Case: Foster v Australian Competition and Consumer Commission [2006] FCAFC 21 ; (2006) 149 FCR 135
Outcome: referred to
the Court's power to grant an injunction in the case of a contravention of the Act is contained exclusively in s 80 of the Act and no reliance can be placed on s 23 of the Federal Court of Australia Act 1976 (Cth): Thomson per Gibbs CJ, Stephen, Mason and Wilson JJ at 161-162; Foster v Australian Competition and Consumer Commission [2006] FCAFC 21 ; (2006) 149 FCR 135 (Ryan, Finn and Allsop JJ) at 145 [22] (' Foster' ). Fourthly, there must be a relevant nexus between the injunction or undertaking and the alleged or established contravening conduct. It is not the case that an injunction or undertaking can only be framed in terms of restraining a repetition of contravening or alleged contravening conduct: Foster . As far as future conduct is concerned, an injunction or undertaking may be in wider terms. The question of what is a relevant nexus between the alleged or established conduct and the proposed order or undertaking has been discussed in the context of orders or undertakings requiring a compliance or educational programme to be implemented. Of course, there is no denying the desirability of an extensive compliance or educational programme, but that is a different issue from the question of the Court's power to order such a programme or to accept an undertaking to implement such a programme. In Australian Competition and Consumer Commission v Z-Tek Computer Pty Ltd (1997) 78 FCR 197 (' Z-Tek '), Merkel J considered the scope of an appropriate order implementing a trade practices compliance programme. His Honour said (at 203): summary, in determining whether an injunction under s 80 is "appropriate" there are, at least, three limitations on the Court's power. the power is confined by reference to the scope and purpose of the TPA and in particular s 80. It is within the scope and purpose of s 80 to grant injunctive relief which is designed to prevent a repetition of the conduct for which the relief is sought. there is a contextual limitation within s 80 itself. As the jurisdiction to grant an injunction is enlivened by an alleged or actual contravention of a provision of Pt IV , IVA or V of the TPA, there must be a sufficient nexus or relationship between the contravention and the injunction granted. It is that nexus or relationship that enables determination by the Court of whether the injunction sought is "appropriate". there is the constitutional limitation which requires that the injunction granted be related to the case or controversy the subject of the proceeding.' A little later, his Honour said (at 205): trade practices compliance program agreed to relates to the TPA generally rather than to the specific provisions in Pt V which are alleged to have been contravened by Z-Tek. It was contended by counsel for the ACCC that the program was "appropriate" because it arose as a result of a breach of the TPA. In my view the contention is based on an unwarranted and excessively broad view of s 80. The jurisdiction to make orders under s 80 only arises as a result of advertising and representations by Z-Tek which are alleged to have contravened ss 52 , 53 (e) and 53C of the TPA. As the order is sought under s 80(1AA) I do not have to be satisfied that the conduct contravened the particular provisions of the TPA. Nevertheless, I must determine whether the orders are "appropriate". the reasons discussed earlier any order requiring the implementation of a trade practices compliance program should be one which has a sufficient nexus or relationship to the conduct alleged to constitute a breach of a particular provision of the TPA. Given that the orders are sought by consent I am prepared to take a broad view of the conduct which may fairly be described as misleading or deceptive advertising and the making of representations in contravention of ss 52 , 53 (e) and 53C of the TPA. The compliance program, which the Court may order, should be no wider than one which is designed to prevent repetition of that conduct. orders sought require a compliance program in respect of all parts of the TPA which will include, for example, Pt IV and other parts which have no connection whatsoever with the alleged conduct giving rise to the case or controversy in the Court. In my view it is not appropriate to make orders which require a compliance program which relates to conduct other than the alleged contravening conduct as characterised by the Court.' The comments of Merkel J (at 203) were referred to in Foster . The Full Court did not say anything to suggest that they did not agree with his observations.