Metcash Trading Limited v Bunn

The Court's Order 2 On 24 February 2006, the applicant companies (which I will describe collectively as "the Metcash companies") commenced proceedings against Mr Bunn. Interlocutory relief was sought to restrain publications by Mr Bunn relating to companies and their businesses which they claimed were objectionable. At a contested interlocutory hearing on 9 March 2006 at which Mr Bunn appeared without legal representation, Lander J of this Court was satisfied that there were serious questions to be tried in relation to alleged breaches of the companies' trademarks, inducements to third parties to breach their contracts with the Metcash companies and contraventions of s 52 and s 53 of the Trade Practices Act 1974 (Cth): Metcash Trading Limited v Bunn [2006] FCA 322. Being satisfied that the balance of convenience favoured the applicants, his Honour made interlocutory orders which included the following: 3.2 Until further order, the Respondent, his servants or agents be restrained from publishing or republishing the allegations contained in the "Open Letter" dated 17 December 2005 being exhibit "PAC 11" to the affidavit of Peter Andrew Campbell sworn 23 February 2006. … 3.5 Until further order, the Respondent, his servants or agents be restrained from publishing, whether on the internet or by any other means of communication to the public, any allegation to the effect that: a. the Respondent or the Respondent's former company, Chadmar Enterprises Pty Ltd (In Liquidation) is currently pursuing recovery proceedings against any of the Applicants or their related entities; b. the Applicants actively and deliberately operated in a manner calculated to destroy the Respondent's business; c. the Applicants actively and deliberately operate in a manner calculated to prejudice, damage or destroy the business of independent retailers with whom they deal; d. the Applicants have deliberately and improperly concealed the existence of substantial actions commenced by suppliers and customers and thereby caused Metcash Limited to breach its disclosure requirements'. (Emphasis added.) 3 Though the contempt charged relates only to instances of disobedience to Order 3.5(c), the other orders above are of some significance, as will later become apparent. 4 The first version of the applicants' Statement of Claim post-dated the 9 March 2006 orders. It was filed on 26 May 2006 and, in addition to the causes of action identified by Lander J, it contained as well claims for threatened disclosure of confidential information, defamation and injurious falsehood. I simply note in passing that the allegations pleaded in the current version of the statement of claim in relation to defamation, injurious falsehood and contravention of s 52 and s 53(d) of the Trade Practices Act reflect that referred to in Order 3.5(c): see Second Amended Statement of Claim paras 46.1.5, 47, 52, 57 and 61. 5 At a later interlocutory hearing before Lander J on 28 February 2007, the scope and meaning of aspects of the above orders was raised in discussion between Lander J and Mr Bunn. The genesis of this discussion related in part to Mr Bunn's claimed inability to work out what it was in his 17 December 2005 "Open Letter" to which the Metcash companies objected. The contents of that letter are described below. The following exchanges extended across seven pages of the Transcript: see pp 51-57. MR BUNN: I first of all started off trying to work out exactly what they were referring to in my open letter of 17 December. … MR BUNN: The order against me was - I was restrained from publishing and republishing the allegations contained in the open letter of 17 December. See, from my perspective, I am not seeing allegations. I know them to be facts so that is where all my confusion comes in. So I actually went and I broke down that open letter of 17 December into numbered paragraphs and sub-numbered sentences, asking them: please tell me which is which? All I got was - - - HIS HONOUR: Sorry, what do you ask? MR BUNN: In the letter I asked them: could they please identify by paragraph and sentence number the allegations to which you are claiming in regard to the injunction that was placed on it. HIS HONOUR: Where do you write that? MR BUNN: The third-last paragraph. HIS HONOUR: Of what? MR BUNN: The 5 October letter, which is 130 - PCV130. HIS HONOUR: Yes. MR BUNN: Asked the name so that we can actually deal in words. Maybe I was wrong in doing that, I don't know. The only reply I got was annexure 131 from Mr Mauritz, who basically said: we have clearly identified the issues in dispute, and he names the statement of claim and the categories of documents. He does state prior to that: we are not your legal advisers, a fact that you have identified. Once again, another twist of what has been said before, but I understand that they are not, that they are bringing the claim against me and I just wanted to know, what were the allegations in that 17 December letter. After getting that reply I then wrote to them on 9 October. This time I went to the great time and effort to list, or enclose all open letters which were referred to in this Court into numbered paragraphs and sub-sentences - I am pretty proud of my job, if I may say so, it took a long time - once again, to identify which allegations - or what they are calling an allegation - including the page of the Metcash Info site. HIS HONOUR: Mr Bunn, in that letter you wrote sending the open letter, to which - - - MR BUNN: Is that the 17th, or all of the open letters, your Honour? HIS HONOUR: Well, as the order presently stands you are not entitled to publish any of the allegations which are assertions of fact contained in the open letter of 17 December. MR BUNN: But what are they calling an allegation in that letter? HIS HONOUR: An assertion of fact. MR BUNN: An assertion of fact is something that is not backed by evidence, is it not? HIS HONOUR: No, no. At this stage anything assertion of fact which is made is an allegation. MR BUNN: Even if it has got factual evidence? HIS HONOUR: Yes. Until such time as it is established to be a fact by the Court. MR BUNN: Okay. All right, my understanding. I didn't think I was being stopped talking about truth and fact. HIS HONOUR: There might be something to be said to varying the order because it is probably too wide. MR BUNN: I read the order all the time and I didn't understand it as saying, I couldn't even talk about fact. It says: Any allegation to the effect that. HIS HONOUR: Yes. MR BUNN: An allegation is unbased with evidence, is it not? HIS HONOUR: Well, yes. MR BUNN: Have I got it upside down? HIS HONOUR: I think you have. I think the intent of the order is to prevent you making the claims previously published in that letter. Whether the order ought to continue to stand is another thing. … MR BUNN: This is where I get tripped up. A lot of what is in that 17 December letter is fact. Some of the stuff they haven't even raised in it. Some of the stuff they have raised but it has got blaring evidence that even they have produced to this Court … HIS HONOUR: Can I answer some of your questions that you raised rhetorically, I think - and this is not to sound critically of you - you have got an ongoing campaign directed against Metcash. MR BUNN: It is not a campaign, your Honour. It is not directed at Metcash. Can I explain? HIS HONOUR: Yes. MR BUNN: I had six supermarkets turning over a substantial amount of money and I had operated in the industry for 18 years and I had a lot all my life, everything invested in it. Under a contract that was what I believed was what I could base that business on. The contract was either not honoured or was manipulated by the applicants and of course the company got into trouble, and since then I have lost the company, I have lost everything in life, I have gone into bankruptcy. It has all been a 5 big joke to Metcash. But my greatest fear is, above everything else that has happened to me, is that what I have gone through doesn't happen to anyone else, and it doesn't happen to anyone else through them knowing what and how it occurred, what is occurring and what is going on. Now, I have at all times, if you go through these open letters, I have said to Metcash: you place in the public forum the evidence to prove me wrong and I will not only withdraw what I have said, I will make a public apology - and I mean that - I have no malice towards anybody in particular at Metcash and I have said in numerous open letters: yes, I want them to review their conduct in regard to Chadmar and its supply agreement. I am not in the position as Franklins are to take them to the Supreme Court and run through there for three and a half years but, yes, I do - so it is not an agenda to pull down Metcash. HIS HONOUR: I didn't say that. MR BUNN: But, I tell you what, it is in to make sure that no other independent wholesaler falls into the hole that I fell into. HIS HONOUR: Yes. I think - - - MR BUNN: And, this is all based on fact and truth. I mean, it is not - - - HIS HONOUR: That may be so. I don t think anything you have said actually causes me to alter what I said. I think you are running a campaign, and this is not said critically, you are a constant critic of Metcash, and it is directed against Metcash and the ALM. Now, whilst you do that, you can assume that Metcash will react because - - - MR BUNN: Certainly. … MR BUNN: … In regard to the affidavit of Peter Andrew Campbell, 5 February, under contempt, and I understand that contempt is now off the table, and has taken another format. But, still, he quotes that the orders at number 38, he quotes the orders: The applicants actively and deliberately operate in a manner calculated prejudice, damage, or destroy the business of the independent retailer. Without going through every sentence, and every paragraph I understand what that says in that order. I'm very aware of what it says in that order but in nothing that they have brought before this Court have I said that they actively do it, or deliberately do it. What I have always said - and I have said right from the start - is that their actions create a problem. Their actions are having these impacts. Whether it be naively or anything else, I have never made a judgment on it. What I have made a judgment on has been the resulting effect of what Metcash do and what Metcash say. So I have never said they don t have the - - - HIS HONOUR: That is a different thing. The order doesn't address motive; the order addresses actions. It might be that they have done it for the right motives or for the wrong motives, but the question is: if you write something in which you say that Metcash has intentionally done something, in a manner calculated to produce damage or destroy the business of a retailer, then you will breach the order. MR BUNN: But I haven t said that they have actively or deliberately done it; calculated it to do such. HIS HONOUR: You don't have to use the words of the order to breach it. You can breach the order if what you write is contrary to the terms of the order. I'm not saying you have - - - MR BUNN: With all due respect, your Honour - and this is no criticism of the Court, because I understand; you explained it to me in March when the injunction was put on me the reasons why the Court had to - but the basis on their applications and the issues ordered would really, if you allow their interpretations to rest on everything that has been written - and, mind you, there is a mile of other stuff that has been printed that I have made no issue with - but if you take what they have brought up to this Court and having issue with on their interpretation of my words, well then I would get sunk on every sentence in every paragraph of every media release and every open letter. HIS HONOUR: Maybe, but that is not the issue today. As I said, if you want to apply to discharge or vary the order, make your application and I will hear it as soon as I can.

6 I refer to this exchange despite its length, as it bears directly both on the way in which the Metcash companies seek to characterise the contempt alleged and on Mr Bunn's defence of the charges against him. What I would presently emphasise is that, while the first two passages I have emphasised clearly relate to Order 3.2, the latter two equally clearly relate to Order 3.5(c). The two orders, as his Honour indicated, were quite different in the restraints they respectively imposed. 7 By notice of motion of 27 March 2007, Mr Bunn sought, amongst other things, the deletion of Order 3.5(c). Argument on that motion was heard on 17 December 2007. Mr Bunn indicated then that he no longer wished to prosecute the Order 3.5(c) part of his motion, having been advised against it by pro-bono solicitors appointed by this Court to advise him in relation to that and other motions. 8 The first of the three publications said to constitute the contempt was published in July 2007.

The Applicable Legal Principles 9 These are not in issue and can be stated shortly. First, the order alleged to be breached must be clear and unambiguous: see Australian Consolidated Press Ltd v Morgan (1965) 112 CLR 483 at 515-516; and be capable of being complied with: see Australian Prudential Regulation Authority v Siminton (No 7) [2007] FCA 1609 at [40]. Secondly, the proper construction of an order is not a matter of fact but a question of law: Universal Music Australia Pty Ltd v Sharman Networks Ltd (2006) 150 FCR 110 at [19]. Thirdly, it is not necessary for an applicant to prove that an alleged contemnor intended to disobey the order: ibid, at [17]; nor is it necessary to prove that the alleged contemnor understood the true meaning of the terms of an order or that he or she was aware that his or her conduct constituted a breach of the order: Microsoft Corporation v Marks (No 1) (1996) 69 FCR 117 at 143. Nonetheless it may be highly relevant to the question of penalty that the alleged contemnor disobeyed an order because he or she placed a construction on it that was not its true construction: Universal Music Australia Pty Ltd at [38]. Fourthly, deliberate conduct which is in breach of a court order will constitute wilful disobedience of the order, and therefore a civil contempt, unless the conduct be casual, accidental or unintentional: Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494 at [6]. Fifthly, the facts in issue in a contempt charge must be proved beyond reasonable doubt: Witham v Holloway (1995) 183 CLR 525 at 534.

The Statement of Charge 10 After referring to Order 3.5(c), the Statement referred individually to allegations made by Mr Bunn in three editions of a publication entitled "The Independent Grocers [sic] Advocate" ("TIGA"). This was published periodically, the individual editions of which were differentiated by reference (usually) to month, publication number and year (eg 07/1 2007). To put the allegations in their respective contexts, I will quote extracts from each of the editions in question highlighting the various allegations made in each respectively. 11 (i) The first publication. This was dated from in or about July 2007 and stated in part: The anger and frustration against Metcash, by its independent grocery and liquor retailer customers, would appear, to be at an all time high. Following Metcash's announcement of its 105% increase in net profit (FY 2007) retailers are saying that Metcash's profit increase proves that Metcash's agenda is aimed at Metcash's bottom line regardless of the detrimental impact to the independent retailer. One Metcash customer, from W.A. stated that "… Metcash, under the control of Mr. Andrew Reitzer CEO (one of Metcash's largest private shareholders), drags ever increasing profits out of the pockets of every independent retailer, and, such action is only killing off the small independent retailer …" Another Metcash customer, from Qld. Stated that "… whilst Metcash states they are the 'Champion of the Independent Retailer', the fact of the matter is that Metcash is slowly but surely taking a shareholding in a large number of multi site independent retailers, and thus having a significant detrimental influence over those retailers, as Metcash is not only a shareholder, but also the major supplier to those retailers". He went on to say that "whilst this is promoted by Mr. Reitzer as Metcash's defence against the 'creeping acquisitions' by the majors, it has a far darker side in that Metcash are now becoming the retailer, and thus the competitor to all other truly independent retailers … Many retailers have also complained that Metcash is financially killing them with ever increasing fees and costs, which in turn are making them uncompetitive,and they all cite the latest report by Choice Magazine, which received a lot of discussion in the press stating that IGA supermarkets are the most expensive. … A Metcash customer from Vic. Stated that at one IGA retailer conference, the theme was 'Gangsters' and he claimed that it was not just a theme, but he believed it was the mantra of the Metcash management team, lead by Andrew Reitzer, in the way they treat the independent retailers!!

12 (ii) The second publication. This was dated October 2007. It stated in part: It is strongly rumoured that Metcash/ALM now have the 300+ members of a very successful, independently owned, marketing group that ALM supplies, Independent Liquor Retailers (ILR), whose privately owned banners are "Local Liquor" and "Countrywide", in its sights. As the ILR group is independently owned, this means that Metcash/ALM loose the control, and benefit, of large amounts of co-operative/promotional funds that liquor manufacturers pay for the marketing of their products, not to mention the embarrassing situation for Metcash in having independent retailers who have their stores bannered as IGA, yet they market their liquor under a non-Metcash/ALM banner - doesn't say much for the independent retailers opinion of the Metcash/ALM banners, or of the "IGA plus LIQUOR" banner which is what Metcash want, and need, IGA bannered stores that sell liquor to be trading under! Metcash executives have been reported as saying that the supply agreement that ALM has with ILR is not profitable enough for Metcash anymore, and that Metcash need to get rid of the ILR supply agreement, either by, taking over, or somehow terminating/varying, the ILR supply agreement, to gain control of all the independent retailers who belong to, and trade under, ILR's banners, so they (Metcash/ALM) are able to merge those ILR members into one of the Metcash owned IBA banner groups. By doing this Metcash would be able to accomplish the following benefits, to the detriment of the independent liquor retailers: 1. Metcash would be able to get control of the co-operative/promotional funds that ILR currently collect for its members from manufacturers, and redirect those funds from the ILR group, to the ALM balance sheet. 2. Metcash would be able to claim another 300+ members for its ALM/IBA banner groups, so Metcash/ALM could publicly claim greater numbers of retailers joining the Metcash/ALM controlled banner groups, although such does not equate to any direct increase in sales, or actual customer numbers for ALM. 3. Metcash/ALM would have a tighter control over its customers. The retailers who currently belong to the ILR group, and obtain stock under the terms of the ILR supply agreement with ALM, would then be required to deal individually with Metcash/ALM, thus losing the financial and commercial benefit of being able to negotiate as a member of a large independently owned banner group. 4. Metcash would be released from a supply agreement that is not as profitable for ALM as is the supply agreements that ALM requires its IBA banner members sign, thus ILR members would be forced into having to accept higher costs, and lower benefits in trading with Metcash/ALM. Given that it has appeared over the last 12-18 months that Metcash is struggling to keep profitability in ALM, it has been rumoured that the Metcash Executive team fears that ALM's dropping profitability could eventually start impacting the profitability of Metcash's other wholesaling divisions, and hence the Metcash Executive team are looking at every conceivable way of dragging even further profits out of the independent retailer's pockets and onto the Metcash balance sheet … how much more can the independent retailer, who deals with Metcash, withstand before he, the independent retailer, finds he is unprofitable? The big question is that of the future for the independent liquor retailers who deal with Metcash's ALM, as to Metcash/ALM's actual plans, not to mention the abovementioned rumoured plans by Metcash/ALM, all, which raise many worrying questions for all independent liquor retailers. 13 (iii) The third publication. This was dated December 2007. It stated in part: Mr. Andrew Reitzer [the Metcash CEO] has been able to announce a 30% profit increase, before abnormals (*), for the Metcash first half 2007-08 financial year. Mr. Reitzer, at the Metcash 1H08 presentation, was also able to loudly announce that the Metcash executive team had delivered to Metcash, and its shareholders: · 22% increase in interim dividend - Mr. Andrew Reitzer is a major shareholder in Metcash · Group sales increase of 6.4% · .33% reduction in cost of doing business The initial reaction by manufacturers and suppliers, was one of frustration, and some anger, as those manufacturers/suppliers that spoke to TIGA stated that their cost of doing business (CODB) with Metcash was increasing out of proportion, compared to their CODB with the major retailers, second tier retailers and wholesalers, or even their business directly with independent retailers. One senior employee of a major grocery manufacturer said, in response to Metcash's profit announcement, "And the independents wonder why they cannot compete with the majors in the market, clearly I believe that this shows Metcash are retaining monies (discounts, etc) that we (manufacturers) pay on the purchase of our products for their (Metcash) bottom line, rather than rightly passing them (discounts, etc) on to their customers (independent retailers) … that is the only way to get such a profit increase greater than your sales increase". An employee from another major manufacturer stated that he, and other manufacturers that he spoke with were not seeing the growth in sales figures for Metcash that they (Metcash) are reporting! Customers of Metcash, the independent retailers, that spoke to TIGA, are more than frustrated, and certainly very angry at the treatment, and wholesale pricing, that they receive from Metcash, most of them saying that they are not achieving profit, or sales growth, like Metcash. One retailer went on to say that "the independent retailers (Metcash customers) who Metcash rely on for it volumes and profits, are being slowly bled"!! Those independent retailers further stated that, in contrast, to the profit and sales increases being enjoyed by Metcash, the customers of Metcash are watching their profitability decline due to, beside other matters: · Decreasing profits due to Metcash's high service fees and low rebates. · Loss of market competitiveness due to high wholesale cost of goods from Metcash compared to the wholesale costs paid major retailers. · Increased cost of doing business due to Metcash's demands and pressure to accelerate costly refurbishments, promotional activities, etc. On another matter, an invitation has been issued to Mr. Andrew Reitzer to publicly debate "The current and future needs for independent grocery and liquor retailers in Australia" with Peter Bunn, at a time and place suitable to Mr. Reitzer, in the first quarter of 2008. This will allow Mr. Reitzer to openly debate his, and the Metcash executives, actions, and future plans for Metcash, and the independent retailers who deal with Metcash. Unfortunately, to date, Mr. Reitzer has not accepted the invitation (!!), although given Mr. Reitzer's belief of the good work that Metcash carries out, as 'The Champion of the Independent', we are sure he will jump at the chance to put forward his justification and future plans. We will advise once Mr. Reitzer nominates the date and time!! FINAL THOUGHT: Kill the golden goose … No more golden eggs!!!

14 The Statement of Charge concluded with the assertion that, by reason of the highlighted matters raised in the three publications, the respondent had breached Order 3.5(c) and thereby acted in contempt of this Court. 15 I should add by way of comment on the Statement of Charge that paras 2, 3 and 4 have obviously been formulated by reference to specific allegations made in the respective publications identified so as to reflect the language of Order 3.5(c) of the 9 March 2006 orders.

Contextual Matters 16 In the exchange between Lander J and Mr Bunn quoted above, reference was made both to Mr Bunn's claimed loss of his business at Metcash's hands and to what his Honour described as Mr Bunn's "campaign" against the Metcash companies. While neither of these matters were the subject of direct evidence in this proceeding, they were subjects to which reference was made. They clearly inform a proper understanding of this matter. As to the "campaign", sufficient instances of publications and "open letters" have been put in evidence to substantiate that characterisation of Mr Bunn's conduct vis-à-vis the Metcash companies. 17 The circumstances alleged to have given rise to Mr Bunn's business, Chadmar Enterprises Pty Ltd, going into liquidation and Mr Bunn's allegations against Metcash in relation to, and arising out of, the liquidation are the principal topics of the 17 December 2005 "open letter" referred to earlier in these reasons. The allegations contained in that letter were the subject of Order 3.2 quoted above. I emphasise the focus on Chadmar and its failure in the open letter because it bears upon the construction Mr Bunn has placed upon Order 3.5(c). 18 When both the first and second of the three contempt publications were made, the Metcash companies lawyers wrote to Mr Bunn indicating their and their clients' view that the allegations made breached Order 3.5(c). 19 In affidavit material in support of the motion, further publications of Mr Bunn were put in evidence on the basis that they were in their content and tenor consistent with the three contempt publications. They span the period from March 2007 to July 2008. It is unnecessary to refer to them in any detail. They are suffused with allegations, critical comment and opinions (both of Mr Bunn and of third parties) concerning Metcash's conduct and alleged practices. Simply by way of illustration, I note the following in TIGA11/3 of 2007: Metcash's profit growth has far outstripped the profit growth of those independent retailers who deal with Metcash's divisions, IGA>D, ALM, and CC&C, and it has long been considered by Metcash customers and suppliers that Metcash is being unduly enriched by discounts, allowances and rebates that are not passed on to the independent retailer. Of course, Metcash deny this, but Metcash will not allow its customers, or suppliers to discuss the trading terms that Metcash enjoy from manufacturers, or that Metcash provide to customers … Metcash expect all stakeholders to trust what the Metcash executives say !!!! Metcash also, will not open its books to its customers and suppliers so as to evidence their (Metcash's) claims as to proprietary in the handling of discounts, allowances and rebates, nor to its pricing policies … once again, Metcash executives expect stakeholders to trust them!

20 Much in Mr Bunn's affidavit evidence either was directed at refuting what were claimed against him to be "allegations", or was advanced to verifying the accuracy or truth of comments, etc made in the publications. I will refer to this evidence insofar as it is relevant at all in dealing with Mr Bunn's contentions as to the proper construction of Order 3.5(c) and to his innocence of the contempt charged. 21 In affidavits filed on 18 September 2008 and 7 October 2008, Mr Bunn annexed copies both of Ch. 7 and of the "Overview" section respectively of the Report of the ACCC inquiry into the competitiveness of retail prices for standard groceries dated 31 July 2008. His reason for so doing in relation to the first affidavit: see Affidavit [3]; was that Ch. 7 related to "Competition from Metcash and Metcash supplied independents". Mr Bunn indicated he wished to use the ACCC's "findings" in respect to Metcash - … so as to evidence in this Court, the conduct, public knowledge and understanding of Metcash Limited as to its conduct within the Australian marketplace, and so to place material before the Court so that I, the Respondent, may seek to refer to, and rely upon at the hearing of the matter of the Applicants' Notice of Motion/Statement of Charge, dated 18 December 2007.

22 For reasons which I later give, whatever may be the possible relevance of that Report in the principal proceedings, it has none on this motion. 23 Finally, the Metcash companies rely upon an affidavit sworn and filed by Mr Bunn on 10 December 2007 but not read by him on the hearing of the contempt motion. The affidavit deals amongst other things with Mr Bunn's publications and his methods for disseminating them. Paragraphs 10 to 45 of the affidavit are relied upon for the admissions they contain as to the extent of dissemination of Mr Bunn's publications. Put shortly the affidavit identified the titles, formats and/or locations of the various open letters, press releases, the newsletter and the internet sites he uses or has used. While Mr Bunn differentiates the databases of facsimile numbers for stakeholders he had before and after 30 June 2006 (when his laptop computer was stolen), it is clear from his discovered documents that he still has a facsimile list of over 1,000 numbers. I do not infer that all of the publications were sent by facsimile to all such numbers. His facsimile machine apparently does not hold the numbers in a memory and the numbers have to be entered manually. One of his websites remains operative and access to it is unrestricted. All of the "contempt publications" as well as the supporting "consistent publications" to which I have referred were published on that website. Additionally Mr Bunn stated in his affidavit (at [33]) that he had "been told by nearly all the stakeholders that have made contact with me that my publications are very widely distributed by them, and other people to other stakeholders and interested parties across Australia". 24 While it is not possible in respect of any one of the three contempt publications to determine with any exactness the extent of its distribution, I am satisfied that each was, and was intended to be, widely distributed through facsimile transmissions and website access.

The Construction of the order and Mr Bunn's contentions 25 I preface what I have to say, first, by referring to the acknowledgment by Lander J that Order 3.2 and possibly Order 3.5(c) may be too wide. Nonetheless, neither order was later varied at Mr Bunn's behest. Secondly, one potential difficulty in construing Order 3.5(c) has been dissolved by a concession by the Metcash companies for the purposes of the present motion. That concession, as I will note below, is advantageous to Mr Bunn. 26 To reiterate, Orders 3.2 and 3.5(c) provide, insofar as presently relevant: 3.2 Until further order, the Respondent, his servants or agents be restrained from publishing or republishing the allegations contained in the "Open Letter" dated 17 December 2005 … 3.5 Until further order, the Respondent, his servants or agents be restrained from publishing, whether on the internet or by any other means of communication to the public, any allegation to the effect that: … c. the Applicants actively and deliberately operate in a manner calculated to prejudice, damage or destroy the business of independent retailers with whom they deal. 27 I would note that, while Order 3.2 relates to the publishing or republishing of allegations contained in a designated document (ie the proscribed allegations are those made in that document), Order 3.5(c) is not circumscribed in the same way. The publishing of allegations is proscribed by that order, not because they are contained in a designated document, but because they have a particular character (ie the allegations are to the effect that "the Applicants actively and deliberately etc"). So much is quite clear on the face of the orders themselves and this in turn is reflected in the explanation of the orders given by Lander J to Mr Bunn on 28 February 2007: see [5] above. 28 Mr Bunn appears not to have perceived this obvious difference between the two orders, or to have understood Lander J's explanation of them in this respect. In consequence, as seems to emerge from his cross-examination, he took the view that Order 3.5 was simply an itemisation of Order 3.2 having the same 17 December temporal limitation, hence the following exchange (Transcript 29): Can you refresh your memory about the terms of paragraph 3.2?---I have. That was restraining you from publishing, or re-publishing the allegations in the letter of 17 December, wasn't it?---Yes. Paragraph 3.5 was not limited to that, was it?---Oh, I thought it was directly in relation to it. Well, tell me where?---Because it talks about - at paragraph 8: The respondent, or the respondents former company, Chadmar Enterprises, currently pursuing recovery proceedings. And it went through and listed, and itemised that letter of 17 December. Where does it refer to the letter of 17 December?---Well, they were the allegations contained in the 17 December. Where does the order refer to - - -?---Well, the order doesn't. No?---I'm just telling you that was my understanding. And, notwithstanding that there was an order in paragraph 3.2 that specifically prohibited you from publishing the allegations in the letter of 17 December?---Well, it followed on in my mind when it went from - when it goes down to 3.5,A and B, and C, and D is that that's what it was doing. It was expanding on what was in 3.2. That's how I understood it to be. 29 Consistent with this view Mr Bunn claims that the orders as he understood them only prohibited him from publishing or republishing allegations made in the 17 December letter that gave rise to the orders. Those allegations, which had not as yet been substantiated in the principal proceedings, could not be published. New allegations (which were not in issue in that proceedings) could be published. In his evidence he described the procedure he used to check whether material to be published was caught by the orders as he understood them. He explained how he used a legal dictionary's definition of "allegation" to assist his understanding of the 9 March orders. He took from that definition (not from the terms of the order) that he was stopped from publishing any still to be proved assertion made by a party to the principal proceeding. This in turn he took to mean that he could publish the assertions of retailers, seemingly because they were not parties. In his affidavit of 25 February he appears to use this explanation to indicate that such assertions were not "allegations" for the purposes of the orders. In cross-examination he did accept, though, that in publishing such retailer assertions he was himself making an assertion about what retailers were saying. Mr Bunn's misunderstandings in all of this - if misunderstandings they be - were stark. They took him far from the obvious meaning and intent of Order 3.5(c). 30 Necessarily I have to return to the question of Mr Bunn's veracity below. All I wish to emphasise here is that such understanding as he says he entertained of the proper construction of Order 3.5(c) was not the true construction of that order. 31 There is one additional matter relating to Order 3.5(c) to which I should refer which is the subject of the concession I earlier noted. This relates to what is signified by the concatenation of words "actively and deliberately operate in a manner calculated to …". The applicants, accept that the word "calculated" when used in connection with conduct may be used in two senses, as meaning either "devised with forethought" or "likely": O'Sullivan v Lunnon (1986) 163 CLR 545 at 549; but that usually it is construed to mean having the described tendency irrespective of intention: R v Odhams Press Ltd; Ex parte Attorney-General [1957] 1 QB 73 at 80. Nonetheless, it is conceded for present purposes - properly so in my view - the composite formula used in the order and in particular the use of the words "actively and deliberately" in conjunction with the verb "operate", necessitates the construction that the applicants operate in the knowledge that their manner of operation is likely to prejudice etc the business of independent retailers with whom they deal. As I earlier noted, this construction is favourable to Mr Bunn.

Has the contempt been proved? 32 As I indicated at the outset, there can be no reasonable doubt that Mr Bunn's conduct in publishing the three contempt publications was deliberate and that, in making the allegations in them that he did, he disobeyed the restraint imposed upon him by Order 3.5(c). There was nothing casual, accidental or unintentional about that conduct, notwithstanding he may have misunderstood the true meaning of Order 3.5(c). His recurrent accusation in many of his publications that are in evidence is that the Metcash companies knowingly conducted themselves in their dealings with their independent retailers in a manner which was to the advantage of the Metcash interests and which was likely to be prejudicial to, damaging or destructive of, the business of those retailers. I am satisfied that all nine allegations particularised in the Statement of Charge, when read in the context of the particular publication in which each appeared, were ones which conveyed the very assertion prohibited by Order 3.5(c) on the construction I have given it. The first allegation made in the first of the contempt publications is illustrative of this and of the recurrent accusation noted: [R]etailers are saying that Metcash's profit increase proves that Metcash's agenda is aimed at Metcash's bottom line regardless of the detrimental impact to the independent retailer.

33 I should add for the sake of completeness that, where it is not explicitly asserted to be so (as in the allegation just quoted), it is implicit in the allegations made in their setting that the respective Metcash company's conduct was engaged in with knowledge of its likely consequence to the independent retailers with whom they dealt. I so find. 34 Justice Lander properly characterised Mr Bunn's publication activities as a campaign against the Metcash companies. Whether or not it will be vindicated in the principal proceedings is not for me to say. There is no room for doubt, though, that he has systematically condemned or called into serious question alleged practices of the companies and the unfairness of their alleged treatment of independent retailers through allegations clearly comprehended by Order 3.5(c) on its true construction. Individually and collectively in each contempt publication, the allegations made establish deliberate conduct in breach of the order.

The Character of the Contempt 35 This, as I foreshadowed at the outset, is the more difficult aspect of this matter. The applicants contend that Mr Bunn consciously and deliberately breached the order. First, they point to some number of their solicitors' letters commencing with that dated 21 March 2006 which stated: Your letters also ignore your obligations under the injunctive orders made on 9 March 2005 [sic]. Under paragraph 3.2 of those orders, you were restrained from publishing allegations of the nature contained in your letter of 17 December 2005 - it should be noted that the restraint attaches to the allegations and does not merely prohibit the distribution of the physical letter. Further, under paragraph 3.5 of the 9 March orders, you were restrained from publishing allegations of the nature set out in the sub-paragraphs a, b, c and d. Notwithstanding the clear terms and intent of the orders, you have deliberately chosen to publish allegations of the same nature as those which are the subject of restraint. Your letters also suggest that your new website will contain many of the same allegations. … Your actions constitute a blatant disregard for the orders which have been made. Please confirm by return that you will comply in all respects with the terms of the orders made on 9 March 2006. Please also confirm you will preserve and retain records of all of your correspondence and documentation regarding our clients, including the "avenues" for exchange of information which have been established. Our clients reserve all of their rights, including the right to seek to have the Court deal with you for contempt. The applicants refer as well to the letters written to Mr Bunn after the first and second contempt publications both of which referred to Order 3.5(c) and contempt of court or breach of the injunction. 36 Secondly, they rely upon Lander J's 28 February 2007 explanation to Mr Bunn of the meaning and intent of Orders 3.2 and 3.5(c) which has been set out in part at [5] above. 37 Thirdly, they point to the attitude demonstrated by Mr Bunn in media releases and "open letters" he published from time to time. By way of illustration, I note the statement relied upon in the open letter of 10 May 2008 that: One would assume that given you have been unable to silence, and stop my publications after 28 months in the Federal Court, that you would have realised that the legal system does not stop free speech, truth and fact from being spoken, and published …

38 Finally, reliance is placed upon the pattern of conduct of repeated publishing of allegations after the making of the orders. The contempt publications, it is said, are merely representative of that conduct. 39 Mr Bunn's explanation and defence of his actions focuses primarily on two matters. This first was his own understanding of the 9 March 2006 orders. The second, which was interrelated with the first, was that the content of his publications was accurate or could be verified. 40 I have set out earlier what I discern to be Mr Bunn's understanding of the proper construction of Orders 3.2 and 3.5. I say that with this qualification. Mr Bunn's evidence, particularly in cross-examination was often not easy to understand and on occasion might reasonably be thought to be internally inconsistent. 41 The first issue with which I must deal is Mr Bunn's veracity. While his explanation of his understanding of the meaning of the orders and how he translated them into a procedure for checking his publications strain credibility, I am not convinced beyond reasonable doubt either that he did not genuinely entertain that understanding or that he did not implement it. This conclusion requires that I express my conclusions on Mr Bunn, his evidence and the applicants' contentions. I will do this in a composite way. 42 By way of necessary background, I note that Mr Bunn has been as courteous to the Court as it would seem he has been difficult with the applicants and their lawyers. Their relationship is now obviously one of distrust, suspicion and lack of cooperation. I do not assign blame for this state of affairs other than to say that it clearly has impeded the bringing of the present dispute to an expeditious and simple conclusion. 43 Mr Bunn has, for practical purposes, represented himself on this motion and, as I understand it, in much of the principal proceedings. This in turn has had its adverse effects in this matter. He appears to have lacked effective assistance in understanding the real burden of orders - or for that matter legal threats - made against him. It is quite obvious both from his oral evidence and conduct at the hearings before me, and from the transcripts of the hearings before Lander J, that he does not grapple easily with concepts and he is not quick to understand what is put to him. For this reason I am not prepared to attribute great significance to the actual explanation of the orders given to him by Lander J, while accepting that he ought reasonably to have had greater regard to what was said to him by his Honour. I will return to that matter below. 44 It is equally clear, as his campaign against the applicants attests, that he is tenacious in adhering to a view once entertained. I am not prepared to conclude that he was wilfully blind in the view of the orders he took, but he nonetheless seems to have viewed them uncritically from a perspective that was least disfavouring of his cause against the Metcash companies as, for example, in his seeing Order 3.5 as simply an itemisation of order 3.2 or in accepting apparently that he could without breach of the orders recount the comments of other retailers as these were not relevantly "allegations". 45 Whatever may have been the intellectual processes that lead him to the conviction that the orders had the meaning he ascribed to them - I am not prepared to find he was knowingly dishonest in that regard - I cannot find beyond reasonable doubt that he did not genuinely hold the views he has espoused. I equally consider it most unlikely that his views would be shaken in any way by contrary assertions made by the applicants' lawyers. Both of these matters had some reflection in his tenacious adherence to his views despite protracted and hostile cross-examination. In saying this, I am not suggesting he so rendered his views the more plausible but rather that, despite what was put to him to the contrary, he would not readily yield. 46 Taking the rather benign view of the orders he did allowed Mr Bunn to implement his understanding in the way he did. Provided he stayed away from the allegations of the 17 December 2005 open letter, he had considerable latitude to publish "the truth" as he saw it and to flout in his open letters/media releases the threats, etc of the applicants' lawyers. It appears to have been for this reason that much in his two principal affidavits was aimed at showing the accuracy and/or veracity of what was asserted in the contempt and other post-orders publications relied upon by the applicants. All that can relevantly be said of that material is that it lends some support to the fact that he had the understanding of the orders' reach that he said he had. 47 What I have said so far is not intended to diminish my view of the seriousness of Mr Bunn's contempt. Rather it is to indicate why I am not satisfied that Mr Bunn consciously and deliberately breached the order. His conduct nonetheless has been censurable. While he may not have understood the true meaning of Order 3.5(c) and hence that his conduct could constitute a breach of that order: cf Microsoft Corporation, at 143; his ignorance could provide him with no ready vehicle for exculpation. He knew he was bound by Court orders and that they precluded him from publishing or republishing certain allegations. After his exchange with Lander J on 28 February he had reason to know that his understanding of the meaning and effect of Orders 3.2 and 3.5(c) was quite imperfect. If he was to continue to publish matter critical of the Metcash companies without acting in breach of the orders, it was necessary for him to have an informed understanding of what the orders prohibited. Against that background, it was hazardous for him obdurately later to reject without inquiry the assertions about the orders made by the applicants' solicitors. Mr Bunn needed, but on the material before me did not obtain, reasonable and reasoned advice. Put shortly, he had been put on inquiry in circumstances in which it quite properly can be said he assumed the risk that his conduct might be found to be in breach of the orders. His so acting may well be a matter appropriately to be taken into account in relation to any penalty imposed on him.

Conclusion 48 I am satisfied that the charge of contempt of court made in the Statement of Charge has been established beyond reasonable doubt. While the applicants have sought orders by way of penalty and otherwise if breach of Order 3.5(c) be established neither party has put on evidence or made submissions (particularly in relation to penalty) against that contingency. It is necessary in light of my findings that this occur. I will adjourn the motion for directions in relation to these matters. I certify that the preceding forty-eight (48) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn.

Associate: Dated: 20 January 2009 Counsel for the Applicants: Mr J Wells QC with Mr I Robertson SC