Case: Colgate-Palmolive Company v Cussons Pty Ltd [1993] FCA 536 ; (1993) 46 FCR 225
Outcome: referred to
my view, the response of the ACCC, by letter of 23 May 2008, did not constitute "an imprudent refusal of an offer to compromise" as discussed by Sheppard J in Colgate-Palmolive Company v Cussons Pty Ltd [1993] FCA 536 ; (1993) 46 FCR 225 at 233-4, where his Honour was discussing circumstances in which an award of indemnity costs might be made. Nor was it unreasonable for the ACCC to have rejected that proposal. Harris Scarfe had not acknowledged any contravention of ss 52 or 53(e) of the TP Act, so the question whether that sort of conduct in advertising might infringe those provisions was left unanswered. For reasons already given, it was not unreasonable for the ACCC to seek a court determination of any contravention of the TP Act, rather than acceptance of a further undertaking under s 87B. The terms of the proposed undertaking and of the corrective advertising were general. The proffered undertaking did not set out with any specificity why the ACCC alleged that ss 52 and 53(e) were contravened by the television advertisement or the catalogue. The proposed corrective advertisement was a little more precise, but still did not clearly convey the nature of the allegations. And, as noted, those documents contained no acceptance that the television advertisement and the catalogue were in fact misleading or deceptive. In addition, the related recitals were emphatic as to Harris Scarfe's conscientious attempts to comply with the TP Act and its cooperation with the ACCC. It may be that the ACCC would have entered into discussions on those issues if, in principle, that form of resolution of the dispute were acceptable. In that event, it would have been remiss of the ACCC not to have furthered discussion as to the contents of those documents. But, because I consider it acted reasonably in declining to pursue resolution of the dispute by a further s 87B undertaking, I do not regard it as having acted unreasonably by simply rejecting the overall proposal. Moreover, the letter of 2 May 2008 made no offer for costs of the proceeding to that date. For those reasons, I do not consider the letter of 2 May 2008, or the ACCC response to it, provides any reason to depart from the general approach to costs which I have referred to above. Senior counsel criticised the ACCC for not responding to the letter of 2 May 2008 earlier than 23 May 2008. Its then response was, in my view, sufficiently timely. First, the offer made by the letter of 2 May 2008 was expressed to be open until 23 May 2008. Secondly, as Harris Scarfe's witness statements were due to be served on 7 May 2008, it was reasonable for the ACCC to await their receipt and to consider them before responding to the letter of 2 May 2008. In fact, they were not served until 16 May 2008. Moreover, it was a complex proposal, and it is not clear the extent to which its terms in the circumstances required the attention of the ACCC itself, rather than of its officers. In any event, it appeared to that point that the parties were simply stalemated: the Harris Scarfe proposal was, in my view, expressed in a way which invited its acceptance or rejection, and involved the dismissal of the proceeding with no order as to costs. The ACCC response indicated that the ACCC assessed its prospects of success in the proceeding differently, it rejected the proposal. It required a Court order in resolution of the issues. It indicated that, if Harris Scarfe proposed to make any further offer to resolve the proceeding, it would have to cover a specified series of topics of relief. It invited any such proposal by 29 May 2008.