Refrigerated Express Lines (A/Asia) Pty Ltd v Australian Meat & Livestock Corp & Ors [1980] FCA 45

Federal Court of Australia|1980-07-01|Before: Deane J

1974 does not apply to the whole or any of the conduct on the part of the respondents alleged in the statement of claim for the reason that such conduct is conduct in the course of overseas cargo shipping engaged

conference agreement or alternatively conference agreements within the meaning

Alternatively, that Part IV of the Trade Practices Act does not apply to the whole or any part of the conduct on the part of respondents alleged in the statement of claim for the reason that such conduct is conduct in relation to outwards cargo

That the conduct alleged against the respondent the Australian Meat and Live-Stock Corporation in paragraphs 29 to

not, in the light of the provisions of the Australian Meat _and Live-stock Corporation Act, 1977, involve any contravention of the provisions of the relevant section

ASSOCIATED CONTAINER TRANSPORTATION (AUSTRALIA) LIMITED

AUSTRALIAN SHIPPING COMMISSION (TRADING AS AUSTRALIAN NATIONAL LINE)

HAMBURG-SUEDAMERIKANISCHE DAMPFSCHIFFAFRTS - GESELLSCHAFT EGGERT & AMSINCK (TRADING AS COLUMBUS LINE)

In these proceedings, Refrigerated Express Lines (Australasia) Pty. Limited ("the applicant") seeks injunctive relief and damages against six corporate and six personal respondents. The basis of the proceedings is alleged contravention and involvement in contravention of the provisions

of Part IV of the Trade Practices Act, 1974 ("the Act").

The following preliminary points have been taken on

(i) That Part IV of the Trade Practices Act 1974 does not apply to the whole or any part of the conduct on the part of the respondents alleged in the statement of claim for the reason that such conduct is conduct in the course of overseas cargo shipping engaged in by a shipowner in pursuance of a conference agreement or alternatively conference

(ii) Alternatively, that Part IV of the Trade Practices Act does not apply to the whole or

any part of the conduct on the part of respondents alleged in the statement of claim for the reason that such conduct is conduct in

That the conduct alleged against the respondent the Australian Meat and lLive-Stock Corporation in paragraphs 29 to 34 of the amended statement of claim does not, in the light of the provisions of the Australian Meat and Live-stock Corporation Act, 1977, involve any contravention of the provisions of the

relevant section (s.46) of the Trade Practices Act,

~4- Full argument has been heard on these preliminary points. I

The statement of claim alleges that the applicant is a New South Wales company which engages in the activities of a breakbulk carrier for profit of meat from Australia to the east

The first respondent is the Australian Meat and Live-Stock Corporation ("AMLC"). It is a body corporate

established under the Australian Meat and Live-stock Corporation

Act, 1977. It is alleged by the statement of claim to be a trading corporation which is an authority of the Commonwealth and which carries on a business within the meaning of s.2A of the Act. The third respondent, the Australian Shipping Commission, is a

body corporate established under the Australian Coastal Shipping

Act, 1956. It is alleged to be a trading corporation carrying on

business under the name of Australian National Line as a carrier of meat by sea from Australia to the United States of America and to be an authority of the Commonwealth which "carries on a business" within the meaning of s.2A of the Act. The second, fourth, fifth and sixth respondents are alleged to be foreign corporations for the purposes of the Act. I shall, on occasion, refer to the second to sixth respondents as "the corporate respondents". Each of the corporate respondents is alleged by the statement of claim to carry on business as a carrier of meat by

sea from Australia to the United States of America.

The seventh to twelfth respondents constitute the personal respondents. The seventh respondent is alleged to have been, at material times, the chairman and a member of the AMIC. Each of the other personal respondents is alleged to have been, at material times, a representative and agent of one or other of the

The applicant's case against the respondents, as appearing from the statement of claim, falls into two distinct branches. The first branch of the case involves allegations against all the respondents. The second branch of the case consists essentially of allegations against the AMIC of conduct in which the other respondents are alleged to be involved as

The allegations under the first branch of the case may

(i) It ius alleged against the corporate respondents and the A.M.L.C. that they have engaged in, or been accessories to, the making of contracts, arrangements or understandings which contained exclusionary provisions and which had the purpose or effect or likely effect of substantially lessening competition within the meaning of

It is alleged against the corporate respondents and the AMIC that they have engaged in, or been accessories to conduct in breach of s.45(2)(b) of the Act in giving effect to the provisions of the contracts, arrangements or understandings

It is alleged against the corporate respondents and the AMIC that they have engaged in, or been accessories to, conduct in concert contrary to the provisions of s.45D of the Act. It is alleged that such conduct was engaged in for the purpose and would have or would be likely to have the effect of causing either substantial loss or damage to the business of the applicant and/or the business of corporate licensed meat exporters who were prevented from, or hindered in, acquiring services from the applicant or a substantial lessening of competition in the market in which the applicant and/or such corporate licensed meat exporters supply or

-7- It is alleged against the corporate respondents and the AMLC that they have engaged in, or been accessories to, conduct in concert in contravention of s.45D(1A) of the Act. It is alleged that such conduct was engaged in for the purpose and would have or be likely to have the effect of preventing or substantially hindering the applicant from engaging in trade or commerce between Australia and the east coast of the

It is alleged against the corporate respondents and the AMIC that, in offering to supply services in relation to the export of meat by sea from Australia to the east coast of the United States of America upon certain conditions, they have engaged in conduct which constitutes exclusive dealing within the meaning of s.47 of the Act. It is also alleged against these respondents that

It is alleged against the personal respondents that they have either engaged in or been accessories to the conduct referred to in (i), (ii) and (iii) above and that they have been accessories to the conduct engaged in by the corporate respondents and the AMIC referred to in

-8- The above summary is, in some respects, incomplete. In particular, it omits reference to allegations against all respondents of conspiracy to contravene the Act by entering into and giving effect to the alleged arrangements and undertakings and

Under the second branch of the case, it is alleged against AMIC that it is in a position substantially to control the Market for the supply of carrying services in relation to the export of meat by sea from Australia to the east coast of the United States of America and that, in contravention of s.46(1)(b) and (c) of the Act, it has taken advantage of its power in relation to that market for the purpose of preventing the applicant from entering it or engaging in competitive conduct within it. It is alleged against the other respondents that they have been parties to the AMIC's alleged conduct in that they have conspired with the AMIC to commit the alleged contraventions and have "aided, abbetted, counselled and procured" the alleged

The first preliminary point relates to both the first and second branch of the applicant's case. It is, in effect, that, in the light of the provisions of Part X of the Act which deal with overseas cargo shipping, the conduct and activities of which the applicant complains are not within the range of operation of the provisions of Part IV of the Act. The argument in

support of this preliminary point is put both on a restricted

-9- basis and on a wide general basis. These are reflected in the separate clauses ((i) and (ii)) in which the first preliminary point is stated. The wide argument is that the provisions of Part X of the Act provide an exclusive code on the subject of outwards cargo shipping and contracts, agreements and arrangements relating thereto, and that the conduct of which the applicant complains is within that subject matter and is consequently excluded from the ambit of operation of the relevant provisions of Part IV of the Act. The more restricted argument rests upon the provisions of s.112 of the Act which, in terms, provides that Part IV of the Act does not apply in relation to a limited class of overseas cargo

The main facts which the applicant would attempt to prove, appear with tolerable clarity from the allegations set out in the statement of claim and the particulars of those allegations which the applicant provided in the statement of claim and subsequently. At the risk of over-simplification, the essential factual basis of the case which the applicant seeks to make against the respondents can be shortly stated. It is that the AMIC and the corporate respondents have entered into agreements, arrangements and understandings, have acted in concert and have engaged in conduct, (and, in the case of the AMLC, has taken advantage of monopoly power) with the purpose and effect of procuring and ensuring that the corporate respondents alone carry meat by sea between Australia and the east coast of the United States of America and that the applicant be completely excluded from that trade. Central to the case which the applicant proposes to attempt to make are the statutory powers of the AMIC. I turn

-10- The AMIC is, in many respects, the successor of the

Australian Meat Board which was a body corporate incorporated by,

and with the powers, functions and duties as set out in, the Meat

Industry Act, 1964. Section 30(1) of that Act provided, inter alia, that a contract for the carriage of meat by sea to a place beyond Australia should not be made except by the Australian Meat Board or by that Board acting as agent for the exporter or "in conformity with such conditions (if any) as are approved by the Board from time to time". The AMIC was, as has been mentioned,

established by the Australian Meat and Live-stock Corporation Act,

That Act repealed the Meat Industry Act, 1964. Section 14(1) of the 1977 Act provides, inter alia, that a contract for the carriage of meat or livestock, by sea, to a place beyond Australia shall not be made except by the AMIC or by the AMLC acting as the agent for the exporter or "with such persons, and in conformity with such conditions (if any) as are, from time to time, approved in writing by the Minister upon the recommendation" of the AMIC. It can be seen that the AMIC, under s.14(1), can effectively exclude a -.shipowner from the carriage of meat or livestock from Australia in that a contract for such carriage can only be made either by the AMIC, as principal or agent, or with a person approved in writing by the Minister upon the recommendation of the AMIC. The contracts, arrangements and understandings, the acting in concert and the conduct alleged against the AMLC and the corporate respondents are structured upon these statutory powers of the AMLC. The allegations against the personal respondents are largely of involvement in alleged activities of the AMIC and the

The specific legislative provisions upon which the applicant places primary reliance are to be found in ss.45(2), 45A, 45D, 45D(1A) 46(1) and 47 of the Act. To understand the issues involved in the determination of the first preliminary point, it is necessary to refer generally to the provisions of the

Part of the Act (Part IV) in which all of those sections occur.

Part IV of the Act is headed "RESTRICTIVE TRADE PRACTICES". The general purpose and scope of the Part can be described by .saying that it contains provisions which proscribe and regulate agreements and conduct and which are aimed at procuring and maintaining competition in trade and commerce. Broadly speaking, those provisions either control or proscribe the making of certain contracts or arrangements or the reaching of certain understandings, the giving or extracting of certain covenants in relation to land, the engaging in conduct involving a secondary boycott, engaging in the practices of monopolization, exclusive dealing or resale price maintenance, engaging in predatory price discrimination, and the increasing of market share by means of take-over or merger. The primary constitutional heads of legislative power are the corporation power (Constitution, s.5i(xx)) and the trade and commerce power (Constitution, s.51{(i)) and the relevant legislative controls and proscriptions contained in Part IV are largely directed to conduct or agreements, arrangements or understandings in trade or commerce or involving a foreign, trading or financial corporation. For reasons which will

become subsequently clear, special reference should be made to the

Section 45(2) provides, inter alia, that a corporation

shall not make or give effect to a provision of a contract, arrangement or understanding that "has the purpose, or would have or be likely to have the effect, of substantially lessening competition". Section 45A(1) provides, inter alia, that contracts, arrangements or understandings between competitors, having the purpose or effect of fixing, controlling or maintaining the prices of goods or services are deemed to have the purpose or effect of substantially lessening competition in the market for those goods or services. In the result and regardless of form or description (s.45A(5)), contracts, arrangements or understandings between competitors, to which a corporation is a party and which fix, maintain or control the price of services, such as freight rates for the carriage of goods, are, subject to some special exceptions, proscribed by the provisions of Part IV. Among the special exceptions is that contained in s.51(2)(g) which concerns provisions relating exclusively to the export of goods or supply of overseas services and to which detailed reference will

Breach or threatened breach of a provision of Part IV can be restrained by injunction (s.80). A person who has committed or been involved in a contravention of the Part is liable to a pecuniary penalty of $50,000 in the case of a person not being a body corporate and $250,000 in the case of a body corporate (s.76) and can be sued by any person for damages suffered by reason of

Part X of the Act is headed "Overseas Cargo Shipping". It contains a wide range of provisions controlling and regulating the activities of shipowners in, and in relation to, the carriage of goods wholly or partly by sea from a place in Australia to a place outside Australia ("outwards cargo shipping"). It draws a broad distinction between outwards cargo shipping under conference agreements and the activities of individual ship owners in

A conference agreement is defined (s.111) as an "agreement to which this Part applies" which is, in turn (s.113(1)) defined as, subject to the section, being an agreement "the parties to which are or include two or more persons carrying on two or more businesses that include outwards cargo shipping and is one that makes provision, in relation to outwards cargo shipping, having the purpose or effect of restricting, preventing

-]4- - Section 113(2) provides that an agreement is not "an agreement to which this Part applies" by reason only of any provision as between shipowners of the one part and shippers of the other part with respect to the terms and conditions which are to be applicable to contracts for outwards cargo shipping. Section 111(2) provides, inter alia, that for the purposes of Part X, an arrangement or understanding, whether formal or informal and

whether express or implied, shall be deemed to be an agreement.

Division 2 of Part X contains provisions requiring and regulating the filing of conference agreements. Division 3 confers upon the Minister (who may be a different Minister to the Minister concerned with the general administration of the Act: see s.140(1)) and the Governor-General, wide powers in relation to conference agreements and the activities of ship owners being parties to such agreements. For present purposes, the most important section in this Division is s.122 which must be read in

the context of the definition of "shipper body" contained in

By s.1ll of the Act, "shipper body" is @efined as meaning "an association that, in the opinion of the Minister, represents the interests, in relation to outwards cargo shipping, of persons who are shippers of goods, or producers of goods of a kind exported from Australia". Section 122 of the Act provides that the Minister may serve on each of the parties to a conference agreement who carry on outwards cargo shipping to which the agreement relates, a notice in accordance with the section.

"A notice to a party under sub-section (1) shall request the party to give to the Minister, not later than a date specified in the notice, an undertaking in writing executed by the party that, whenever the party is reasonably requested by the designated shipper body, by notice in writing, to take part in negotiations with that shipper body with regard to arrangements for, and the terms and conditions that are to be applicable to, outwards cargo shipping to which the conference agreement relates - - (a) the party will take part in those negotiations and

designated shipper body in the course of the negotiations;

Section 123 provides that the Governor-General may, by order, disapprove a conference agreement on a number of specified and wide-ranging grounds. Among these grounds are failure to comply with a request for an undertaking under s.122 or failure to comply with an undertaking given under that section in relation to the agreement. Upon a conference agreement being disapproved, the agreement becomes (s.124(1)) unenforceable. Section 124(2) provides that, under pain of a penalty of $50,000, a party to a disapproved agreement shall not do any act or thing in pursuance of, or enforce or purport to enforce, the agreement so far as it relates to outwards cargo shipping; oer enter into any other conference agreement that relates, in whole or in part, to the carriage of goods from Australia to a place outside Australia that is a place to the carriage of goods to which the disapproved agreement related; or do any act or thing in pursuance of, or

enforce or purport to enforce, such other conference agreement.

Division 4 of Part X of the Act confers upon the Minister and Governor-General similar powers in relation to the outwards cargo shipping activities of individual shipowners. Section 128 is the section which empowers the Minister to serve on the individual shipowner a notice requesting an undertaking. Like s.122, it must be read in the context of the definition of

"shipper body" (see above). The section provides, inter alia:

"(1) Subject to sub-section (2), the Minister may serve on a shipowner a notice requesting the shipowner to give to the Minister, not later than a date specified in the notice, an undertaking in writing executed by the shipowner that, whenever the shipowner is reasonably requested by the designated shipper body, by notice in writing, to take part in negotiations with that shipper body with regard to arrangements for, and the terms and conditions that are to be applicable to, outwards cargo shipping to which the notice relates-- -

(a) the shipowner will take part in those negotiations and will have due regard to matters and

considerations raised, and representations made, by the designated shipper body in the course of the negotiations;

(2) A notice under sub-section (1) requesting an undertaking shall be expressed to relate to outwards cargo shipping by the shipowner to a specified port or to specified ports, not being outwards cargo shipping that is within the operation of a conference agreement, not being a disapproved agreement, particulars of which have been furnished under Division 2.

The Governor-General may, on broad specified grounds, declare a shipowner to be, in relation to outwards cargo shipping to a specified port or ports, a declared shipowner (s.129). The

specified grounds include failure to comply with a request for an

-17- undertaking under s.128 or failure to comply with an undertaking given under that section in relation to relevant shipping. Section 130 provides that a declared shipowner shail not, in respect of outwards cargo shipping to a port specified in the order by virtue of which he is a declared shipowner, engage in a number of specified activities. The specified activities are all of the kind covered by provisions of Part IV of the Act. Breach of the provisions of s.130 renders the declared shipowner liable

to a penalty of $50,000. It seems fair tc comment that the Division appears to proceed on the basis that, unless the shipowner is a "declared shipowner", the specified activities

Division 5 of Part X provides for the reference to the Trade Practices Tribunal of matters for inquiry and report and contains provisions dealing with prosecutions and with aiding and abetting offences against the Part. Division 6 confers upon a shipper, shipowner or other person who suffers loss or damage by the act of another person done in contravention of s.124 or s.130, the right to recover the amount of the loss or damage by action

The above examination of the provisions of Part IV and Part X of the Act tends to create two general prima facie impressions. First, the structure and contents of Part X, with its Preliminary Division, including a definitions section, its

Division establishing a filing system, its Divisions dealing with

~18- regulation and control of outwards cargo shipping activities both under conference agreements and by individual shippers, its General Division dealing with inquiries by the Trade Practices Tribunal and, in a general way, with prosecutions and with aiding and abetting offences against the Part, and its Division dealing with civil remedies in respect of contraventions, tend to convey a clear impression of a comprehensive code dealing with outwards cargo shipping. Second, it is apparent that, if both Part IV and Part X are generally applicable to the same agreements and practices, there is considerable room for overlapping and conflict in the practical operation of the different legislative provisions. In particular, the making or giving effect to an agreement as to rates which was reached as a result of negotiations pursuant to an undertaking given under Division 3 or Division 4 of Part X would almost inevitably involve prima facie contravention of the provisions of Part IV (ss. 45 and 45A), while conduct which attracted the penalties imposed for breach of the provisions of s.124 or s.130 would be prima facie calculated also to attract the penalties imposed by s.76 for a breach of the provisions of Part IV. These general impressions tend to favour the view that the general provisions of Part IV should be construed as not applicable to the subject matter of the special provisions of Part X. The inter-relation between the provisions of Part IV and the provisions of Part X must, however, be seen in

the context of s.112 (in Part X) and s.51(2)(g) (in Part IV).

-19- Section 112 of the Act provides: "Part IV does not apply in relation to overseas cargo shipping engaged in by a shipowner in pursuance of a conference agreement, including a disapproved agreement". Reference has already been made to the provisions of the Act (s.111 and s.113) which, when read together, provide a definition of "conference agreement". Examination of those provisions

reveals the narrowness of the exclusion from the provisions of

Read literally, the words of s.112 provide an exemption only in relation to overseas cargo shipping engaged in by a shipowner in pursuance of a conference agreement. They do not, in terms, exclude the actual making of such an agreement. The words

"in relation to" are, however, "extremely wide" and "elastic" (see

Tooheys Ltd. v. Commissioner of Stamp Duties (N.S.W.) (1961) 105

C.L.R. 602 at pp. 620 and 624). With some hesitation, I have come to the view that the exclusion from Part IV which s.112 provides would extend to the making of a conference agreement as well as to overseas cargo shipping engaged in by a shipowner in pursuance of it. The narrowness of the exclusion contained in s.112 does not, however, flow from the fact that it does not, in terms, encompass the making of the conference agreement as well as conduct in pursuance of it. It flows from the definition of "conference

20- By virtue of the provisions of s-.113(i) of the Act, it is a requirement of a "conference agreement" that the parties to it "are al include two or mrore persons carrying on two or more

businesses that include outwards cargo shipping". It was

t submitted, on behalf of the respondents, that this reguirement is

satisfied if one only of two or more businesses carried on by the parties includes outwards cargo shipping, that is to say, if the agreement is between one or more shippers and only one shipowner. I am unable so to read the sub-section. In my view, the requirement is satisfied only if the parties to the agreement include two or more persons each of whom carries on a business that includes outwards cargo shipping. In the result, the exclusion which s.312 provides does not extend to the conduct or agreements of individual shipowners. In particular, it does not extend to agreements of an individual shipowner entered into in pursuance of negotiations under Division 4 of Part X or conduct in

The scope of what constitutes a "conference agreement" and, in consequence, the ambit of the exclusion contained in s.112 are further limited by the provisions of s.113(2) which, as has been mentioned, provide that an agreement is not an agreement to which Part X applies by reason only of any provision as between shipowners of the one part and shippers of the other part with respect to the terms and conditions that are to be applicable to

contracts for outwards cargo shipping. A considerable amount of

discussion took place in the course of argument before me as to

the precise effect to be given to s.113(2) and written submissions on behalf of the applicant and some of the respondents on the effect of the sub-section were received by me after the conclusion of oral argument. It was submitted on behalf of the respondents that the words of s.113(2) should be given a very restricted meaning and confined to particular provisions, regulating the shipment of particular goods, of a type found, for example, in a bill of lading. I do not accept that submission. It is, in my view, plain from the words used that the provisions referred to

in s.113(2) include general provisions as between shipowners of the one part and shippers of the other part with respect to the common or general terms and conditions upon which the shipowners will carry goods. The practical effect of this reading of s.113(2) is to confine a conference agreement to one which contains provisions binding between two or more shipowners, being included among the parties to it, inter se. The exclusion contained in s.112 will not, on this view, extend to what is no more than a general agreement as to terms and conditions, including rates of carriage, reached between a group of shipowners of the one part and a group or body of shipowners of the other part. In particular, the exclusion will not be calculated to extend to any agreement reached between shipowners of the one part and shippers of the other part as a result of negotiations carried on in pursuance of an undertaking given to the Minister under

-22- Section 51(2)(g) of the Act provides that in determining whether a contravenLion of Part IV, other than s.45D or s.48, has

"to any provision of a contract, arrangement or understanding, being a provision that relates exclusively to the export of goods from Australia or to the supply of services outside Australia, if full and accurate particulars of the provision (not including particulars of prices for goods or services but including particulars of any method of fixing, controlling or maintaining such prices) were furnished to the Commission before the expiration of 14 days after the date on which the contract or arrangement was

made or the understanding was arrived at, or before 8 September, 1976, whichever was the later."

There is plainly room for legitimate differences of opinion as to the precise meaning to be given to the words of s.51(2)(g). This is the result, in part, of the difficulties of construction which must inevitably flow from the combination of the word "relates" which has an extremely wide but vague and

"exclusively" which has a narrow and precise meaning. It also results, in part, from the difficulty in determining whether the reference to a provision relating "exclusively" to the export of goods should be restricted to a provision dealing with actual export as such or should be construed as embracing contracts for the carriage of goods in the course of their export. Putting these difficulties to one side,

there are a number of aspects of s.51(2)(g) which are important

First, s.51({2)(g) does not unconditionally exclude the provisions to which it refers from the ambit of the provisions of Part IV (other than s.45D or 5.48). It excludes them from those provisions only if the full and accurate particulars specified are filed in accordance with, and within the time allowed by, the paragraph. If such full and accurate particulars are not so filed, the exclusion which the paragraph contains does not apply. In this regard, it is important to contrast the provisions of s.51(2)(q)) with the situation which would exist if the exclusion vere unconditional regardless of failure to file full and accurate particulars but such failure was in itself a breach of the Act

Second, the description of the "provision" to which s.51(2)(g) applies does not, in terms, correspond with the description of any of the agreements, arrangements or

understandings to which the provisions of Part X are applicable.

To the extent that there is such correspondence, it would, in view of the difficulties of construction to which reference has been made, seem more to be coincidental than the result of any

Thirdly, it is plain that, even giving a wide meaning to the terms of s.51(2)(g), particular provisions of general agreements reached as a result of negotiations pursuant to Division 3 or Division 4 of Part XK would be outside the bounds of

the protection given by s.51(2){(q). Provisions which would

-~24- properly be seen as being "with regard to arrangements for, and the terms and conditions that are to be applicable to, outwards cargo shipping" (s.122(2) and s. 128{1)) may well lie outside what is properly encommpassed in the reference to a "provision ... that

relates exclusively to the export of goods" in s.51(2)(g).

The above examination of the provisions of s.112 and s.51(2)(g) makes plain that those provisions do not completely remove the potential conflict and overlapping between Part X and Part IV of the Act. In particular, notwithstanding the effect of

(i) Agreements which flow from negotiations in pursuance of undertakings given under Division 3 and Division 4 of Part xX, and conduct in pursuance thereof, are likely to be prima facie proscribed by the provisions (in particular, s.45 and s.45A) of Part IV. Even if such agreements are confined to provisions of the type referred to in s.51(2)(g), the making of, and giving effect to, them will not be removed from the area of operation of the provisions of Part IV unless the filing requirements laid down, but not imposed under penalty, by s.51(2)(g) are complied with. Where such agreements are not so confined, the proscription will not be merely prima facie:

(ii) Conduct involving breach of the provisions of s.124 or s.130 and attracting the penalties imposed by one or other of those sections and the civil liability in damages under Division 6 of Part X will be likely, at least prima facie, to constitute a breach of the provisions of Part IV attracting the different penalties imposed by s.76 and the distinct civil liability in damages

(iii) Conduct which is plainly assumed by Division 4 of Part X to be lawful by a shipowner who is not a declared shipowner will be likely to be prima

In the light of the above, I return to the question whether, upon the proper construction of the Act, the general provisions of Part IV were intended to apply in respect of the subject matter of the special provisions of Part X, that is to say, in respect of the subject matter of outwards cargo shipping and practices, conduct, agreements, arrangements or understandings

engaged in, entered into or reached in relation to such shipping.

On the one hand, one cannot but be conscious of the force of the argument advanced on behalf of the applicant that the

Court should be reluctant to imply such a general exclusion of the

-~26- subject matter of Part X from the provisions of Part IV in a context where the Parliament has expressly provided, in s.112, for a more limited exclusion. On the other hand, the provisions of Part X contain an apparently comprehensive and internally cohesive code on the subject matter of outwards cargo shipping and, in my view, the specific matters to which reference has been made provide strong grounds for concluding that the subject matter was not intended also to be governed by overlapping and, to a significant extent, conflicting proscriptions and controls contained in Part IV. This is particularly so in the case of the making and observance of agreements resulting, in the ordinary course, from negotiations in pursuance of an undertaking given to

The undertakings which the Minister is empowered by ss.122 and 128 to request, obligate the relevant shipowners or shipowner to take part in negotiations with regard to arrangements for, and the terms and conditions that are to be applicable to, outwards cargo shipping with a body representing the shippers for whom goods are carried. Failure to give a requested undertaking or to honour an undertaking once given will render the shipowner in question liable to the severe consequences of disapproval of the relevant conference agreement under s.123 or, in the case of an individual shipowner, of being "declared" under s.129. Plainly, it is intended that the negotiations will have some point and that any agreed outcome of them will be binding on shipowners

and shippers. Equally plainly, the making and giving effect to

-27- any agreement resulting from such negotiations would almost certainly, at least prima facie, involve breaches of the substantive provisions of Part IV of the Act if those provisions are applicable to the subject matter of those negotiations. It is highly unlikely that it was the legislative intent that the shipowner under a conference agreement or the individual shipowner should, for practical purposes, be under a legislative constraint to give, and to honour, an undertaking to engage in negotiations, with regard to outwards cargo terms and conditions, with a representative body of shippers in circumstances where the making or giving effect to any agreement resulting from those negotiations would almost certainly render him, at least prima facie, liable to the penalties imposed for breach of the provisions of Part IV of the Act. It seems to me that the unavoidable conclusion is that the provisions of Part IV were not intended to be applicable to the making of, or giving effect to, such an agreement. That being the case, it follows that s.112 cannot properly be regarded as containing an exhaustive statement of the extent to which the provisions of Part IV of the Act are inapplicable to conduct or agreements covered by Part X and much

of the apparent force of the argument based on s.112 disappears.

As a matter of general construction, where there is repugnancy between the general provision of a statute and provisions dealing with a particular subject matter, the latter must prevail and, to the extent of any such repugnancy, the

general provisions will be inapplicable to the subject matter of

-28- the special provisions. "The rule is, that wherever there is a particular enactment and a general enactment in the same statute, and the latter, taken in its most comprehensive sense, would overrule the former, the particular enactment must be taken to be operative ..." (per Romilly M.R., Pretty v. Solly [1859] 26 Beav. 606 at p. 610). Repugnancy can be present in cases where there is no direct contradiction between the relevant legislative provisions. It is present where it appears, as a matter of construction, that special provisions were intended exhaustively to govern their particular subject matter and where general provisions, if held to be applicable to the particular subject matter, would constitute a departure from that intention by encroaching on that subject matter. A more fundamental example of such repugnancy is where the particular provisions prescribe or encourage conduct which the general provisions would render prima facie, though not irremediably, wnlawful or where the particular provisions assume to be lawful conduct which the general provisions would render prima facie unlawful. I have already indicated my view that the latter, more fundamental, example of repugnancy is present in the instant matter. I consider that the

The conclusion which I have reached from an overall consideration of the Act is that the provisions of Part X were intended by the Parliament to constitute an exhaustive code controlling and regulating, in so far as restrictive practices are

concerned, outwards cargo shipping. The inclusion of the limited

-29- - provisions of s.112 is to be explained by reference to the legislative history of the provisions of that section in particular and of Part X in general. Notwithstanding the inclusion of that section, I am of the view that the proper inference to be drawn upon the overall construction of the Act is that the provisions of Part IV of the Act were not intended to be applicable to outwards cargo shipping or to practices, conduct, agreements, arrangements or understandings engaged in, entered into or reached in relation to such _ shipping. It becomes necessary to consider the effect of my conclusion in that regard

upon the applicant's action as pleaded and particularized.

Examination of the statement 'of claim and the further and better particulars subsequently provided by the applicant discloses that the whole of the first branch of the applicant's case falls within the subject matter of practices, conduct, agreements, arrangements and understandings engaged in, entered into or reached in relation to outwards cargo shipping. The contracts, arrangements and understandings which constitute the basis of the alleged breaches of s.45(2)(a) and s.45(2)(b) of the Act are all concerned with outwards cargo shipping. The conduct in concert alleged to contravene s.45D and s.45D(1A) of the Act and the conduct alleged to constitute exclusive dealing within the meaning of s.47 are likewise in relation to such shipping. The allegations of conspiracy, aiding and abetting and being accessories to conduct are to be classified in accordance with the classification of the substantive primary allegations which have

The position is not quite so clear as regards the second branch of the applicant's case, that is to say, the allegations based on an alleged taking advantage by AMIC of a power to control the market for the supply of carrying services in relation to the export of meat by sea from Australia to the east coast of the United States of America. The AMLC is not alleged to be a shipowner and its alleged conduct in this regard does not lie at the heart of the subject matter of Part X. The manner in which AMIC is alleged, in paragraphs 32 and 33 of the amended statement of claim, to have taken advantage of its alleged power in relation to the market is, however, to exclude the applicant from supplying carrying services in that market and to fix and determine freight rates for container vessels operating within that market for a particular purpose. In my view, the conduct alleged under the second branch of the applicant's case directly relates to outwards cargo shipping and, for that reason, is excluded from the scope of

It follows that I uphold preliminary point 1(ii), that is to say, I hold that Part IV of the Act does not apply to any part of the conduct, practices, agreements, arrangements or understandings on the part of the respondents alleged in the amended statement of claim for the reason that such conduct, practices, agreements, arrangements and understandings are in relation to outwards cargo shipping. In the result, the

applicant's action must fail and should be dismissed.

~31- - There remain for consideration preliminary points 1(i)

Preliminary point 1(i) was argued in the alternative to preliminary point l1(ii) upon which I have ruled. It is intended to cover an argument on behalf of the respondents that s.112 of the Act excludes from the area of operation of Part IV of the Act all of the conduct on the part of the respondents alleged in the statement of claim other than so much of such conduct as is comprised or is based upon the alleged contravention by AMIC of the provisions of s.46 of the Act. The issue between the applicant and the respondents on this preliminary point concerns the proper construction of s.112 of the Act and the extent of the

exclusion from the provisions of Part IV which it contains.

Preliminary Point 2 concerns those parts of the statement of claim which are based upon the alleged contravention by AMLC of the provisions of s.46 of the Act. It is intended to cover the submission on behalf of the respondents that the conduct alleged could not constitute a breach of that section. The argument in support of the submission was divided into the

(a) That the conduct proscribed by s.46 is conduct of a supplier or acquirer of goods within the relevant market and it is not suggested that AMIC is such a

At a glance

Court

Decision date

Before

Source

Judgment (137 paragraphs)

Cited By (4)