Panasales Clearance Centre Pty Ltd v J B Hi Fi Brighton Pty Ltd

REASONS FOR JUDGMENT 1 There is before the Court a motion by the applicant, Panasales Clearance Centre Pty Ltd ("Panasales"), for interim injunctions against the respondents J B Hi Fi Brighton Pty Ltd ("J B Hi Fi Brighton") and J B Hi Fi Camberwell Pty Ltd ("J B Hi Fi Camberwell"). 2 Panasales is a retailer of television sets, high-fidelity stereo equipment, video recorders, telephones, answering machines and the like which are apparently known generically in the trade as "brown goods". Panasales conducts its business from a single outlet at 239 Nepean Highway, Brighton. The respondents are a part of a group of retailers carrying on business under the name "J B Hi Fi" from ten different retail outlets in suburbs of Melbourne, including one at Brighton conducted by the first respondent and one at Camberwell conducted by the second respondent. 3 By its amended statement of claim, Panasales alleges that various employees of J B Hi Fi Brighton and J B Hi Fi Camberwell have made remarks disparaging Panasales stock-in-trade and business practices which have been misleading and deceptive and have thereby contravened the Trade Practices Act 1974. 4 One series of such remarks was allegedly made to a Mr Kourtis on 17 April 1999. Mr Kourtis had found that he could purchase a particular type of video recorder from Panasales for $529. He then spoke by telephone to the J B Hi Fi store at Nunawading and was told that its price for that machine was $530 but there were none in stock. Accordingly, he was advised to try another J B Hi Fi store. Upon his telephoning J B Hi Fi Camberwell, he had the following telephone conversation, he has deposed, with an unidentified salesman: "I asked whether the VCR was in stock at the price at which it was selling. I was told that the VCR was in stock and that the price was $569.00. I asked why the price was so much higher than the J B Hi Fi store at Nunawading? The salesperson said he was unable to answer that question. I then said that I had been quoted a cheaper price to what he had quoted me, by the Applicant Panasales. The salesperson then said, "If you want to purchase a second-hand factory remake from Panasales, go ahead and buy it. We deal in new stock only." I then asked the salesperson how he could prove that that statement was true? The salesperson replied that Panasales always have "second-hand stuff and you will be going back with the warranty all the time." I then said to the salesperson that I did not appreciate him speaking about other stores in that way, that I had been offered a better deal by Panasales, that I had received better customer relations from Panasales and that I intended to deal with them. The salesperson then said, "Mate, if you want to buy second-hand stuff, go ahead and buy it and leave us alone." 5 The other instances of allegedly offending oral representations occurred in conversations between J B Hi Fi sales staff and either private inquiry agents retained by Panasales or Mr Leibovich, the Managing Director of Panasales. Those circumstances increased the possibility that the conversations were directed towards the case which Panasales was seeking to make or were recollected or recorded selectively or otherwise favourably to Panasales. I have taken these features into account in assessing the extent to which the evidence as a whole raises a serious question to be tried. 6 The first private inquiry agent, Mr MacDonnell, attended at the premises of J B Hi Fi Brighton and had a conversation with a salesman, later identified as Kevin Koelmeyer, which, so far as is relevant, was recorded in these terms: "I said, "My wife has been looking at Televisions as well, at other stores and she has been given some good prices." He said, "Yep". I said, "She went to Panasales and they told her they could match prices." He said, "Panasales? Just be careful, most of their stuff is factory seconds. They do have some new stuff, but as I said, most of their stuff is factory seconds, so be careful of that." I said, "They sell the same televisions as here though don't they?" He said, "They're not allowed to sell some of the brands and they were actually taken to court over it by Panasonic." I said, "What to court?" He said, "Yep, selling brands they weren't allowed to and they lost." I said, "What over?" He said, "Selling brands they weren't allowed to sell. Look we can beat any of their prices, so I wouldn't worry about that." I said, "Yeah I'm just looking at what JB has for sale." He said, "Another problem with Panasales is that they only have one store, while J B Hi-Fi has a lot. The after sales service is really poor." I said, "What do you mean?" He said, "They only have one shop and if they go bust, then you've got problems with your warranty." I said, "Why?" He said, "You won't have a warranty on the goods if they go bust." I said, "What do you suggest?" He said, "Stay away from them, we can beat any of their prices anyway." I said, "Thanks for that, I'll speak to my wife about it, what's your name so I can get back to you?" He said, "Yeah Kev."