knights is presently a supplier. There are others, cne in a chemist's shop,

but their number was not revealed by the evidence. The evidence

was hardly sufficient to enable a conclusion to be reached as to

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whether any conduct of the first respondent which might be of a description specified in s.47(9)(a) would be likely to have the effect of substantially lessening competition in that Geelong

Notwithstanding an interesting argument to the contrary, I think the installation of the computer in each of the 7-Eleven

shops in' Geelong constituted a breach by the licensee of Article 4(e) of the franchise agreement. I have already stated my finding that the first respondent will probably exercise the power to terminate the licence in respect of each shop unless the computer is removed. (For present purposes it is umnecessary to consider the other chattels brought into each shop in performance of the

agency agreement.) It is then a question whether, if the licence

were terminated, it would be terminated "for the reason that" the licensee had acquired the video hiring system, of which the computer is a part, from a competitor of the first respondent. That question involves, at least, matter of the proper construction of s.47(9) and matter of fact. Evidence was adduced that the first respondent "has a clear policy which is strenuously pursued that any breaches by franchisees of Article 4(e).......... should not be permitted. That policy is enforced regardless of the merits or otherwise of any additions to the licensed property made by the franchisee without the prior consent in writing of Pacific-Seven". It was sworn that the first respondent "takes the

view that even a relatively trifling breach of Article 4(e) such

as the installation of an additional magazine rack should not be

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tolerated as the nature and extent of the licensed property for each of the stores is critical to the proper functioning of the

' Company's unique convenient store system. Control over equipment

added to the licensed property is regarded as essential to the

relationship between the Company and the respective franchisees". Mr. Uren also undertook in argument a careful comparison of a number of the terms of the agency agreement with terms of the \ franchise agreement, to show that in some imstances observance of ' a provision of the agency agreement would involve breach of a provision of the franchise agreement and that in other instances ' . performance of an obligation of the one contract would or might make difficult the licensee's performance cf the other contract. The evidence did not in Mr. Uren's submission justify any inference that the conduct of Mr. Moon or Mr. Miller in their ' dealings with the licensees of the two shops at Geelong in May

1984 betokened any intention on the part of the first respondent

' to terminate the licence for the reason specified in s.47(9)(a),

or any inference that, if in the future either licence were terminated, that would be done for that reason. Mr. Uren submitted that the evidence showed other sadstantial reasons which the first respondent had for refusing, if and when its consent

were sought, to consent to the performance in a 7-Eleven shop of

I think it probable that the conduct of the first respondent's servants in May 1984 which wes designed to achiave

the termination of the agency agreements was directed by the first

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_respondent for -the reason that the Licensees were acquiring

services, of a kind which the first respondent expected to be

offering to the licensees in the immediate future, from a competitor in the supply of such services; and probable that, unless the licensee's agency agreement is terminated, the first respondent will terminate that licensee's franchise agreement for the same reason. Such difficulties as may arise by reason of inconsistent requirements of the franchise agreement and the agency agreement could be obviated by variation of the agency agreement, as it seems to me. But I do not think that 1t is

concern about those difficulties which moved the first respondent

My conclusion is that a prima facie case has been made that the first respondent is proposing, unless restrained, to engage in conduct that would constitute a contravention of s.47(1), being conduct of the description specified in s.47(9)(a), and the engaging in which is likely to have the effect of substantially lessening competition. Mr. Chernov submitted, and Mr. Uren denied, that conduct of a deseription specified in s.47(2)(a) and (da) and conduct of a description specified in s-47(3)(a) and (da) had been and would be engaged in by the first. respondent in its dealings with the licensees of the two Geelong

shops. It is unnecessary to deal with those submissions.

application on the assumption that the onus of proof in relation

to the facts specified in paragraphs (a) and (b) of s.47(13) lay on the applicant. But I express no opinion as to the correctness

Mr. Moon gave evidence of concern that, if Knights' video

hiring system were operating in the Geelong shops for any substantial period and were then removed, the disappointment of customers' expectations that they could hire cassettes in those shops would seriously damage goodwill. "Further, the grant of interlocutory injunctive relief may prove, if in this proceeding the applicant ultimately fails, to have constituted a gross

interference with the exercise by the first respondent cof contractual rights deriving from the franchise agreements -and an interference with whatever proprietary or contractual rights in respect of the shops the first respondent derives from other sources. On the other hand, refusal of interlocutory relief may result, if the applicant yltimately succeeds in the proceeding, in serious damage to Knights which might be very @ifficult to assess. If interlocutory relief is refused the licensees of the Geelong shops will be faced with a choice between several courses of action, all of them fraught with a risk that breach of one or other 'of their contracts with the principal parties to this proceeding might involve them in substantial loss. If contravention of s.47(1} is involved in the course which the first respondent is pursuing, those licensees are members of one of the

classes for whose protection the section was enacted, and their

interests may in my opinion be weighed in exercise of the

discretion conferred by s.80(2) of the Trade Practices Act 1974.

The applicant offers, in consideration of the grant of

interlocutory relief, an undertaking that while the first

respondent is restrained it will not offer to enter or enter into

"an agreement concerning the hiring of video cassettes with a

licensee of a 7~Eleven shop. In all the circumstances the better

course, in my opinion, is that upon the applicant's usual

undertaking as to damages and a further undertaking of the kind

offered, the first respondent be restrained until the hearing of

(i) threatening to withdraw from Michael Milinkovic of 7-Eleven store Geelong West any goods or services if he, the said Michael Milinkovic, should use in t®e course of the business conducted in the said 7-Eleven store the business system referred to in the Affidavit of Lucian Anceschz sworn in this proceeding the 25th day of May 1984 as the *Allinite Video System';

(ii) threatening to withdraw from Brian and Pamela McDonald of 7-Eleven store Geelong North any goods or services if they, tke said Brian and Pamela McDonald should use im the course of the business conducted in the said 7~-Eleven store the business system referred to in the Affidavit of Lucian Anceschi sworn in this proceeding the 25th day of May 1984 as the 'Allnite Video System';

(iii) giving without the leave of the Court a notice to the said Michaei Milinkovic in purported exercise of a right conferred by Article 25(c) of the agreement which is exhibit PM5 to the affidavix of Peter Moon sworn the 30th day of Mey 1984 in this proceeding;

{iv giving without the leave of the Court a notice to the said Brian McDonald or the said Pamela McDonald in purporte'di exercise of a right conferred by Article 25(c) of the

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agreement which is exhibit PM6 to the | affidavit of Peter Moon sworn the 30th day of May 1984 in this proceeding.

At a glance

Court

Decision date

Before

Source

Judgment (187 paragraphs)