FEDERAL COURT OF AUSTRALIA

Village Building Company Limited v Canberra International

Airport Pty Limited & Ors [2003] FCA 1195

PRACTICE AND PROCEDURE – Federal Court Rules – application for separate trial of questions of law – s 52 of Trade Practices Act 1974 (Cth) – whether “carrying on a business” and “in trade or commerce” – whether just and convenient to make an order under O 29 r 2.

Trade Practices Act 1974 (Cth), s 52

Federal Court Rules, O 29 r 2

Olbers v Commonwealth of Australia (No 3) [2003] FCA 651 applied

Reading Australia Pty Ltd v Australian Mutual Provident Society [1999] FCA 718 applied

Robin Pty Ltd v Canberra International Airport Pty Ltd (2001) 179 ALR 449 cited

THE VILLAGE BUILDING COMPANY LIMITED ACN 056 509 025 v CANBERRA INTERNATIONAL AIRPORT PTY LIMITED ABN 14 080 361548, AIRSERVICES AUSTRALIA

A59 OF 2002

FINN J

29 OCTOBER 2003

CANBERRA

THE COURT ORDERS THAT:

              1.       On the First Respondent’s notice of motion, the question whether the conduct complained of in paragraphs 13, 15, 17A and 18 of the Further Amended Statement of Claim was in trade or commerce be decided separately and before the trial of any other question in this proceeding (other than those questions ordered to be tried separately by order 1 of the Orders of 29 August 2003 and by these orders).

              2.       On the Second Respondent’s notice of motion, the question whether the conduct complained of in paragraph 23 of the Further Amended Statement of Claim was in trade or commerce be decided separately and before the trial of any other question in this proceeding (other than those questions ordered to be decided separately by order 1 of the orders of 29 August 2003 and by these orders).

              3.       Costs of the separate motions be reserved.

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

REASONS FOR JUDGMENT

1                     This proceeding concerns aircraft noise and rezoning of land.  The applicant, The Village Building Company Ltd (“Village”), is a land development company which owns land in New South Wales near Queanbeyan known as “Tralee North” and “Tralee South”.  This land is presently zoned for rural and environmental uses.  Village has applied to have it re-zoned for use for residential purposes.

2                     The first respondent, Canberra International Airport Pty Ltd (“CIA”), is the lessee and operator of Canberra Airport and the developer of the airport site.  The second respondent, Airservices Australia (“AsA”) is a body corporate established by s 7 of the Air Services Act 1995 (Cth)(“the Act”).  One of its functions undertaken pursuant to a direction of 3 May 1999 of the then Minister for Transport and Regional Services was to endorse (inter alia) Australian Noise Exposure Forecasts (“ANEFs”) for all Australian airports.  An ANEF is a contour map joining points of equal noise exposure in the vicinity of an airport.  In January 2002, AsA endorsed for technical accuracy CIA’s ANEF 2050. 

3                     Village’s application alleges separate and distinct contraventions by CIA and AsA respectively of s 52 of the Trade Practices Act 1974 (Cth) (“the TP Act”) for which injunctive relief is sought under s 80 of that Act.  I will outline below the conduct of each of the respondents which is impugned in the proceeding.

4                     Both respondents have filed notices of motion seeking orders under O 29 r 2 of the Federal Court Rules seeking the separate determination of the questions:

(i)         in the case of CIA, whether its conduct of which complaint is made was “in trade or commerce” as required by s 52 of the TP Act;

(ii)        in the case of AsA, whether its conduct in endorsing the ANEF 2050 was engaged in as part of the carrying on of a business by it for the purposes of s 2A of the TP Act and, if it was, whether that conduct was in trade or commerce for the purposes of s 52 of that Act.

5                     I merely note in passing that the question raised in CIA’s motion and either of the questions raised in AsA’s would, if answered favourably to either of the respective respondents, be a complete answer to Village’s claim against that respondent.  AsA, I should add, is only subject to the provisions of the TP Act “in so far as it carries on a business”:  s 2A(2) of the TP Act.

6                     It is necessary to deal with each motion separately.  I will, for convenience, deal first with that of AsA but before so doing I will refer briefly to O 29 r 2 and the discretion it confers.

Order 29 rule 2

7                     Sub rules 1 and 2 of O 29 provide:

“1.       In this Order, question includes any question or issue in any proceeding, whether of fact or law or partly of fact and partly of law, and whether raised by pleadings, agreement of parties or otherwise.

2.         The Court may make orders for –

            (a)        the decision of any question separately from any other question, whether before, at or after any trial or further trial in the proceedings;  and

            (b)        the statement of a case and the question for decision.”

8                     The principles governing the circumstances in which an order will be made under O 29 r 2 are, as Branson J noted in Reading Australia Pty Ltd v Australian Mutual Provident Society [1999] FCA 718 at [8], “relatively well established”.  In summarising those “principles” Her Honour referred (inter alia) to the following which I gratefully adopt for present purposes:

“(d)     where the preliminary question is one of mixed fact and law, it is necessary that the question can be precisely formulated and that all of the facts that are on any fairly arguable view relevant to the determination of the question are ascertainable either as facts assumed to be correct for the purposes of the preliminary determination, or as agreed facts or as facts to be judicially determined (Jacobson v Ross [1995] 1 VR 337 at 341, referring to Nissan v Attorney-General [1970] AC 179 at 242-243 per Lord Pearson;  Bass v Permanent Trustee [Co Ltd [1999] HCA 9] at para 53);

…

(f)        factors which tend to support the making of an order under O 29 r 2 include that the separate determination of the question may –

              (i)       contribute to the saving of time and cost by substantially narrowing the issues for trial, or even lead to disposal of the action;  or

              (ii)      contribute to the settlement of the litigation (CBS Productions Pty Ltd v O’Neill (1985) 1 NSWLR 601 per Kirby P at 607);

(g)         factors which tell against the making of an order under O 29 r 2 include that the separate determination of the question may –

              (i)       give rise to significant contested factual issues both at the time of the hearing of the preliminary question and at the time of trial (GMB Research & Development Pty Ltd v The Commonwealth [1997] FCA 934;

              (ii)      result in significant overlap between the evidence adduced on the hearing of the separate question and at trial – possibly involving the calling of the same witnesses at both stages of the hearing of the proceeding (GMB Research & Development Pty Ltd v The Commonwealth;  Arnold v Attorney-General for Victoria [1995] FCA 727).  This factor will be of particular significance if the Court may be required to form a view as to the credibility of witnesses who may give evidence at both stages of the hearing of the proceeding;  or

              (iii)     prolong rather than shorten the litigation (GMB Research & Development Pty Ltd v The Commonwealth).

9                     The issue, ultimately, is whether it is just and convenient for the order to be made:  Reading Australia, at [9].  In this particular regard should be had to “efficient case management”:  Olbers v Commonwealth of Australia (No 3) [2003] FCA 651 at [8].

AsA’s motion

10                  I have already ordered that the first of the two questions raised by the motion be decided separately, ie whether the conduct of AsA in endorsing for technical accuracy the ANEF 2050 was engaged in as part of “the carrying on of a business” for the purposes of s 2A of the TP Act.

11                  The outstanding question is whether I should order the separate determination of the question whether AsA in so endorsing the ANEF was acting in trade or commerce for s 52 purposes.  This question, I should emphasise, would only arise if AsA was unsuccessful on the “carrying on a business question”.  Nonetheless the determination of it favourably to AsA would itself be a complete answer to Village’s application against it.

12                  Given (i) that last consideration, (ii) that AsA has indicated that the evidence it will rely upon for this question will be “to a large extent, if not entirely that led on the carrying on a business question” and (iii) that Village has not sought positively to oppose AsA’s motion, I am satisfied that the order sought should be made.  It is manifestly just and efficient for this question to be tried separately and at the same time as the carrying on a business question.

CIA’s motion

13                  Village has in four distinct respects pleaded that CIA has engaged in conduct contravening s 52.  It is necessary to set out part of the relevant paragraphs of the pleading in detail given the contentions that have been advanced by both parties to the motion.

14                  First, para 13 of the Further Amended Statement of Claim is in the following terms:

“The First Respondent has engaged in misleading and deceptive conduct or conduct which is likely to mislead or deceive by publicly claiming that the ANEF contours which are applicable and are “in force” at Canberra Airport are the ANEF 2050 when those ANEF contours are not properly or validly applicable to the Canberra Airport in accordance with AS 2021.

Particulars

The ANEF 2050 said to be applicable by the First Respondent for Canberra Airport:

              a)       Does not comply with or meet the required definition for ANEF in AS 2021-2000 as set out in paragraphs 5C, 5D and 5E therein;

              b)       Has not been endorsed or properly or validly endorsed by AirServices Australia or the Department of Defence in accordance with part A3 of AS 2021-2000;  and

              c)       the average aircraft movements used to constitute “ultimate capacity” for Canberra Airport in the 2050 ANEF have been improperly determined in that they cannot be achieved without:

                        i.          Expanding terminal space;

                        ii.         Expanding passenger handling facilities;

                        iii.        Increasing the length of the main north/south runway;

                        iv.        Expanding the system of taxiways;

                        v.         Expanding the Canberra Airport leased area;

                        vi.        Moving Pialligo Avenue;  and

                       vii.        No approvals have been given for these matters either under the Airports Act 1996 and subordinate legislation or by the ACT Government, or otherwise;  and

                       viii.       In the alternative, if the assessment of “ultimate capacity” for the purposes of preparing the First Respondent’s ANEF 2050 has been based on the assumption that the changes set out (c.vi) will be implemented, that assessment is not consistent with the determination of “ultimate capacity” of the existing airport.

              d)      Are not based on “firm forecasts”.

15                  Secondly, paragraph 15 was in the terms that:

“In July 2002, the First Respondent circulated a letter to members of the public, members of the Queanbeyan City Council and to members of Parliament:-

              a)       stating, “AirServices Australia has now advised us that ICAO (the International Civil Aviation Organisation) will be approving procedures facilitating the use of GPS precision approach paths into airports within the next three years”.

              b)       stating, “We believe this would see landing aircraft fly over the rural properties of Tralee and Environa before joining the runway centre line at approximately 3.5 nautical miles from the airport” and

              c)       attaching a map showing an offset approach flight path intercepting the runway centreline at a point one nautical mile out from the airport.”

16                  The representations as made were particularised as constituting contravening conduct in the following ways:

“a)      AirServices Australia did not make the statement pleaded in paragraph 15(a).

b)         If the off-set flight-paths join the runway centreline at 3.5 nautical miles, it does not pass over Tralee.

c)         It is not permissible for an approach path to intercept the runway centreline only 3.5 nautical miles from Canberra Airport.

d)         The representations on the map of an aircraft joining the runway centreline at one nautical mile from the Canberra Airport shows aircraft flying closer to Tralee land than would be the case if the map represented the permissible approach to Canberra Airport.”

17                  Thirdly, it is pleaded in paragraph 17A that:

“On 9 October 2002, the First Respondent, its servants or agents displayed overhead projections and circulated charts to people at a public meeting, which indicated that Brisbane, Melbourne and Adelaide flights landing at Canberra Airport from the south could join the runway centreline at 2.5 to 4 miles from Canberra Airport.”

The manoeuvre so represented is alleged to be impermissible and would not be permitted as it would be unsafe.  It is said that CIA had no reasonable grounds for making the representation.

18                  Fourthly, paragraph 18 alleges that:

“On or about 27 September 2002, the First Respondent, its servants or agents informed relevant members of staff of Queanbeyan Age newspaper or caused to be published in the Queanbeyan Age newspaper matter, the import of which was that the Federal Minister for Transport agreed that complaints from future residents of Tralee would mean a redistribution of aircraft flight paths and that there was Federal bi-partisan support that Tralee should not be re-zoned.”

This conduct is claimed to contravene s 52 because the import of the two representations made was false.

19                  I should note the following in passing.  First, the matters particularised to demonstrate the misleading or deceptive character of the four pleaded species of conduct are unlikely to have any significant bearing upon the question whether that conduct was in trade or commerce.  Secondly, the factual issues on the misleading or deceptive question are likely to be complex (especially in relation to the ANEF 2050) and time consuming.

Submissions and Conclusions

20                  CIA concedes it has an interest in the outcome of the applicant’s rezoning application as residential subdivision of Tralee can be expected to lead to more noise complaints in relation to aircraft noise.  It, nonetheless, contends that the second, third and fourth of the contraventions alleged were of conduct engaged in for the purpose of public debate.  That conduct was not engaged in in the context of some commercial transaction or activity:  Robin Pty Ltd v Canberra International Airport Pty Ltd (2001) 179 ALR 449.  Distinctly, the status and character of the ANEF 2050 are to be determined, it is said, in the setting of the legislative scheme in which the ANEF has been produced and the question whether the conduct alleged in respect of it was in trade or commerce is a discrete and narrow one.  It is submitted that nothing has been alleged against CIA in its trading or commercial dealings with people in the course of the provision of the airport’s services and amenities.  And, it is contended, there is little overlap between the factual matters involved in the trade or commerce question and the question whether the conduct was misleading or deceptive.  While the former question would involve a hearing time of days, the hearing of both together would be likely to consume weeks.  Justice and efficiency favour the separate determination of the trade or commerce question.

21                  Village’s contentions on the motion essentially were these.  (i) Hearing the separate question will result in the inconvenience, at least on the ANEF issue, of the same expert witnesses having to give evidence on separate occasions.  (ii) To determine the preliminary question there will need to be presented extensive evidence concerning both CIA’s conduct and its business and commercial activity and Village’s commercial activity so as to establish the interrelationship between the two.  In providing material on the separate question almost all of that required to establish the misleading or deceptive character of CIA’s conduct will have been raised if not fully laid out.  (iii) Delay is a serious issue as the rezoning issue is before the relevant planning authorities in New South Wales.  (iv) The correctness of Robin’s case will in any event be in issue with the consequence that, even if the separate question were decided adversely to Village on the basis of Robin,an appeal would be likely to be lodged with the consequence of further delay in the final resolution of the matter.

22                  For my own part I am in broad agreement with CIA’s contentions.  The matter is one in which effective case management favours the hearing of the separate question.  When one weighs the potential saving in costs and court time against such delay as might be occasioned if the question was decided adversely to CIA, the balance in my view comes down decisively in favour of the separate hearing.  This is the more so as that question, if decided favourably to CIA, will provide an answer to Village’s application against CIA.

23                  While I accept that there will of necessity be evidence adduced on the separate question relating to the nature and purpose of CIA’s ANEF 2050 I am far from satisfied that it will bear significantly on contravention issues.

24                  The need for expert witnesses to be called on separate occasions is unfortunate.  But given the distinctive issues raised in this matter, I do not consider that that need outweighs the manifest convenience of determining the separate question.

Orders

25                  On CIA’s notion of motion, I will order that the question whether the conduct complained of in paragraphs 13, 15, 17A and 18 of the Further Amended Statement of Claim was in trade or commerce be decided separately and before the trial of any other question in this proceeding (other than those questions ordered to be decided separately by order 1 of the orders of 29 August 2003 and by these orders).

26                  On AsA’s motion, I will order that the question whether the conduct complained of in paragraph 23 of the Further Amended Statement of Claim was in trade or commerce be decided separately and before the trial of any other question in this proceeding (other than those questions ordered to be decided separately by order 1 of the orders of 29 August 2003 and by these orders).

27                  I will reserve the costs of the separate motions.

Associate:

Dated:              28 October 2003