Case: Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53
Outcome: considered
The authorities on s 45 of the TPA explain the concept of a 'contract, arrangement or understanding' as it is used in Pt IV: see Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd [2004] FCA 1678 ; (2004) 141 FCR 183 (' Leahy' ); Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission [2005] ATPR 42-078 (' Apco' ); Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 ; (2003) 216 CLR 53 (' Rural Press' ); Trade Practices Commission v Email Ltd (1980) 43 FLR 383 (' Email' ); and Trade Practices Commission v David Jones (Australia) Pty Ltd (1986) 13 FCR 446 (' David Jones' ). Some assistance is also to be gained from authorities that have considered s 45E in its original form: Gibbins ; see also Keith Russell Simplicity Funerals Pty Ltd v Cremation Society of Australia (ACT) Ltd (1982) 57 FCR 472. 110 On appeal, in Apco , the Full Court of this Court (Heerey, Hely and Gyles JJ) considered whether an understanding necessarily involves the making of a commitment to a particular course of action, as opposed to giving rise to a mere expectation or hope that a party will act in a certain way. After considering Merkel J's findings in Leahy , their Honours said at 43,234 - 43,235: 'Whilst the appellants attacked the factual finding that the parties arrived at the price-fixing understanding outlined in [330] of the reasons for judgment, they did not dispute that the primary judge had enunciated the correct legal principles which are applicable in determining whether parties have entered into an understanding. In particular, the primary judge referred to the following observations of Lindgren J in Australian Competition and Consumer Commission v CC (NSW) Pty Ltd [1999] FCA 954 ; (1999) 92 FCR 375 at [141] (emphasis in original) which were specifically endorsed by the Full Court in Rural Press Ltd v Australian Competition and Consumer Commission [2002] FCAFC 213 ; (2002) 118 FCR 236 at [79] : "The cases require that at least one party 'assume an obligation' or give an 'assurance' or 'undertaking' that it will act in a certain way. A mere expectation that as a matter of fact a party will act in a certain way is not enough, even if it has been engendered by that party. In the present case, for example, each individual who attended the meeting may have expected that as a matter of fact the others would return to their respective offices by car, or, to express the matter differently, each may have been expected by the others to act in that way. Each may even have 'aroused' that expectation by things he said at the meeting. But these factual expectations do not found an 'understanding' in the sense in which the word is used in ss 45 and 45A . The conjunction of the word 'understanding' with the words 'agreement' and 'arrangement' and the nature of the provisions show that something more is required." The primary judge's inference at [371] that Anderson [the Director and General Manager of one of the respondent companies] expected that his competitors would hold their increased price for a time whilst he was deciding whether or not to match their prices represents Anderson's assessment of what was likely to occur, without any assurance being given to him that the competitors would act in that way. It is no more than what Lindgren J described as a "factual expectation" which falls short of an "understanding".' Special leave to appeal the Full Court's decision was refused by the High Court in Australian Competition and Consumer Commission v APCO Service Stations Pty Ltd [2006] HCATrans 272. 134 In Rural Press , the High Court did not find any error in the Full Court's conclusion in Pont Data that a particular class can be defined by its exclusion from supply or acquisition: at 90-91 [88] per Gummow, Hayne and Heydon JJ, see also Gleeson CJ and Callinan J at 62 [7]; and Gummow J in South Sydney at 590 [77]. 225 There is utility in making a declaration of the kind sought by the ACCC: see Rural Press at 92 [95]. It will record the consequences of the Court's findings in a legally binding way, and will mark the Court's disapproval of the CEPU's conduct. However, it is essential that the terms of the declaration are tied to the proven facts: see Rural Press at 91 [90]; cf Bass v Permanent Trustee Company Ltd [1999] HCA 9 ; (1999) 198 CLR 334; and Electricity Supply Association of Australia v Australian Competition and Consumer Commission [2001] FCA 1296 ; (2001) 113 FCR 230. I propose to vary the terms of the declarations sought by the ACCC to ensure that they accord with and are sufficiently tied to the factual findings I have made.