Federal Court of Australia Act 1976, s.33

Counsel and Solicitors for Applicant: Mr. N.F. Francey instructed by

Cashman and Partners

Counsel and Solicitors for Respondent: Mr. A. Robertson and

Mr. M.A. Robinson instructed

by Dunhill Madden Butler

1. The statement of claim be struck out.

2. Grant liberty to the applicant to replead her statement of claim

and to amend her application, as she may be advised, within 28

days.

3. Applicant pay the respondent's costs of the notice of motion.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

BEAUMONT J Before the Court is a notice of motion filed by Qantas seeking, inter alia, an order that this proceeding commenced by Mrs. Cameron be struck out.

2. In order to understand the nature of the issues which now arise in what is essentially a dispute about pleadings, it is necessary to refer, in some detail, first to the form and terms of the application filed by Mrs. Cameron and then to her statement of claim.

3. In her application, purportedly filed under Part IVA of the Federal Court of Australia Act 1976 ("the Act"), Mrs. Cameron states that her application is "brought...as a representative party". The group members to whom the proceedings relate are stated to be Mrs. Cameron "and other persons who have suffered loss or damage arising from the conduct of (Qantas) the subject of these proceedings, being loss or damage arising on and after 5 March 1992 and other persons who are or may be affected by the (said) conduct...". Mrs. Cameron claims that Qantas has engaged in unconscionable conduct, contrary to s.52A of the Trade Practices Act 1974; or in conduct likely to mislead or deceive, contrary to s.52 of that Act, on the grounds stated in her statement of claim.

"(a) A declaration that (Qantas) has engaged in conduct, in

trade or commerce, that is unconscionable in

contravention of Section 52A of the Trade Practices

Act ... or was misleading or deceptive or was likely

to mislead or deceive contrary to Section 52 of the

Trade Practices Act ... in relation to its policy of

permitting smoking on aircraft flights operated by

(Qantas) and/or the allocation of seating on aircraft

operated by (Qantas) in which smoking is permitted.

(b) An order restraining (Qantas) from engaging in conduct

the subject of the foregoing declarations insofar as

it involves such contraventions.

(c) Damages.

(d) Such other or further orders as the Court thinks fit

to compensate the Applicant or group members or

prevent loss or damage arising from the conduct the

subject of the declaration sought above.

(e) Such other or further orders as the Court thinks fit."

5. By para.5 of the application, it is stated as follows:

"The questions of law or fact common to the claims of the

group members are:

(a) Whether (Qantas) has engaged in conduct which is

unconscionable in contravention of Section 52A of the

Trade Practices Act ...or conduct which was misleading

or deceptive or likely to mislead or deceive in

contravention of Section 52 of the Trade Practices Act

...in the manner set out in the accompanying Statement

of Claim.

(b) Whether orders should be made restraining (Qantas) in

the manner sought in this Application."

6. (As has been noted, the application refers to the date of 5 March 1992. The reason is that this is the date of the commencement of Part IVA of the Act.)

7. By paras. 3 to 18 of the statement of claim, it is stated as follows:

"3. As and from 5 March, 1992, (Qantas) has operated

aircraft on airline flights as part of its business

activities and as part of that operation permitted

smoking on all of certain flights and allocated

seating designated smoking or non-smoking.

4. On 3 July, 1992 the Applicant together with other

passengers travelled on Qantas Flight 1 from Sydney to

Bangkok for a one week Jetabout holiday.

5. Despite requesting a non-smoking seat having arrived

at the airport two hours prior to departure, (Qantas)

allocated the Applicant a smoking seat.

6. Subsequent to the Applicant being allocated a smoking

seat on Qantas Flight 1 from Sydney to Bangkok on 3

July, 1992, (Qantas) allocated other passengers to

non-smoking seats including passengers who were

smokers and Qantas employees and others travelling on

discounted or subsidised airfares.

7. In the course of the flight from Sydney to Bangkok on

3 July, 1992, the Applicant was exposed to

considerable quantities of cigarette smoke including

from persons allocated seats in the non-smoking

section of the aircraft who smoked in and about the

smoking section of the aircraft.

8. During the flight and on arrival in Bangkok, the

Applicant suffered considerable distress and

impairment to her respiratory condition caused by the

said exposure to cigarette smoke on the flight and as

a consequence thereof suffered loss or damage.

Particulars

(a) The Applicant developed Bronchitis and was

incapacitated and prevented from enjoying her

holiday.

(b) The applicant's condition of Bronchitis

continued even after her return to Australia.

(c) The Applicant suffered the loss of benefit of

the holiday.

9. The Applicant returned to Australia on a further

flight about a week after her departure from Australia.

10. In anticipation of her return flight, the Applicant

caused enquiries to (be) made and a booking to be made

for a non-smoking seat on the return flight from

Bangkok to Sydney.

11. Upon arrival at Bangkok airport approximately two

hours prior to departure return flight, the Applicant

was allocated a seat in the smoking section of the aircraft.

12. Upon the Applicant protesting about having allocated a

seat in the smoking section of the aircraft, (Qantas),

its servants or agents arranged for the Applicant to

be seated in the non-smoking section of the aircraft.

13. Notwithstanding the Applicant being allocated a seat

in the non-smoking section of the aircraft on the

return flight to Sydney, the Applicant continued to

suffer the loss or damage particularised above.

14. In the premises, (Qantas) has engaged in conduct that

is, in all circumstances, unconscionable in relation

to its conduct in permitting smoking on airline

flights and/or its allocation of smoking and/or

non-smoking seats in contravention of Section 52A of the

Trade Practices Act 1974.

15. In the alternative, (Qantas) has engaged in conduct

that has been misleading or deceptive or likely to

mislead or deceive in contravention of Section 52 of

the Trade Practices Act 1974 (Commonwealth) in

relation to its allocation of smoking and/or

non-smoking seats on airline flights.

16. In regards to the immediately foregoing paragraph, the

Applicant relies upon Section 51 of the Trade

Practices Act 1974 (Commonwealth) insofar as it is

alleged that (Qantas) has made a representation as to

a future matter, namely, that it would provide the

Applicant with a seat in a non-smoking section, as to

which it is a matter for the Court to determine

whether (Qantas) had reasonable grounds for making

that representation.

17. (Qantas) has engaged in the conduct set out above as

and from at least 5 March, 1992 and other persons have

or may have suffered loss or damage or will or may

suffer loss or damage caused by (Qantas') conduct done

in contravention of the Trade Practices Act as set out above.

18. And the Applicant claims the relief sought in the

Application."

Further particulars of the allegations in paras. 14 and 15 of the statement of claim

8. Pursuant to an order made by Davies J on 13 May 1993, Mrs. Cameron has provided the following further particulars (dated 5 July 1993) of the allegations in paras. 14 and 15 of the statement of claim:

"1. The conduct of (Qantas) which the Applicant claims was

and is unconscionable and/or was and is misleading or

deceptive or likely to mislead or deceive is as follows:-

(a) The policy of permitting smoking on aircraft

flights operated by (Qantas); and/or

(b) The allocation of seating on aircraft operated

by (Qantas) in which smoking is permitted.

2. The persons in respect of whom the said conduct is

alleged to be unconscionable and/or misleading or

deceptive or likely to mislead or deceive include:-

(a) The Applicant and other persons who have

suffered loss or damage arising from the conduct

of (Qantas), being loss or damage arising on and

after 5 March 1992; and

(b) Other persons who are or may be affected by the

conduct of (Qantas) the subject of these

proceedings being persons who continue to suffer

or are likely to suffer loss or damage by the

said conduct.

3. The said persons include:-

(a) All passengers flying on Qantas aircraft on and

after 5 March 1992 including future passengers

who may be subject to (Qantas') policy of

permitting smoking on aircraft flights and/or

the allocation of seating on aircraft operated

by (Qantas) in which smoking is permitted; and

(b) Flightcrew who have been, are or will be exposed

to tobacco smoke by reason of (Qantas') policy

of permitting smoking on aircraft flights

operated by it.

4. The Applicant is unable to give the names and

addresses of all of the persons who may have claims

against (Qantas), however:-

(a) Attached is a petition tabled in the Senate of

the Australian Parliament on 12 May 1993

containing some 1,672 (or 1,694) signatures

giving the name, rank and address of the

signatories. It is understood that all of the

signatories are flight attendants employed by

(Qantas) and a total represent approximately 50%

of the total operating cabincrew as at 23

February 1993 (out of the total of 3,314). It

is understood that only about 60% of crew were

actually approached to sign the petition and the

number of persons concerned about the issue may

well be considerably more than those ascribing

their names to the petition; and

(b) The Applicant is aware of a number of passengers

who also may have specific claims against

(Qantas) including a number in the order of 15

to 20 who have identified themselves since the

commencement of these proceedings. However, the

Applicant is unable at this time to identify

precisely all those passengers by name and

address or to identity precisely each of the

circumstances of those passenger's claims, but

will do so at the appropriate time in these proceedings.

5. In respect of all group members, the alleged

unconscionable conduct involves permitting smoking on

aircraft flights operated by the Respondent in

circumstances in which:-

(a) there is substantial evidence of the health and

safety hazards that arise from the smoking of

cigarettes and other tobacco products;

(b) it is not reasonably practicable or efficient

for cigarette smoke to be eliminated from indoor

aircraft air;

(c) smoking is not permitted on domestic Qantas

flights, all other domestic Australian flights

and a number of other airlines long haul

international flights including those operated

by Continental Airlines and Cathay Pacific;

(d) (Qantas) is implementing a complete smoking ban

throughout its ground operations from 1 January 1993;

6. In respect of all group members, the conduct of

(Qantas) which is misleading or deceptive or likely to

mislead or deceive is that (Qantas') allocation of

smoking and non-smoking seating on the aircraft

conveys an impression that the non-smoking areas are

'smoke-free' whereas the recycled nature of airline

indoor air quality is such that cigarette smoke is

distributed throughout the aircraft and persons

including both passengers and crew in non-smoking

sections are in fact exposed to environmental tobacco smoke.

7. In respect of passengers additional unconscionable

conduct includes the fact that the relative strength

of (Qantas) and passengers is such that (Qantas) has

control of smoking policies on its aircraft and is in

a position to dictate those to passengers such that it

is not possible for non-smoking passengers to insist

on a smoke-free flight or to be seated in a genuine

smoke-free area whereas it is within a capacity of

(Qantas) to determine that all flights be non-smoking.

8. In respect of passengers, additional misleading or

deceptive conduct includes:-

(a) Passengers who request non-smoking seats between

the time of purchasing tickets and before

presenting for seat allocation are told that

they will receive a non-smoking seat whereas on

presenting for seat allocation, they are not

allocated a non-smoking seat, but in fact are

allocated a smoking seat in circumstances in

which the conduct of (Qantas) involves a

representation as to the future in respect which

the Applicant relies upon Section 51A of the

Trade Practices Act;

(b) Where a non-smoking seat is allocated to a

passenger, (Qantas) represents that the

passenger will be allocated a seat in a

smoke-free area whereas some passengers are allocated

seats immediately in front of or adjacent to

seats in which passengers are smoking and/or are

subjected to cigarette smoke by virtue of the

recycled nature of indoor aircraft air, and in

this regard, (Qantas) again makes a

representation as to the future in respect of

which the Applicant relies upon Section 51A of

the Trade Practices Act."

Additional particulars of Mrs. Cameron's representative claims

9. By correspondence between the solicitors for the parties, further particulars of Mrs. Cameron's personal claims have been sought and supplied. They are not, for present purposes (that is to say, the pleading questions which now arise) really contentious. However, the claims she purportedly makes in a representative capacity have also been the subject of requests by Qantas for further and better particulars. Mrs. Cameron's solicitors have responded to these requests in an argumentative fashion. It is not necessary to restate this material for present purposes. It will suffice to note that, despite the contrary views expressed by the solicitors for Qantas, by letter dated 9 July 1993 Mrs. Cameron's solicitors maintained that their pleadings, read with their particulars dated 5 July, complied with the provisions of Part IVA of the Act.

10. Part IVA of the Act provides, relevantly, as follows:

"33C(1) Subject to this Part, where:

(a) 7 or more persons have claims against the same person;

and

(b) the claims of all those persons are in respect of, or

arise out of, the same, similar or related circumstances; and

(c) the claims of all those persons give rise to a

substantial common issue of law or fact;

a proceeding may be commenced by one or more of those

persons as representing some or all of them.

33C(2) A representative proceeding may be commenced:

(a) whether or not the relief sought:

(i) is, or includes, equitable relief; or

(ii) consists of, or includes, damages; or

(iii) includes claims for damages that would require

individual assessment; or

(iv) is the same for each person represented; and

(b) whether or not the proceeding:

(i) is concerned with separate contracts or

transactions between the respondent in the

proceeding and individual group members; or

(ii) involves separate acts or omissions of the

respondent done or omitted to be done in

relation to individual group members.

33D(1) A person referred to in paragraph 33C(1)(a) who has

a sufficient interest to commence a proceeding on his or her

own behalf against another person has a sufficient interest

to commence a representative proceeding against that other

person on behalf of other persons referred to in that paragraph."

...

33H(1) An application commencing a representative

proceeding, or a document filed in support of such an

application, must, in addition to any other matters required

to be included:

(a) describe or otherwise identify the group members to

whom the proceeding relates; and

(b) specify the nature of the claims made on behalf of the

group members and the relief claimed; and

(c) specify the questions of law or fact common to the

claims of the group members.

33H(2) In describing or otherwise identifying group members

for the purposes of subsection (1), it is not necessary to

name, or specify the number of, the group members."

...

33L If, at any stage of a representative proceeding, it

appears likely to the Court that there are fewer than 7

group members, the Court may, on such conditions (if any) as it

thinks fit:

(a) order that the proceeding continue under this Part; or

(b) order that the proceeding no longer continue under

this Part.

...

33N(1) The Court may, on application by the respondent or

of its own motion, order that a proceeding no longer

continue under this Part where it is satisfied that it is in

the interests of justice to do so because:

(a) the costs that would be incurred if the proceeding

were to continue as a representative proceeding are

likely to exceed the costs that would be incurred if

each group member conducted a separate proceeding; or

(b) all the relief sought can be obtained by means of a

proceeding other than a representative proceeding

under this Part; or

(c) the representative proceeding will not provide an

efficient and effective means of dealing with the

claims of group members; or

(d) it is otherwise inappropriate that the claims be

pursued by means of a representative proceeding."

...

33P Where the Court makes an order under section 33L, 33M

or 33N that a proceeding no longer continue under this Part:

(a) the proceeding may be continued as a proceeding by the

representative party on his or her own behalf against

the respondent; and

(b) on the application of a person who was a group member

for the purposes of the proceeding, the Court may

order that the person be joined as an applicant in the

proceeding."

The submissions put on behalf of the parties on the notice of motion

11. On behalf of Qantas, it is contended that the claims advanced on behalf of Mrs. Cameron are "political" only and, as such, are not justiciable by a federal court. It is also said that the pleadings and particulars filed on behalf of Mrs. Cameron do not comply with the requirements of Part IVA of the Act. It follows, the argument runs, that the proceedings should be struck out. An alternative submission is advanced on behalf of Qantas that Mrs. Cameron's pleadings do not clearly distinguish the claims she makes in her personal capacity from the claims purportedly made in her representative capacity. It is also said that the pleading of both types of claim is not clear and embarrassing, and does not distinctly state the requisite ingredients of the statutory causes of action sought to be sued upon.

12. On behalf of Mrs. Cameron, it is submitted that the proceedings are properly constituted and do, at least in substance, comply with the representative provisions of Part IVA. It is said that any shortcomings in the pleadings, in terms of their detail, can be adequately dealt with by directions given under Part IVA or by subsequent amendment of the statement of claim.

13. In Poignand v NZI Securities Australia Ltd. [1992] FCA 369; (1992) 37 FCR 363, Gummow J said (at 365):

"Part IVA assumes the investment by another law of the

Parliament of this Court with jurisdiction to entertain the

subject matter of the representative proceeding. Part IVA

creates new procedures and gives the court new powers, in

relation to the particular exercise of that jurisdiction.

The new legislation exemplifies the distinction to be made

between the jurisdiction of the court to hear and determine

a matter and the powers and procedures of the court in

relation to the exercise of that jurisdiction: ...

Upon the hearing of the motion, counsel for the applicant

indicated that he wished to amend pars 26A and 42A of the

statement of claim to clarify the allegations concerning the

position of the guarantors. When the court is asked to take

the summary steps of staying or dismissing an action it

should have regard to the manner in which the claims made

could be framed in pursuance of any proper amendment: ...

I therefore deal with the present application on the footing

that the pleading might properly be amended as indicated by

senior counsel for the applicant."

15. Although Part IVA does not create a new cause of action in any substantive sense, it permits, in appropriate circumstances, the joinder in one proceeding of several causes of action vested in different persons where their claims are in respect of, or arise out of similar or related circumstances and give rise to a substantial common issue of law or fact. But, in order that a matter may properly proceed under Part IVA, it is necessary that the pleadings filed on behalf of the applicant, or applicants, adequately indicate the basis upon which it is claimed that the procedures mentioned in Part IVA are said to be available. In my view, the pleadings here (i.e. the application, the statement of claim and the further and additional particulars provided) do not adequately indicate the basis upon which it is said that the Part IVA procedures may be used here.

16. The statement of claim gives, I think, an appropriate indication of the nature of the claim made by Mrs. Cameron in her personal capacity, yet, in my opinion, no real attempt is made in the applicant's pleadings to set out clearly the basis for the claims of the other persons. Moreover, no proper attempt has been made to explain in what way the circumstances are said to be "the same, similar or related" within the meaning of s.33C(1)(b), or why the other claims are alleged to give rise to a "substantial common issue of law or fact" within the meaning of s.33C(1)(c). Rather, what is pleaded in respect of the other claims is, in essence, no more than (1) It was Qantas "policy" to permit smoking on its aircraft and (2) Qantas knew that this would be harmful to passengers and crew.

17. It is plain, in my view, that this is an inadequate pleading. It is no answer to suggest, as was put on behalf of Mrs. Cameron, that the complaints made about her pleadings can be adequately dealt with and the position clarified in later directions hearings. I accept that, as part of the Court's practice of case management, directions hearings may be, and should be, used to identify what is, and what is not, seriously in dispute. However, it is axiomatic that a respondent is entitled to have, from the outset, the benefit of an adequate indication from an applicant's pleading of the case to be met at the trial so that a proper defence may be filed.

18. In the present case, so far as concerns the other claims, the pleadings are, I think, deficient in several respects: There is no real attempt to distinguish the claims under s.52 from the very different claims under s.52A. Nor is there any proper explanation of the basis upon which all of the claims are said to be related in some way. For instance, Mrs. Cameron's claim, as pleaded, depends very much upon what she was alleged to have been told by the ground staff. Such a claim could hardly be made on behalf of the flight crew, who are also purportedly joined in the proceedings.

19. As has been noted, Qantas seeks, as its primary relief on the notice of motion, an order striking out the whole proceeding. I decline to do this, for two reasons: (1) So far as the claim made by Mrs. Cameron in her own capacity is concerned, the pleadings give sufficient notice to Qantas of its nature in order that Qantas may file a defence to that claim. (2) So far as the claims purportedly made on behalf of other persons are concerned, counsel for Mrs. Cameron indicated in argument that, if given the opportunity to do so, she would wish to amend her statement of claim (and possibly her application) so as to articulate these claims with more precision. In my view, it is appropriate that, within reasonable time limits, she be given this opportunity.

20. In these circumstances, I have concluded that the proper course is to strike out the statement of claim, with costs, but to grant Mrs. Cameron liberty to re-plead.

1. The statement of claim be struck out.

2. Grant liberty to the applicant to replead her statement of claim

and to amend her application, as she may be advised, within 28

days.

3. Applicant to pay the respondent's costs of the notice of motion.