Meyer Heine Pty Ltd v China Navigation Co Ltd - [1966] HCA 11 - HCA 1966 case summary — Zoe

CTHHCA

Meyer Heine Pty Ltd v China Navigation Co Ltd

[1966] HCA 11

High Court of Australia|1966-03-03|Before: Windeyer JJ, McTiernan J, Kitto J

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Court

High Court of Australia

Decision date

1966-03-03

Before

Windeyer JJ, McTiernan J, Kitto J

Source

Original judgment source is linked above.

Judgment (61 paragraphs)

[1]

This matter comes before the Full Court on a series of demurrers by the defendants to parts of the statement of claim, and a series of demurrers by the plaintiff to parts of the defence, in an action pending in this Court for treble damages under s. 11 of the Australian Industries Preservation Act 1906-1950 Cth. The statement of claim alleges that until 8th July 1964 the plaintiff carried on the business of a shipping line, carrying goods for reward by sea from Australia to other countries including Japan, and from other countries including Japan and Hong Kong to Australia. The defendants, it is alleged, carried on business in competition with the plaintiff, but unlike the plaintiff they were members of a group of companies, known at one time as the Australian-Eastern Shipping Conference and more recently as the Australian and New Zealand - Eastern Shipping Conference, who carried substantially all the wool shipped from Australia to Japan, and substantially all the general cargo from Japan and Hong Kong to Australia. The Conference was governed at all material times by an agreement made in Sydney on 23rd May 1961. The statement of claim sets out some of the terms of this agreement, alleges conduct of the defendants and others in compliance with it, and puts forward the conclusion that by reason of matters alleged the Conference is a commercial trust within the meaning of the abovementioned Act. Then there follow allegations of the making of agreements of three classes between members of the Conference, including the defendants, and individual shippers. The first class consists of agreements with the shippers of all or practically all of the goods shipped at relevant times by sea from Japan to Australia; the second consists of agreements with the shippers of all or practically all of the goods shipped at relevant times by sea from Hong Kong to Australia; and the third consists of agreements with the importers and/or spinners in Japan of all or practically all of the wool shipped at relevant times by sea from Australia to Japan. The agreements of the first and second classes may be described sufficiently for present purposes as having provided for lower freight charges than were available to shippers not entering into such contracts, and as having bound the shippers to forward all their shipments from Japan and Hong Kong to Australia by vessels of the members of the Conference. The agreements of the third class may be described as having provided for discounts to the consignees of wool who became parties to them, and as having bound the consignees to confine all shipments of wool from Australia to Japan to vessels provided by members of the Conference. It is alleged that the members of the Conference, including the defendants, entered into the agreements of the first and third classes in Japan and the agreements of the second class in Hong Kong.

[2]

The first of the defendants' demurrers relates to those parts of the statement of claim which allege a breach of s. 4 (1) of the Act by the making or entering into of a contract or contracts; and the ground is, in effect, that the plaintiff does not allege, and the fact could not be, that the plaintiff suffered injury by the making or entering into of a contract without more. A limited demurrer of this kind is permitted by O. 26, r. 1 (b), if the part that is demurred to sets up a distinct cause of action. The parts of the statement of claim to which the first demurrer is directed do not by themselves set up a distinct cause of action, but at the end of the pleading there is a general allegation of injury "by reason of the aforesaid acts or things done by the defendants in contravention of the provisions of the said Act", and no doubt the demurrer intends to embrace this allegation in so far as it applies to the making and entering into of agreements. Presumably the allegation of injury should be read distributively, as alleging injury from each alleged contravention, and if so the first demurrer must necessarily fail except as to any contract of which it is right to say that no injury to the plaintiff could possibly have been caused by the bare act of the defendants' entering into it. Because of the view which I shall later express as to the making of the three classes of agreements in Japan and Hong Kong, I need not consider the question in relation to them. But in relation to the Sydney agreement of 23rd May 1961 I do need to consider it. The point in that connexion is that at the time the Sydney agreement was made the plaintiff was not in existence. The statement of claim gives the date of the plaintiff's incorporation as 15th June 1962, so that by entering into the agreement the defendants cannot have caused the plaintiff any injury. This demurrer should therefore succeed in so far as it relates to the Sydney agreement. No question arises at present concerning the extension of the agreement which is alleged to have taken place on or about 30th June 1963.

[4]

If I thought that the Act itself gave no relevant indication of intention I should find it necessary to discuss more fully than I do the arguments for and against the application of the general rule; but as it is I need say but little about them. Questions of the same general description under the Sherman Act in the United States have arisen in a series of important cases, from American Banana Co. v. United Fruit Co. [2] (in which the judgment of Holmes J. gives full effect to the rule abovementioned) to the much-debated Alcoa Case, United States v. Aluminum Co. of America [3] , and Steele v. Bulova Watch Co. [4] . A case of a combination of shipping lines is Thomsen v. Cayser [5] . These and the later case of United States v. Watch-makers of Switzerland Information Centre Inc. (1964) are the subject of valuable discussions, to which we have been referred, in papers presented to the 1964 Conference at Tokyo of the International Law Association. Such discussions have relevance to questions of statutory construction because, as Lord Russell of Killowen said in the Jameson Case [6] after stating the general rule in the terms I have quoted: "That is a rule based on international law by which one sovereign power is bound to respect the subjects and the rights of all other sovereign powers outside its own territory" [7] . In the present proceeding, however, it is not necessary to decide what view should be recognized by Australian Courts upon the question, about which unanimity among nations is lacking, of the legislative jurisdiction of a country in regard to acts done outside its territory but intended to have and actually having adverse effects upon the internal or external trade of that country. No doubt much may be said for the view that the state of international opinion in 1906 was such that an enactment passed in that year in the general terms of s. 4 (1) should be taken to apply only to the making and entering into of contracts within Australia; and that an enactment passed in 1910, when s. 4 (1) took its present form, that is to say after Holmes J. had delivered the judgment of the Supreme Court in the Banana Case [1] , should with all the greater assurance be taken to apply only to such contracts.

[6]

I rest my conclusion, however, not upon such considerations as these but upon the fact that I find in s. 9 (b) of the Act what seems to me a compelling indication that in creating offences the Act intends to speak territorially. The provision of s. 9 is: "Whoever aids, abets, counsels, or procures, or by act or omission is in any way, directly or indirectly, knowingly concerned in or privy to - (a) the commission of any offence against this Part of the Act; or (b) the doing of any act outside Australia which would, if done within Australia, be an offence against this Part of this Act, shall be deemed to have committed the offence." It will be observed that the concluding words, "the offence", as applied to (a) refer to an offence committed, but as applied to (b) refer to a purely notional offence, namely the offence which would have been committed if the act done outside Australia had been done within Australia. But, in relation both to an offence committed and to an act which is saved from being an offence by the fact that it was done outside Australia, the section, as I read it, is speaking of something done in fact in respect of which the question whether it is an offence is to be answered by considering the operation of other provisions in Pt II of the Act. It appears to me to accept the situation that if the act done is an offence the doer is punishable under another provision, and, equally, that if the act done is saved by its extra-territoriality from being an offence under another provision the doer of the act is saved by that fact from being punishable. I do not understand it to be altering the position of the doer of the act. Rather does it appear to be directed to the case of a person who has done something which is neither the commission of an offence nor the doing of an act which if done in Australia would have been an offence, but which has one of the specified forms of connexion with an offence or act which has been committed or done by someone else. Like the other provisions creating offences, s. 9 says nothing expressly as to the territorial extent of its own operation. But the presence of par. (b) is, I think, to be accounted for only on the basis that the Act as a whole, including s. 9 itself, has been framed in reliance upon its being taken for granted by everyone that when conduct is made an offence it is only conduct in Australia that is meant. There is, I think, nothing inconsistent with this view in s. 6 (1) (a) as read with the definition of Commercial Trust in s. 3. I should add that I do not accept the suggestion made on behalf of the plaintiff that the word "act" in s. 9 (b) is inapt to comprehend being or continuing to be a member of or engaging in a combination. An intention to refer by that word to any conduct which would amount to the commission of an offence if it were done within Australia is too clear to permit of so narrow an interpretation. I would decide this demurrer in favour of the defendants.

[7]

The next demurrer is to all those parts of the statement of claim which allege contraventions of s. 4 (1), scil. by which the plaintiff was injured. The relevant allegations need not be stated in detail; it is enough to say that they allege contraventions of s. 4 (1) (a) by the defendants, not only by making and entering into contracts, but also by being members of or engaged in a combination, in restraint of or with intent to restrain trade or commerce. The ground of demurrer is that it is an essential ingredient in a cause of action under s. 11 for injury by reason of any such contravention that the conduct complained of was to the detriment of the public and unreasonable. If s. 4 had been enacted in its present form but without sub-s. (3) this result might possibly have been reached by force of considerations such as those which have led the Supreme Court of the United States, in a line of cases which began with Standard Oil Co. of New Jersey v. United States [1] , to interpret the corresponding provision of the Sherman Act as being subject to an implied exception of contracts in restraint of trade which are enforceable at common law, though the force of Harlan J.'s dissenting opinion would have had to be recognized. By such an interpretation the enforceability of a contract at common law would become the test of the legality under the statute of a contract or combination: cf. Attorney-General of the Commonwealth of Australia v. Adelaide Steamship Co. Ltd. [2] . But an argument along that line is untenable, I think, in view of the changes made by the amending Act 1910 which introduced sub-s. (3). Before that Act, s. 4 (1) applied only with respect to contracts and combinations "with intent to restrain trade or commerce to the detriment of the public". The Act altered this to read "in restraint of or with intent to restrain", omitting "to the detriment of the public", and it capped those amendments with the insertion of sub-s. (3). The sub-section enacts that it shall be a defence to a proceeding for an offence under par. (a) of sub-s. (1), if the party alleged to have contravened the section proves - (a) that the matter or thing alleged to have been done in restraint of, or with intent to restrain, trade or commerce, was not to the detriment of the public, and (b) that the restraint of trade or commerce effected or intended was not unreasonable. The defendants submit that sub-s. (3) recognizes that detriment to the public and unreasonableness are impliedly elements in the offence, but casts the burden of disproving them upon the defence in a prosecution, while leaving the burden of proving them upon the plaintiff in an action for treble damages. This seems to me a strained and indeed an impossible construction to place upon the provision. I should have thought, particularly in view of the context provided by s. 11 (2), s. 14A and s. 14B, that an action for treble damages for injury by a contravention of s. 4 (1) (a) is a proceeding for an offence under that provision, within the meaning of sub-s. (3), and that the manifest intention of sub-s. (3), enacted, as it was, correlatively to the amendment of sub-s. (1), is to make detriment to the public and unreasonableness matters of defence only, and, as a necessary consequence, to indicate that they are not ingredients in the offence. But even if s. 4 (3) were to be regarded as merely creating a prima facie presumption as to matters germane to the offence, a statement of claim seeking damages for injury caused by the offence would not be demurrable for omitting to allege those matters: see O. 20, r. 27, of the High Court Rules. This demurrer, in my opinion, should be overruled.

[10]

Finally, there is a demurrer to those parts of the statement of claim which allege contraventions of s. 7, that is to say a demurrer to the statement of claim in so far as it sets up distinct causes of action in respect of injury by reason of the defendants' having monopolized or attempted to monopolize, or combined or conspired to monopolize, any part of the trade or commerce with other countries or among the States. The ground taken is that proof of such a contravention requires proof that the monopolization effected or attempted is pernicious or harmful to the Australian public, and that the statement of claim does not allege that it was. If such proof is in truth necessary it must be because the word "monopolize" as used in s. 7 connotes a pernicious or harmful effect or tendency. The statement of claim, after alleging a number of matters of conduct on the part of the defendants, charges the defendants in the very words of s. 7 and by specific reference to that section. In so doing it must, I think, be taken to use the word "monopolize" in the sense of the section, and in any event s. 14A provides that in any proceeding for an offence against Pt II of the Act any statement of claim shall suffice if the offence is set forth as nearly as may be in the words of the Act. Accordingly I think that the point raised is not an available ground of demurrer. If it were necessary to decide the point I should regard it as one of some difficulty in view of the Privy Council's judgment in the case above cited. That case was decided on the section as originally enacted. It then contained words which concluded the question and supplied their own test of perniciousness by using the words: "with intent to control, to the detriment of the public, the supply or price of any service, merchandise, or commodity". The amending Act of 1910 omitted these words from the section, but it does not necessarily follow that by so doing it showed an intention that "monopolize" in the section should thenceforth have a meaning wide enough to include the creation of a benign monopoly. However, I would overrule this demurrer for the reason I have mentioned, and the more readily because I think it would be desirable not to deal with the question until findings have been made as to what the defendants did and in what circumstances. Presumably evidence would not be admissible as to the actual or probable consequences of what was done, even on the assumption that the section should be construed as the defendants suggest; for on that assumption the question for the Court to decide would be simply one as to the nature of any monopoly which the defendants effected or attempted or combined or conspired to effect: cf. Attorney-General of the Commonwealth of Australia v. Adelaide Steamship Co. Ltd. [1] .

[30]

The first question which arises is concerned with how far, if at all, the provisions of s. 4 (1) of the Act apply to, or with respect to, contracts or combinations made or entered into outside Australia. The sub-section, which is generally silent on the point, merely provides that any person who, either as principal or as agent, makes or enters into any contract or, is, or continues, to be a member of or engages in any combination in relation to trade or commerce with other countries or among the States: "(a) in restraint of or with intent to restrain trade or commerce is guilty of an offence". The words of the section are general but, prima facie, "the persons, property, and events in respect of which Parliament has legislated are presumed to be limited to those in the territory over which it has jurisdiction" (per Isaacs J. in Morgan v. White [1] ) and "it is always to be understood and implied that the legislature of a country is not intending to deal with persons or matters over which, according to the comity of nations, the jurisdiction properly belongs to some other sovereign or State" (per Dixon J. (as he then was) in Barcelo v. Electrolytic Zinc Company of Australasia Ltd. [2] quoting from the judgment of James L.J. in Niboyet v. Niboyet [3] - see also Jumbunna Coal Mine, No Liability v. Victorian Coal Miners' Association [4] and Reg. v. Foster; Ex parte Eastern and Australian Steamship Co. Ltd. [5] ). It was with these shortly stated principles in mind that we were referred by the defendant to the attention which has been given in recent years by distinguished lawyers to problems associated with the extra-territorial operation of the restrictive trade legislation of various countries. In particular we were referred in some detail to the proceedings of the Committee on The Extra-Territorial Application of Restrictive Trade Legislation at the Tokyo Conference of the International Law Association. But the rule, as I have stated it, is one of interpretation only and, if by a local statute otherwise within power, provision is made "in contravention of generally acknowledged principles of international law" it is binding upon and must be enforced by the courts of this country (Polites v. The Commonwealth [6] , per Latham C.J. [7] , Starke J. [8] , Dixon J. [9] and McTiernan J. [10] ).

[32]

For the plaintiff it is asserted that the very subject matter with which the Act deals makes it manifest that the legislative intention was that the section should extend to acts done beyond the Commonwealth. It was intended for the protection of the trade and commerce of this country with other countries and among the States and both categories of trade, and particularly the former, can just as well be affected adversely by contracts and combinations made and entered into in other countries as by contracts and combinations made or entered into in Australia. But I do not find in these very general considerations any clear indication that s. 4 (1) was intended to apply to acts done or performed outside Australia. Indeed, there is, I think, manifest in the provisions of s. 9 a recognition that the other provisions of Pt II do not so apply. The first paragraph of s. 9 is plainly recognizable as an "aiding and abetting" provision for it is in the traditional form. It does not operate unless and until the substantive offence has been committed and "then, and then only, does the section operate to make any person falling within the terms of the section a principal participating in that offence" (Walsh v. Sainsbury [1] , per Isaacs J. [2] ). "The section is an aiding and abetting section and it was necessary first that the commission of the principal offence should be established and next that the appellant was knowingly concerned in the commission of that offence" (R. v. Goldie; Ex parte Picklum [3] ). But the second paragraph, (b), is a provision of a somewhat different character. It provides that whoever aids, abets, counsels, or procures, or by act or omission is in any way directly or indirectly knowingly concerned in, or privy to, the doing of any act outside Australia which would, if done within Australia, be an offence against this Part of the Act, shall be deemed to have committed that offence. As will be observed it does not require proof of the commission of an offence by a principal offender; all that it requires is proof of an act done outside Australia which would, if done within Australia, be an offence against Pt II of the Act and that the defendant aided, abetted, counselled, or procured it or by act or omission was directly or indirectly knowingly concerned in, or privy to, it. In terms, it recognizes quite plainly that the doing of an act which, if done in Australia, would constitute an offence against the general provisions of the Part, is not a contravention of those provisions where it is done outside Australia. Yet it subjects to a penalty any person who aids, abets or procures or by act or omission is in any way directly or indirectly knowingly concerned in, or privy to, the doing of any such act. There may be room for some difference of opinion concerning the effect of the paragraph but to me it seems that it was intended merely as supplementary to par. (a) and to prescribe a penalty for things done in Australia which would not qualify as an offence under that paragraph because the act aided and abetted, having been done outside Australia, was not an offence against the other provisions of the Part. It was, however, suggested that the language of par. (b) is, in effect, apt to extend the operation of the other provisions of the Part to things done outside Australia; it was submitted that, in terms, it was wide enough to extend to the doer of an act outside Australia which would, if done in Australia, be an offence against the other provisions of the Part. But this submission should be rejected, for its effect would be to treat the provision, which according to its form and content is no more than supplementary to the preceding paragraph, as, in effect, a substantive declaration that the whole of the provisions of the Part should operate extra-territorially. That being so I am of the opinion that the defendants' demurrer raised by par. 13a of the statement of defence should be allowed.

[34]

The next question raised for our consideration is concerned with what I may, for the moment, call the substance of the offences created by s. 4 and s. 7A. In its original form s. 4 (1) provided that any person who, either as principal or as agent, makes or enters into any contract, or is or continues to be a member of or engages in any combination, in relation to trade or commerce with other countries or among the States with intent to restrain trade or commerce to the detriment of the public is guilty of an offence. Section 7A, which was introduced by the amending Act of 1909, provides, in effect, that any person who, in relation to trade or commerce with other countries or among the States, either as principal or agent, in respect of dealings in any goods or services gives offers or promises to any other person any rebate, refund, discount, concession, or reward, for the reason, or upon the condition, express or implied, that the latter person deals, or has dealt, or will deal, or intends to deal exclusively with any other person, either in relation to any particular goods or services or generally, or with members of a Commercial Trust is guilty of an offence. But by sub-s. (3) of that section it is further provided that it shall be a defence to a prosecution under this section, and an answer to an allegation that a contract was made or entered into in contravention of this section, if the party alleged to have contravened its provisions proves that the matter or thing alleged to have been done in contravention was not to the detriment of the public, and did not constitute competition which was unfair in the circumstances, and was not destructive of or injurious to any Australian industry. In the following year, 1910, s. 4 was amended by omitting, inter alia, the words "to the detriment of the public" and by adding a new sub-s. (3): "(3) It shall be a defence to a proceeding for an offence under paragraph (a) of sub-section (1) of this section and an answer to an allegation that a contract was made or entered into in restraint of, or with intent to restrain, trade or commerce, if the party alleged to have contravened this section proves - (a) that the matter or thing alleged has been done in restraint of, or with intent to restrain, trade or commerce, was not to the detriment of the public, and (b) that the restraint of trade or commerce effected or intended was not unreasonable". It may be noted that every contract made or entered into in contravention of either section is absolutely illegal and void.

[35]

It is apparent from a consideration of these provisions that a prosecution for an offence against either of these sections will fail if the defendant proves the exculpatory matter. Proof of such matter in proceedings for an offence against s. 4, or, in a prosecution for an offence under s. 7A, will mean that there has been no contravention of either section. But what is the position where an action for damages is brought pursuant to s. 11? That section merely provides that any person who is injured in his person or property by any other person, by reason of any act or thing done by that other person in contravention of this part of the Act, may sue for and recover treble damages for the injury. The basis of liability is a contravention of the provisions of the Act causing damage to the plaintiff but the section is silent as to whether the defendant may, where the contravention alleged is a breach of s. 4 or s. 7A, exculpate himself by proof of the matters mentioned in sub-s. (3) of each of those sections. And, according to the defendants' contentions, neither s. 4 (3) nor s. 7A (3) provides that a defendant may set up as a defence to proceedings under s. 11 the exculpatory matter that might be set up as a defence to a prosecution for offences under those sections. In this situation, it is said, we might well find an action for damages resulting from an alleged contravention of either section succeeding and a prosecution for the same contravention failing. This, of course, could scarcely be so when the defendant has been prosecuted unsuccessfully before the institution of proceedings for damages under s. 11. But it could be so, on the defendant's contention, where proceedings of the latter character are prior in point of time to the prosecution for the same contravention. It is, to my mind, unthinkable that a construction should be given to the legislation which will be capable of producing such an anomalous result. We have, therefore, the choice of holding that, in spite of the contention which is raised as to the limited operation of s. 4 (3) and s. 7A (3), the exculpatory matter may be proved as a defence to an action under s. 11 or, on the other hand, that in such an action it is necessary for the plaintiff to establish positively that, in the case of an alleged contravention of s. 4, that the matter or thing alleged to have been done in restraint of or with intent to restrain trade or commerce was to the detriment of the public, or, that the restraint of trade or commerce effected or intended was unreasonable, and, in the case of an alleged contravention of s. 7A, that the matter or thing alleged to have been done in contravention of the section was to the detriment of the public, or, constituted competition which was unfair in the circumstances or was destructive or injurious to any Australian industry. Since there is no contravention of either section if the defendant proves the exculpatory matter the argument was that the effect of s. 4 (3) and s. 7A (3), from a practical point of view, was, in a prosecution under those sections, simply to place the onus of proof in relation to these matters on the defendant. Thus detriment to the public, or unfair competition or destruction or injury to an Australian industry was of the substance of the offences created by s. 4 and s. 7A (1). But I think this contention must be rejected. Under s. 4 (3) and s. 7A (3) the exculpatory matter may be proved not only as a defence to proceedings for an offence or to a prosecution for an offence but also as "an answer to an allegation that a contract was made or entered into restraint of or with intent to restrain trade or commerce" (s. 4), or, as "an answer to an allegation that a contract was made or entered into in contravention of s. 7A" and, it seems to me, these expressions are apt to refer to allegations necessarily made in proceedings commenced under s. 11. It may be noted that it is conceivable that there may be a contravention of s. 7A constituted by some act other than the making of a contract but this, it seems to me, is of little consequence when one comes to give a meaning to the sub-section. It seems to me that proceedings under s. 11 based upon alleged contraventions of s. 4 and s. 7A constituted by the making of a contract or contracts, or, by engaging in a combination, cannot succeed unless there is an allegation that the acts complained of were done in restraint of trade or with intent to restrain trade or commerce (s. 4), or, unless it is alleged that they were done in contravention of s. 7A. In answer to such allegations the defendant may, as sub-s. (3) of each section provides, prove, as an answer to those allegations, the exculpatory matter. The construction of the relevant provisions are difficult but, in my opinion, this interpretation is to be preferred and accordingly the defendant's demurrer raised by pars. 14 and 16 of the defence should be overruled.

[44]

The first, raised by par. 13a of the amended defence and demurrer, is whether s. 4 of the Act applies when what is charged as an offence is something done outside Australia. This raises no question of power, for a law which is with respect to trade and commerce with other countries can validly control conduct outside Australia: cf. Reg. v. Foster; Ex parte Eastern and Australian Steamship Co. Ltd. [1] . The question is simply one of the construction of a section expressed in language amply wide enough to cover acts done outside Australia. The defendants, however, to limit the section relied upon the well-accepted general principle of statutory construction that, prima facie, penal laws of one country are not intended to reach into the territory of another country to make punishable in the courts of the former acts done in the territory of the latter. Having given full weight, however, to this principle, I am not satisfied that the operation of s. 4 should be limited to acts done within Australian territory. The Act is primarily one for the preservation of Australian industries. This appears from its title and from its provisions as a whole. The protection for Australian industries which it provides is clearly enough against specified conduct on the part of those whose interest it is to destroy or injure Australian industries. The Act, therefore, is directed, inter alia, against those whose interests lie outside Australia. To construe an Act for this purpose as having an operation limited to acts done within Australia would of necessity deprive it of much of its efficacy. On this aspect of the matter I find myself in full agreement with the decision of the Circuit Court of Appeals reported in United States v. Aluminum Co. of America [2] with regard to the United States Sherman Act, upon which the legislation here under consideration was largely based. There Judge Learned Hand, for the Court, said: " we are concerned only with whether Congress chose to attach liability to the conduct outside the United States of persons not in allegiance to it. That being so, the only question open is whether Congress intended to impose the liability, and whether our own Constitution permitted it to do so: as a court of the United States, we cannot look beyond our own law. Nevertheless, it is quite true that we are not to read general words, such as those in this Act, without regard to the limitations customarily observed by nations upon the exercise of their powers; limitations which generally correspond to those fixed by the "Conflict of Laws". We should not impute to Congress an intent to punish all whom its courts can catch, for conduct which has no consequences within the United States. On the other hand, it is settled law that any state may impose liabilities, even upon persons not within its allegiance, for conduct outside its borders that has consequences within its borders which the state reprehends " [1] . Upon consideration, the Sherman Act was held to impose liabilities of that character, as it was said: "Both agreements would clearly have been unlawful, had they been made within the United States; and it follows from what we have just said that both were unlawful, though made abroad, if they were intended to affect imports and did affect them" [2] .

[46]

My conclusion, however, that the operation of the Act is not confined to acts done within Australia does not depend merely upon the general purpose of the Act which so clearly appears. In addition, I find in the definition of a Commercial Trust a clear indication that the Act is concerned with combinations "whether wholly or partly within or beyond Australia". I also consider that s. 4, upon its express terms, would apply to a principal in Australia whose agent outside Australia does any of the acts which the section forbids. What seems to me to be the principal objection to giving the Act extra-territorial effect is s. 9, which is in these terms: "Whoever aids, abets, counsels, or procures, or by act or omission is in any way, directly or indirectly, knowingly concerned in or privy to - (a) the commission of any offence against this Part of this Act; or (b) the doing of any act outside Australia which would, if done within Australia, be an offence against this Part of this Act, shall be deemed to have committed the offence." It will be observed that while s. 9 (a) is a provision in ordinary form making it an offence to aid or abet the commission of an offence created by some other provision of the Act, s. 9 (b) serves a different purpose. It makes it an offence to aid or abet a person to do outside Australia an act which, if done within Australia, would be an offence. Section 9 (b) covers cases not falling within s. 9 (a) because, presumably, the doing of the act outside Australia which was aided or abetted was not itself an offence. A simple explanation of this provision would be the existence elsewhere in the Act of some particular offence depending upon the doing of an act within Australia - for example, if, in contravention of s. 10A, an act were to be done in breach of an injunction granted under s. 10 expressly prohibiting nothing but the doing of acts in Australia. I am not, however, satisfied about this as an explanation of s. 9 (b), particularly as s. 10A is an amending provision inserted in 1909, whereas s. 9 was in the original Act of 1906. Although I cannot account for s. 9 (b) to my satisfaction, I do not think that I am compelled by its terms to decide that it is only an act done in Australia that can be an offence against the Part. To do that would be to give too much weight to an ancillary provision of the Act.