FEDERAL COURT OF AUSTRALIA

Energex Limited v Alstom Australia Limited [2004] FCA 575

PRACTICE AND PROCEDURE – pleadings – application for summary judgment or strike out of statement of claim – whether allegations under s 82(1) of Trade Practices Act 1974 (Cth) statute barred under s 82(2) – whether cause of action accrues at time agreement to purchase goods entered into, or when loss and damage discovered – whether limitation defence should be dealt with at interlocutory stage – whether allegations under ss 80 and 87 included in order to circumvent limitation period – whether those allegations fail to disclose cause of action, are frivolous or vexatious, or abuse of process – whether failure to plead essential elements of tort of deceit

WORDS & PHRASES – “in trade or commerce” – s 51AC of Trade Practices Act 1974 (Cth) – whether reliance upon limitation defence constitutes conduct in trade or commerce

Trade Practices Act 1974 (Cth) Pt IV and ss 45, 51AC, 80, 82, and 87

ACCC v ABB Transmission and Distribution Limited (2001) ATPR 41-815 referred to

ACCC v ABB Transmission and Distribution Limited (2001) ATPR 41-839 referred to

Gould v Vaggelas (1985) 157 CLR 215 referred to

State of Queensland v Pioneer Concrete (Qld) Pty Ltd (1999) ATPR 41-691 referred to

Wardley Australia Limited v Western Australia (1992) 175 CLR 514 applied

Arcadi v Colonial Mutual Life Assurance Society Ltd (1984) ATPR 40-473 referred to

Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 referred to

Torrens Aloha Pty Ltd v Citibank NA (1997) 72 FCR 581 referred to

Keen Mar Corporation Pty Ltd v Labrador Park Shopping Centre Pty Ltd (1988) ATPR 

40-853 referred to

Australian Iron & Steel Ltd v Hoogland (1962) 108 CLR 471 referred to

Mayne Nickless Ltd v Multigroup Distribution Services Pty Ltd (2001) 114 FCR 108 discussed

Williams v Spautz (1992) 174 CLR 509 referred to

Walton v Gardiner (1993) 177 CLR 378 referred to

James v ANZ Banking Group Ltd (1986) 64 ALR 347 referred to

Karedis Enterprises Pty Ltd v Antoniou (1995) 59 FCR 35 applied

Potts v Miller (1940) 64 CLR 282 referred to

Jobbins v Capel Court Corporation Ltd (1989) 25 FCR 226 referred to

ACCC v CG Verbatis Holdings Pty Ltd (2001) ATPR 41-802 referred to

Multigroup Distribution Services Pty Ltd v TNT Australia Pty Ltd (1996) ATPR 41-522 referred to

Sammy Russo Supplies Pty Ltd v Australian Safeway Stores Pty Ltd (1998) ATPR 41-641 referred to

Western Australia v Wardley Australia Ltd (1991) 30 FCR 245 applied

Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 referred to

I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 referred to

Cartledge v E Jopling & Sons Ltd [1963] AC 758 discussed

Blacker v National Australia Bank Ltd (2001) ATPR 41-817 referred to

Troulis v Vamvoukakis (unreported, NSW Court of Appeal, 27 February 1998) referred to

Williams v Commonwealth Bank of Australia [1999] NSWCA 345 referred to

Sutherland Shire Council v Heyman (1985) 157 CLR 424 referred to

Hawkins v Clayton (1988) 164 CLR 539 discussed

Brunninghausen v Glavanics (1999) 46 NSWLR 538 referred to

Dey v Victorian Railways Commissioners (1949) 78 CLR 62 applied

General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 applied

Webster v Lampard (1993) 177 CLR 598 referred to

McKellar v Container Terminal Management Services Ltd (1999) 165 ALR 409 applied

Bank Commerciale SA (In Liq) v Akhil Holdings Ltd (1990) 169 CLR 279 referred to

Murphy v Overton Investments Pty Ltd (2004) 204 ALR 26 discussed

Little v Law Institute of Victoria & Ors (No 3) [1990] VR 257 applied

Re Ku-ring-gai Co-operative Building Society (No 12) Ltd (1978) 22 ALR 621 referred to

Australian Associated Motor Insurers Ltd v NRMA Insurance Ltd (2002) 124 FCR 518 referred to

Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 applied

The Commonwealth v Verwayen (1990) 170 CLR 394 referred to

Atlantic City Electric Co v General Electric Co 312 F2d 236 (1962) referred to

Bailey v Glover 88 US 342 (1874) referred to

Scarcella v Lettice (2000) 51 NSWLR 302 discussed

Imperial Gas Light and Coke Co v London Gas Light Co (1854) 10 Exch 39; 156 ER 346 referred to

Hunter v Gibbons (1856) 1 H & N 459; 156 ER 1281 referred to

Armstrong v Milburn [1886-90] All ER Rep 596 referred to

R v McNeil (1922) 31 CLR 76 referred to

Metacel Pty Ltd v Ralph Symonds Ltd (1969) 90 WN (Pt 1) (NSW) 449 referred to

Gibbs v Guild (1882) 9 QBD 59 referred to

Cubillo v Commonwealth (1999) 89 FCR 528 referred to

Noble v Victoria [1999] QCA 110 referred to

Director of Public Prosecutions v Ray [1974] AC 370 discussed

Smith v Hughes (1871) LR 6 QB 597 referred to

Lord Brennan & W Blair, Bullen & Leake & Jacob’s Precedents of Pleadings, 14^th ed, Vol 2, London, Sweet & Maxwell, 2001

I C F Spry, The Principles of Equitable Remedies, 5^th ed, Australia, LBC Information Services, 1997

R Meagher, D Heydon & M Lemming, Meagher, Gummow & Lehane’s Equitable Doctrines & Remedies, 4^th ed, Australia, Butterworths Lexis Nexis, 2002

ENERGEX LIMITED (ACN 078 849 055) v ALSTOM AUSTRALIA LIMITED (ACN 000 215 092), REXEL AUSTRALIA LIMITED (ACN 000437 758), RICHARD ELLIOT, PAUL BRAGHAM, COLIN JAMES, WILSON TRANSFORMER COMPANY PTY LTD (ACN 004 216 979), ROBERT WILSON, DAVID PECK, ABB TRANSMISSION AND DISTRIBUTION LIMITED (ACN 000 169 568), DOUGLAS PITT, CHRIS TAPE, DAVID TOOGOOD, GRAHAM JONES, RUSSELL ELLEN, RAYMOND BOYCE, SCHNEIDER ELECTRIC (AUSTRALIA) PTY LTD (ACN 004 969 304), RUSSELL STOCKER, ASHLEY SMOUT and WENDY MINNE

V409 of 2003

WEINBERG J

7 MAY 2004

MELBOURNE

THE COURT ORDERS THAT:

1.                  The notice of motion filed on behalf of the first, second, third, fourth and fifth respondents on 20 August 2003, and amended on 15 October 2003, be dismissed.

2.                  The notice of motion filed on behalf of the sixth and seventh respondents, on 20 August 2003, be dismissed.

3.                  The notice of motion filed on behalf of the sixteenth, seventeenth, eighteenth and nineteenth respondents, on 28 August 2003, be dismissed.

4.                  The matter be stood over to 16 June 2004 at 9.30 am in order to determine any issue of costs, and to give directions for the future conduct of this proceeding.

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

REASONS FOR JUDGMENT

introduction

1                     In this proceeding, various respondents have sought either summary judgment against the applicant, or failing that, to have the applicant’s statement of claim, filed on 26 May 2003, struck out. The applications are brought by notice of motion. The first notice of motion was filed on behalf of the first to fifth respondents on 20 August 2003. An amended notice of motion was filed in Court on 15 October 2003. The second notice of motion was filed on behalf of the sixth and seventh respondents on 20 August 2003. The third notice of motion was filed on behalf of the sixteenth to nineteenth respondents on 28 August 2003.

2                     The applicant, Energex Limited (“Energex”), is an electricity utility that has, for many years, engaged in the purchase of electricity transformers. There are two types of electricity transformers: power transformers, which are used to transform large amounts of electrical power at high voltages; and distribution transformers, which are used in applications for smaller amounts of electrical power at lower voltages.

3                     Energex was originally known as the South East Queensland Electricity Board (“SEQEB”) being a body corporate established under the Electricity Act 1976 (Qld). On 1 July 1977, SEQEB was constituted as a body corporate capable of suing and being sued. On 9 September 1994, the South East Queensland Electricity Corporation (“SEQEC”) was established under the Government Owned Corporations (Queensland Transmission and Supply Corporation) Regulation 1994 (Qld), and assumed the rights and liabilities of SEQEB. On 1 July 1997, SEQEC became an unlisted public company, and was renamed the South East Queensland Electricity Corporation Limited. On 29 July 1998, the company changed its name to Energex Limited.

4                     Energex has existed, in one form or another, since at least 1 July 1977. Since 1993, it has been a state owned corporation operating under the provisions of the Government Owned Corporations Act 1993 (Qld). It carries on the business of distributing and retailing electricity and other energy products. It supplies these products in Queensland, as well as other parts of Australia.

5                     The respondents to this proceeding are either companies engaged in the manufacture and supply of power and distribution transformers, or individual members of their senior management.

6                     The first respondent, Alstom Australia Limited (“Alstom”), was formerly named GEC-English Electric Pty Ltd from 1 October 1957 until 17 July 1989. It was renamed GEC Alsthom Australia Limited, and kept that name between 18 July 1989 and 21 June 1998, when it became known as Alstom. It has carried on business from its factory site at Rocklea, in Queensland, since 1989.

7                     The second respondent, Rexel Australia Limited (“Rexel”), was formerly named GEC Australia Limited from 7 February 1978 until 4 February 1998. Between 1980 and 1989 it carried on business from the Rocklea site.

8                     The third, fourth and fifth respondents, Messrs Richard Elliot, Paul Brabham and Colin James, are all executives or directors, past or present, of Alstom.

9                     I shall refer to the first, second, third, fourth and fifth respondents as “the Alstom respondents”.

10                  The sixth respondent, Wilson Transformer Company Pty Ltd (“WTC”), has carried on business from its two factories in Glen Waverley and Wodonga, in Victoria, since at least 1980.

11                  The seventh respondent, Mr Robert Wilson, has at all relevant times been the managing director of WTC.

12                  I shall refer to the sixth and seventh respondents as “the Wilson respondents”.

13                  The eighth respondent, Mr David Peck, was formerly a sales and marketing manager with WTC. He ceased employment with that company in 1995. He is not a party to any notice of motion presently before the Court.

14                  The ninth respondent, ABB Transmission and Distribution Limited (“ABBTDL”), was formerly named Tyree Industries Ltd from 2 February 1956 until 21 April 1993. On that date, its name changed to ABB Transmission Limited. On 21 December 1995, it changed its name again and became ABBTDL. ABBTDL, under whatever name, was at all times the holding company of an entity originally named Tyree Electrical Co Ltd (“TEC”), which later changed its name to ABB Power Transmission Pty Ltd (“ABBPT”). That company carried on business from its various factories in Moorebank in New South Wales, in Darra in Queensland, and in Perth. ABBPT eventually went into liquidation.

15                  The tenth, twelfth and fourteenth respondents, Messrs Douglas Pitt, David Toogood, and Russell Ellen, all at various times held senior managerial positions at ABBPT or ABBTDL. So too did the eleventh and thirteenth respondents, Messrs Chris Tape and Graham Jones. Neither Mr Tape nor Mr Jones have yet been served with any process. They are not therefore formally parties to this proceeding and, self evidently, are not parties to any notice of motion currently before the Court.

16                  I shall refer to the ninth, tenth, twelfth and fourteenth respondents as the “ABB respondents”. The ABB respondents are not parties to any notice of motion before the Court. They were, however, represented briefly before me at the commencement of the hearing of these applications. They indicated that they proposed to await the outcome of the various challenges brought by the other respondents before deciding upon their own course of action.

17                  The fifteenth respondent, Mr Raymond Boyce, has not yet been served by the applicant. Nothing more need be said about his position at this stage.

18                  The sixteenth respondent, Schneider Electric (Australia) Pty Ltd (“Schneider”), was formerly named Telemecanique (Australia) Pty Ltd from 19 December 1972 until 29 December 1992. It was named Schneider Pty Ltd from 30 December 1992 until 1 March 1999, and has been named Schneider Electric (Australia) Pty Ltd since 2 March 1999. In 1993, Schneider acquired all the issued shares in Australian Standard Electrical Transformers Pty Ltd (“ASET”), a company that from 1980 to 1993 manufactured and supplied distribution transformers from a factory in Benalla, in Victoria. Since 1993, Schneider has carried on that business that from factory.

19                  The seventeenth, eighteenth and nineteenth respondents, Messrs Russell Stocker, and Ashley Smout and Ms Wendy Minne, have all, at various times, held senior management positions with Schneider.

20                  I shall refer to the sixteenth, seventeenth, eighteenth and nineteenth respondents as “the Schneider respondents”.

the factual Background

21                  Energex claims that since about 1980, it, together with others, has engaged in the purchase of electricity transformers from the various corporate respondents. It identifies those from whom it has purchased the transformers as being:

·                    GEC from 1980 to 1989, and Alstom thereafter;

·                    WTC since 1980; and

·                    ABBPT from 1980 to 1996, and ABBTDL thereafter.

22                  In addition, Energex claims that it purchased distribution transformers from ASET from 1980 to 1993, and from Schneider thereafter.

23                  Energex claims that there has, at all material times, been a market in Australia for the supply of power and distribution transformers. The purchasers of these transformers have included electricity utilities, and large industrial and mining companies. Energex describes this market as “the transformer market”. Alternatively, it alleges that two separate markets, one for the supply of power transformers, and the other for the supply of distribution transformers, have, at all material times, existed in Australia.

24                  Energex claims that there was competition among the corporate respondents in relation to the supply of these transformers. It alleges that, from 1980 onwards, acting under the auspices of Australian Electrical and Electronic Manufacturers Association Limited (“AEEMA”), a company limited by guarantee, and through a Division known as the “Power and Distribution Transformers Division”, the corporate respondents entered into a series of unlawful agreements, arrangements or understandings relating to the supply of transformers. Energex describes these agreements, arrangements or understandings as “the Transformer Arrangement”.

25                  The Transformer Arrangement was, in substance, a classic case of collusive tendering. The corporate respondents agreed that they would allocate tenders for the production and supply of transformers among themselves with a view to each of them maintaining their share of sales of power and distribution transformers. They would achieve this object by ensuring that the selected manufacturer submitted a tender at a lower assessed annual value (“AAV”) than the tenders submitted by other manufacturers, or by those manufacturers not submitting a tender. The lower AAV would be achieved by the manufacturers discussing their tenders with each other, thereby ensuring that those tenders yielded a higher AAV than that of the selected manufacturer. Energex sets out in its statement of claim a series of detailed particulars from which the existence of such an agreement, arrangement or understanding is to be inferred.

26                  Alternatively, Energex pleads the existence of a “Pre-1993 Power Transformer Arrangement”. The parties to that arrangement are said to have been GEC, WTC and TEC. Energex claims that the arrangement involved those companies agreeing to allocate forthcoming tenders for the production and supply of power transformers amongst themselves with a view to each maintaining its share of sales. The shares of sales to be maintained were 45% to TEC, 32% to GEC, and 23% to WTC. The method by which this would be achieved was essentially the same as for the Transformer Arrangement.

27                  The statement of claim sets out, in voluminous detail, the circumstances under which it is alleged that either the Transformer Arrangement, or the Pre-1993 Power Transformer Arrangement, came to be implemented.

28                  Energex also pleads a third case, once again in the alternative. It alleges in par 179 of the statement of claim that in 1993, ABBPT, WTC and Tyree Transformers Pty Ltd (“Tyree”) (a company not a party to these proceedings) made an agreement or arrangement, or arrived at an understanding. It refers to this arrangement as “the 1993 Distribution Transformer Arrangement”. As with the other arrangements alleged, it pleads that those companies agreed that they would not compete with each other for contracts let to tender for the production and supply of distribution transformers, with a view to each of them maintaining their share of sales of those transformers. Again, the method adopted was similar to that previously outlined.

29                  To complicate matters further, Energex also pleads a fourth alternative case. It alleges that in 1995, there came into existence what it describes as “the 1995 Distribution Transformer Arrangement”. It is unnecessary, for present purposes, to attempt to summarise the salient features of that arrangement. They are broadly similar to those of the first three arrangements pleaded.

the statement of claim

30                  The statement of claim is a complex document. It runs for 121 pages and contains 408 paragraphs. Many of these paragraphs contain a large number of sub-paragraphs. It refers to literally hundreds of meetings, conversations, or other communications, and it would take an inordinate amount of time even to attempt to summarise the broad scope of the allegations contained therein. It should be noted, however, that the allegations of unlawful conduct extend over a period of about twenty years, throughout the 1980s and 1990s.

31                  There are, in substance, two causes of action pleaded. The first involves numerous breaches of s 45 of the Trade Practices Act 1974 (Cth) (“the Act”). As is well known, that section proscribes the making of contracts, arrangements or understandings that restrict dealings or affect competition. The second is a series of claims for the tort of deceit.

32                  As against the various corporate respondents, Energex claims that their conduct, as specified in its statement of claim, constituted in each case the making of an agreement, arrangement or understanding which contained an exclusionary provision in contravention of s 45(2)(a)(i). It further claims that this conduct constituted in each case the making of an agreement, arrangement or understanding which contained a provision to which s 45A(1) applied, and which accordingly had the purpose, or had or was likely to have the effect of substantially lessening competition for the supply of transformers in one or other of the markets pleaded. This is said to constitute a contravention of s 45(2)(a)(ii). Energex also relies upon s 45(2)(b)(ii). It alleges that the conduct of the corporate respondents fell within ss 80(1)(a), 82(1) and 87(1).

33                  Energex also claims that the conduct of the corporate respondents constituted in each case the giving effect to a provision of an agreement, arrangement or understanding which was an exclusionary provision in contravention of s 45(2)(b)(i), with the same consequences.

34                  Energex then pleads that it suffered loss or damage by reason of these contraventions. It identifies that loss or damage in the following way:

“381. The conduct referred to in paragraphs 362 to 380 hereof constituted the making of or the giving effect to arrangements between:

(a)                GEC, WTC, ABBPT, and Tyree from 1983 until early 1989;

(b)                Alstom, WTC, ABBPT, and Tyree from early 1989 until May 1995;

(c)                Alstom, WTC, ABBPT, Tyree and Schneider from May 1995 until 1 January 1996;

(d)                Alstom, WTC, ABBTDL, Tyree and Schneider since 1 January 1996.

382. In light of the matters referred to in paragraphs 31 to 60, and in light of accepted economic principles, such conduct resulted in the suppliers of transformers charging higher prices than they otherwise would have charged.

383. During the period from 1983 until 2002, the prices paid by SEQEB and ENERGEX for power transformers and distribution transformers exceeded the prices which would have prevailed but for the conduct referred to in paragraphs 362 to 380 hereof.

Particulars

The best particulars of those prices which can be provided by the Applicant before the completion of discovery are set out in Annexure B to this Statement of Claim.

384. The prices which would have prevailed but for the conduct referred to in paragraphs 362 to 380 hereof have been estimated by:

(a)                isolating the prices paid by SEQEB and ENERGEX for transformers over the period from 1983 to 2002;

(b)                estimating the costs of manufacturing transformers over the period from 1983 to 2002;

(c)                calculating the contribution margin, being the ratio of the price paid less the variable cost to the price paid, over that period;

(d)                identifying the lowest contribution margin to the transformer manufacturers over that period;

(e)                using the lowest contribution margin as an upper bound to the contribution margins which would have prevailed but for such collusive conduct;

(f)                 adding that contribution margin to variable costs to estimate the prices which would have prevailed but for the collusive conduct.

385. SEQEB and ENERGEX have suffered damage as a result of the price paid by them for power transformers and distribution transformers exceeding the prices which would have prevailed but for the conduct referred to in paragraphs 362 to 380 hereof.

Particulars

The damages are particularised in Annexure B to this Statement of Claim.”

35                  Finally, Energex turns to the ancillary liability of the individual respondents. This is particularised at pars 386-399 of the statement of claim.

36                  As noted earlier, Energex also pleads the tort of deceit. It alleges that from 1985 until 2002, it purchased transformers from GEC, Alstom, WTC, ABBPT, ABBTDL, Tyree and Schneider, pursuant to contracts awarded by the selection of a tenderer after completion of a public tender process. It alleges that each tenderer, by submitting a tender in response to an invitation to do so, represented that the price and other terms of the tender had been arrived at by the tenderer without any knowledge of the price and terms of any other tender, and was not the subject of any agreement, arrangement or understanding between the tenderer and any other manufacturer or supplier. It claims that these representations were implied, and that they were made with the intention of inducing either SEQEB or Energex to accept one of the tenders. It alleges that the representations were false, and that they were known to be false. It pleads dishonesty, in terms. It claims that it relied upon the representations, and suffered consequential loss and damage.

37                  The claim for deceit is set out at pars 400 to 406. Those paragraphs are in the following terms:

“400. During the period from 1985 until 2002, SEQEB and ENERGEX purchased transformers from GEC, Alstom, WTC, ABBPT, ABBTDL, Tryee and Schneider pursuant to contracts awarded by the selection of a tenderer after completion of a public tender process.

Particulars

Particulars of the tender reference numbers, the closing date for tenders, the tenders submitted and the identity of the successful tenderer are contained in Annexure A to this Statement of Claim.

401.          In relation to each such tender process:

(a)              Invitations to tender were published in a newspaper circulating in the Brisbane area.

(b)              The invitations specified the place at which copies of the tender documents would be provided.

(c)              The invitations specified that tenders had to be sealed.

(d)              The invitations specified the closing date and hour for tenders.

(e)              The invitations specified that tenders would be publicly opened immediately after the closing time for the tender.

402.          In submitting a tender in response to the invitation by SEQEB or ENERGEX, each tenderer, in respect of those tenders set out in Annexure A hereto, represented that the price and other terms of the tender submitted by it:

(a)              had been arrived at by the tenderer without any knowledge of the price and terms, or likely price and terms, of any other tender; and

(b)              was not the subject of any agreement, arrangement or understanding between the tenderer and any other manufacturer or supplier of the goods the subject of the tender;

Particulars

The representations are to be implied from the submission of a tender in the circumstances specified in paragraph 401 hereof.

403.          Those representations were made with the intention of inducing the person who issued the invitation to tender to accept one of the tenders.

404.          Those representations were false in that:

(a) each tenderer had arrived at the price and other terms of the tender submitted by it after discussing that price and other terms with another manufacturer or supplier of the goods the subject of the tender;

(b) the price and other terms of the tender submitted by it was the subject of an agreement, arrangement or understanding between the tenderer and another manufacturer or supplier of the goods the subject of the tender.

405.          Those representations were made dishonestly, in that they were made with knowledge of their falsity.

406.          The person issuing the invitation to tender acted in reliance on those representations and was induced thereby to accept one of the tenders.”

38                  The loss or damage alleged to have been suffered is particularised at par 407 of the statement of claim:

“407. By virtue of the matters specified in paragraphs 400 to 406 hereof, SEQEB and ENERGEX suffered loss and damage.

Particulars

(a) If the representation had not been made, the person issuing the invitation to tender would have investigated why that tenderer was unwilling to participate in a public tender process, and further or alternatively would have referred the matter to the Australian Competition and Consumer Commission, or its predecessor the Trade Practices Commission.

(b) There was a chance that such investigation or referral would have disclosed the existence of one or more of those arrangements, in which event SEQEB or ENERGEX could have prevented the Respondents from continuing to give effect to those arrangements.

(c) SEQEB and ENERGEX lost the opportunity to prevent the Respondents from continuing to give effect to those arrangements.

(d) Had the Respondents been prevented from continuing to give effect to those arrangements, SEQEB and ENERGEX would have paid less than they did for their purchases of transformers.”

the alstom respondents’ contentions

39                  The Alstom respondents contend that the allegations pleaded against them should either be dismissed under O 20 r 2(1) of the Federal Court Rules (“the Rules”), or alternatively, struck-out under O 11 r 16. They contend that:

·               Energex has failed to plead the essential elements required to establish a cause of action in deceit;

·               a significant number of the allegations do not “deal with” the applicant and do not disclose a cause of action maintainable by it;

·               a significant number of the allegations in reliance on s 82(1) are statute barred; and

·               the claims based on ss 80 and 87 of the Act constitute an abuse of process in that they serve no independent purpose other than an attempt to avoid the limitation period in relation to claims that are statute barred under s 82.

40                  In order to understand these contentions, it is necessary to set out a few historical matters. The present application brought by Energex followed two earlier proceedings brought by the Australian Competition and Consumer Commission (“the ACCC”). Those proceedings were commenced in October 1999. The first, ACCC v ABB Transmission and Distribution Limited (2001) ATPR ¶41-815 concerned power transformers, and led to orders being made by consent against the first, third, fourth and fifth respondents. The second, ACCC v ABB Transmission and Distribution Limited (2001) ATPR ¶41-839 concerned distribution transformers, and led to orders being made by consent against the first, fourth and fifth respondents. In each of those proceedings, injunctions were granted against the first respondent, restraining it from engaging in certain conduct in relation to the supply of transformers that would otherwise be in breach of s 45 for a period of four years.

41                  As already indicated, one of Energex’s primary claims is that the corporate respondents engaged in conduct in breach of s 45. As regards the individual respondents, the applicant alleges that each was knowingly concerned in, or party to, the contraventions by their respective employers.

42                  It is important to note that Energex seeks injunctive relief against the respondents, under s 80. It also claims damages under ss 82(1) and/or 87(1), as well as in respect of its alternative claim for damages for deceit.

43                  Turning first to the challenge made to the pleading of deceit, Mr Hilton SC who appeared with Mr Elliott, on behalf of the Alstom respondents, submitted that the essential elements of that cause of action included the making of a false representation, knowledge of the falsity, an intention that the person to whom the representation is made act upon it, reliance upon the representation, and loss or damage thereby sustained.

44                  Mr Hilton submitted that Energex had failed in its pleading to “establish that a representation was made by ALSTOM or Rexel”. The meaning of that submission is not entirely clear. However, in substance, the point seems to be that although a representation can be made in circumstances where there has been no express statement, ordinarily silence, no matter how deceptive, cannot give rise to a cause of action in deceit. Absent a duty to disclose, silence cannot constitute the making of a representation.

45                  Mr Hilton submitted that pars 400 to 402 of the statement of claim failed to plead that either Alstom or Rexel had a duty to disclose anything to Energex in relation to the tender process. The fact that Energex may genuinely have believed that the details of each tender were secret, and confidential to each tenderer, could not in the absence of a specific representation by the tenderers, or any of them, found a cause of action.

46                  Mr Hilton also submitted that Energex’s pleading in relation to deceit should be struck out on the basis that the damage claimed in par 407 of the statement of claim was insufficiently connected, in a causal sense, with the deceit pleaded. He submitted, with reference to par (c) of the particulars of damage in par 407, that the statement of claim essentially pleaded that Energex had lost the opportunity to prevent the corporate respondents from giving effect to the anti-competitive arrangements previously alleged. However, he submitted, in an action for deceit, the general principle is that “the plaintiff is to be put, so far as possible, in the position he would have been in if he had not acted on the fraudulent inducement”: Gould v Vaggelas (1985) 157 CLR 215 at 220-221. In State of Queensland v Pioneer Concrete (Qld) Pty Ltd (1999) ATPR ¶41-691 it was held at 42,840 and 42,841 that damages could not be recovered for lost opportunity. Accordingly, this limb of Energex’s case should be struck out.

47                  In addition, Mr Hilton complained that an allegation of deceit, involving as it did, a claim of dishonesty, was a serious matter, and should be properly particularised. He submitted that Energex had failed to particularise at least two critical elements of its claim, namely the alleged intention with which the representations were made (par 403), and the alleged dishonesty of those representations (par 405).

48                  Turning from the claim in deceit, Mr Hilton mounted a more general attack upon the pleading. He pointed out that the statement of claim identified forty-five separate tenders that were let by parties other than Energex or its predecessors. He submitted that these allegations had nothing whatever to do with Energex’s supposed loss or damage, and should for that reason be dismissed or struck out.

49                  Perhaps more fundamentally, Mr Hilton submitted that many of the price fixing allegations in the present proceeding related to tenders that were awarded more than six years prior to the filing of the statement of claim. As a result, he submitted, a large number of those claims were now statute barred.

50                  Mr Hilton developed his argument in the following way. Energex was seeking damages pursuant to s 82(1) of the Act. Its claim for damages under that section was contained in par 3 of the application by which this proceeding was initiated. Section 82(1) is, however, subject to a statutory limitation period that is now of six years. It was, at one time, three years. The effect of the limitation period was that any claims that related to tenders prior to 26 July 1998 were statute barred.

51                  Mr Hilton noted that Energex also claimed damages pursuant to s 87(1). He acknowledged that this section, unlike s 82(1), was not subject to any limitation period. However, he submitted that the claim under s 87(1) had been made solely in order to avoid the limitation period in s 82(2), and was therefore an abuse of process.

52                  Mr Hilton recognised that there was often a reluctance on the part of courts to deal with limitation defences at the interlocutory stage, it being thought preferable to consider them only after all the evidence had been led, or at least only at a final hearing. See for example Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 533 (“Wardley”). He submitted, however, that there were strong reasons for departing from that course in the present case. He contended that the allegations related to causes of action that were so old, and so clearly time barred, that they should be disposed of at the interlocutory stage. He distinguished those cases in which there was an element of uncertainty as to when the relevant loss occurred, accepting that it would not be appropriate to deal with limitation issues in those cases until a final hearing. In the present case, he submitted, any loss sustained by Energex must have been suffered, at the latest, at the moment that each transformer was purchased.

53                  In order to understand this submission, it is necessary to have regard to s 82, in its present form. That sections provides:

“82. Actions for damages

(1) A person who suffers loss or damage by conduct of another person that was done in contravention of a provision of Part IV, IVA, IVB or V or section 51AC may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention.

(2) An action under subsection (1) may be commenced at any time within 6 years after the day on which the cause of action that relates to the conduct accrued.’

54                  Section 82(2), in its present form, came into force on 26 July 2001. Prior to that, the limitation period under that section was three years. Transitional provisions were enacted in the Trade Practices Amendment Act (No 1) 2001 (Cth). Item 21 of Sch 1 to that Act provided:

“21 Application of item 20

(1) The amendment made by item 20 [ie the amendment to s 82(2)] applies in relation to conduct engaged in on or after the commencement of that item.

(2) The amendment made by item 20 also applies in relation to conduct engaged in before the commencement of that item, but only if the period that:

(a) relates to the conduct; and

(b) applied under subsection 82(2) of the Trade Practices Act 1974 before the commencement of that item;

had not ended when that item commenced.”

55                  Mr Hilton submitted that the effect of these transitional provisions was that the new six year limitation period applied to all causes of action that had not already been barred under the previous three year limitation period, as at 26 July 2001. Accordingly, any cause of action that accrued prior to 26 July 1998, which would have been barred by the time the amendments to s 82 were made, was statute barred.

56                  Mr Hilton then submitted that there were two elements in the cause of action established by s 82. They were a contravention, inter alia, of a provision of Pt IV of the Act and resultant loss or damage suffered by such conduct.

57                  Mr Hilton contended that a cause of action accrues as soon as all of the necessary elements are present. Accordingly, a cause of action under s 82 accrues once an applicant first suffers loss or damage by reason of the contravention: Arcadi v Colonial Mutual Life Assurance Society Ltd (1984) ATPR ¶40-473 at 45,454. The loss must be actual loss or damage, rather than merely potential or likely loss or damage: Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 348. By contrast, and by reason of s 87(1), actions under s 87 accrue on the date on which an applicant has suffered, “or is likely to suffer”, loss or damage. It was submitted that the distinction in the wording between these two provisions suggested that a cause of action under s 87 accrues from the date on which the contravention occurred.

58                  Critically, Mr Hilton submitted, that it is not an essential ingredient of a cause of action under s 82(1) that an applicant be aware that he or she has a right to sue. He referred to Torrens Aloha Pty Ltd v Citibank NA (1997) 72 FCR 581 at 595 per Sackville J, with whom the other members of the Full Court agreed, in support of that contention.

59                  It followed, so it was submitted, that in the present case, any claim that Energex might have under s 82(1) would have accrued as soon as loss or damage was first sustained. On Energex’s own case, that would have been at the moment that the transformers were accepted, and payment at an inflated price was made.

60                  Mr Hilton submitted that the limitation period established by s 82(2) was a condition of the right to damages under that section, and not merely a limitation on that right. Notably, he pointed out that there was no discretion vested in the Court to extend the limitation period under that section on what might be described as equitable grounds. See Keen Mar Corporation Pty Lt v Labrador Park Shopping Centre Pty Ltd (1988) ATPR ¶40-853 at 49,196 and Australian Iron & Steel Ltd v Hoogland (1962) 108 CLR 471 at 488. It followed that any cause of action that accrued prior to 26 July 1998 was statute barred.

61                  Mr Hilton noted that pars 64, 65, 66 and 68 of the statement of claim alleged the existence of a number of agreements in relation to the fixing of tender prices, all of which preceded that date. Paragraphs 67 and 69 to 355 alleged that those agreements were all put into effect. All of the tenders referred to in those paragraphs had been let, and accepted, prior to 26 July 1998. They were therefore statute barred, and should either be dismissed under O 20 r 2(1)(a), or alternatively struck out under O 11 r 16.

62                  Mr Hilton then turned specifically to Energex’s claim under s 87(1) of the Act. That subsection provides:

“(1) Without limiting the generality of section 80, where, in a proceeding instituted under this Part, or for an offence against Part VC, the Court finds that a person who is a party to the proceeding has suffered, or is likely to suffer, loss or damage by conduct of another person that was engaged in (whether before or after the commencement of this subsection) in contravention of a provision of Part IV, IVA, IVB, V or VC, the Court may, whether or not it grants an injunction under section 80 or makes an order under section 82, 86C or 86D, make such order or orders as it thinks appropriate against the person who engaged in the conduct or a person who was involved in the contravention (including all or any of the orders mentioned in subsection (2) of this section) if the Court considers that the order or orders concerned will compensate the first-mentioned person in whole or in part for the loss or damage or will prevent or reduce the loss or damage.”

63                  Section 87(2) provides that the orders referred to in s 87(1) include a number of orders specifically identified in s 87(2)(a) to (g). Section 87(2)(d) provides that among the orders that can be made in a claim under s 80, which provides for injunctive relief, is an order:

“… directing the person who engaged in the conduct or a person who was involved in the contravention constituted by the conduct to pay to the person who suffered the loss or damage the amount of the loss or damage.”

64                  At first glance, the orders that may be made under s 87(2)(d) are the same as those that can be made under s 82(1). However, as noted earlier, actions brought under s 87(1), requesting loss or damages under s 87(2)(d), appear not to be subject to any limitation period.

65                  Mr Hilton submitted that the only reasonable inference to be drawn was that Energex, by seeking damages pursuant to s 87(2)(d), was attempting to circumvent the limitation period contained in s 82(2). He pointed out that the claim brought under s 87(1) and s 87(2)(d), was actually ancillary to the primary claim for injunctive relief under s 80. Indeed, s 87 was headed “Other Orders”, thereby signifying its ancillary nature.

66                  Mr Hilton contended that a similar tactic had been considered by a Full Court in Mayne Nickless Ltd v Multigroup Distribution Services Pty Ltd (2001) 114 FCR 108. There, the Court dealt with the question whether a claim under s 87(1) could be made in conjunction with a claim under s 82 that was out of time. The Court (Wilcox, French and Drummond JJ) noted that s 87(1) contained no time limit, but emphasised that this was because the sub-section provided for ancillary relief. Their Honours said at 123:

“If a proceeding is brought out of time under s 82 and the limitation is pleaded and the application dismissed, then there will have been no finding of a contravention which is a necessary condition of the exercise of the power under s 87(1). If the time limitation under s 82(2) is not pleaded or is waived, or if the respondent is estopped from raising it, then a finding of contravention may be made and damages awarded under s 82. Such other orders as may be open under s 87 can also be made. That possibility is open as the time limitation imposed by s 82(2) does not in terms operate as a jurisdictional limitation but rather as a procedural bar.”

67                  Their Honours went on to say that it followed that the time limitation under s 82 did not exclude the possibility of orders being made under s 87(1) in a proceeding commenced after the expiration of three years from the date when the cause of action occurred. In proceedings for injunctive relief under s 80, no time limitation applied, although discretionary considerations might arise in relation to undue delay in seeking that relief.

68                  Mr Hilton noted their Honours’ comment at 124 that the absence of any time limitation under s 87, in relation to claims for damages under s 87(1), might render the time limit imposed by s 82(2) too easily avoidable.

69                  However, the Court went on to say at 124:

“… So much may be accepted but does not provide a basis for writing into s 87(1) words that are not there. Indeed, to import into the subsection a time limitation on claims for damages under it would be to introduce an element inconsistent with its character as providing relief ancillary to a primary cause of action. The same is true of any attempt to import by analogy or otherwise the time limits imposed on claims for relief under s 87(1A) by s 87(1CA).

There are, in any event, significant differences between the relief which may be awarded under s 87(1) and that which is recoverable under s 82. The primary difference is that the relief awarded under s 87(1) is discretionary. In the exercise of that discretion, a court would be entitled to have regard to whether the subsection had been invoked merely to overcome a time problem in proceedings that could, absent that problem, have been brought under s 82. The answer to the question whether proceedings have been brought on that basis may be informed by the extent to which the primary injunctive relief would be of any utility. If the primary injunctive relief were to be refused on discretionary grounds, including lack of utility, then there would be a real issue as to whether any award for damages should be made particularly where the case is one in which a claim under s 82 would have been out of time.

It is also to be noted that the relief that may be awarded under s 87(1) includes relief which compensates only in part for loss or damage suffered. Section 82 on the other hand provides a right to complete recovery of loss or damage. Section 87(1) also allows for orders to be made to reduce or prevent likely loss or damage, a remedy not available under s 82. Having regard to the range of ancillary remedies available under s 87(1) and the range of circumstances to which it may be applied there is no warrant for importing into it any selective time limitation for any class of the relief available under it.” (emphasis added)

70                  Accordingly, Mr Hilton submitted that although Mayne Nickless might be thought, at first glance, to support Energex’s case that it could rely upon s 87(1) to recover damages, notwithstanding that its claim under s 82(2) might be time barred, that interpretation of the case had to be heavily qualified. On balance, Mayne Nickless at least suggested that caution ought to be exercised before permitting a claim under s 87(1) to be pursued, thereby avoiding the difficulties posed by s 82(2).

71                  Mr Hilton next submitted that, on any view, there had been undue delay in bringing the claim. He pointed to the fact that the ACCC had commenced proceedings against the Alstom respondents in 1999, and in 2000. Those proceedings had been settled by early 2001. Yet, Energex did not file its present application, or its statement of claim, until more than two years later on 26 May 2003.

72                  Importantly, Mr Hilton submitted that the injunctive relief sought by Energex under s 80, which formed the basis of the claim under s 87(1), would be of no utility. The terms of the injunction sought were substantially the same as those of the injunction that was already in force as a result of the judgment of the Court in ACCC v ABB Transmission and Distribution Limited (2001) ATPR ¶41-815. The only difference between that injunction, and the injunction sought, was that the injunction currently in force would expire at the end of four years from the date on which it was granted, whereas the injunction sought was one in perpetuity. Mr Hilton submitted that it was an abuse of process for Energex to seek essentially the same relief as had already been granted in other proceedings, purely in order to circumvent a limitation period: Williams v Spautz (1992) 174 CLR 509 at 528 and 536.

73                  Finally, Mr Hilton submitted that it would be “unjustifiably vexatious and oppressive” to permit Energex to litigate anew a case that had already been disposed of by earlier proceedings: Walton v Gardiner (1993) 177 CLR 378 at 393. He submitted that it would be contrary to public policy to permit that course, with all its attendant risks. He pointed, in particular, to the danger that there might be inconsistent judgments if this matter were permitted to proceed.

the wilson respondents’ contentions

74                  Mr Archibald QC, who appeared with Mr Collinson on behalf of the Wilson respondents, joined with Mr Hilton in submitting that all causes of action for damages pursuant to s 82(1) (other than those arising from one specific tender, No QESI 30/98) were statute barred because they had not been commenced within the time specified by s 82(2). Mr Archibald further submitted that both the claim for injunctive relief under s 80, and the claim for loss or damages under s 87(2)(d) be dismissed as disclosing no reasonable cause of action, or as being frivolous or vexatious, and as constituting an abuse of process. Finally, Mr Archibald submitted that the claim for deceit should also be summarily dismissed.

75                  In substance, Mr Archibald submitted that the relevant question to be determined was whether the conduct alleged against his clients had occurred before 26 July 1998. He submitted that, if so, any claim brought against them under s 82(1) was time barred date.

76                  Mr Archibald joined with Mr Hilton in submitting that a claim under s 82 had two elements. It required proof of a contravention of a provision of the Act, and also proof that loss or damage had been suffered as a result of that contravention. Accordingly, he submitted, a cause of action under s 82(2) accrued, not at the moment that a breach of a section of the Act had occurred, but only when loss or damage was suffered by reason of that breach. Mr Archibald cited, in addition to Acardi, James v ANZ Banking Group Ltd (1986) 64 ALR 347 at 392.

77                  Mr Archibald next submitted that the date on which loss or damage occurred was a question of fact, to be determined in all the circumstances of the case. He referred to Wardley, and to Karedis Enterprises Pty Ltd v Antoniou (1995) 55 FCR 35. He submitted that loss or damage could be suffered at the moment an applicant first entered into an agreement. A classic instance was where an asset was purchased and, by reason of an inherent defect, it was worth less than the price paid: Potts v Miller (1940) 64 CLR 282 at 298. Similarly, where an agreement imposed upon an applicant an obligation to pay a particular amount of money, without gaining any corresponding benefit, and the amount to be paid was quantified by “no factors extrinsic to the agreement save for the passing of time”, the loss would be suffered as soon as the agreement to pay became binding upon the applicant.

78                  Mr Archibald contrasted these examples with the case where the actual loss that an applicant suffered depended not only upon the making of an agreement, but also upon circumstances extrinsic to that agreement. In such a case, he submitted, the loss would not be suffered until those circumstances had transpired. Thus, in Wardley, where the State of Western Australia gave an indemnity to a bank which entitled the bank to demand the payment of money upon certain contingencies, the State was not under any liability to pay until those contingencies occurred. The relevant loss or damage was not suffered merely by giving the indemnity.

79                  Mr Archibald submitted that, in the present proceeding, Energex alleged that combinations of transformer manufacturers had in various ways reached agreements, arrangements or understandings which affected the tender prices they submitted in response to tenders issued by Energex. The allegations in relation to each tender followed a common pattern with a series of tender contracts being pleaded in pars 69 to 355 of the statement of claim. On the basis of such conduct, various contraventions of the Act were alleged in pars 362 to 390 so as to attract liability under ss 80(1)(a), 82(1) and 87(1). Loss or damage was then said to arise as set out in pars 381 to 385.

80                  Mr Archibald contended that this was a case where any loss or damage suffered by the applicant necessarily arose immediately upon entry into each tender contract pleaded in the statement of claim. Unlike Wardley, no question arose of contingent liabilities, or of unfairness in compelling an applicant to institute a proceeding before the existence of its loss could be ascertained. There was no possibility that the Court would be put in the difficult position of having to estimate damages on the basis of probabilities, rather than assessing damages by reference to established events: Wardley at 527. Each agreement imposed upon Energex an obligation to pay an amount of money without acquiring a corresponding benefit. The amount to be paid was not quantified by factors extrinsic to the agreement, save for the passing of time. It followed that each cause of action for loss or damage arose upon the date of entry into each tender contract.

81                  Mr Archibald submitted that all of the contracts, except one, QESI 30/98, had been made before 26 July 1998. They were therefore statute barred. All that was left was a claim for damages arising out of QESI 30/98, an amount totalling $441,113.

82                  Mr Archibald acknowledged that the High Court had made it clear in Wardley that it was ordinarily undesirable that limitation questions should be decided in interlocutory proceedings, in advance of the hearing of the action. The Full Court made the same point in Mayne Nickless, at [26] when it observed that:

“Generally speaking a statutory time limitation will not support an order striking out a claim for failure to disclose a reasonable cause of action or on the basis that the proceeding is frivolous or vexatious or an abuse of the process of the Court: see Carey-Hazell v Getz Bros & Co (Aust) Pty Ltd. (2001) 112 FCR 336 and the cases reviewed there.”

83                  The reason why courts are reluctant to deal with limitation issues at an interlocutory stage is because, generally speaking, not enough is known about the damage sustained by an applicant, and the circumstances in which it was sustained, to justify a confident answer to the question whether the proceeding should be statute barred before all of the evidence has been heard. However, Warldey recognised that there were exceptions to this rule. That case concerned contingent liabilities, and that issue did not arise here.

84                  Mr Archibald submitted that where, as in the present case, it was clear that an applicant could not succeed on its claim, as pleaded, because s 82(2) would be a complete answer to that claim, the Court should not defer the inevitable. As the action must fail, the Court should not hesitate to say so. He referred to Jobbins v Capel Court Corporation Ltd(1989) 25 FCR 226 at 231.

85                  In addition, Mr Archibald submitted that there would be considerable utility in striking out the claim for damages under s 82(1) at this stage. Removing that claim from the proceeding would have a major impact upon the preparation and future conduct of the case. Apart from the claim for injunctive relief, it would leave only the claim for damages for deceit, and the claim for damages pursuant to s 87. Although these claims might have to be tried, the issues raised would be considerably narrowed.

86                  Mr Archibald then turned to the claim for injunctive relief. He submitted that Energex had simply fashioned a claim under s 80 in order to enable damages to be obtained under s 87(1). He noted that the claim for damages pursuant to s 82 had been pleaded as though it were nothing more than an alternative claim to that made under s 87(1). That was transparently nothing more than a device, designed to circumvent the limitation period in s 82(2). All of this had occurred against the background of this Court having already granted injunctive relief against the Wilson respondents, in favour of the ACCC, in terms that were almost identical to those sought by Energex in the present proceeding.

87                  Mr Archibald further noted that it was not suggested that his clients had engaged in any contravening conduct after February 1999. Yet the present application had not been instituted until more than four years later, in May 2003, following the final disposition of the ACCC proceedings. There was no allegation by Energex of any threat by the Wilson respondents to engage in any further contravening conduct. Indeed, Finkelstein J, in his judgment in proceeding no V868 of 2000, on 3 May 2002, found that it was unlikely that the Wilson respondents would offend again. His Honour therefore concluded that specific deterrence was not a relevant consideration when fixing an appropriate penalty.

88                  Mr Archibald acknowledged that the Court could grant injunctive relief restraining a person from engaging in conduct in contravention of the Act irrespective of whether it appeared that the person intended to engage again, or to continue to engage, in conduct of that kind: see s 80(4)(a). He submitted, however, that the risk that such conduct might recur was relevant to the exercise of the discretion: see ACCC v CG Verbatis Holdings Pty Ltd (2001) ATPR ¶41-802 at 42,638. He further submitted that the present proceeding was unique, in some respects. Energex was seeking a perpetual injunction against his clients notwithstanding the fact that there was already in place an injunction in similar terms for a period of four years.

89                  Mr Archibald submitted that it was an abuse of process to bring such a claim. He submitted that it was also frivolous or vexatious to do so. The claim for injunctive relief was, in his submission, “clearly foredoomed to fail”: Walton v Gardiner. There was no realistic prospect that the Court would grant the injunctive relief sought, given the existence of an injunction in almost identical terms, and given also the absence of any risk that the contravening conduct would be repeated. It was obvious that the claim for injunctive relief had been included purely in order to gain a collateral advantage.

90                  Finally, Mr Archibald submitted that the claim for deceit, as pleaded, should not be permitted to stand. He submitted that the tort required proof that a representation had been made which is not in fact genuinely believed to be true. Representations were usually made by statements, whether oral or written. Sometimes representations could be implied from acts and conduct. The law also recognised that a half-truth could amount to a falsehood. Notwithstanding qualifications of these kinds, mere silence, or non-disclosure of certain facts could not ordinarily give rise to a claim in deceit. There had to be more. For example, there might be cases where, by reason of the existence of a particular relationship, there was a duty to disclose. Such relationships might include trustee and beneficiary, solicitor and client, and principal and agent. They did not, however, include vendor and purchaser. The question whether silence alone could constitute misleading or deceptive conduct under s 52 of the Act raised an entirely different issue.

91                  Mr Archibald submitted that Energex had done no more than allege that the mere act of submitting a tender in response to its invitation constituted a representation by each tenderer that the price and other terms of the tender had been arrived at independently, and without any knowledge of the price and terms of any other tender. The alleged representations could not be distilled from the mere submission of a tender in these circumstances.

92                  In State of Queensland v Pioneer Concrete (Qld) Pty Ltd, one issue was whether the tort of deceit had been adequately pleaded. The statement of claim alleged that the respondents had committed that tort in impliedly representing that the various offers to provide pre-mixed concrete were competitive and non-collusive, and complied with the State’s Standard Code of Tendering. It was alleged that these were not representations capable of supporting a claim in deceit. Drummond J rejected that contention, and held that the conduct of the respondents in submitting tenders was “capable of” amounting to a representation that the prices at which they were prepared to supply concrete were competitive and non-collusive.

93                  Mr Archibald submitted that Pioneer Concrete was readily distinguishable. In that case, the claim for deceit was struck out, at least in part, because of a difficulty with causation. The applicant in that case had pleaded that, by virtue of the deceit, it had lost the opportunity to take such steps as it was advised, including bringing proceedings under s 80, or requesting the Trade Practices Commission to bring such proceedings, to prevent the respondents from continuing to give effect to the collusive agreements alleged. The applicant’s case therefore assumed that when a person makes a fraudulent misrepresentation, the victim’s damages in deceit are assessed on the basis of the gains the victim might have made, or the detriment it might have avoided, had the fraudster disclosed the true position. That was not, and never had been, the law. In an action for deceit, the plaintiff could only seek to be put, so far as possible, in the position he would have been in had he not acted on the fraudulent inducement: see generally Pioneer Concrete at [85] to [86].

94                  Mr Archibald submitted that Energex, having failed to plead the existence of a duty of full disclosure, could not recover the wider damages claimed in this case unless it could say that those damages flowed directly from, i.e. were caused by, the respondents’ misrepresentations. However, what caused Energex’s subsequent losses was not the initial representation, but rather the agreement made beforehand between the respondents, and the implementation of that agreement. Energex had not pleaded, and sought to avoid pleading, a duty of full disclosure. It only alleged that had the representations not been made, it would have investigated why the tenderers were unwilling to participate in a public tender process.

the schneider respondents’ contentions

95                  Mr Gray, who appeared on behalf of the Schneider respondents, submitted that the statement of claim was seriously deficient in setting out Energex’s involvement in the various arrangements with the respondents, and with other transformer manufacturers. He submitted that the claims made against his clients suffered from the vice of uncertainty, containing many allegations that he described as “rolled up”, and therefore impossible to meet.

96                  Mr Gray also joined with Mr Hilton and Mr Archibald in attacking the pleading in deceit, and in asserting that the claims for damages pursuant to s 82 were time barred.

97                  Mr Gray developed his submissions by noting that Schneider had commenced manufacturing electrical transformers in December 1993, after it acquired the shares in ASET. Energex claimed that Schneider contravened s 45(2)(a)(i) and s 45A(1) by entering into arrangements with other transformer manufacturers to tender for the supply of transformers, which resulted in those suppliers charging higher prices than would otherwise have been the case. He submitted that the statement of claim was drawn in an unsatisfactory manner because the case against his clients could not clearly be discerned. He pointed specifically to pars 64, 179, 276, 379, 382, 383, 384, 397, 398 and 388 as containing “rolled-up” pleas.

98                  It is unnecessary, for present purposes, to summarise all of the many complaints that Mr Gray made regarding the form of the pleading. It is sufficient to provide the flavour of those complaints by summarising what he said about two specific paragraphs.

99                  Mr Gray submitted that par 64 should be struck out on the basis that it was a “rolled-up” plea which failed to identify and single out those material facts that were alleged against the Schneider respondents, as opposed to those facts alleged against the other respondents.

100               Paragraph 64 of the statement of claim reads as follows:

“ARRANGEMENT

64. By no later than 1982, transformer manufacturers had made an agreement or arrangement or arrived at an understanding (“the Transformer Arrangement”) whereby:

(a) they would allocate tenders for the production and supply of transformers amongst themselves with a view to each of them maintaining their share of sales of power transformers and distribution transformers;

(b) the maintenance of each manufacturer's share of sales would be achieved by the manufacturers agreeing to the allocation of tenders for the production and supply of transformers to a particular manufacturer (“the selected manufacturer”) in the expectation that the selected manufacturer would be awarded the contract resulting from the tender;

(c) the allocation of a contract to the selected manufacturer would be sought to be achieved by the selected manufacturer submitting a tender at a lower AAV than the tenders submitted by other manufacturers, or by the other manufacturers not submitting a tender;

(d) the submission of the tender by the selected manufacturer at a lower AAV would be achieved by the manufacturers discussing their tenders with each other, and the manufacturers other than the selected manufacturers ensuring that their tenders yielded a higher AAV than the tender of the selected manufacturer.

Particulars

The best particulars that the Applicant can currently provide are that the existence of such an agreement, arrangement or understanding is to be inferred from the overt acts specified in paragraphs 75, 79, 104, 110, 118, 130, 142, 146, 150, 158, 176, 182, 186, 189, 194, 196, 197, 199, 203, 205, 207, 216, 219, 227, 231, 233, 237, 241, 243, 249, 251, 253, 255, 257, 259, 261, 263, 265, 267, 269, 271, 276, 283, 285, 287, 289, 291, 293, 295, 298, 300, 303, 308, 311, 319, 329, 333, 335, 343, 345, 347, 350, 355, 383 and 384 hereof. In relation to the acts specified in paragraphs 75, 79, 104, 110, 118, 130, 142, 146, 150, 158, 176, 182, 186, 189, 194, 196, 197, 199, 203, 205, 207, 216, 219, 227, 231, 233, 237, 241, 243, 249, 251, 253, 255, 257, 259, 261, 263, 265, 267, 269, 271, 276, 283, 285, 287, 289, 291, 293, 295, 298, 300, 303, 308, 311, 319, 329, 333, 335, 343, 345, 347, 350, 355, 383 and 384 hereof, the Applicant relies on them both as overt acts from which the existence of the Transformer Arrangement can be inferred, and as separate agreements, arrangements or understandings.

101               Mr Gray submitted that a pleading drawn in this manner made it impossible to understand what role, if any, his clients were alleged to have played in relation to the “Transformer Arrangement”, to which the paragraph referred. He complained that the reference, in the particulars, to the numerous paragraphs of the statement of claim, from which such an agreement, arrangement or understanding could be inferred, reinforced the “rolled-up” nature of the plea. The problem was exacerbated by the fact that Energex asserted that it relied upon each and every one of the overt acts specified in order to infer the existence of the Transformer Arrangement. At the same time, Energex relied upon those same overt acts as the basis for the inference that there were “separate agreements, arrangements or understandings”. This inconsistency in approach was said to be the source of some confusion.

102               Mr Gray claimed that par 179 of the statement of claim was defective in that it contained no allegations against the Schneider respondents in relation to the 1993 Distribution Transformer Arrangement, whereas subsequently, in par 272, Energex referred expressly to the Schneider respondents as having participated in the Transformer Arrangement, or alternatively, the 1993 Distribution Transformer Arrangement.

103               Paragraph 179 reads as follows:

“179. Further and alternatively to paragraph 64 hereof, in about early 1993, ABBPT, WTC and Tyree made an agreement or arrangement or arrived at an understanding (“the 1993 Distribution Transformer Arrangement”) whereby:

(a) ABBPT, WTC and Tyree agreed that they would not compete with each other for contracts let to tender for the production and supply of distribution transformers, with a view to each of them maintaining their share of sales of distribution transformers;

(b) ABBPT, WTC and Tyree agreed that they would allocate such tenders so that usually the company which had an existing contract to supply that particular purchaser would be awarded the new contract to result from the letting of the tender.

(c) the awarding of the new contract to the existing supplier would be sought to be achieved by the selected supplier submitting a tender at a lower AAV than the tenders submitted by other manufacturers, or by the other manufacturers not submitting a tender, in the expectation that the selected supplier would be awarded the contract resulting from the tender;

(d) the submission of the tender by the selected supplier at a lower AAV would be achieved by the manufacturers discussing their tenders with each other, and the manufacturers other than the selected supplier ensuring that their tenders yielded a higher AAV than the tender of the selected manufacturer.

Particulars

(i) The agreement or arrangement was made, or the understanding was arrived at, at a number of meetings and telephone conversations between Pitt and Jones on behalf of ABBPT, Wilson on behalf of WTC, and Boyce on behalf of Tyree.

(ii) The meetings and telephone conversations which took place included:

(A) a meeting on 25 February 1993 at the ABB premises at Darra, Brisbane, between Pitt and Boyce.

(B) a meeting on 26 March 1993 at the ABB premises at Moorebank, Sydney, at which Pitt, Jones and Boyce were present.

(C) Telephone conversation and/or meetings in the period of late 1992 to mid 1993 between Ptitt and/or Jones and Wilson that the Applicant is not yet able to particularise.

(iii) The submission of tenders at an appropriate AAV was to be achieved by:

(A) When a request for tenders was announced, and the quantity and specifications for the product were known, the parties would individually commence preparation of a tender in the ordinary course.

(B) Shortly prior to the closing date for the tender, the representatives of the party with an existing contract was to contact the representative for each other party by telephone and arrange a “covering bid” for the tender process. A covering bid would involve the other parties agreeing with the party with an existing contract to provide a bid with a higher AAV so as to enable the party with an existing contract to win the tender. The covering margin was to be 2% to 5%. Alternatively, agreement was reached for another supplier to win the tender.

(C) The representatives of each party were then to have a detailed discussion of their respective AAVs for each of the relevant tender items. Prices and/or AAVs could also be exchanged by facsimile.

(iv) Each party would then submit a tender in accordance with and in the knowledge of the price information exchanged, the effect of which being that the bid of the selected supplier would be covered by the bids of the other parties.”

104               Paragraph 272 is in the following terms:

“272. In or about May 1995:

(a) ABBPT, WTC and Tyree re-committed to the Transformer Arrangement, or alternatively the 1993 Distribution Transformer Arrangement, and Schneider agreed to participate in the Transformer Arrangement, or alternatively the 1993 Distribution Transformer Arrangement; or

(b) ABBPT, WTC, Tyree and Schneider made an agreement or arrangement or arrived at an understanding that they would not compete with each other for contracts let to tender for the production and supply of distribution transformers, with a view to each of them maintaining their share of sales of distribution transformers. The parties agreed as part of the agreement, arrangement or understanding that it was to be implemented in the manner pleaded in paragraph 179 above;

except that

(c) due to the break up of the State-wide electricity utility in Victoria into five regionally based utilities, WTC and Schneider would need to agree on how any forthcoming tenders in Victoria for distribution transformers above 100kVA would be shared between them so as to ensure that they maintained their share of sales of distribution transformers;

the conduct in this paragraph being referred to as the “1995 Distribution Transformer Arrangement”.

Particulars

(i) The agreement or arrangement was made at a number of meetings and telephone conversations between Pitt and Jones on behalf of ABBPT, Wilson on behalf of WTC, Boyce on behalf of Tyree, and Stocker on behalf of Schneider .

(ii) The meetings and telephone conversations which took place included:

(A) A meeting on 17 March 1994 immediately before or after an AEEMA meeting at Woolloomooloo Waters, Woolloomooloo Bay, Sydney at which Pitt and/or Jones and Stocker were present.

(B) A meeting on 29 July 1994 immediately after an AEEMA meeting at the Australian Chamber of Manufacturers offices, St Kilda, Melbourne at which Jones, Wilson and Stocker were present.

(C) A meeting on 11 November 1994 immediately after an AEEMA meeting at Sanctuary Cove, Surfers Paradise at which Pitt, Jones, Wilson and Stocker were present.

(D) A meeting in late 1994 at the home of Wilson in Glen Iris, Melbourne at which Jones, Wilson and Stocker were present.

(E) A meeting in or about May 1995 at the home of Wilson in Glen Iris, Melbourne at which Jones, Wilson, Stocker and Boyce were present.

(F) Telephone conversations during the period from about March 1994 to May 1995 between Pitt, Jones, Wilson, Boyce and Stocker that the Applicant is not yet able to particularise.”

105               Mr Gray submitted that it was impossible to glean from reading these paragraphs in conjunction with each other precisely what conduct Energex alleged that the Schneider respondents had engaged in that was said to have given rise to the 1993 Distribution Transformer Arrangement.

106               Mr Gray levelled similar criticisms at numerous other paragraphs of the statement of claim. For example, he submitted that par 276 was defective because the allegation contained therein was devoid of proper particulars regarding any alleged agreement or arrangement made by Schneider with respect to a particular tender. I interpolate, at this stage, to observe that many of his criticisms can fairly be described as “pleading points”, raising matters that could be addressed by the provision of further particulars. Even if there were substance in his complaints, it would not necessarily follow that the application should be dismissed, or that the statement of claim should be struck out, in whole or in part.

107               Mr Gray largely adopted the submissions of Mr Hilton and Mr Archibald with regard to the pleading of the tort of deceit. He submitted that the tort had been pleaded in a manner that could be analysed in the following way:

“(a) Paragraph 400 simply pleads that the applicant purchased transformers from transformer manufacturers, including Schneider, by the selection of a tender after a public tender process.

(b)               Paragraph 401 pleads what that tender process involved.

(c)               Paragraph 402 pleads that in submitting a tender each tenderer represented that the price and other terms of the tender had been arrived at by the tenderer without knowledge of the price and terms of any other tenderer and was not subject to any agreement, arrangement or understanding between them. It is pleaded that these representations are to be implied from the facts pleaded in paragraph 401. It is submitted there is no basis upon which such representations could be said to arise from the facts pleaded in paragraph 401 as to the tender process.

(d)               Paragraphs 404 and 405 allege that the representations were false and that they were made dishonestly in that they were made with knowledge of the falsity. There is, it is contended, no proper basis pleaded for the allegation of dishonesty. There is, furthermore, no proper basis pleaded that the alleged representations were made with knowledge of their falsity. The pleading simply relies upon the tender process alleged in paragraph 401 as impliedly giving rise to a representation that the tender submitted had been arrived at by the tenderer without any knowledge of the price or terms of any other tender and was not the subject of any agreement or arrangement or understanding between the tenderers. That is not sustainable on the matters pleaded.”

108               Mr Gray submitted that the pleading in deceit should be struck out because the Schneider respondents had not been successful in any of the tenders set out in Annexure “A” to the statement of claim. A plaintiff could only be liable in deceit for damage actually caused on the basis that damage is the gist of the tort.

109               Finally, Mr Gray noted that par 381 of the statement of claim alleged that Schneider had been involved in contravening conduct “between May 1995 and 1 June 1996”, and then “from 1 January 1996”. According to par 354, the last tender by Energex in which it was alleged that Schneider had engaged in contravening conduct was the Aurora tender, on 8 January 1999. The only other tenders that might have occurred after 26 July 1998 were those described in pars 344, 346, 348, and 354. The tenders that occurred prior to that date were those described in pars 234, 270, 274, 282, 284, 294, 297, 299, 301, 307, 314, 316, 318, 328, 330, 334 and 342. For the reasons advanced by Mr Hilton and Mr Archibald, the claims relating to the tenders that occurred prior to 26 July 1998 should be struck out.

energex’s contentions in reply

110               Mr Keane QC, who appeared with Mr O’Shea SC and Mr O’Bryan on behalf of Energex, commenced his reply by noting that O 11 r 2(a) provides that a pleading of a party shall contain, and contain only, a statement in summary form of the material facts on which the party relies, but not the evidence by which those facts are to be proved.

111               Mr Keane submitted that it was well established that the material facts are those necessary for the purpose of formulating a complete cause of action. It is not sufficient that the statement of claim simply express a conclusion drawn from facts that are not stated. Not only must all material facts be pleaded, but they must be pleaded with a sufficient degree of specificity, having regard to the general subject matter, to convey to the opposing party the case that party has to meet. It must be apparent on the face of the document that the facts pleaded, if proved, would establish the cause of action relied upon: see Multigroup Distribution Services Pty Ltd v TNT Australia Pty Ltd (1996) ATPR ¶41-522 at 42,679.

112               Mr Keane then summarised his understanding of the elements of a cause of action alleging a contravention of s 45(2)(a). He identified the following elements:

·               the making of a contract, arrangement or understanding (collectively described for convenience as an “arrangement”);

·               a party to the arrangement being a corporation; and

·               the arrangement containing either an exclusionary provision, or a provision that has the purpose or likely effect of substantially lessening competition in a market.

113               Mr Keane submitted that in relation to an arrangement containing an exclusionary provision within the meaning of s 4D, two additional elements had to be satisfied. The arrangement must be made between persons, any two of whom were in competition with each other. In addition, the provision within the arrangement must have the purpose of preventing, restricting or limiting the supply of goods or services to, or the acquisition of goods or services from, particular persons or classes of persons.

114               Mr Keane also noted that under s 45A(1), a provision of an arrangement would be deemed to have the purpose or likely effect of substantially lessening competition if it had the purpose or likely effect of fixing, controlling or maintaining the price for goods or services supplied or acquired by the parties to the arrangement, or any of them in competition with each other.

115               Mr Keane then turned to s 45(2)(b). He submitted that in order to establish a contravention of that provision, it was necessary to show that the arrangement that contravened s 45(2)(a) had been implemented. See generally Sammy Russo Supplies Pty Ltd v Australian Safeway Stores Pty Ltd (1998) ATPR ¶41-641 at 41,094.

116               Having outlined the elements of a cause of action under s 45, Mr Keane next summarised his reasons for contending that the Court should not, at this stage, entertain the respondents’ applications to dismiss, or strike out, Energex’s claims under s 82(1) as being time barred. In substance, he submitted:

·                    the claims had not been commenced outside the limitation period, having regard to the proper construction of s 82, and the nature of the loss alleged;

·                    there was no utility in dealing with summary dismissal at this stage, having regard to the fact that the same issues would have to be canvassed, in any event, in the trial when dealing with Energex’s claim against the ABB respondents. Those respondents had not sought summary dismissal on this or any other ground. Moreover, Energex’s claims under s 87 would still need to be addressed; and

·                    it was inappropriate to deal with any application for summary dismissal at this stage because the respondents had not yet filed their defences. It was possible, at least in theory, that no limitation defence would be pleaded. If limitation defences were raised, Energex would seek leave to amend its statement of claim, and seek damages for loss arising from that plea. Energex would also respond to the defence by filing a reply, relying upon a claim of fraudulent concealment.

117               Mr Keane developed these contentions in considerable detail. He challenged the respondents’ contention that each cause of action under s 45 had accrued on the date on which Energex had entered into each tender contract. He submitted that the only cause of action that s 82(2) was concerned with was that conferred by s 82(1). That cause of action was conferred on a person who suffered loss or damage by reason of certain proscribed conduct. The language by which that cause of action was conferred was not, as the respondents submitted, concerned with the moment at which loss or damage was incurred within the conceptions of the general law, or other statutes.

118               Mr Keane drew attention to the following passage from the judgment of the Full Court in Western Australia v Wardley Australia Ltd (1991) 30 FCR 245 at 255-256:

“... it is unsafe in the process of statutory construction of s 82 to turn first to, or to rely too heavily upon, analogies drawn from the interpretation by other courts of statutes of limitation controlling causes of action arising under the general law or other statute. This particularly is so in circumstances where, in construing those other limitation statutes, the courts have been constrained by the terms thereof to reach, as Lord Reid pointed out in Cartledge v E Jopling & Sons Ltd [1963] AC 758 at 771-772, conclusions running against the grain of the common law, which favours conclusions consistent with common sense and basic fairness.”

119               Mr Keane submitted that the High Court had, in recent years, adopted the same approach to the interpretation of s 82: Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 and I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at 135. Analogies with the law of tort and contract were useful aids, but could not be substituted automatically for the “flexible and general” language of the section.

120               Mr Keane took his lead from this approach, and focused on the word “suffers” in s 82(1). He noted that the Macquarie Dictionary defines “suffer” as, inter alia:

“1. to undergo or feel pain or distress.

2. to sustain injury, disadvantage or loss.

3. to undergo a penalty, especially of death,

4. to be the object of some action.

5. to endure patiently or bravely. – verb (t),

6. to undergo, experience, or be subjected to (pain, distress, injury, loss, or anything unpleasant) …”

121               Mr Keane submitted that the cause of action conferred s 82(1) was expressed in language that involved a person “feeling, undergoing, or enduring” loss or damage. A loss could not sensibly be said to be “felt or undergone or endured” unless the person said to feel or undergo or endure the loss appreciated that the loss had been incurred. In other words, one could not “suffer” loss or damage without being aware of the fact that one had done so.

122               Mr Keane submitted that it was not to the point to say, as Mr Hilton had done, that “knowledge of the right to sue is not an essential ingredient of a cause of action”. What was at issue was not whether, or when, Energex first knew that it had a cause of action. The issue was rather when that cause of action first arose. Mr Keane submitted that it did not arise until Energex suffered the loss; that is, when it discovered that the prices that it had paid were not competitive, but rigged and, in consequence, excessive.

123               Mr Keane submitted that this approach accorded with common sense, and justice. It avoided the injustice that a right of action might be lost before the party who had that right knew anything of the facts that gave rise to it. It was hardly likely that legislature would have intended such an absurd, and unfair, outcome. Mr Keane submitted that there was no authority standing in the way of this construction of s 82(1), and that there was at least implicit support to be found in some of the case law.

124               Mr Keane referred first to Cartledge v E Jopling & Sons Ltd [1963] AC 758. That case concerned the effect of s 2(1)(a) of the Limitation Act 1939 (UK) which provided that an action founded on tort should not be brought after the expiration of six years from the date on which the cause of action accrued. In that case, workmen, while employed as steel dressers in a factory, contracted pheumoconiosis, a disease in which slowly accruing and progressive damage may be done to a person’s lungs without that person’s knowledge.

125               The House of Lords held that the cause of action accrued at the date of the loss or damage when there had been a wrongdoing by the defendant from which loss or damage (not being insignificant) was suffered by the plaintiff, irrespective of whether he had any knowledge of such loss or damage. Accordingly, the claims were statute barred.

126               Mr Keane acknowledged that, superficially, Cartledge seemed to support the respondents’ contentions. However, he submitted that on a closer analysis of the reasoning, the case actually supported his argument. He referred to the speech of Lord Reid at 771-772:

“It is now too late for the courts to question or modify the rules that a cause of action accrues as soon as a wrongful act has caused personal injury beyond what can be regarded as negligible, even when that injury is unknown to and cannot be discovered by the sufferer, and that further injury arising from the same act at a later date does not give rise to a further cause of action. It appears to me to be unreasonable and unjustifiable in principle that a cause of action should be held to accrue before it is possible to discover any injury and, therefore, before it is possible to raise any action. If this were a matter governed by the common law I would hold that a cause of action ought not to be held to accrue until either the injured person has discovered the injury or it would be possible for him to discover it if he took such steps as were reasonable in the circumstances. The common law ought never to produce a wholly unreasonable result, nor ought existing authorities to be read so literally as to produce such a result in circumstances never contemplated when they were decided.

But the present question depends on statute, the Limitation Act, 1939, and section 26 of that Act appears to me to make it impossible to reach the result which I have indicated. That section makes special provisions where fraud or mistake is involved: it provides that time shall not begin to run until the fraud has been or could with reasonable diligence have been discovered. Fraud here has been given a wide interpretation, but obviously it could not be extended to cover this case. The necessary implication from that section is that, where fraud or mistake is not involved, time begins to run whether or not the damage could be discovered. So the mischief in the present case can only be prevented by further legislation.”

127               Mr Keane submitted that the considerations that had led the House of Lords to arrive at its reluctant conclusion were not present in this case. In particular, there was no provision in the Act analogous to s 26 of the Limitation Act making special provision for when time began to run in particular cases, such as fraud or mistake. There was therefore no need to construe s 82(1) so as to produce a result that was “an affront to common sense”.

128               Next Mr Keane referred to a passage in the judgment of the Full Court of the Federal Court in Wardley that, he suggested, supported his contention that no loss is suffered until the facts that give rise to that loss are ascertained. The Full Court said at 262:

“In cases of economic loss, authorities dealing with injury to interests in tangible property will not necessarily be of immediate assistance … (W)here the economic interest of the plaintiff which is injured by the negligence of the defendant is the value of property acquired by the plaintiff, it may be appropriate to speak of the cause of action for economic loss sustained … as accruing when the … damage is manifest …”

129               Next Mr Keane submitted that there was no general rule that loss was suffered at the moment when a person paid too much for an asset. He referred, in that regard, to what Brennan J said in Wardley at 536-537:

“… A plaintiff may suffer economic loss or damage in a number of ways: by payment of money, by transfer of property, by diminution in the value of an asset or by the incurring of a liability. Whether loss or damage is actually suffered when any of those events occurs depends on the value of the benefit, if any, acquired by the plaintiff by paying the money, transferring the property, having the value of the asset diminished or incurring the liability. If the plaintiff acquires no benefit, the loss or damage is suffered when the event occurs. At that time, the plaintiff’s net worth is reduced. And that is so even if the quantification of that loss or damage is not then ascertainable. But if a benefit is acquired by the plaintiff it may not be possible to ascertain whether loss or damage has been suffered at the time when the burden is borne -that is, at the time of the payment, the transfer, the diminution in value of the asset or the incurring of the liability. A transaction in which there are benefits and burdens results in loss or damage only if an adverse balance is struck. If the balance cannot be struck until certain events occur, no loss is suffered until those events occur. The quantification of the diminution in value of an asset or of a liability incurred or the value of any benefit acquired may not be ascertainable at the time when the burden of the transaction is borne. In that event, the suffering of any loss cannot be said to occur before it is reasonably ascertainable (not before it is ascertained) that the burdens which the plaintiff has borne are greater than the value of the benefits that the plaintiff has acquired or will acquire. In other words, no loss is suffered until it is reasonably ascertainable that, by bearing the burdens, the plaintiff is “worse off than if he had not entered into the transaction.” (footnote omitted)

130               Mr Keane noted that in Karedis, the Full Court had considered this aspect of the decision Wardley. In Karedis, the facts were as follows. In October 1988, the applicants leased from the respondents certain premises on which they intended to operate a café. They traded from December 1988 until February 1991. They commenced proceedings in November 1992, seeking damages under s 82(1), on the basis of a contravention of s 52 alleging misrepresentations as to the likely takings from the café. The losses claimed included trading losses from December 1988. The defendants contended that the claim under s 82(1) was statute barred.

131               The majority, Burchett and Hill JJ, held that the entry into the lease produced a situation where the applicants had only the potential to suffer loss. Whether any actual loss was suffered could only be determined by considering the receipts and outgoings of the business over time. The question for the Court was when the loss, which the applicants ultimately suffered (or a more than negligible part of it), was either ascertained by them, or reasonably ascertainable. That point would have been reached after the business was commenced, but within the first twelve months of trading.

132               Sackville J agreed with the majority, but added some additional comments. His Honour said at 45:

“In Wardley Australia Ltd v Western Australia (1992) 175 CLR 514, the High Court considered the time at which loss had been sustained by a party who had entered into an agreement creating an executory and contingent liability. The Court held that, where a person is induced by misrepresentations to enter such an agreement, that person does not suffer a loss for the purposes of s 82 of the Trade Practices Act 1974 (Cth) until the contingency is fulfilled: at 533, per Mason CJ, Dawson, Gaudron and McHugh JJ.

The precise holding in Wardley does not necessarily mean that a person suffers a loss for the purposes of s 82 only when he or she knows, or has the means of knowing, that a particular transaction has produced financial disadvantages that outweigh the advantages. The actual decision in Wardley rested on the fact that:

“[i]f an action is commenced before [the contingency is fulfilled], it will fail if the events so transpire that it becomes clear that no loss is, or will be, incurred.”

Wardley, itself, was therefore not a case where the party which had been misled had in fact sustained a loss at the relevant time (that is, in accordance with objective criteria supported by evidence at a subsequent trial), but did not then have the knowledge or the means of ascertaining that such a loss had occurred.

The reasoning of the Court does, however, support the proposition that, at least in the case where the disadvantageous character of a transaction cannot be ascertained at the outset, a loss is not sustained until the plaintiff or applicant ascertains, or has the means available to ascertain, that he or she has been prejudiced by entry into the transaction. Potential loss is not enough.”

133               His Honour then quoted from the judgment of the majority in Wardley at 527, and continued at 46:

“This passage suggests that, where the applicant has been induced by misleading and deceptive conduct to enter a lease, as in the present case, no loss is sustained unless and until the existence of the loss is ascertained or ascertainable by the applicant. The significance of “events as they unfold” is that they bring home, or should bring home, to the lessee that the obligations imposed by the lease exceed the value of any offsetting benefits, such as the lessee's entitlement to conduct a business on the leasehold premises. It would seem that a loss is not sustained simply because evidence given at a subsequent hearing demonstrates, with the benefit of hindsight, that the prejudice or disadvantage in fact sustained by the lessee after taking possession and paying rent outweighed any offsetting advantage.”

134               Sackville J continued at 47:

“In proceedings under ss 52 and 82 of the Trade Practices Act it is often the case that a purchaser acquires an asset on the faith of a false representation and that asset is shown, by subsequent evidence, to have been worth less at the time of the purchase than the price paid. It is also often the case that the purchaser, at the date of acquisition, neither knows nor has the means of knowing that the representations are false, nor that the business is worth less than the price paid. To use the language of the majority in Wardley, it would seem unjust to compel such a purchaser to institute proceedings before the existence of his or her loss is ascertained or ascertainable by that person.”

135               Finally, his Honour concluded at 48:

“Another approach is to determine the date damage has been sustained by reference to the nature of the interest infringed, in accordance with the approach taken by Gaudron J in Hawkins v Clayton. Where a business is purchased, the interest is presumably the value of the business. On one view, the value of the business and therefore the loss is always “ascertainable” at a particular date, since it is only necessary for the purchaser to seek appropriate expert advice as to that value. On the other hand, the existence of a loss is not necessarily ascertainable by the purchaser at that time, unless the purchaser has some reason to suspect a disparity between the price paid and the true value of the business. Finally, it is arguable that the reasoning in Wardley should be extended to cases involving the purchase of an asset, even where there are no apparent countervailing benefits or detriments as the result of the transaction. From the purchaser's perspective, the existence of a loss may not be ascertainable until events unfold. On this approach, a loss would not be sustained for the purpose of s 82 until the purchaser had either ascertained or, acting reasonably, should have ascertained, that the asset was worth less than the price paid for it.

Whatever the position in relation to the acquisition of an asset, the present is a case where the Antonious obtained both advantages and disadvantages from the lease transaction, which they were induced to enter by the appellant’s misleading conduct. It was not the entry into the lease which of itself produced the loss. The lease may have enabled the lessees to pursue a profitable undertaking. The losses claimed by the Antonious flowed from the pursuit of a particular business which they were encouraged to undertake by the appellants’ representations. Only when the course of events allowed the lessees the opportunity to ascertain that the business could not succeed was loss sustained in the relevant sense.”

136               Both the Full Court of this Court, and the New South Wales Court of Appeal, have followed Karedis. See Blacker v National Australia Bank Ltd (2001) ATPR ¶41-817 at 42,970, Troulis v Vamvoukakis (unreported, NSW Court of Appeal, 27 February 1998), and Williams v Commonwealth Bank of Australia [1999] NSWCA 345 at [139].

137               Mr Keane submitted that in the present case, it was not until the respondents’ collusion had been unearthed that it was reasonably ascertainable that Energex had suffered loss by paying more for the transformers than it ought to have.

138               Mr Keane also relied upon an analogy with cases involving building defects: see, for example, Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 503-505 per Deane J. He submitted that the principle was not confined to building defects but had been applied also to latent defects in title. He cited various additional authorities in support of that proposition.

139               Finally, Mr Keane relied upon the observations of Deane J in Hawkins v Clayton (1988) 164 CLR 539 regarding the need to avoid hardship and injustice when dealing with a limitation provision. Mr Keane noted in particular his Honour’s comment that it would be a travesty of justice if the law provided that a cause of action lay for damages for false imprisonment, but then went on to provide that that cause of action would be lost if the false imprisonment continued for six years after the cause of action first accrued. Indeed, his Honour observed at 590:

“… It is arguable that the notion of unconscionable reliance upon the provisions of a Statute of Limitations which provides the foundation of the long-established equitable jurisdiction to grant relief in a case of concealment of a cause of action until after the limitation period has expired (cf. s. 55(1) of the Limitation Act) should, by analogy, be extended to cover cases such as these where the wrongful act at the one time inflicts the injury and, while its effect remains, precludes the bringing of an action for damages. It seems to me, however, that the preferable approach is to recognize that it could not have been the legislative intent that the effect of provisions such as s. 14(1) of the Limitation Act should be that a cause of action for a wrongful act should be barred by lapse of time during a period in which the wrongful act itself effectively precluded the bringing of proceedings. On that approach, the reference in s. 14(1) of the Act to the cause of action first accruing should be construed as excluding any period during which the wrongful act itself effectively precluded the institution of proceedings.”

140               Mr Keane then repeated his contention that there was no utility, in terms of the administration of justice, in striking out the claims made under s 82. He submitted that largely the same issues would have to be canvassed in the trial in any event.

141               Finally, Mr Keane submitted that it was inappropriate to rule upon the respondents’ applications at this stage. He submitted that s 82(2) was a procedural condition of relief, and not, as Mr Hilton had suggested, an ingredient of Energex’s right of action: see the Full Court of the Federal Court decision in Wardley at 258-259, and Mayne Nickless at [46]-[47].

142               Mr Keane submitted that if the respondents chose to plead the limitation defence, Energex would amend its statement of claim in two respects. It would contend that the reliance by the respondents on s 82(2) was conduct that was, in all the circumstances, unconscionable within the meaning of s 51AC. It would seek injunctions under s 80 restraining them from persisting in their reliance upon s 82(2). Alternatively, in the event that injunctions were not granted, it would seek orders pursuant to s 82(1) or s 87(1) directing the respondents to pay the amount of the loss or damage suffered by Energex by reason of their reliance upon s 82(2).

143               Mr Keane foreshadowed that in the event that the limitation defences were raised, Energex would rely on s 51AC(2). He submitted that reliance by any respondent upon a limitation defence would be conduct by a person, in trade or commerce, in connection with the supply of goods or services to a corporation. Such conduct would be unconscionable because the respondents had concealed their illegal collusion from Energex, as had been essential if their collusive endeavours were to succeed. One purpose of the limitation provisions was to suppress fraud, by preventing bogus claims from being brought at a time when the evidence needed to meet them was no longer available. To permit s 82(2) to be used as a bar would be to make that section, a law designed to prevent fraud, the vehicle by which fraud could successfully be perpetrated.

144               As previously noted, Mr Keane also submitted that Energex would meet any limitation defence with a plea of fraudulent concealment. He acknowledged that the decision of the Full Court of the Federal Court in Wardley was binding authority, so far as I was concerned, for the proposition that this plea was not available in a case such as the present. Nonetheless, he formally submitted that the Full Court had erroneously rejected this doctrine.

145               Mr Keane then turned to the respondents’ contention that Energex’s claims for injunctive relief, and for damages under s 87(1), constituted an abuse of process. He submitted that this was not the case. The claim for injunctive relief was neither foredoomed to fail, nor brought to achieve a collateral advantage. The fact that there was no allegation in the statement of claim of any threat of continuing contravention was simply because s 80(4) provided that an injunction could be granted whether or not a future contravention was threatened. The fact that Finkelstein J took the view that some of the respondents were unlikely to re-offend did not lead his Honour to conclude that it was unnecessary to grant injunctive relief.

146               In any event, Mr Keane submitted that there was in fact a threat of future contravention. He submitted that no great store should be placed on submissions now made on behalf of the respondents who had admitted, in the proceedings before Finkelstein J, that they had engaged in a course of conduct over many years that involved serious wrongdoing. He noted that the position of the ABB respondents had not yet been determined. I understand that those respondents have subsequently been dealt with, and penalties of $14 million were levelled against them.

147               Mr Keane submitted that it could hardly be an abuse of process for Energex to seek the protection of an injunction that it could enforce in circumstances where, for example, the ACCC might be unwilling, or unable, to act. Energex had not been a party to the ACCC proceedings. It could not enforce the orders made in those proceedings. There was every justification for it to seek addition protection.

148               Mr Keane rejected the contention that any injunction granted to Energex would only take effect upon the expiration of the existing injunctions granted in the ACCC proceedings. The injunctions that it sought would take effect from the date of judgment. Relief of that kind was in no way inconsistent with the relief granted to the ACCC.

149               Mr Keane noted that the Act expressly conferred rights under s 80 and s 87(1) that did not attract a limitation defence. He submitted that it could hardly be illegitimate, or amount to a collateral purpose, to seek relief for which the Act expressly provided. He further submitted that it was impossible, at this time, for the Court to consider whether any relief under s 87(1) should be granted as a matter of discretion.

150               The next matter that Mr Keane dealt with concerned the pleading of the tort of deceit. He submitted that the main issue raised in the statement of claim was whether the conduct of the respondents, in replying individually to the invitations to tender, was apt to create a deliberately false impression that their bids were genuine. He submitted that it could not be said that this claim was untenable.

151               Mr Keane denied that Energex’s case involved an assertion that mere silence or non-disclosure of facts was a sufficient foundation for an action in deceit, absent a legal obligation to make disclosure. Energex relied neither on silence nor on non-disclosure, but rather upon the representations to be implied from the active steps taken by the respondents. Mr Keane cited the following comment by Priestley JA in Brunninghausen v Glavanics (1999) 46 NSWLR 538 at 540:

“The only comment I wish to make concerns the proposition that mere silence by a party with superior knowledge is not a misrepresentation. I think the citation by Handley JA from Spencer, Bower and Turner, Actionable Misrepresentations, 3^rd ed (1974) London, Butterworths, demonstrates the emptiness of this proposition. A case of “mere” silence is very hard to imagine. What happens in fact in the decision in litigation in which the proposition is invoked is that the court considers whether, in all the circumstances of the case, the conduct of the impugned party should be considered as having misled the other party.”

152               As regards the causation issue raised by Mr Archibald, Mr Keane noted that the statement of claim filed in this case differed significantly from that in Pioneer Concrete. It was not alleged in Pioneer Concrete, as it was in the present case, that but for the fraudulent representation, the applicant would have carried out investigations which might have disclosed the existence of the collusion. Mr Keane accepted that Energex must, in due course, prove that it had relied upon the implied representation pleaded, but damages would then be assessed by considering what the position would have been had that representation not been made. He contended that had the tenders not been submitted, the representations would not have been made. There would then have been no loss.

153               Finally, Mr Keane dealt with the more mundane pleading points raised by the respondents. He rejected Mr Hilton’s contention that the statement of claim was deficient because it contained no particulars of the intention of the tenderers, or of their alleged dishonesty. He submitted that intention was to be inferred. The statement of claim alleged that the representations were false, and that they were known to be false. It was obvious that Energex’s case was that they were made dishonestly, and it was perfectly clear what was meant by that term.

154               Mr Keane then addressed Mr Gray’s complaints on behalf of the Schneider respondents. He submitted that Energex’s case against those respondents was entirely clear. Energex alleged the existence of an agreement, arrangement or understanding based on an inference to be drawn from overt acts. As such, the principles governing the pleading, and proof of such a case, were essentially the same as those involving proof of a conspiracy. It was unnecessary, in those circumstances to single out those material facts alleged against Schneider, as distinct from the material facts alleged against the other respondents.

155               Mr Keane submitted that there were three reasons why Mr Gray’s contentions should be rejected. First, the nature of the case pleaded against all respondents was clear. Indeed, it was essentially the same as the case that the ACCC had presented against Schneider, a case that was sufficiently well understood to have enabled the Schneider respondents to have admitted having contravened ss 45 and 45A. Second, there could be no possible need for further particulars. If anything, Energex’s case was more detailed than necessary. Third, such particulars as had been provided were the best that could be given at this time. Further particulars might be provided after discovery.

156               Mr Keane dismissed various other criticisms made by Mr Gray being insubstantial, and having no merit.

conclusionS

Summary dismissal and strike out

157               There is no doubt that this case has the potential to run for months if it goes to trial. The proceedings thus far indicate that it will be hard fought, with every conceivable point likely to be taken. In these circumstances, it is of some comfort to note that there is at least a measure of common ground among the parties regarding the general principles that govern applications for summary dismissal.

158               It is well accepted that the Court will not order that a proceeding be dismissed under O 20 r 2(1) except in a “very clear” case. In Dey v Victorian Railways Commissioners (1949) 78 CLR 62, Dixon J, as his Honour then was, formulated the relevant principle, as follows, at 91:

“A case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting his case for determination in the appointed manner by the court with or without a jury. The fact that a transaction is intricate may not disentitle the court to examine a cause of action alleged to grow out of it for the purpose of seeing whether the proceeding amounts to an abuse of process or is vexatious. But once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process.”

159               In General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125, Barwick CJ stated the test as follows at 128-130:

“The plaintiff rightly points out that the jurisdiction summarily to terminate an action is to be sparingly employed and is not to be used except in a clear case where the Court is satisfied that it has the requisite material and the necessary assistance from the parties to reach a definite and certain conclusion. I have examined the case law on the subject, to some of which I was referred in argument and to which I append a list of references. There is no need for me to discuss in any detail the various decisions, some of which were given in cases in which the inherent jurisdiction of a court was invoked and others in cases in which counterpart rules to Order 26, r. 18, were the suggested source of authority to deal summarily with the claim in question. It is sufficient for me to say that these cases uniformly adhere to the view that the plaintiff ought not to be denied access to the customary tribunal which deals with actions of the kind he brings, unless his lack of a cause of action – if that be the ground on which the court is invited, as in this case, to exercise its powers of summary dismissal – is clearly demonstrated. The test to be applied has been variously expressed; “so obviously untenable that it cannot possibly succeed”; “manifestly groundless”; “so manifestly faulty that it does not admit of argument”; “discloses a case which the Court is satisfied cannot succeed”; “under no possibility can there be a good cause of action”; “be manifest that to allow them” (the pleadings) “to stand would involve useless expense”.

At times the test has been put as high as saying that the case must be so plain and obvious that the court can say at once that the statement of claim, even if proved, cannot succeed; or “so manifest on the view of the pleadings, merely reading through them, that it is a case that does not admit of reasonable argument”; “so to speak apparent at a glance”.

… [I]n my opinion great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal. On the other hand, I do not think that the exercise of the jurisdiction should be reserved for those cases where argument is unnecessary to evoke the futility of the plaintiff's claim. Argument, perhaps even of an extensive kind, may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that it cannot possibly succeed.”

160               See also Webster v Lampard (1993) 177 CLR 598.

161               I discussed the general principles that govern summary dismissal in McKellar v Container Terminal Management Services Ltd (1999) 165 ALR 409 at 415-417. I do not propose to repeat here what I said regarding that issue in that judgment. The power to order summary judgment in favour of a respondent must be exercised with caution, and should not be exercised unless it is obvious that there is no real question to be tried.

162               A similar approach must be taken in relation to the power to strike out, in whole or in part, a pleading under O 11 r 16. The rules that govern pleadings in this Court are set out in O 11. Order 11 r 2(a) provides that, subject to the Rules, a pleading of a party shall contain, and contain only, a statement in a summary form of the material facts on which the party relies. Order 11 r 3 requires brevity and O 11 r 9 allows a party, by his pleading, to raise any point of law.

163               Order 11 r 16 provides:

“Where a pleading:

(a) discloses no reasonable cause of action or defence or other case appropriate to the nature of the pleading;

(b) has a tendency to cause prejudice, embarrassment or delay in the proceeding; or

(c) is otherwise an abuse of the process of the Court;

the Court may at any stage of the proceeding order that the whole or any part of the pleading be struck out.”

164               I dealt with the principles which govern pleadings in McKellar at [20]-[33]. In addition to the cases there discussed, there is a useful statement of the function of pleadings in Bank Commerciale SA (In Liq) v Akhil Holdings Ltd (1990) 169 CLR 279 where Mason CJ and Gaudron J said at 286:

“The function of pleadings is to state with sufficient clarity the case that must be met…. In this way, pleadings serve to ensure the basic requirement of procedural fairness that a party should have the opportunity of meeting the case against him or her and, incidentally, to define the issues for decision. The rule that, in general, relief is confined to that available on the pleadings secures a party’s right to this basic requirement of procedural fairness”. (footnote omitted)

165               Once again, in the interests of brevity, I shall not go over the same ground as I did in McKellar. I will simply apply the same approach to the respondents’ challenges to Energex’s statement of claim in this case as I did in McKellar.

Are the s 82(1) claims time barred?

166               I propose to deal first with the contention that virtually all of Energex’s claims for damages under s 82(1) should be dismissed, or struck out, as disclosing no reasonable cause of action. That contention is, of course, primarily based upon the proposition that these claims are time barred.

167               As Mr Keane noted, the respondents must persuade this Court that Energex should be denied the opportunity to present these claims. Because the time bar point is raised at the interlocutory stage, the burden that they must discharge is a heavy one.

168               If the respondents are correct in their submission that Energex’s claims are time barred, it will have no recourse, by way of damages, against them no matter how strong a case it can mount that they engaged in the most flagrant breaches of s 45. There are strong reasons to think that such an outcome would not have been intended by the legislature. Collusive tendering, of the type alleged in this case, is by its very nature covert. It may take years in order to be detected.

169               In principle, a party who has engaged in fraudulent conduct should not be permitted to take advantage of a limitation defence where that conduct has not come to light until long after the victim has suffered harm. The same is true where a party has caused harm, but managed by fraudulent means to conceal it.

170               Mr Keane submitted, with some rhetorical flourish, that the outcome for which the respondents contended would be “a disgrace to our jurisprudence”. That did not prevent the House of Lords in Cartledge v E Jopling & Sons Ltd from holding that the claim in that case was statute barred, notwithstanding the fact that the result was an affront to common sense, and justice. However, as Mr Keane noted, that conclusion was arrived at by construing the relevant limitation statute in the light of the maxim expressio unius est exclusio alterius, a consideration that is not present when considering s 82(2).

171               I accept Mr Keane’s contention that it would be contrary to basic principle to deprive an injured party of its right to compensation arising out of a fraudulent conspiracy merely because the conspiracy was not detected until after the limitation period had expired.

172               I also accept Mr Keane’s submission that s 82 should be interpreted without any of the preconceptions that would flow from the ordinary application of common law doctrines of tort and contract. In Marks v GIO, the High Court said as much. The task for the Court is to construe the expression “suffers loss or damage” in s 82(1), and the cognate expression “the conduct accrued” in s 82(2).

173               In my view, these expressions are to be given their ordinary and natural meaning. However, that meaning is to be informed by the extensive body of authority that now exists regarding when a cause of action accrues arising out of misconduct, or breach of a statute. Some of the cases suggest that this occurs only when the misconduct, or breach, comes to light.

174               The clearest example of this approach lies in the case of a defective building. It is clear that if a building with a latent defect is purchased, the plaintiff does not suffer economic loss until the defect becomes manifest. Yet the way in which such a case is typically pleaded is to assert that the loss results from the payment of a greater amount than would have been paid had the defect been known.

175               Another example is the line of cases, of which Karedis is a prime example, in which an asset is purchased, and it becomes necessary to determine, in the context of a claim under s 52, whether the transaction was disadvantageous. It may be, in such a case, that one cannot make such a finding until the benefits and burdens of the transaction have been fully ascertained. That may be long after the date on which the asset is purchased.

176               Mr Keane challenged the respondents’ contention that the gist of Energex’s claim was that it had paid more for the transformers than it ought to have done, and that but for the cartel, it would have paid less for those items. He submitted that this was a distortion of the way Energex’s case was pleaded. It claimed that it suffered damage as a result of the price paid exceeding the price that would have prevailed, but for the contravening conduct. In Mr Keane words, the difference between these propositions was as follows:

“… it is not the case, as Mr Hilton suggested, that our pleading is that we paid more than the market price, or that we paid more than they were worth. We understand why our learned friends seek to reformulate our pleading, because their objective is to say that, having pleaded the case in the way in which we have, we must be taken to have pleaded that our cause of action is in respect of a loss suffered when we bought the transformers. But your Honour, just like the person who buys the building with the latent defects that one day will emerge into cracks that devalue it, we acquired transformers in the market in circumstances in which the day after we acquired them, just like the building with the canker working away at its foundations, our transformer was worth exactly what we paid for it the day before and remained so, and remained so until the fact of the cartel and the fact that the market was rigged emerged.”

177               Mr Keane submitted that Energex’s position should be regarded as analogous to that of the purchasers in the latent defect building cases. He submitted that the price paid by Energex exceeded the true value of the transformers in a market that had not been “rigged” by the respondents’ conduct. The suggestion that Energex could have sued the respondents for the difference between the price paid, and their “value”, the day after they had been purchased, was misconceived. The only measure of true market value would have been a hypothetical fair and honest market. That would have required the fact that the market had been rigged to become manifest.

178               I consider that Wardley provides some support for Mr Keane’s argument. I refer in particular to the discussion by Brennan J of the principle that a loss is suffered only when the true extent of the benefit and burden of the various transactions can be ascertained. Mr Keane’s approach is also supported by Karedis. On that analysis, Energex could not be said to have paid more than the market value for the transformers purchased until it became clear what that market value actually was. That could not have occurred until it was discovered that the market had been rigged.

179               In summary, therefore, the primary case advanced on behalf of Energex seems to me not to be that it suffered loss at the moment it paid for the transformers, but rather, that it suffered loss because it paid more than it ought to have done, in a free market. It is arguable that Energex did not suffer loss, within the meaning of that expression in s 82(2), until the market-rigging became manifest. At that point, it could be ascertained that it had suffered loss, and that loss could be quantified.

180               I should emphasise that I am making no final determination on this point. The only question that must be considered at this stage is whether Mr Keane’s submission that Energex’s claims under s 82(2) are not time barred is arguable. For the reasons set out above, in my view, that submission is tenable.

181               Mr Keane also put Energex’s case on several alternative bases. He submitted that the use of the word “suffers” in s 82(1) connotes knowledge, on the part of the victim, of the facts that give rise to the loss or damage alleged. He accepted that there was no authority directly in point that supported that contention. However, he submitted that there were highly persuasive dicta in cases such as Hawkins v Clayton, and Wardley,that broadly fortified it.

182               Hawkins v Clayton concerned a will made in 1970 appointing an executor, and leaving him the residue of the testatrix’s estate. The will was retained by the solicitors by whom it was drawn. The testatrix died in January 1975, but the solicitors made no attempt to locate the executor and inform him of the will until March 1981. In October 1982, the executor obtained a grant of probate. Between the testatrix’s death, and March 1981, the main asset of her estate, a house, was permitted to fall into disrepair and to lie vacant for a substantial time.

183               By majority, the High Court held that the solicitors were under a duty to take reasonable steps to find the executor and inform him of the existence and terms of the will. The majority also held that the solicitors were in breach of that duty, and liable in damages. They held that the action was not barred by s 14(1) of the Limitation Act 1969 (NSW).

184               Brennan and Gaudron JJ arrived at this conclusion on the ground that the cause of action did not accrue until the executor assumed office in March 1981. Deane J reasoned that the cause of action did not accrue until the expiration of the period in which the wrongful act itself effectively precluded the bringing of proceedings.

185               Wardley concerned an action by the State of Western Australia claiming damages for loss it alleged that it had suffered as a result of misleading and deceptive conduct on the part of a company called Wardley Australia Ltd. That conduct was said to have led the State to grant an indemnity to the National Australia Bank against a facility granted by the bank to Rothwells Ltd. The statement of claim alleged that at a meeting on Saturday, 24 October 1987, representations were made on behalf of Wardley to the effect that Rothwells had very substantial net assets, that it did not suffer a capital deficiency but simply a liquidity problem, and that there were no substantial amounts owed to Rothwells by Laurie Connell, or interests associated with him. It was in reliance upon those representations, that were false, that the State, on 26 October 1987, executed the indemnity. In due course, the bank called on the indemnity. The State disputed its liability, and the dispute was later settled by the State paying the bank $10.5 million.

186               On 14 January 1991, the State amended its statement of claim so as to rely on an additional representation made by Wardley at a meeting on Sunday 25 October 1987 to the effect that Rothwells was a sound financial institution that had substantial net assets. It was alleged that this was not the case, and that the State had been induced to give this indemnity on the basis of the misleading statements made by Wardley on the Sunday, as well as on the preceding day.

187               The trial judge, French J, struck out the amendment on the ground that it pleaded a cause of action that was outside the time limit prescribed by s 82(2). The Full Court allowed an appeal by the State, and Wardley appealed to the High Court from that judgment. It was held, by majority, that where as a result of misleading or deceptive conduct a person grants an indemnity under which he is obliged to make a payment when the loss of the party to be indemnified is ascertained, and quantified, the person granting the indemnity suffers no loss until the contingency is fulfilled. Accordingly, time did not begin to run under s 82(2) until that event occurred.

188               Deane J, who together with Toohey J dissented, referred to his earlier views in Hawkins v Clayton. His Honour observed at 540:

“In Hawkins v Clayton, a majority of the Court implicitly or explicitly rejected a submission that the Court should recognize a general overriding qualification of the prima facie position that a requirement of loss or damage as an ingredient of a cause of action is satisfied as soon as relevant loss or damage is in fact sustained. That suggested qualification was to the effect that, at least in the case of claims in negligence for damages for economic loss, time under a limitations provision does not commence to run until the stage is reached when the plaintiff discovers, or could on reasonable inquiry have discovered, that the loss has been sustained. If such a broad overriding qualification had been adopted in relation to such claims, reasoning by analogy would have lent strong support for the conclusion that, in a case such as the present where the action under s 82(1) is for damages for economic loss caused by misleading conduct in contravention of s 52 of the Act, time does not commence to run until the plaintiff knows or reasonably ought to know that the relevant conduct has in fact caused loss. The Court’s rejection of such an overriding qualification does not, however, alter the fact that, in some of the cases where an action lies in negligence for pure economic loss, no relevant loss is actually sustained or suffered and no cause of action for damages accrues unless and until some actual adverse consequence of the negligence is known or becomes manifest. Nor does the rejection of such a qualification provide, by analogy or otherwise, a general answer to the question whether the mere incurring of a contingent liability to make a future payment of itself constitutes loss or damage for the purpose of determining when a cause of action of which loss or damage is a necessary ingredient accrues or arises.” (footnotes omitted)

189               Brennan J said at 536-537:

“The cause of action created by s 82(1) has several elements, but it is a cause of action for the recovery of money representing loss or damage suffered by the plaintiff – “the amount of the loss or damage”. The loss or damage includes, of course, economic loss or damage which the plaintiff suffers. …”

190               His Honour then set out the passage contained at [129] above, to which Mr Keane referred, and continued:

“False representations contravening s 52, like fraudulent misrepresentations and negligent misstatements, may induce a plaintiff to act or to refrain from acting and the relevant loss or damage may flow from the plaintiff’s own act or omission and only indirectly from the defendant’s contravening conduct. The relevant transaction may be between the plaintiff and a third party, not between the plaintiff and the defendant. Each case requires an analysis of its particular circumstances in order to identify the transaction, the nature of the loss or damage actually suffered by the plaintiff and, where there are benefits and burdens, their components. Once the loss or damage is identified, the date when it was suffered can be ascertained.

… There is a sense in which it is right to say that, when a misrepresentation induces a plaintiff to enter into a transaction in which the plaintiff suffers a loss, the loss is suffered once the plaintiff becomes bound to the transaction. The die is then cast and what follows can be viewed as evidence proving the extent of the loss suffered when the first binding step was taken. That may be the correct analysis when the first binding step is such that, whatever extrinsic circumstances may transpire, a loss must be suffered. For example, when an asset is purchased for a price and, by reason of an inherent defect, it is worth less than the price paid, a loss may said to be suffered when the plaintiff pays the price or becomes bound to pay the price. Similarly, when an agreement imposes on a plaintiff an obligation to pay an amount of money without acquiring a benefit and the amount to be paid is quantified by no factors extrinsic to the agreement save the passing of time, it is right to say that the loss is suffered when the agreement to pay becomes binding on the plaintiff. But when the actual loss that a plaintiff suffers depends not only on the making of an agreement but also on circumstances extrinsic thereto, the loss is not suffered until those circumstances have transpired and, in benefit and burden cases, not until the loss is ascertainable. The present case does not involve any acquisition by the State of a contractual benefit: there was simply an indemnity given to the Bank which entitled the Bank to demand the payment of money upon certain contingencies.” (footnotes omitted)

191               Mr Keane accepted that on his analysis, if the cartel had never come to light, then even though Energex would have paid more that it ought to have done by reason of the cartel’s existence, it would not have “suffered” any loss or damage. That conclusion seems to me to be counter-intuitive.

192               I have difficulty in accepting this alternative variant of Energex’s case. It relies upon a somewhat strained meaning being given to the word “suffers” in s 82(1). In ordinary parlance, a person can “suffer” loss or damage without being aware of the facts that give rise to that loss or damage. The analogy between the present case, and the case of a latent building defect, is not nearly as exact as Mr Keane contends, nor is the analogy between the present case, and a contingent liability case, such as Wardley.

193               That does not detract from the force of Mr Keane’s contention that it hardly lies in the mouth of those who have engaged in serious and persistent misconduct to say that, having managed to keep their nefarious deeds secret for a sufficiently long time, they are entitled to take the benefit of a limitation defence. The miscreants, having by their conspiracy not merely injured Energex, but also prevented it from discovering what was happening, should not be permitted to take advantage of their own misconduct.

194               There is no doubt in my mind that a person who buys what he or she is told is a famous painting, but is in fact a forgery, should be able to recover damages from the fraudulent vendor, provided proceedings are brought within the relevant limitation period once the fraud has been discovered. The question is whether it requires legislation to produce this result, or whether there is some other way in which it can be achieved.

195               For reasons that are difficult to understand, s 82(2) contains no express fraud exception. Mr Keane submits that this is because the word “suffers” was intended to do the work of such an exception. Alternatively, he submits, that it is because relief is available, in any event, under s 87. These are possible explanations, though they seem to me to lack cogency.

196               It is unnecessary, at the present stage, to come to any firm conclusion about this matter. It is sufficient to say, as I have done, that it is arguable that in cases where what is claimed is economic loss arising from the purchase of an asset, no loss is suffered until there has been an actual balancing of benefits and burdens, leading to the conclusion that loss has been incurred. Alternatively, no loss is suffered until it becomes possible to ascertain that an adverse balance has been struck.

197               I consider that so much follows from the reasoning of the majority in Wardley at 527:

“Economic loss may take a variety of forms and, as Gaudron J noted in Hawkins v Clayton, the answer to the question when a cause of action for negligence causing economic loss accrues may require consideration of the precise interest infringed by the negligent act or omission. The kind of economic loss which is sustained and the time when it is first sustained depend upon the nature of the interest infringed and, perhaps, the nature of the interference to which it is subjected. With economic loss, as with other forms of damage, there has to be some actual damage. Prospective loss is not enough.

When a plaintiff is induced by a misrepresentation to enter into an agreement which is, or proves to be, to his or her disadvantage, the plaintiff sustains a detriment in a general sense on entry into the agreement. That is because the agreement subjects the plaintiff to obligations and liabilities which exceed the value or worth of the rights and benefits which it confers upon the plaintiff. But, as will appear shortly, detriment in this general sense has not universally been equated with the legal concept of “loss or damage”. And that is just as well. In many instances the disadvantageous character or effect of the agreement cannot be ascertained until some future date when its impact upon events as they unfold becomes known or apparent and, by then, the relevant limitation period may have expired. To compel a plaintiff to institute proceedings before the existence of his or her loss is ascertained or ascertainable would be unjust. Moreover, it would increase the possibility that the courts would be forced to estimate damages on the basis of likelihood or probability instead of assessing damages by reference to established events. In such a situation, there would be an ever-present risk of undercompensation or overcompensation, the risk of the former being the greater.” (footnotes omitted)

198               I note that the majority in Wardley specifically disapproved of Jobbins and, in particular, the proposition in that case that loss or damage is sustained on entry into an agreement induced by a false, negligent or misleading misrepresentation. The majority said of Jobbins at 529:

“But we have difficulty in accepting that the applicant suffered loss or damage on entry into the agreement merely because the investment was alleged to lack the represented qualities. On this aspect of the case, the question was whether the investment was worth less than the applicant contracted to pay for it and, if so, when the applicant first sustained loss or damage. How that question could be answered in the absence of evidence is not evident to us. Although the investment lacked the represented qualities, it may have been worth no less than the consideration provided by the applicant.”

199               The majority continued at 530-531:

“In the case of a fraudulent or negligent misrepresentation which induces the plaintiff to enter into a contract to purchase property, the plaintiff’s loss, apart from any question of consequential damage, is measured by the difference between the price paid or payable under the contract and the value of the property at the date of the contract. It will be noticed that, even in such a case, Dixon J spoke in Potts v Miller (an action in deceit) of the measure of damages consisting in “the loss or expenditure incurred by the plaintiff in consequence of the inducement upon which he relied, diminished by any corresponding advantage in money or money's worth obtained by him on the other side”. It is that amount that, in such a case, represents “the prejudice or disadvantage” the plaintiff “has suffered in consequence of his altering his position under the inducement of the fraudulent misrepresentations made by the defendant”, subject to any consequential damage. Putting aside the incurring of expenditure, these statements might be thought to indicate that a plaintiff does not sustain loss until that loss is ascertained or, at least, is capable of ascertainment.

Be that as it may, the English decisions have proceeded according to the view that, where the plaintiff is induced by a negligent misrepresentation to enter into a contract and the contract, as a result of the negligence, yields property or contractual rights of lesser value, the plaintiff first suffers financial loss on entry into the contract, notwithstanding that the full extent of the plaintiff’s financial loss may be incapable of ascertainment until some later date. In part, the English approach appears to have been influenced by the general principle stated in Darley Main Colliery Co v Mitchell that damages in respect of a cause of action are awarded on a once and for all basis. But that principle tells us very little, if anything, about the time when the plaintiff first suffers loss or damage in the circumstances of a particular case, except that, properly understood, Darley Main Colliery emphasizes the need for actual, as distinct from prospective, damage before prospective damages can be included in the award.

Another element in some of the English decisions, as in Jobbins, is the conclusion that, because the subject matter of the agreement lacked the qualities which it had been represented as having, that subject matter was therefore less valuable than it would have been if the representations had been true. That conclusion is acceptable in cases in which the contract measure of damages is appropriate but it is not acceptable here where the contract measure of damages does not apply. The application of that measure of damages may, in some situations, enable a court to conclude more readily that the plaintiff first suffers loss or damage on entry into an agreement.

It has been contended that the principle underlying the English decisions extends to the point that a plaintiff sustains loss on entry into an agreement notwithstanding that the loss to which the plaintiff is subjected by the agreement is a loss upon a contingency. For our part, we doubt that the decisions travel so far. Rather, it seems to us, the decisions in cases which involve contingent loss were decisions which turned on the plaintiff sustaining measurable loss at an earlier time, quite apart from the contingent loss which threatened at a later date.” (footnotes omitted)

200               Finally, the majority in Wardley stated at 533:

“The conclusion which we have reached is reinforced by the general considerations to which we referred earlier. It is unjust and unreasonable to expect the plaintiff to commence proceedings before the contingency is fulfilled. If an action is commenced before that date, it will fail if the events so transpire that it becomes clear that no loss is, or will be, incurred. Moreover, the plaintiff will run the risk that damages will be estimated on a contingency basis, in which event the compensation awarded may not fully compensate the plaintiff for the loss ultimately suffered. These practical consequences which would follow from an adoption of the view for which the appellants contend outweigh the strength of the argument that the principle applicable to the cases in which the plaintiff acquires property (or a chose in action) should be extended to cases where an agreement subjects the plaintiff to a contingent loss. In such cases, it is fair and sensible to say that the plaintiff does not incur loss until the contingency is fulfilled.”

201               Recently, the High Court has looked again at the question of when contingent losses are sustained. In Murphy v Overton Investments Pty Ltd (2004) 204 ALR 26, the applicants took a 99-year lease over a unit in a retirement village owned and managed by Overton Investments Pty Ltd. Prior to, and at the time they entered into the lease, Overton gave them an estimate of the amount that they would be required to contribute towards outgoings. It explained that this was an estimate only, and would be subject to variation from time to time.

202               The estimate was based on figures that did not reflect the actual cost of outgoings. Nor did it take into account all of the various outgoings that Overton was entitled to recover. In 1997, Overton began charging the applicants for all outgoings that could properly be charged under the lease. The applicants brought proceedings alleging breaches of s 52 and sought orders under s 87, limiting the contributions that they were required to pay. In the alternative, they sought damages under s 82. Those damages reflected the difference between the value of the lease if contributions were calculated in accordance with Overton’s legal entitlement, and the value of the lease if contributions were charged in accordance with a restriction on its recovery entitlements.

203               The applicants succeeded at first instance in proving that Overton had engaged in conduct that was misleading or likely to mislead. His Honour also concluded that Overton’s conduct had caused the applicants to enter into the lease. However, he held that they had not proved that they had suffered any loss or damage. That was because there was no difference between the price paid under the lease, and its value at the date of the lease. Nor was there any evidence that the applicants were not receiving value for the maintenance fees that they were required to pay. An appeal to the Full Court was dismissed. However, the High Court reversed the trial judge’s decision, and remitted the matter to him for assessment of damages and interest.

204               The reasoning of the High Court can be summarised as follows. The Full Court erred in concluding that the applicants had not proved loss or damage. It is not correct to assume that in every misrepresentation case, the only type of damage that could be redressed under Pt VI of the Act was a difference between price and value, or any consequential loss. Although there was no evidence that the applicants had not received value for the maintenance fees that they paid, it did not necessarily follow that they did not incur loss.

205               The High Court also reiterated what had been decided in Marks v GIO, namely that the operation of Pt VI should not be approached by drawing analogies from the tort of deceit, or any other claims under general law. The expression “loss or damage” should not be given a narrow meaning, and was not confined to economic loss. Importantly, the Court held that if a party enters a contract that exposes that party to a contingent loss or liability (that is, the possibility of future detrimental consequences), no damage is sustained until the contingency is fulfilled and the loss becomes actual. In the instant case, the applicants suffered loss when Overton starting charging the full amount of the outgoings that it was entitled to charge. Their Honours said at [55]:

“What the appellants did not know was that the estimate of outgoings they were given did not provide for all the outgoings that were then being incurred. Here, therefore, the appellants suffered no loss as a result of undertaking the obligations they did unless and until the contingency which the misrepresentation hid (that items other than those used to form the estimate were then being incurred and could be charged as outgoings) was first realised. That was a contingency in the sense that the adverse risk might never have eventuated. When the lease was entered in 1992, the respondent was charging levies in relation only to limited categories of the overall outgoings. The respondent might have chosen to continue to charge the appellants only for those limited categories. On the other hand, it was possible that after 1992 it might decide to charge for wider categories. It was only from the time when it in fact decided to depart from the 1992 position and charge for the wider categories that the adverse risk eventuated. When it did, but only then, the appellants suffered loss and damage. And this court’s decision in Wardley requires the conclusion, on the evidence in this case, that it was only when the contingency came to pass that the appellants sustained loss or damage. It follows that no limitation defence was available.” (footnote omitted)

206               The Court also said at [66]:

“The appellants had been induced by the respondent’s conduct to undertake an obligation which may, but need not, have been more onerous than the respondent’s representation led them to believe. When the respondent started to charge all the outgoings it was entitled to charge, the appellants suffered a loss. The amount of that loss was not to be determined, as the majority of the Full Court held, only by comparing the financial position of the appellants according to whether they entered this lease or took some other accommodation. The appellants did not contend that they had suffered loss in that way. The appellants suffered loss because the continuing financial obligations they undertook when they took the lease proved to be larger than they had been led to believe.”

207               The present case differs in several important respects from both Wardley and Murphy v Overton. There is no question of Energex having entered into a contract that exposed it to a “contingent loss or liability”. Nonetheless, the reasoning in those cases, and the reasoning in Karedis, at least lends some support to Mr Keane’s argument that Energex did not suffer loss or damage at the moment it entered into each of the agreements pleaded. Rather, it suffered loss only at the point that it could be ascertained that the price it had paid exceeded the market value of the goods. That is, of course, treating “market value” as a value untainted by market rigging.

208               It is not necessary, therefore, to determine whether Mr Keane’s alternative contention as to the meaning of the word “suffers” is arguable in order to conclude that Energex should not be shut out of court, at this stage, on the basis of s 82(2).

209               It is also unnecessary to accept as arguable Me Keane’s somewhat elaborate submissions regarding what Energex might do in the event that the respondents seek to rely upon s 82(2) as an answer to the claim for damages under s 82(1). Mr Keane pointed out that it was theoretically possible that the respondents would not plead the limitation defence. He submitted that no application for summary dismissal should be entertained until that defence had at least been pleaded.

210               I am not persuaded by that submission. The various notices of motion presently before the Court make it abundantly clear that the respondents will, if required to file defences, plead the limitation defence. Mr Keane’s suggestion that they may not do so is entirely unrealistic.

211               The next point raised by Mr Keane was that any attempt on the part of the respondents to plead a limitation defence would be met by an amendment to the statement of claim, by way of reply, in which Energex would seek damages based not upon the original breaches of s 45, but rather upon the unconscionable conduct involved in pleading the defence. Mr Keane contended that such relief would arise pursuant to s 51AC. Alternatively, he submitted that Energex would be entitled to recover damages, pursuant to the causes of action already pleaded, or to obtain injunctive relief to prevent the respondents from pleading that defence.

212               I am greatly impressed by the ingenuity of the argument. I am rather less impressed by its merits.

213               Mr Keane submitted that any attempt to plead the limitation defence would amount to conduct “in trade or commerce”. Section 51AC relevantly provides:

“(1) A corporation must not, in trade or commerce, in connection with:

(a) the supply or possible supply of goods or services to a person (other than a listed public company); or

(b) the acquisition or possible acquisition of goods or services from a person (other than a listed public company);

engage in conduct that is, in all the circumstances, unconscionable.

(2) A person must not, in trade or commerce, in connection with:

(a) the supply or possible supply of goods or services to a corporation (other than a listed public company); or

(b) the acquisition or possible acquisition of goods or services from a corporation (other than a listed public company);

engage in conduct that is, in all the circumstances, unconscionable.

…”

214               Section 51AC(4) contains a series of matters to which the Court may have regard when determining whether either ss 51AC(1) or 51AC(2) has been contravened.

215               Section 51AC(5) provides:

“5. A person is not to be taken for the purposes of this section to engage in unconscionable conduct in connection with:

(a) the supply or possible supply of goods or services to another person; or

(b) the acquisition or possible acquisition of goods or services from another person;

by reason only that the first-mentioned person institutes legal proceedings in relation to that supply, possible supply, acquisition or possible acquisition or refers to arbitration a dispute or claim in relation to that supply, possible supply, acquisition or possible acquisition.”

216               Mr Keane submitted that any party who enters into a contract, and then seeks to plead a defence, or seeks to take advantage of a legal right, in circumstances where it would be “unconscionable” to do so, thereby contravenes s 51AC. He submitted that s 51AC(5) supported that contention, and he relied in particular upon the use of the expression “by reason only that”.

217               I am not persuaded by that submission. It requires the expression “in trade or commerce” to be given an unduly wide meaning. It is also difficult to reconcile with those authorities that have dealt with the meaning of that expression in this context. For example, in Little v Law Institute of Victoria & Ors (No 3) [1990] VR 257, the Full Court of the Supreme Court of Victoria held that a statement made by the respondent during the course of proceedings brought against the appellant seeking to restrain the appellant from practising as a solicitor could not give rise to a claim under the Fair Trading Act 1985 (Vic).

218               In a joint judgment, Kaye and Beach JJ said at 273:

“In our opinion, statements made during the course of litigation cannot be categorised as statements made in trade or commerce nor can they categorised as representations.”

219               Their Honours referred to Re Ku-ring-gai Co-operative Building Society (No 12) Ltd (1978) 22 ALR 621 where Bowen CJ explained that the words “trade” and “commerce” were ordinary terms which described all the “mutual communings” that comprised commercial arrangements or commercial dealings. They then concluded:

“A statement made to a court during the course of litigation is not a statement made in connection with or as part of a commercial arrangement.”

220               See also the observations of Ormiston J at 292, which are to the same effect.

221               I also note that in Australian Associated Motor Insurers Ltd v NRMA Insurance Ltd (2002) 124 FCR 518, Conti J held that a claim that the NRMA and the second respondent, who was a solicitor who acted under retainer agreements from NRMA–insured parties, had contravened s 52, should be struck-out because the conduct about which the applicant complained did not occur “in trade or commerce”. His Honour applied the test laid down in Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 at 603-604 in arriving at that conclusion. In substance, he accepted that the conduct of litigation in court on behalf of a client does not amount to engaging in an activity having a trading or commercial character.

222               On the present state of the authorities, any attempt on the part of Energex to invoke s 51AC in response to a pleading of a limitation defence is unlikely to succeed. The same may be said regarding Mr Keane’s submission that the equitable jurisdiction of the Court could be invoked to enjoin the respondents from relying upon any limitation defence. There is no basis, in the present case, for invoking an estoppel of the kind raised in The Commonwealth v Verwayen (1990) 170 CLR 394. The respondents have not undertaken, expressly or impliedly, not to plead a limitations defence. I accept that in Hawkins v Clayton, Deane J flagged the possibility that an injunction might go to prevent reliance upon such a defence in circumstances where it would be unconscionable to permit it to be raised. However, his Honour’s analysis does not seem to have commended itself to the other members of the Court.

223               Mr Keane also relied upon what is known in the United States as the “doctrine of fraudulent concealment”. He referred to Atlantic City Electric Co v General Electric Co 312 F2d 236 (1962), a decision of the United States Court of Appeals, Second Circuit. In that case, the majority referred to that doctrine, and its application in every Federal statute of limitation. In effect, the Court held that the doctrine applied unless Congress expressly provided to the contrary, in clear and unambiguous language.

224               A similar approach had earlier been taken by the United States Supreme Court in Bailey v Glover 88 US 342 (1874). There, it was held that, at least in equity suits, time did not run in cases of fraudulent concealment until the fraud had been discovered. The Court observed that the position at common law was less clear, but on balance, the same principle ought to apply.

225               The difficulty with my placing any reliance upon these authorities is that the Full Federal Court in Wardley expressly considered, and rejected, any such principle. It noted, for example, that in England, historically, limitation statutes had been construed in a manner that favoured defendants. That led to the enactment of the Latent Damages Act 1986 (UK) which inserted s 14A into the Limitation Act 1980 (UK). This had the effect that the starting date for the reckoning of the period of limitation would be the earliest date on which the plaintiff first had both the knowledge required to bring an action, and the right to do so.

226               The Full Court in Wardley observed that the older English authorities had not escaped criticism. Nonetheless, those cases had been repeatedly followed in Australia and left little room for the invocation of any equitable doctrine of concealed fraud. The Full Court observed at 269:

“The equitable doctrine of concealed fraud does not operate to prevent a defendant to a purely legal claim, not being a claim also cognisable in the concurrent jurisdiction of an equity court, from pleading the Statute of Limitations.”

227               The Full Court noted that strong criticisms had been levelled at this approach by various commentators and law reform bodies. It said at 270:

“In 1936, the contrary views of McCardie J in Lynn v Bamber drew some anxious comment in par 22 of the Fifth Interim Report of the Law Revision Committee which dealt with statutes of limitation: see also the cautious treatment of the subject by D B Ross, “Concealed Fraud and the Statute of Limitations” (1930) 4 ALJ 174. The result was a recommendation by the Committee (since embodied in the British legislation) that in all cases in which the statutes of limitation apply, or are applied by analogy, (a) where a cause of action is founded on fraud, committed by the defendant or his agent or some person through whom he claims, or (b) where a cause of action unconnected with fraud is fraudulently concealed from the plaintiff by the defendant or his agent or some person through whom he claims, the right of the plaintiff to sue should be deemed to have first accrued at the time when the plaintiff discovered such fraud, or could with reasonable diligence have discovered it. The New South Wales and Victorian legislation, to which Davies J referred in Fenech v Sterling, expresses the same policy. We were told that there was no such legislation in Western Australia. (No question arose on this appeal as to whether, consistently with the scope of s 82 of the Act, there remained room for the operation of s 79 of the Judiciary Act to pick up any State limitation statute: see Vink v Schering Pty Ltd (No 2) [1991] ATPR 52,113.)”

228               Having given the matter careful consideration, the Full Court concluded:

“But the question for us is whether there is room for the application of this particular equitable doctrine to defeat reliance upon a limitation provision contained within the statute conferring the cause of action. The equitable doctrine is expressed in terms of claims arising under the general law, whether they might be characterised as legal or equitable. It is not couched in terms which extend to claims created purely by statute. In such cases, the statute has to be given its full effect including any engrafted time limitation of whatever character. That, in our view, is what follows from the decision of the High Court in Crown v McNeil.”

229               Nothing said by the High Court in Wardley, when the case went on appeal, casts any doubt upon the correctness of the approach taken to this issue by the Full Court. Other cases that are in point, including Scarcella v Lettice (2000) 51 NSWLR 302, point in the same direction. See generally the observations of Handley JA in Scarcella at 306 and 308.

230               In Scarcella it was held that time commenced to run, in an action for negligence, when damages accrued, even though the purchasers were not aware of the defect in title. The defect in question was not latent, and could have been discovered had the solicitors who acted for the plaintiff adopted normal conveyancing procedures.

231               On the present state of the authorities, the doctrine of concealed fraud cannot be invoked in answer to the respondents’ foreshadowed reliance upon s 82(2). The authorities suggest that there may be some scope for the application of the doctrine of equitable estoppel, but it is clearly premature to consider that possibility. There would need to be a great deal more known about the facts before any definitive conclusion could be reached.

232               Some commentators have noted that in cases of fraud, statutes of limitations have been given a special application in equity. For example, I C F Spry, in The Principles of Equitable Remedies 5^th ed, 1997, observes at pp 424 and following, that courts of equity would not ordinarily allow a statute of limitations to be set up, in equitable proceedings, in respect of time during which, by reason of the fraud of the defendant, the plaintiff was not aware of his or her right of action. He says that the precise basis upon which equitable relief was granted had been the subject of controversy but “should probably be found in the general disposition of courts of equity to prevent fraudulent reliance on rights”. He also says that there has been some uncertainty as to whether courts of equity would intervene to prevent the setting up of statutory limitation periods in common law actions.

233               The learned authors of Meagher, Gummow & Lehane’s Equitable Doctrines & Remedies, 4^th ed, 2002, essentially agree with this analysis. They point out that when the Court of Chancery developed the doctrine of applying statutes of limitation, by analogy, it refused to do so in cases of “concealed fraud”. There were two main classes of case to which the doctrine applied: (a) when the action was one alleging fraud, in which case time did not run until the discovery of the fraud; and (b) where the cause of action did not involve fraud but its existence was fraudulently concealed by the defendant, in which case time did not run until both the concealment had been discovered, and the cause of action ascertained. They suggest that the former category included actions involving the common law notion of deceit.

234               Whatever rules developed in equity regarding the taking of limitation defences in cases of fraud seem to have been confined to purely equitable proceedings. In Meagher, Gummow & Lehane, it is said at [34-095] that the equitable doctrine of concealed fraud furnished an answer only to equitable claims. It could not be used to furnish grounds for an injunction restraining a defendant at law from pleading the statute of limitations. See generally Imperial Gas Light and Coke Co v London Gas Light Co (1854) 10 Exch 39; 156 ER 346, Hunter v Gibbons (1856) 1 H & N 459; 156 ER 1281, Armstrong v Milburn [1886-90] All ER Rep 596, and R v McNeil (1922) 31 CLR 76 at 99-100. The New South Wales Court of Appeal took the same approach in Metacel Pty Ltd v Ralph Symonds Ltd (1969) 90 WN (Pt 1) (NSW) 449 at 452, a case cited with approval by the Full Court in Wardley.

235               In such cases, time did not begin to run against a plaintiff so long as, by reason of the fraud of the defendant, the plaintiff was not aware of the matters giving rise to the cause of action. See for example Gibbs v Guild (1882) 9 QBD 59 at 69. According to Dr Spry, the better view was that fraud included, for these purposes, fraudulent concealment after a cause of action accrued. He noted, however, that much of this old learning had been superseded by the passage of legislation dealing with limitation periods.

236               In summary, I am not persuaded that Energex’s claims for damages under s 82(1) are untenable. It is at least arguable that any loss or damage suffered by Energex did not occur until after 26 July 1998, the date on which time began to run. Whether or not the limitation defence ultimately succeeds will be a matter for the trial. It is not a matter for summary dismissal.

237               I am fortified in my conclusion regarding this matter by what the High Court said in Wardley. The majority observed in its joint judgment at 533:

“We should, however, state in the plainest of terms that we regard it as undesirable that limitation questions of the kind under consideration should be decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases. Generally speaking, in such proceedings, insufficient is known of the damage sustained by the plaintiff and of the circumstances in which it was sustained to justify a confident answer to the question.”

238               In Cubillo v Commonwealth (1999) 89 FCR 528, O’Loughlin J adopted a similarly cautious approach at 580-590. His Honour supported that approach by reference at 588 to a passage from the judgment of the Queensland Court of Appeal in Noble v Victoria [1999] QCA 110.

Abuse of process

239               Because I have rejected the respondents’ contention that it is clear beyond argument that Energex’s claims for damages under s 82(1) are time barred, so as to warrant summary dismissal, it is not necessary, strictly speaking to deal with their alternative argument that the attempt to invoke s 87(1), as a by-product of a spurious application for injunctive relief, constitutes an abuse of process. Clearly, if s 82(2) does not constitute a bar to the claims under s 82(1), it cannot be an abuse of process for Energex to plead an alternative claim.

240               However, even if the claims brought under s 82(1) were statute barred, it would not necessarily follow that bringing an alternative claim under s 87(1), in conjunction with a claim for injunctive relief, would amount to an abuse of process.

241               In the first place, I see no reason why Energex should not seek the additional protection that would be afforded if an injunction under s 80 were granted in the terms sought. The fact that the ACCC has already obtained injunctive relief is relevant to the exercise of the discretion as to whether additional injunctive relief should be granted. It is not, however, a bar to such relief.

242               Once it is accepted that Energex is entitled to seek injunctive relief, there is no reason why it should be prevented from seeking damages under s 87(1). If Energex can make good its claim that the respondents have systematically engaged in collusive tendering over many years, there would be every justification, in my view, for permitting it to plead its case under s 87(1) so that it could recover damages.

243               The current weight of authority in this country is against the existence of a doctrine of fraudulent concealment in answer to a limitation defence, save in purely equitable proceedings. However, the principles that underlie that doctrine are relevant when considering whether the applicant’s attempt to find an alternative basis upon which to press its claim should be regarded as an abuse of process.

244               There is nothing wrong, in my opinion, with what Energex has done. If the respondents have engaged in systematic fraud, as alleged, it hardly behoves them to complain about Energex’s reliance upon a remedy for which the Act expressly provides. The respondents describe Energex’s conduct as an attempt to “circumvent” a protection that the Act affords them. I do not accept that as a valid characterisation. This is a case in which not only is fraudulent conduct alleged against the respondents, but so too is fraudulent concealment of that conduct. It is, in my view, quite inappropriate to describe Energex’s application for injunctive relief, and for damages under s 87(1), as an abuse of process.

Deceit

245               This takes me to the next issue, which is the challenge to the manner in which the tort of deceit is pleaded. I propose to deal with that point briefly.

246               I accept Mr Keane’s submission that it is at least arguable that the conduct of the respondents in engaging in the tender process, as they did, gave rise to an implied representation that that process was being conducted in a proper and lawful manner. I also accept his submission that Energex need not, and does not, rely upon the existence of some duty, on the part of the respondents, to inform it of the true position. The question is simply whether the respondents’ conduct was apt to indicate that what were in truth collusive tenders, were genuine and separate bids.

247               There appears to be no real issue between the parties regarding the necessary elements of an action in deceit. It seems clear enough that there must be a representation of fact made by words or by conduct, and mere silence is not sufficient.

248               There is a helpful summary of the requirements for pleading the tort of deceit in Bullen & Leake & Jacob’s Precedents of Pleadings, 14^th ed, Vol 2, London, Sweet & Maxwell, 2001, at pp 813-816. A representation can be a statement which is implied from the context in which words are spoken, or by conduct.

249               An example of how conduct that appears not to involve any representation may in fact be held to do so is to be found in Director of Public Prosecutions v Ray [1974] AC 370. In that case, the defendant and four friends went to a restaurant intending to have a meal there and pay for it. After eating the main course, they decided not to pay for the meal. However, they remained seated until the waiter went out of the room. They then ran from the restaurant. The defendant was convicted of dishonestly obtaining a pecuniary advantage by deception. The House of Lords held that the conviction should stand on the basis that the defendant’s conduct, in remaining seated in the restaurant, amounted to a continuing representation of his present intention to pay. His change of mind produced a deception, the effect of which was that he was treated as an honest customer whose conduct did not call for precautions.

250               This decision has not escaped criticism. Nonetheless, it remains good law in England, and although he did not cite it, it certainly supports Mr Keane’s argument. Bullen & Leake makes the point that active concealment of a material fact may operate as a misrepresentation but mere non-disclosure of facts will not give rise to a cause of action unless there is a duty of disclosure, for example, where there is a fiduciary relationship: see Smith v Hughes (1871) LR 6 QB 597.

251               It is at least arguable that the respondents, by their conduct in submitting tenders in accordance with a regulated tender process, made the representations pleaded. That is sufficient to avoid summary dismissal, or a strike out application.

Other pleading points

252               The final matter that needs to be considered is whether Mr Gray has succeeded in demonstrating that the statement of claim is so defective as to warrant being struck out in whole or in part. In my view, he has not made good that contention.

253               The statement of claim is certainly a complex document. At times it is difficult to follow. That is because it encompasses a large number of transactions, involving many different entities. Nonetheless, I am not persuaded that it is so complex, or unclear, that it would “embarrass” the Schneider respondents to require them to file a defence. If any uncertainty exists regarding the nature of the allegations made against those respondents, it can be overcome by the provision of further and better particulars.

Orders

254               Each notice of motion will be dismissed. I will stand the matter over to 16 June 2004 at 9.30 am to hear submissions from the parties regarding the matter of costs, and to give directions as to the future conduct of this proceeding.

Associate:

Dated: 7 May 2004