Medibank Private Ltd v Cassidy

Federal Court of Australia (Full Court)|2002-09-13|Before: Ryan J, Conti JJ

REASONS FOR JUDGMENT THE COURT: 1 Brian Cassidy is the chief executive officer of the Australian Competition and Consumer Commission ("ACCC"). Mr Cassidy is also a delegate of the Australian Securities and Investment Commission ("ASIC") in relation to its powers in respect of health insurance. On 26 October 2000, Mr Cassidy commenced a proceeding in the Court pursuant to the Australian Securities and Investment Commission Act 1989 (Cth) ("the ASIC Act"). In substance, ACCC seeks the relief claimed in the proceeding. As a matter of convenience, therefore, ACCC will be treated in these reasons as the applicant. 2 In the proceeding, ACCC seeks declarations, inter alia, that the respondent, Medibank Private Limited ("Medibank"), has engaged in conduct in contravention of s 12DA(1) of the ASIC Act. Section 12DA(1) provides that a corporation must not, in trade or commerce, engage in conduct in relation to financial services that is misleading or deceptive or is likely to mislead or deceive. 3 In addition, ACCC seeks orders under ss 12GD and 12GE of the ASIC Act. Section 12GD relevantly provides that, if the Court is satisfied that a person has engaged in conduct that constitutes a contravention of s 12DA, the Court "may grant an injunction in such terms as the Court determines to be appropriate". Section 12GE relevantly provides that if the Court is satisfied that a person has engaged in conduct constituting a contravention of s 12DA, the Court may also make orders requiring that person to disclose information to the public, or to a particular class of persons, and to publish advertisements, in terms specified in the orders. 4 On 15 January 2001, Medibank filed a notice of motion seeking an order that the amended statement of claim and amended application that have been filed in the proceeding be struck out as disclosing no reasonable cause of action, as tending to cause prejudice, embarrassment or delay in the proceeding, and as being otherwise an abuse of the process of the Court. At the hearing of the motion, Medibank confined itself to seeking orders that certain paragraphs of the further amended application be struck out. On 21 March 2002, a judge of the Court ordered that the motion be refused. 5 On 10 April 2002, Medibank applied for leave to appeal to the Full Court from that order. On 30 April 2002, orders were made that the appeal be listed for hearing at the same time as the application for leave. In its draft notice of appeal, Medibank makes clear that its application is for leave to appeal only from the order of the primary judge insofar as his Honour refused to order that the claims for relief set out in paragraphs 10, 11 and 12 of the further amended application be stayed or dismissed pursuant to Order 20, rule 2 of the Federal Court Rules. The orders sought in paragraphs 10, 11 and 12 will be set out in full later.

BACKGROUND 6 ACCC asserts that Medibank was, at all material times, a company carrying on the business of a private health insurer. That business includes the promotion and sale of financial products and the provision of financial services in connection with health insurance within the definition of "financial services" in s 12DA of the ASIC Act. In the amended statement of claim it is alleged that, at various times, Medibank, inter alia, made a number of representations defined, for the purposes of the proceeding, as follows:

the waiting period representation;
the thirty days free cover representation;
the package plus premium representation;
the call centre premium representation;
the website and brochure representations; · the no‑rate increases representation. The full content of the representations is not presently relevant. 7 Orders 10, 11 and 12 sought in the further amended application are in the following terms: "10. An order directing the Respondent to: (a) write to all persons who have transferred from another health insurance provider to the Respondent in the period between 13 August 2000 and 10 September 2000 (inclusive) informing them that:

(i) the Waiting Period Representation and the 30 Days Free Cover Representation … were misleading and/or deceptive or were likely to have been misleading and/or deceptive to consumers;

(ii) the Respondent will compensate those persons who were mislead and/or deceived and who suffered loss or damage by this, according to the nature of the loss or damage by:

(y) granting 30 days free cover without any conditions in respect of the Respondent's Health Insurance Products…; and

(iii) such compensation will be made after confirmation of the identity of such persons and of the loss or damage by a procedure to be agreed between the Applicant and the Respondent within a time fixed by the Court, or in default the procedure to be determined by the Court; (b) upon confirmation of the identity of the persons to be compensated and of the loss or damage by a procedure to be agreed between the Applicant and the Respondent within 14 days hereof, or in default to be determined by the Court, make the waiver and/or grant the free cover referred to above.

An order directing the Respondent to: (a) write to all persons who have entered into agreements to purchase the Respondent's PackagePLUS Products … in the period between 1 March 2000 and 30 June 2000 (inclusive) informing them that:

(i) the PackagePLUS Premium Representation, the Call Centre Premium Representation, the Website and Brochure Representations and the No Rate Increases Representation … were misleading and/or deceptive or were likely to have been misleading and/or deceptive to consumers; and

(ii) all persons who purchased the PackagePLUS Products … on or before 30 June 2000 who were mislead and/or deceived and who suffered loss or damage by this will be compensated by the Respondent according to the nature of the loss or damage by receiving a refund of, or a credit for, the difference between the pre‑1 July 2000 premium or rate and the post‑1 July 2000 premium or the rate for the period 1 July 2000 up to 31 December 2000; and

(b) upon confirmation of the identity of the persons to be compensated and of the loss or damage by a procedure to be agreed between the Applicant and the Respondent within 14 days hereof, or in default to be determined by the Court, make the payment of the refund or give the credit referred to above.

The Respondent provide forthwith to the Applicant particulars of each person who: (a) transferred from another health insurance provider to the Respondent in the period between 13 August 2000 and 10 September 2000 (inclusive);

(b) entered into an agreement to purchase the Respondent's PackagePLUS Products … in the period between 1 March 2000 and 30 June 2000 (inclusive)

such particulars to include: (i) the name and address of each person;

(ii) the date the person transferred or purchased as referred to above;

(iii) the type of health insurance product selected;

(iv) the method of payment for the product selected;

(v) the amount and date of each payment made by each person up to 31 December 2000;

(vi) whether the person applied to the Respondent for the transfer or purchase:

(x)by means of the Respondent's website; (y)after telephoning a Call Centre operated by or on behalf of the Respondent; (z)after visiting a business premises operated by the Respondent." 8 Medibank contended that the provisions of the ASIC Act relied on by ACCC, namely, ss 12GD and 12GE, do not empower the Court to grant all of the relief claimed in orders 10, 11 and 12. Order 12 is in aid of orders 10 and 11 and ACCC accepts that, if the Court has no power to make orders 10 and 11, then it would have no power to make order 12. The primary judge concluded that s 12GD confers on the Court a general power to make an order compelling a person to perform some stipulated act and that that power is circumscribed only by the requirement that the Court be satisfied that the person has engaged in, or is proposing to engage in, a contravention of a relevant provision of the ASIC Act. His Honour, citing Leon Fink Holdings Pty Limited v Australian Film Commission (1979) 141 CLR 672 at 679, placed some weight on the fact that the operative words of s 12GM are prefaced by the words "without limiting the generality of s 12GD" and concluded that those words indicated that the general power of s 12GM should be given a construction "that accords with the width of the language in which it is expressed". 9 In order to deal with Medibank's contentions as to the effect of ss 12GD and 12GE, it will also be necessary to have regard to related provisions of the ASIC Act, namely, ss 12GF, 12GJ and 12GM. Sections 12GD, 12GE, 12GF, 12GJ and 12GM of the ASIC Act are analogues of ss 80, 80A, 82, 86 and 87 of the Trade Practices Act 1974 (Cth)("the TP Act"). That is to say the language of those provisions of the ASIC Act is relevantly identical to the language of the provisions of the TP Act and was derived from those provisions. The argument proceeded on the basis that the historical background relevant to the construction of the provisions of the TP Act is equally relevant to the construction of the corresponding provisions of the ASIC Act. Accordingly, it is convenient to deal with the provisions of the TP Act and the powers of the Court under those provisions on the assumption that the conduct of Medibank complained of constituted a contravention of provisions of the TP Act.

LEAVE 10 The substantive questions raised by Medibank's motion are not without doubt and it is common ground that they are of general importance. The amount of compensation involved could be in the order of $90 million and the relief in question potentially involves some 300,000 persons who acquired Medibank's health insurance products during the relevant period. The importance of the issue that would be raised if leave is granted, as well as its impact on the conduct of the case, can also inform the exercise of the discretion to grant leave ‑ Mayne Nickless Ltd v Multigroup Distribution Services Pty Ltd (2001) FCR 168 at [33]. 11 However, the grant of leave is opposed by ACCC, primarily on the basis that it is inappropriate for the question to be considered at this stage of the proceeding. Rather, it is said, the question should only be considered if and when findings have been made at trial and the Judge is invited to make the orders as claimed. It is possible, of course, that ACCC may fail to establish in the proceeding that there has been any contravention by Medibank. It is equally possible that, even if the Court has power to make the orders sought and contravention is established, the Court, in the exercise of discretion, may nevertheless decline to grant the orders claimed. 12 There would be no real prejudice occasioned to Medibank by a refusal of leave in the present case, other than the possibility of incurring costs that would not otherwise be incurred. However, it is undesirable that unnecessary costs be incurred and that the hearing time of the Court be unnecessarily taken up by the trial of issues that would not arise if the Court does not have power to grant the relief sought in relation to such issues. 13 In support of its motion, Medibank relies on the fact that its preparation time for trial and the duration of the trial itself would be increased considerably if the parties are required to lead evidence and to make submissions relevant to the orders claimed. The discovery of documents that Medibank would be required to give is likely to be significantly larger, both in quantity and scope, than would be the case if the claims for orders 10, 11 and 12 were not maintained. Medibank asserts that it would be put to considerable expense and inconvenience in satisfying such extended discovery obligations. 14 It is also possible that Medibank would need to assemble extensive and complex evidence to demonstrate that, even if representations of the kind alleged were made and were misleading, and the Court were to possess power to grant the orders claimed, such relief would be inappropriate in the circumstances of the case. Preparation for the proceeding may require detailed consideration of Medibank's very large client base and examination of market practices and consumer behaviour. It is also likely to require expert and, perhaps, market survey, evidence in relation to those matters. 15 Having regard to the importance of the question raised and to the impact that the presence of the claims in orders 10, 11 and 12 could have on the conduct of the proceeding, we consider that this is an appropriate case for the grant of leave to appeal. Accordingly, we shall proceed to consider and decide the substantive questions.

THE SUBSTANTive QUESTIONs 16 There are three grounds on which Medibank contends that the orders in question should be struck out summarily. The first is that the Court does not have power to order compensation in favour of non‑parties under s 80 (s 12GD), as is contemplated by orders 10(b) and 11(b). The second ground, related to the first, is that orders 10(a)(ii) and (iii) and 11(a)(ii) and (iii) would require Medibank to offer compensatory relief to third parties. The considerations relating to that relief are the same as those that arise in relation to orders 10(b) and 11(b). The observations that will be made in relation to orders 10(b) and 11(b) apply equally to orders 10(a)(ii) and (iii) and 11(a)(ii) and (iii). 17 The third question concerns the measure of loss to be the subject of any order for compensation that might be made. Medibank contends that the effect of Orders 10(b) and 11(b) would be to require Medibank to make good the representations to the persons who suffered loss in reliance upon them. The effect, so it is said, would be to place such persons in a position that they would have been in had their contracts of insurance contained the representation as a term. 18 As a general rule, the measure of damages suffered as a consequence of reliance upon non‑contractual representations is, by analogy, that applicable to the measure of damages in tort. However, the power of the Court under s 80 (and s 12GD) is to grant an injunction in such terms as the Court determines to be appropriate. Whether, assuming there is power to make an order at all, it would be appropriate to make an order analogous to the measure of damages in tort or the measure of damages in contract will depend entirely upon the findings that are made. The ACCC should not be deprived summarily of the opportunity of contending for particular orders as may be appropriate once relevant findings have been made. There was no error on the part of the primary judge in exercising his discretion against summary determination of that question. In any event, the question would not arise in this proceeding if we accept that the Court has no power unders 80 to order Medibank to offer or to give compensation in favour of non‑parties.

power to order compensation to non‑parties 19 The true construction of s 80 of the TP Act (s 12GD of the ASIC Act) must be determined in the light of the terms of related provisions of the TP Act, in particular, s 87 (s 12GM of the ASIC Act). The legislative history of the terms of s 80 in its present form is instructive in that regard. We have had the benefit of argument relating to the legislative history of ss 80 and 80A of the TP Act, as that history applies to ss 12GD and 12GE of the ASIC Act. The primary judge did not have the benefit of that material. 20 Section 80 of the TP Act, as originally enacted, relevantly provided that the Court might, on the application of:

the Attorney‑General;
the ACCC;
any other person; "grant an injunction restraining a person from engaging in conduct that constitutes or would constitute a contravention" of a relevant provision of the TP Act. Section 82(1) of the TP Act, as originally enacted, provided that a person who suffers loss or damage by an act of another person that was done in contravention of a relevant provision of the TP Act might recover the amount of the loss or damage by action against the other person. Under s 82(2), such a proceeding was to be commenced within 3 years of the cause of action arising. 21 Section 87(1), however, provided that, where in a proceeding instituted under Part VI of the TP Act (which relates to enforcement and remedies), the Court found that there had been a contravention of a relevant provision of the TP Act, the Court could, in addition to granting an injunction under s 80 or making an order under s 82, make "such other orders as it thinks fit" to redress the injury to persons caused by any conduct to which the proceeding relates or any like conduct engaged in by the defendant. Under s 87(2) the orders that could be made under s 87(1) included an order directing the payment to a person who had suffered loss or damage of the amount of the loss or damage. 22 A number of observations can be made concerning the scheme of those provisions. First, s 80 could be invoked by any person. Secondly, s 80(1) authorised only an injunction restraining a person from engaging in conduct. It did not authorise a mandatory injunction. Thirdly, s 82(2) required that any action to recover the amount of loss or damage be commenced within three years after the date on which the cause of action accrued. Fourthly, s 87(2) contemplated an order in favour of a person who suffered loss or damage, whether or not that person was a party to the proceeding. 23 In 1977, s 87 was amended. Significantly, the operation of s 87 was restricted. The effect of s 87(1), as amended, was that, where in a proceeding instituted under Part VI, the Court found that a person who is a party to the proceeding had suffered loss or damage by conduct of another person that was engaged in in contravention of a relevant provision of the TP Act, the Court might "make such order or orders as it thinks appropriate" against the person who engaged in the conduct, if the Court considers that the order or orders concerned would compensate the first mentioned person for the loss or damage or would prevent or reduce the loss or damage. 24 The explanatory memorandum circulated in connection with the Bill for the Act that amended s 87 contained the following statement(in para 44): "The orders under s 87 are, for constitutional reasons, restricted to orders compensating parties to the proceedings only." Thus there was a conscious decision made by the Parliament to restrict the operation of s 87, which expressly authorised an order compensating a person who suffered loss or damage by conduct that might be restrained, such that it was available only for the benefit of a party to the proceeding. 25 At the same time, s 80A was inserted into the TP Act, authorising the Court to make orders requiring disclosure of information and correcting advertisements. Amendments were also made to s 80 at the same time. There was no change to the provisions insofar as they authorised the Court, on the application of any person, to grant an injunction restraining a person from engaging in certain conduct. 26 In 1983, the TP Act was amended again. In particular, significant amendments were made to s 80. Section 80(1) in its original form was omitted and a new s 80(1) was substituted. The effect of the new s 80(1) was that where, on the application of any person, the Court was satisfied that a person had engaged in conduct that constituted a contravention of a relevant provision of the TP Act, the Court could grant an injunction "in such terms as the Court determines to be appropriate". Thus, the powers of the Court were expanded significantly. That is to say, instead of authorising the Court to grant an injunction restraining a person from engaging in conduct, the Court was empowered to grant an injunction in such terms as the Court determines to be appropriate. 27 That change of language clearly empowered the Court to make mandatory orders in addition to restraining orders. That was recognised by the Parliament in the explanatory memorandum that was circulated in connection with the Bill for the Act to amend s 80. The explanatory memorandum contained the following comment: "The effect of the amendment is to widen the Court's power to grant injunctive relief which is at present generally limited to restraining a contravention of the Act. The amended provision will enable the Court to grant more effective injunctive relief, including mandatory injunctions and other injunctive relief." However, there was no suggestion that the effect of the amendment was to confer on the Court the very power that the Parliament had taken away, by the amendment to s 87 that had been made in 1977 for constitutional reasons, to order compensation in favour of non‑parties. 28 In addition, ss 80(4) and (5), which had been inserted in 1977, were omitted and the following were inserted: "(4) The power of the court to grant an injunction restraining a person from engaging in conduct may be exercised: (a) whether or not it appears to the Court that the person intends to engage again, or to continue to engage, in conduct of that kind; (b) whether or not the person has previously engaged in conduct of that kind; and (c) whether or not there is an imminent danger of substantial damage to any person if the first‑mentioned person engages in conduct of that kind. (5) The power of the court to grant an injunction requiring a person to do an act or thing may be exercised: (a) whether or not it appears to the court that the person intends to refuse or fail again, or to continue to refuse or fail, to do that act or thing; (b) whether or not the person has previously refused or failed to do that act or thing; and (c) whether or not there is an imminent danger of substantial damage to any person if the first‑mentioned person refuses or fails to do that act or thing." 29 Finally, ss 80A and 87 were amended to insert the qualification that their operation was not to limit the generality of s 80. According to the explanatory memorandum circulated in connection with the relevant Bill, those amendments were consequential on the amendment of s 80(1), in order to ensure that the specific grant of injunctive power given to the Court by ss 80A(1) and 87 was not to be used to read down the general power conferred by the new s 80(1). That is to say, the amendments to ss 80A and 87 were to obviate the possibility of any contention that ss 80A and 87 may have some limiting effect on the expanded language of s 80(1). 30 It would be curious indeed, however, if the Parliament, by the amendment made to s 80(1), intended to confer on the Court a power to award compensation in favour of persons who were not parties to any proceeding without any express reference to such an intention. The restriction on the Court's power inherent in s 87 was not affected. That is to say, the power to order compensation under s 87 remained restricted to an order in favour of a party to the relevant proceeding. Section 82 was clearly still limited to a power to order compensation in favour of a person who had commenced a proceeding claiming loss or damage from relevant conduct. 31 Section 15AA of the Acts Interpretation Act 1901 (Cth) would allow the Court to consider the purposes of the TP Act in determining whether there is more than one possible construction of s 80. If reference to the purposes reveals that the drafter has inadvertently overlooked something that would have been dealt with had attention been drawn to it and it is possible, as a matter of construction, to repair such a defect, then that must be done ‑ see Mills v Meeking (1990) 169 CLR 214, 235. 32 Section 12GD(1) of the ASIC Act, in its present form, looked at in a vacuum and without regard to the legislative history of s 80 of TP Act and without regard to s 12GM of the ASIC Act and the corresponding history of s 87 of the TP Act, might literally authorise the Court, if it determined it to be appropriate, to make orders as claimed in orders 10, 11 and 12 of the further amended application. However, the history briefly outlined above indicates that it is demonstrably clear that that was not the intention of the Parliament, and that it would be contrary to the purpose of the TP Act as a whole, for s 80 to be interpreted in that way. Such an interpretation would give rise to a capricious and irrational scheme. The effect of such a construction would be that certain of the provisions of s 87 would be quite otiose and would have no work to do. When a statute confers both a general power, not subject to limitations and qualifications, and a special power, subject to limitations and qualifications, the general power cannot be exercised to do that which is the subject of the special power - see Leon Fink Holdings Pty Limited v Australian Film Commission (1979) 141 CLR 672 at 678. 33 Thus, s 87(1A) of the TP Act (with which s 12GM(2) corresponds) provides that the Court may, on the application of a person who has suffered loss or damage by conduct of another person that was engaged in in contravention of a relevant provision of the TP Act, or on the application of the Commission in accordance with s 87(1B) on behalf of such a person, make such order or orders as the Court thinks appropriate against the person who engaged in the conduct, if the Court considers that the order or orders concerned will compensate the person who made the application, or the person on whose behalf the application was made, for the loss or damage. 34 Section 87(1B), with which s 12GM(3) corresponds, provides that, where in a relevant proceeding a person is found to have engaged in conduct in contravention of a relevant provision of the TP Act, the ACCC may make an application under s 87(1A) on behalf of one or more persons identified in the application who have suffered loss or damage by the conduct. However, the ACCC must not make such an application except with the consent in writing given before the application is made by the person on whose behalf the application is made. Thus, significant qualifications on the Court's powers to order compensation on the application of the ACCC are imposed by ss 87(1A) and 87(1B). Compensation can be ordered by the Court only where the application is brought by the person in whose favour the compensation is ordered or where an application is brought on behalf of such a person with the prior written consent of that person. 35 The provisions of ss 87(1A) and 87(1B) that authorise an application to be brought by ACCC on behalf of a person who has suffered loss or damage were inserted after the amendment of s 80(1) to authorise the Court to grant an injunction in such terms as the Court determines to be appropriate. Nevertheless, it would be irrational, in the light of the amendments that were made to s 87, for s 80(1) to be given the expansive construction contended for by the ACCC. To construe s 80 in that way would raise the very question of Constitutional validity that the Parliament sought to avoid by the amendments made to s 87. The matters outlined above indicate that s 80 does not authorise injunctions in terms of orders 10, 11 and 12 of the amended application. 36 That conclusion is reinforced by an examination of the legislative history of s 1324 of the Corporations Act 2001 (Cth) ("the Corporations Act"). Section 1324(1) confers power to grant injunctive relief analogous to s 80 of the TP Act (s 12GD of the ASIC Act). However, s 1324(10) of the Corporations Act is in the following terms: "Where the Court has power under this section to grant an injunction restraining a person from engaging in particular conduct, or requiring a person to do a particular act or thing, the Court may, either in addition or in substitution for the grant of the injunction, order that person to pay damages to any other person." 37 Section 1324(10), is the successor of s 574 of the Companies Act 1981 (Cth) ("the 1981 Companies Act"). Section 574 was inserted as a new provision in that Act after some public consultation. An exposure draft of the Bill for the 1981 Companies Act ("the 1981 Companies Bill") contained a version of s 574 modelled on s 149 of the Securities Industry Act 1980 (Cth) ("the 1980 Securities Act"). Section 149(1) of that Act, and s 574(1) of the 1981 Companies Bill, each provided as follow: "(1) Where a person has engaged, is engaging or is proposing to engage in any conduct that constituted, constitutes or would constitute an offence against this Act, the Court may, on the application of: (a) the Commission; or (b) any person whose interests have been, are or would be affected by the conduct; grant an injunction restraining the person from engaging in the conduct." 38 Neither provision would have authorised the grant of mandatory injunctions. Neither section contained a provision equivalent to s 1324(10) of the Corporations Act providing for the award of damages by the Court in lieu of, or in addition to, injunctions where the Court had power to grant injunctive relief. 39 Following the introduction of the exposure draft of the 1981 Companies Bill into the Commonwealth Parliament, interested parties were invited by the relevant minister to make submissions on the draft. A submission by the Institute of Directors in Australia suggested that, while the proposed s 574 went some of the way to overcoming the procedural difficulties involved in mounting actions for wrongs done to a company, its wording appeared to exclude mandatory injunctions to "undo" an act, where that was possible or appropriate. The submission suggested that, although damages in lieu of an injunction might be available under the equivalent of the Chancery Amendment Act 1858 (UK) ("Lord Cairns Act"), it would be preferable that such a right to damages in lieu of an injunction be expressed in the proposed s 574 to put the matter beyond doubt. Lord Cairns Act was enacted to remove any doubt about the power of the Court of Chancery to award damages in addition to, or in lieu of, injunctive relief. 40 The point raised by the submission apparently led to amendment of the 1981 Companies Bill. Section 574, as enacted in the 1981 Companies Act:
conferred upon the Court the power to grant mandatory, as well as prohibitory injunctions; and
contained s 574(8), which was in almost identical terms to s 68 of the Supreme Court Act 1970 (NSW), the equivalent of Lord Cairns Act. 41 At about the same time, s 149 of the 1980 Securities Actwas amended to mirror the final version of s 574, as enacted in the 1981 Companies Act. Section 149(1), as amended, authorised the Court to grant mandatory, as well as prohibitory, injunctions and s 149(6) was substituted in identical terms to s 574(8). 42 When section 80 of the TP Act was amended in 1983, the Parliament conferred on the Court the power to grant mandatory as well as prohibitory injunctions, in terms similar to s 574 of the 1981 Companies Act and s 149 of the 1980 Securities Act. Significantly, however, the Parliament did not include within s 80 of the TP Act a provision in the same terms as s 574(8) of the 1981 Companies Act and s 149 of the 1980 Securities Act. 43 In 1989 s 1324 of the Corporations Law 1989 (Cth) ("the Corporations Law") re‑enacted the power contained in s 574 of the 1981 Companies Act. Section 574(8) became s 1324(10) of the Corporations Law. That provision in turn became s 1324(10) of the Corporations Act. Section 1324(10) is in terms substantially the same as Lord Cairns Act. 44 The language of s 1324(1) of the Corporations Act is not the same as s 80(1) of the TP Act. However, there are considerable similarities. Under s 80, the Court may grant an injunction "in such terms as the Court determines to be appropriate". Under s 1324(1), the Court may grant an injunction "on such terms as the Court thinks appropriate, restraining [a] person from engaging in the conduct and, if in the opinion of the Court it is desirable to do so, requiring that person to do any act or thing." If the additional words of s 1324(1) have any effect, they limit the terms of the injunction that s 1324(1) would authorise. However, it is difficult to see any significant restriction, since the Court is, in effect, empowered to grant an injunction, on such terms as the Court thinks appropriate, requiring a person to do any act or thing. 45 If the power given by s 1324(1) authorised an order for damages in favour of any person, there would have been no necessity for s 1324(10). Thus, the language found in s 1324(1), which is to all intents and purposes the same as the language of s 80(1) of the TP Act (s 12GD(1) of the ASIC Act), was not intended, of itself, to authorise the Court to order damages in a proceeding in favour of any person who was not a party to the proceeding. That supports the conclusion that the Parliament did not intend, by the language of s 80(1) or of s 12GD(1), to authorise the Court to order damages in a proceeding in favour of any person who was not a party to the proceeding.

previous decisions of the court 46 The Court has, on a number of occasions, made orders having the effect of redressing wrongs brought about by contraventions of the relevant provisions of the TP Act. It has done so by means of mandatory injunctions against a contravener under s 80 requiring the contravener to make refunds of monies paid. In conjunction with such orders, the Court, under s 80A, has made orders for disclosure of information and for the publishing of advertisements - see, for example, ACCC v Purple Harmony Plates Pty Ltd [2001] FCA 1062 at paragraphs 32, 33 and 36, ACCC v MHG Plastic Industries Pty Ltd [1999] FCA 970 and ACCC v On Clinic Australia Pty Ltd (1996) ATPR 41‑517 at 42,459. In the first two matters, there is no indication within the reasons for judgment, that the question of the Court's power to make the orders sought was raised as an issue. 47 It is true that, in ACCC v On Clinic Australia Pty Ltd, Tamberlin J made an order for corrective advertising which embodied an offer to refund payments previously outlaid by dissatisfied customers, but it is apparent from the report that the question as to whether s 80 of the TP Act (s 12GD of the ASIC Act) authorised the making of any such order, and in particular whether a distinction between an order to make refunds, and an order to make offers of refunds, was not raised. In reality, orders 10, 11 and 12 would have the effect of imposing upon Medibank obligations to make good representations, not being obligations already imposed upon Medibank, for which ss 12GF and 12GM alone are intended to provide the remedies. 48 In ACCC v MHG Plastic Industries Pty Ltd, the orders in question were set aside by the Full Court. The Full Court concluded that there had been no contravention, although it made no comment about the nature of the orders. On the other hand, the question of the Court's power was not raised as an issue in the proceeding. Although Emmett J made reference within the reasons for judgment to the flexible nature of the orders which could be made under s.80 of the TP Act, his Honour made no comment on the application of such orders to non‑parties.

CONCLUSION 49 The appeal should be upheld. In lieu of the order made by the primary judge, there should be an order on the motion that the proceeding be dismissed in relation to the claims for relief made in paragraphs 10, 11 and 12 of the amended application. Medibank should be given its costs of the appeal and of the motion. I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Sundberg, the Honourable Justice Emmett and the Honourable Justice Conti.

Associate: Dated: 13 September 2002 Counsel for the Appellant A C Archibald QC and S E Marks

Counsel for the Respondent: J I Fajgenbaum QC and E A Strong

Solicitors for the Respondent: Australian Government Solicitor

Australian Securities and Investment Commission Act 1989(Cth)ss 12DA, 12GD, 12GE, 12GF, 12GJ, 12GM

Trade Practices Act 1974(Cth)ss 80, 80A, 82, 86, 87

At a glance

Court

Decision date

Before

Source

Judgment (28 paragraphs)

Parties

Legislation Cited (7)

Cases Cited (5)