FEDERAL COURT OF AUSTRALIA

TRADE PRACTICES - injunctions and orders - application for final orders by consent, including order for the implementation by respondent of a trade practices compliance program - Court’s power under s 80 of the Trade Practices Act to grant injunction “in such terms as the Court determines to be appropriate” - whether Court may order compliance program in relation to Trade Practices Act generally or whether limited in scope to provisions in respect of which contravention is alleged or established - limits on Court’s power under s 80 - significance of parties’ consent to the orders - scope of appropriate compliance order.

Trade Practices Act 1974 (Cth) s80

Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 considered

ICI Australia Operations Pty Limited v Trade Practices Commission (1992) 38 FCR 248 applied

Re Judiciary Act 1903-1920 and Navigation Act 1912-1920 (1921) 29 CLR 257 considered

Fencott v Muller (1983) 152 CLR 570 considered

OD Transport Pty Ltd v WA Government Railways Commission (1987) 13 FCR 500 considered

Australian Competition and Consumer Commission v N W Frozen Foods Pty Ltd (1996) ATPR 41-515 distinguished

Australian Competition and Consumer Commission v Woolworths (Federal Court of Australia, Hill J, 3 July 1996, unreported) distinguished

Trade Practices Commission v Amatek  (Federal Court of Australia, Lockhart J, 24 November 1994, unreported) distinguished

Australian Competition and Consumer Commission v Pioneer Concrete Qld Ltd (1996) ATPR 41-457 distinguished

Trade Practices Commission v Monier Roofing Limited (1996) ATPR 41-464 distinguished

Australian Competition and Consumer Commission v Hymix Industries Pty Ltd (1996) ATPR 41-465 distinguished

Trade Practices Commission v Milreis Pty Ltd (No 2) (1978) 32 FLR 234 applied

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v Z-TEK COMPUTER PTY LTD

VG 276 of 1997

MERKEL J

MELBOURNE

3 SEPTEMBER 1997

MINUTES OF ORDER

THE COURT ORDERS THAT the respondent implement a trade practices compliance program as follows:

1.         The respondent shall place responsibility for the implementation of the program with its Financial Manager.  The program will be implemented within two calendar months of this order.

2.         The respondent shall appoint its Financial Manager as its Trade Practices Compliance Officer.  The Trade Practices Compliance Officer shall be appointed within two calendar months of this order.

3.         The respondent shall require the Trade Practices Compliance Officer to review all advertising (by any medium) to ensure that it complies with ss 52, 53(e) and 53C of Part V of the Trade Practices Act 1974 (Cth) (“the Act”), prior to its publication or broadcast.

4.         The respondent shall require the Trade Practices Compliance Officer to maintain a documentary record of the compliance reviews of all advertising.  Such documentary record will include:

a)         a description of the advertisement;

b)         a description of the publication (including name, date, page(s) and publisher);

c)         a copy of the advertisement;

d)         written advice that the advertisement had been reviewed and cleared by the Trade Practices Compliance Officer (including the date on which the advertisement was reviewed);

e)         written advice of any possible contraventions of the Act that were identified by the Trade Practices Compliance Officer and the action taken to address these possible contraventions.

5.         The respondent shall ensure that the documentary records of the compliance reviews of all advertising are available to the Australian Competition and Consumer Commission to be reviewed from time to time.  Such records are to be available from one week after the date of publication of the advertisement for a period of three years after that date.  Such records are to be provided to the Australian Competition and Consumer Commission within five working days of a written request for those records.

6.         The respondent shall ensure that, prior to implementation of the program, the processes which the respondent intends to implement in order to comply with the program are approved by a firm of solicitors with expertise in trade practices law.

7.         The respondent shall ensure that a firm of solicitors with expertise in trade practices law conducts training in relation to misleading or deceptive advertising or conduct which involves the making of representations in contravention of ss 52, 53(e) and 53C of the Act, to the respondents’ staff on six occasions during the three year period following the making of this order.  The first of these training programs is to be completed within three calendar months of this order and the remaining five on a six monthly basis thereafter.

8.         The respondent shall retain a firm of solicitors with expertise in trade practices law to provide the Australian Competition and Consumer Commission with two annual reports (being at 12 months and 24 months following the making of this order) on the respondent’s compliance with the program, and these reports shall be provided to the Australian Competition and Consumer Commission within:

a)         13 months of this order; and

b)         25 months of this order,

respectively.

Note:                Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

INTRODUCTION

The Australian Competition and Consumer Commission (“ACCC”) applied to the Court for the grant of final injunctions against Z-Tek Computer Pty Ltd (“Z-Tek”) pursuant to s 80 of the Trade Practices Act 1974 (Cth) (“the TPA”).

The ACCC’s  claim for injunctive relief arises out of an eight page advertisement inserted by Z-Tek in the March 1997 edition of “Windows Sources Australia” magazine.  The ACCC alleges that, in making certain representations as to price in the advertisement, the respondent:

“(a)     engaged in conduct that was misleading or deceptive or was likely to mislead or deceive, in contravention of section 52 of the Act;

(b)       in connection with the supply or possible supply or promotion of the supply of computing equipment, made a false or misleading representation  with respect to the price of the computing equipment, in contravention of section 53(e) of the Act; and

(c)        in connection with the supply or possible supply or promotion of the supply of computing equipment, made a representation with respect to an amount that, if paid, would constitute a part of the consideration for the supply of the computer equipment, and did not specify the cash price for the computer equipment, in contravention of section 53C of the Act.”

The ACCC and Z-Tek agreed to settle the proceeding by applying to the Court for the grant of final orders by consent.  At the request of the parties I made the orders sought in so far as those orders required corrective advertising or restrained similar contraventions to those alleged.  I also made orders as to costs.  However, I reserved my decision on whether it was appropriate for the Court to make a further order, sought by consent, that:

“The Respondent implement a trade practice corporate compliance program in the form specified in Attachment 2 of these Orders.”

Attachment 2 to the Draft Minute of Consent Orders was in the following terms:

“ATTACHMENT 2

TRADE PRACTICES CORPORATE COMPLIANCE PROGRAM

The Trade Practices Corporate Compliance Program (“the Program”) to be undertaken by the Respondent will have the following features.

1.         The Respondent will place responsibility for the implementation of the Program with its Financial Manager.  The Program will be implemented within two calendar months of this order.

2.         The Respondent will appoint its Financial Manager as its Trade Practices Compliance Officer.  The Trade Practices Compliance Officer will be appointed within two calendar months of this order.

3.         The respondent will require the Trade Practices Compliance Officer to review all advertising (by any medium) to ensure that it complies with ss 52, 53(e) and 53C of Part V of the Trade Practices Act 1974 (Cth) (“the Act”), prior to its publication or broadcast.

4.         The Respondent will require the Trade Practices Compliance Officer to maintain a documentary record of the compliance reviews of all advertising.  Such documentary record will include:

(a)        a description of the advertisement;

(b)        a description of the publication (including name, date, page(s) and publisher;

(c)        a copy of the advertisement;

(d)        written advice that the advertisement had been reviewed and cleared by the Trade Practices Compliance Officer (including the date on which the advertisement was reviewed);

(e)        written advice of any possible contraventions of the Trade Practices Act that were identified by the Trade Practices Compliance Officer and the action taken to address the possible contraventions.

5.         The Respondent will ensure that the documentary records of the compliance reviews of all advertising are available to the Australian Competition and Consumer Commission to be reviewed from time to time.  Such records will be available from one week after the date of publication of the advertisement for a period of 3 years after that date.  Such records will be provided to the Australian Competition and Consumer Commission within 5 working days of a written request for those records.

6.         The Respondents will ensure that, prior to implementation of the Program, the processes which the Respondent intends to implement in order to comply with the Program are approved by a firm of solicitors with expertise in trade practices law.

7.         The Respondent will ensure that a firm of solicitors with expertise in trade practices law conducts training on the Trade Practices Act to the Respondents’ staff on six occasions during the 3 year period following the making of this order.  The first of these training programs will be completed within 3 calendar months of this order and the remaining five on a six monthly basis thereafter.

8.         The Respondent will retain a firm of solicitors with expertise in trade practices law to provide the Australian Competition and Consumer Commission with two annual reports (being at 12 months and 24 months following the making of this order) on the Respondent’s compliance with the Program, and these reports will be provided to the Australian Competition and Consumer Commission within:

            (a)        13 months of this order;  and

                        (b)        25 months of this order,

                        respectively.”

THE ACCC’S SUBMISSIONS

Counsel for the ACCC referred to the width of the power of the Court under s 80 of the TPA to

“... grant an injunction in such terms as the Court determines to be appropriate.”

and submitted that it is “appropriate” and in the public interest for the Court to order that the respondent implement a trade practices compliance program as agreed between the parties.

Counsel submitted that orders for a trade practices compliance program, which are within the scope and purpose of the TPA and in particular s 80, have often been made by the Court.  In substance, it was contended that “prevention rather than cure” in respect of future breaches of the TPA is in the public interest and that is precisely what the trade practices compliance program, agreed between the parties, is designed to achieve. 

The respondent appeared by its solicitor to consent to the orders sought by the ACCC.

SECTION 80 OF THE TPA

In so far as is relevant, s 80 provides:

“(1)     Subject to sub-sections (1A), (1AAA), and (1B), where, on the application of the Commission or any other person, the Court is satisfied that a person has engaged, or is proposing to engage, in conduct that constitutes or would constitute -

(a)        a contravention of a provision of Part IV, IVA or V;

(b)        attempting to contravene such a provision;

(c)        aiding, abetting, counselling or procuring a person to contravene such a provision

(d)        inducing, or attempting to induce, whether by threats, promises or otherwise, a person to contravene such a provision;

(e)        being in any way, directly or indirectly, knowingly concerned in, or party to, the contravention by a person of such a provision; or

(f)        conspiring with others to contravene such a provision,

the Court may grant an injunction in such terms as the Court determines to be appropriate.

(1AA)   Where an application for an injunction under sub-section (1) has been made, whether before or after the commencement of this sub-section, the Court may, if the Court determines it to be appropriate, grant an injunction by consent of all the parties to the proceedings, whether or not the Court is satisfied that a person has engaged, or is proposing to engage, in conduct of a kind mentioned in sub-section (1).”

Prior to the amendment of s 80 in 1983 the Court’s jurisdiction to grant injunctions under the TPA was limited to restraining conduct that constitutes or would constitute a contravention of Part IV or V:  see Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150.

In OD Transport Pty Ltd v WA Government Railways Commission (1987) 13 FCR 500 at 508 French J, in discussing the jurisdiction of the Court under s 80 after the 1983 amendments , said:

“... the effect of the 1983 amendment to s 80(1) was to free the power conferred by the section from the constraint that the injunction granted under it must retrain a person from engaging in conduct that constitutes or would constitute a contravention of Pt IV or V or one of the species of accessorial participation there listed.

The discretion of the court in formulating the terms in which a final injunction may be granted under s 80(1) is as wide as the phrase “as the court determines to be appropriate”.

That is not an unlimited discretion and must at least be confined by reference to the scope and purposes of the Act - Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492, 505;  Murphyores Incorporated Pty Ltd v The Commonwealth (1976) 135 CLR 1 at 23.”

The operation of the section was described by Gummow J in ICI Australia Operations Pty Limited v Trade Practices Commission (1992) 38 FCR 248 at 267 as follows:

“Section 80(1) confers upon the court the power to grant an injunction where it is satisfied that a person has engaged or is proposing to engage in conduct that constitutes or would constitute conduct of the description in pars (a)-(f).  The power of the court to grant an injunction is controlled by the words “in such terms as the court determines to be appropriate”.

Thus, the terms of the injunction will not be “appropriate” if, on its face, it operates upon a range of conduct some of which does, but some of which does not, have the relationship required by s 80 with contravention of the Act.  The injunction should not prohibit conduct falling outside the boundaries drawn by s 80:  see Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 at 161.  The same limitation applies to mandatory injunctive relief.  It is, in my view, no support for the grant of an injunction which, from the outset, has an operation outside the boundaries of s 80, to say that it is open for the party enjoined to apply under s 80(3) to vary the injunction so as to bring its operation wholly within proper limits.  The party in question should not be placed under any such obligation in the first place.”

French J said at 268:

“The Trade Practices Act 1974 (Cth) is concerned primarily with the protection of the public interest in the prevention of anti-competitive conduct in markets within Australia (Pt IV) and the fair treatment of consumers (Pt V).  Section 80 is a widely drawn remedial provision available to restrain conduct which may infringe upon that public interest by contraventions of provisions of the Act in Pt IV and Pt V.  The standing of persons, other than those whose proprietary interests may be affected by such conduct, to obtain injunctive relief is an indication of the regulatory function of this statutory remedy.  The special standing of the Minister and the Commission lends emphasis to that characterisation.”

....

“There is room within the statutory framework and the policy that underlies it for an injunction which is intended not to restrain an apprehended repetition of contravening conduct but to deter an offender from repeating the offence.  That deterrence is effected by attaching to the repetition of the contravention the range of sanctions available for contempt of court.  The possibility remains open, by virtue of s 80(3), that after a suitable period unmarked by further contravention the party restrained may apply to the court to rescind the order.

The remedy is flexible and may be applied in service of a variety of functions to support the policy of the Act.  This was a proper case for the grant of that relief.”

The public interest character of s 80 was also emphasized by Lockhart J at 255.

The width of the power conferred by s 80 and its public interest character obviously give the Court great amplitude in determining appropriate injunctive orders in a particular case.  However there are limitations on the Court’s power under the section.  Confinement of the power by reference to the scope and purpose of the TPA, and in particular s 80, is one limitation on the power.  However, there are at least two further limitations.  The power to make orders under s 80 is only enlivened in a proceeding which alleges that there has been a contravention of a provision of Part IV, IVA or V of the TPA.  As was said by Gummow J in ICI  at 267, the terms of an injunction granted under s 80 must, on their face, operate upon a range of conduct which has “the relationship required by s 80 with contravention of the Act”.  Irrespective of whether the injunction is sought or granted under s 80(1) or s 80(1AA) there must be a nexus between the conduct alleged or found to constitute the relevant contraventions and the injunctions granted.

Part IV and Parts IVA and V of the TPA deal with fundamentally different subject matters.  Part IV of the TPA is concerned primarily with prevention of anti-competitive conduct and promotion of competition in markets within Australia.  Parts IVA and Part V are concerned primarily with the fair treatment of consumers and fair trading.  It will be unusual for conduct which is alleged to contravene a provision of Parts IVA or V also to contravene a provision of Part IV and vice versa.  Accordingly, in general, it is difficult to envisage how injunctive relief that is appropriate in a proceeding based on an alleged contravention of Parts IVA and V could, appropriately, lead to orders enjoining conduct which relates to a contravention of a provision of Part IV unless the conduct in question also touches upon or involves a contravention of the particular provision of Part IV.  In such a case an injunction in relation to a provision of Part IV is unlikely to have the relationship required by s 80 with the actual or alleged contravention of the Act which enlivened the Court’s jurisdiction under s 80.  Put another way, the injunction would not be “appropriate” as there is not a sufficient nexus between the conduct, the subject of the injunction, and the conduct alleged or found to constitute a contravention of a provision of Part IV, IVA or V of the TPA.

The ICI case is a good example of the point.  ICI had previously contravened the resale price maintenance provisions of the TPA in relation to the supply by it of agricultural chemical products.  After a further contravention injunctions were ordered by the Full Federal Court, under s 80, restraining ICI from engaging in the practice of resale price maintenance in the manner alleged in the proceeding in respect of the supply by it of agricultural chemical products or in any similar manner.  The injunction, which was opposed by ICI, was determined to be appropriate as it was related to, and designed to prevent repetition of, the conduct which was alleged against ICI and found by the Court to have constituted a contravention of a provision of Part IV, being s 48.  Whilst the Court did not have to consider the issue arising in the present case, it is implicit in the decision that there be a nexus between the conduct enlivening the jurisdiction under s 80 and the orders made under the section.

There is also a constitutional limitation which operates to ensure that there is a relationship between the relief granted under s 80 and the case or controversy between the parties which gave rise to the exercise of jurisdiction under the section.  The Federal Court exercises judicial power under Ch III of the Constitution in a “matter”.  For present purposes, it is sufficient to state that, in its constitutional sense, a “matter” means the justiciable controversy or dispute, or the subject matter for determination, in a legal proceeding:  see Re  Judiciary Act 1903-1920 and Navigation Act 1912-1920 (1921) 29 CLR 257 at 265 and Fencott v Muller (1983) 152 CLR 570 at 602-610.  As was said by Gummow J in ICI at 264-5:

“Statutory provisions which create an injunctive remedy and invest jurisdiction to administer it in courts exercising federal jurisdiction are to be interpreted in the light of the limitations imposed by the term ‘matter’ in Ch III of the Constitution.  Similar questions arise under Art III of the Constitution of the United States.  This limits the federal judicial power to the resolution of ‘cases’ and ‘controversies’.”

and at 265-6:

“[Section 80] (and the other provisions of Pt VI) is to be read in such a way as to favour its operations within the limits imposed by Ch III:  see Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd (1981) 148 CLR 457 at 508-509, per Mason J.”

If the Court grants relief which has no nexus or relationship to the case or controversy before the Court it will not be exercising judicial power within the confines of Ch III of the Constitution.  Accordingly, orders under s 80 must have the requisite relationship with the case or controversy the subject of the proceeding in the Court.  Taking a broad view, the case or controversy in the present case relates to misleading or deceptive advertising and the making of representations by Z-Tek which are alleged to constitute contraventions of ss 52, 53(e) and 53C of the TPA.  Accordingly, any injunctive relief granted under s 80 must be related to, and in resolution of, that case or controversy.

In summary, in determining whether an injunction under s 80 is “appropriate” there are, at least, three limitations on the Court’s power.

First, the power is confined by reference to the scope and purpose of the TPA and in particular s 80.  It is within the scope and purpose of s 80 to grant injunctive relief which is designed to prevent a repetition of the conduct for which the relief is sought.

Secondly there is a contextual limitation within s 80 itself.  As the jurisdiction to grant an injunction is enlivened by an alleged or actual contravention of a provision of Part IV, IVA or V of the TPA, there must be a sufficient nexus or relationship between the contravention and the injunction granted.  It is that nexus or relationship that enables determination by the Court of whether the injunction sought is “appropriate”.

Thirdly, there is the constitutional limitation which requires that the injunction granted be related to the case or controversy the subject of the proceeding.

ARE TRADE PRACTICES COMPLIANCE PROGRAM ORDERS “APPROPRIATE” ORDERS UNDER SECTION 80?

In my view orders which are designed to prevent the repetition of the alleged or actual contravening conduct do not offend any of the three limitations on the exercise of power under s 80.  As the ICI case demonstrates, orders are commonly made which prevent such repetition by restraining the conduct in question or “any similar conduct”.  However, orders designed to prevent the repetition of contravening conduct may also be indirect; a trade practices compliance program is an example of such an indirect order.  An order directing the implementation of a  compliance program should:

(a)        be in “clear and unambiguous terms which leave no room for the persons to whom they are directed to wonder whether or not their future conduct falls within the scope or boundaries of the injunction”:  see ICI per Lockhart J at 259;

(b)        relate to conduct which has a sufficient nexus or relationship to the actual or alleged contravention which has enlivened the jurisdiction under s 80.

Thus far I have approached the matter on the basis of principle.  However there is ample authority to support my conclusion that the making of orders or the acceptance of undertakings to implement a trade practices compliance program are within the power conferred on the Court by s 80:  see Australian Competition and Consumer Commission v N W Frozen Foods Pty Ltd (1996) ATPR 41-515, Australian Competition and Consumer Commission v Woolworths (Federal Court of Australia, Hill J, 3 July 1996, unreported), Trade Practices Commission v Amatek  (Federal Court of Australia, Lockhart J, 24 November 1994, unreported), Australian Competition and Consumer Commission v Pioneer Concrete Qld Ltd (1996) ATPR 41-457, Trade Practices Commission v Monier Roofing Limited (1996) ATPR 41-464 and Australian Competition and Consumer Commission v Hymix Industries Pty Ltd (1996) ATPR 41-465.  In most, but not all, of these cases the orders were made or the undertakings were proffered by consent and the compliance program was related to the TPA generally.  However, there was little or no discussion by the Court as to its jurisdiction to make such orders or to accept such undertakings under s 80.  Nevertheless, a number of judges of the Court have accepted that the making of orders requiring that an appropriate compliance program be implemented is within the scope and purpose of the power conferred by s 80.

SHOULD THE COURT MAKE THE TRADE PRACTICES COMPLIANCE PROGRAM ORDERS SOUGHT BY CONSENT

In Trade Practices Commission v Milreis Pty Ltd (No 2) (1978) 32 FLR 234 at 243 Franki J said:

“I do not think it is the function of the court to impede a settlement between parties legally represented and presumably well able to understand and evaluate the desirability of agreeing to a settlement, nor do I think it the function of the court to refuse to give effect to terms of settlement by refusing to make orders or to accept undertakings where those orders or undertakings are within the court’s jurisdiction to make and accept and are otherwise unobjectionable.”

See also French J in OD Transport at 509.

The orders in the present case are sought by consent to give effect to a settlement between parties legally represented and well able to understand and evaluate the desirability and appropriateness of the settlement.  There are no public interest factors against the making of the orders; cf:  OD Transport.

In such circumstances the Court would be inclined to make the orders sought if they are within the Court’s jurisdiction.  It is this last aspect which has caused me concern.  The trade practices compliance program agreed to relates to the TPA generally rather than to the specific provisions in Part V which are alleged to have been contravened by Z-Tek.  It was contended by counsel for the ACCC that the program was “appropriate” because it arose as a result of a breach of the TPA.  In my view the contention is based on an unwarranted and excessively broad view of s 80.  The jurisdiction to make orders under s 80 only arises as a result of advertising and representations by Z-Tek which are alleged to have contravened ss 52, 53(e) and 53C of the TPA.  As the order is sought under s 80(1AA) I do not have to be satisfied that the conduct contravened the particular provisions of the TPA.  Nevertheless, I must determine whether the orders are “appropriate”.

For the reasons discussed earlier any order requiring the implementation of a trade practices compliance program should be one which has a sufficient nexus or relationship to the conduct alleged to constitute a breach of a particular provision of the TPA.  Given that the orders are sought by consent I am prepared to take a broad view of the conduct which may fairly be described as misleading or deceptive advertising and the making of representations in contravention of ss 52, 53(e) and 53C of the TPA.  The compliance program, which the Court may order, should be no wider than one which is designed to prevent repetition of that conduct.

The orders sought require a compliance program in respect of all Parts of the TPA which will include, for example, Part IV and other Parts which have no connection whatsoever with the alleged conduct giving rise to the case or controversy in the Court.  In my view it is not appropriate to make orders which require a compliance program which relates to conduct other than the alleged contravening conduct as characterised by the Court.

The parties requested that orders for the compliance program be made in the form submitted to the Court as part of their settlement but indicated that if the Court declined to make those orders then they would not oppose the Court making more confined orders subject to the ACCC not losing any right of appeal it would otherwise have.

For the reasons I have set out I am not prepared to give effect to the settlement of the parties by making orders for a trade practices compliance program in the terms submitted by the parties by consent.  However, on the material before me, I am satisfied that Z-Tek has contravened provisions of Part V of the TPA, as alleged by the ACCC, and that these contraventions have enlivened the jurisdiction of the Court to grant injunctions under s 80(1).  I am prepared to make orders which limit the compliance program to the provisions of Part V of the TPA that have been contravened.

I would add that I considered ordering a compliance program in respect of Part V generally but decline to do so for much the same reason as I was not prepared to order a compliance program in respect of Part IV or, indeed, any other Part of the TPA.  Whilst Part V deals generally with consumer protection and fair trading, the conduct enlivening the Court’s jurisdiction under s 80 in the present case is as far removed from a number of provisions of Part V, eg pyramid selling (s 61), as it is from the provisions of Part IV.  In all the circumstances it seems to me that, in principle, the order under s 80(1) should be confined to a program which is designed to prevent a repetition of the contravening conduct or any similar conduct.  In determining that it is “appropriate” to make orders for a compliance program in broad terms by reference to advertising or representations in contravention of ss 52, 53(e) and 53C I have attached considerable weight to the fact that the parties agreed to and sought a trade practices compliance order in wider terms and did not oppose the making of an order in more confined terms if the Court was not disposed to make the orders sought by consent.

DISCRETION

If my view as to the limitation on the power to grant injunctive relief under s 80 is wrong I would exercise my discretion against making the orders sought by consent in any event.  The Court is not a law enforcement agency of the Executive.  If the ACCC wants to impose a general trade practices compliance program as a term of settlement it may be open to it to do so by agreement.  However, it is an entirely different matter for the Court to exercise its judicial power to give effect to such terms of settlement by way of Court order.  I would therefore refuse to make the orders sought as a matter of discretion essentially for the same reasons I have given for concluding that those orders are not “appropriate”.

CONCLUSION

For these reasons I am not prepared to make the orders sought by consent that, under s 80(1AA) of the TPA, Z-Tek implement a trade practices compliance program in the form specified in the attachment to the draft minutes of consent order which I have set out earlier in these reasons.  However, I am prepared to make orders under s 80(1) that Z-Tek is to implement a trade practices compliance program in a more limited form.  The main limitation is that the program is not to relate to the TPA generally.  Rather, it is to relate to misleading or deceptive advertising or the making of representations in contravention of ss 52, 53(e) and 53C of the TPA.

My decision relates to what is “appropriate” for a Court to order under s 80 as part of an agreed settlement of a proceeding in the Court.  It is not intended that the decision govern, influence or limit a trade practices compliance program which might be the subject of agreement between the ACCC and a party to a proceeding rather than the subject of a court order under ss 80(1) or 80(1AA).  I would add that the issue of whether orders to implement a trade practices compliance program should be made under s 80(1), when the making of the orders is opposed, is a matter for another day.

Associate:

Dated: