FEDERAL COURT OF AUSTRALIA

Australian Competition and Consumer Commission v Allphones Retail Pty Limited [2008] FCA 1664

Federal Court Rules, O 46 r 6

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v ALLPHONES RETAIL PTY LIMITED ACN 008 168 090

NSD 1567 of 2008

FOSTER J

7 NOVEMBER 2008

SYDNEY

UPON the following undertaking being given to the Court by the respondent by its Counsel:

Allphones Retail Pty Limited (Allphones) undertakes to the Court until 4.15 pm on Tuesday 11 November 2008 (or such later time at which the Court gives judgment on the Australian Competition and Consumer Commission’s Notice of Motion filed on 31 October 2008) that Allphones, by itself its servants and agents, in making allocations of stock to be delivered to its franchisees and Allphones’ stores will not take into account whether any franchisee is a party to a New Franchise Agreement or an Old Franchise Agreement (as those terms are defined in the Further Amended Application) as a criterion for making allocations;

THE COURT:

1.                  ORDERS that the further hearing of this matter be adjourned until Tuesday 11 November 2008 with a marking of not before 12 o’clock.

2.                  DIRECTS the applicant to file and serve by 3.00 pm on Monday next, 10 November 2008 any evidence in reply upon which it proposes to rely upon the further hearing of this interlocutory application.

3.                  DIRECTS the applicant to publish these reasons at the same time as any publication of the terms or substance of the undertaking proffered by the respondent.

4.                  DIRECTS the transcript authorities to produce a transcript version of these reasons as soon as those authorities are able.

Pursuant to and for the purposes only of O 46 r 6 of the Federal Court Rules, THE COURT ORDERS THAT:

5.                  The following are confidential:

(a)        paragraphs 5 to 33 inclusive and paragraph 58 of the affidavit of Anthony Baker sworn 4 November 2008 and annexures “A” to “L” inclusive and annexure “N” of that affidavit;

(b)        paragraphs 22 and 23 of the affidavit of Richard John Flitcroft sworn 31 October 2008 and the documents behind tabs 4, 5, 30, 31, 33, 34, 41 and 43 in exhibit “RJF3” to that affidavit;

(c)        the affidavit of Anthony Baker sworn 6 November 2008 and the exhibits to that affidavit; and

(d)        paragraphs 6 to 13 inclusive of the affidavit of Miranda Imogen Horth sworn 6 November 2008.

6.                  The affidavit of Anthony Baker sworn 4 November 2008 and the annexures to the affidavit shall not be made available to or inspected by any person who is not a party to these proceedings without the prior leave of a Judge.

7.                  The affidavit of Richard John Flitcroft sworn 31 October 2008 and exhibit “RJF3” to the affidavit shall not be made available to or inspected by any person who is not a party to these proceedings without the prior leave of a Judge.

8.                  The affidavit of Anthony Baker sworn 6 November 2008 and the exhibits to that affidavit shall not be made available to or inspected by any person who is not a party to these proceedings without the prior leave of a Judge.

9.                  The affidavit of Miranda Imogen Horth sworn 6 November 2008 shall not be made available to or inspected by any person who is not a party to these proceedings without the prior leave of a Judge.

10.              The respondent’s submissions filed in Court on 7 November 2008 shall not be made available to or inspected by any person who is not a party to these proceedings without the prior leave of a Judge.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

1                     There is before me an application for interlocutory injunctive relief made by the applicant, the Australian Competition and Consumer Commission, against the respondent.  The application was brought on urgently for hearing on Tuesday of this week after I listed the matter for that day and abridged the time for the service of both the Application and the affidavits in support.  The subject matter of the Application is of significance both to the respondent and to its franchisees.  The relief, if granted, will affect the way in which the respondent allocates stock both as to type and quantity across its business system.

2                     The matter proceeded before me last Tuesday for some time.  During the course of his final submissions on the interlocutory application, Senior Counsel for the respondent sought an adjournment in order to supplement the respondent’s evidence for the purposes of this application.  That adjournment was opposed but, in the end, was granted by me upon the basis that the further evidence which the respondent sought to file and rely upon would be served by no later than the close of business on Wednesday last, 5 November 2008.

3                     For reasons which do not need to be gone into at the present time, the respondent was unable to comply with that direction in time although after business hours yesterday, 6 November 2008, several further affidavits were notified both to the Court and to the applicant.  I have been told by Senior Counsel for the respondent that the respondent is now in a position where all of the evidence to be led by it on this interlocutory application has been filed and served or, if not filed, notified to the Court and provided to the Court.

4                     The matter was called on this morning pursuant to a listing I made on Tuesday.  The material which was filed yesterday is quite voluminous and requires some time to be read and understood both by the applicant’s representatives and by me.  Inevitably the applicant sought an adjournment of the further hearing of the interlocutory application until it had had an opportunity to consider that material.  That adjournment is to be granted but will be only for a very short time, that is to say, until next Tuesday.

5                     During the course of submissions made today, Senior Counsel for the respondent has presented submissions directed to the question of what I should do now in light of what has happened.  Those submissions helpfully traversed a number of the issues at the heart of the matter.  I have indicated to the parties that I consider the issues raised by the Application to involve important and delicate questions for the franchise system which is run by the respondent and that it would not be in anybody’s interests for decisions to be made which alter in some serious way the status quo unless and until the matter had received full and proper consideration by me.

6                     However, in light of the circumstance that the respondent’s fresh evidence was filed late and that the current adjournment has been necessitated by that fact, I suggested to the respondent that it might consider offering a limited undertaking for a limited period of time.  Senior Counsel for the respondent has handed up to me an undertaking which I am told is proffered by the respondent to the Court in response to my suggestion.

7                     Senior Counsel for the respondent is very concerned to ensure that no inaccurate impression is created either in the minds of franchisees or anyone else as to the circumstances in which or the reasons for which this undertaking has been proffered.  Senior Counsel requested that the respondent be permitted to offer the undertaking on a confidential basis.  That request was opposed by the applicant.  I am not prepared to accept the undertaking on a confidential basis.  I have, however, suggested that an appropriate middle course might be for the undertaking to be proffered and for me to give some brief reasons as to the circumstances in which and the basis upon which it has been proffered.  This is the purpose of these brief reasons.

8                     Accordingly, I need to make very clear that, as matters presently stand, there has been no disposition of this matter at all by the Court but rather that there has been a partially completed hearing which has involved two adjournments.  The concern of the Court clearly is to ensure that nothing alters the present state of affairs at all whilst the matter is being considered.  I wish to make very clear that the undertaking offered is offered without admissions and indeed in circumstances where some little pressure was applied by me to the respondent to proffer the undertaking in light of all of the circumstances with which the parties and the Court are  now confronted.

9                     The undertaking is not an admission of anything and does not indicate acceptance by the respondent of any wrongful conduct on its part.  It is simply a practical solution to a need to cover the nub of the complaints in this matter for a short time until the Court and the parties have had a fair opportunity to consider it.  The compromise position, which I have indicated to the parties would be acceptable to me, is that, if the applicant wishes to disclose either the terms or the substance of the undertaking proffered by the respondent, it must accompany any such publication by a publication also of the precise terms of these reasons which I have just delivered.  The parties have agreed to my suggested compromise.

10                  Accordingly, I will make the following directions and orders:

(1)               I adjourn the further hearing of this matter until Tuesday 11 November 2008 with a marking of not before 12 o’clock.

(2)               I direct the applicant to file and serve any evidence in reply upon which it proposes to rely upon the further hearing of this interlocutory application by 3.00 pm on Monday next, 10 November 2008.

(3)               I direct the applicant to publish these reasons at the same time as any publication of the terms or substance of the undertaking proffered by the respondent.

(4)               I direct the transcript authorities to produce a transcript version of these reasons as soon as those authorities are able.

11                  I note the undertaking given to the Court by the respondent by its Counsel and in particular that it is limited in time to 4.15 pm on Tuesday 11 November next or such later time at which the Court gives judgment on the applicant’s Notice of Motion filed on 31 October 2008.

12                  By consent I also make the orders set out in the document handed up by Senior Counsel for the respondent which I will initial, date and place with the Court file.

Associate:

Dated:         10 November 2008