Outline of the Proceedings
12 In 2008, the ACCC commenced two sets of proceedings against Allphones and certain individuals who had been involved in the conduct about which the ACCC complained in their capacity as executives of Allphones. These proceedings were NSD 408 of 2008 and NSD 1567 of 2008. Subsequently, in 2009, the ACCC commenced a further proceeding against Allphones and against the same individual respondents as had been sued in proceeding NSD 408 of 2008.
13 The genesis of these proceedings was a series of disputes that had arisen between Allphones and several of its franchisees, most of whom were based in South Australia and Western Australia.
14 On 30 March 2009, the applicant commenced the present proceedings in the Western Australia District Registry of the Court. The applicant was a South Australian franchisee of Allphones at the time when he commenced these proceedings. The applicant purported to prosecute the present proceeding for himself and as representative of the group which was ultimately defined as follows:
2. The group members to whom this proceeding relates are those persons who in respect of a territory,
(a) are or, prior to expiry of their most recent franchise agreement, were franchisees to whom the respondent had granted a franchise to operate a business under a name comprising or including the word "Allphones"; and
(b) have or, prior to its expiry, had a franchise agreement in the same or substantially the same terms as the applicant's franchise agreement dated 1 April, 2004 (the applicant's franchise agreement dated 1 April 2004, the "Old Agreement" and each such group member's corresponding franchise agreement, a "Group Member's Old Agreement") containing a right to renew in the same or substantially the same terms as the Old Agreement; and
(c) for whom the time permitted by that provision for exercise of their right to renew has not expired or has not expired without him, her or it giving to the respondent notice of intention to renew under that provision; and
(d) have not yet signed a renewed franchise agreement; and
(e) have entered into a costs agreement with the Applicant's solicitors prior to the date of filing this amended application in respect of these proceeding.
15 By the time that the present proceedings were ready to be heard, there were 21 members in that group.
16 The applicant amended his Application and Statement of Claim on several occasions. It is not necessary for present purposes to traverse the history of those amendments. Nor is it necessary to discuss in any detail the allegations made in those pleadings.
17 As is apparent from the definition of the group members which I have extracted at [14] above, all of the group members either were, or had been, franchisees of Allphones operating their businesses under the Old Agreement (as defined). Those franchisees alleged that, in breach of the Old Agreement (as properly construed or as rectified), Allphones had insisted that it was entitled to offer a renewal of the franchise agreement upon the basis that the renewing franchisees were obliged to enter into the new form of franchise agreement then being deployed by Allphones (the new agreement). As an alternative basis for relief, the group members contended that, by reason of unfair pressure, unfair tactics and bullying, Allphones was guilty of unconscionable conduct within the meaning of s 51AC of the Trade Practices Act 1974 (Cth) (the TPA). The group members wished to avail themselves of the cases which the ACCC was advancing in proceeding NSD 408 of 2008 and in proceeding NSD 869 of 2009 in support of their allegation that Allphones was guilty of unconscionable conduct.
18 As at 23 March 2010, none of the group members had entered into the new agreement. All had resisted the pressure being applied by Allphones to do so.
19 It was the contention of the group members that the new agreement was far less favourable to the franchisees than the Old Agreement and that the new agreement had been fashioned in order to circumvent the findings of this Court in Allphones Retail Pty Ltd v Hoy Mobile Pty Ltd [2009] FCAFC 85.
20 The applicant sought declaratory and injunctive relief designed to compel Allphones to offer to the group members a renewal of their franchise upon terms no less favourable than those which obtained in the Old Agreement pursuant to which they had conducted their franchises for many years.
21 No pecuniary relief was sought by the applicant or the group members in these proceedings. However, it should be noted that, in proceeding NSD 869 of 2009, pecuniary relief was sought on behalf of a large number of Allphones franchisees. That group included all of the group members in the present proceeding.