Friday, 16 March 2012

Stocktake of the ACCC’s new powers and remedies under the Australian Consumer Law – the first 18 months

Part 2: Infringement notices

This article first appeared in the Australian Competition & Consumer Law Tracker, CCH, Issue 12, December 2011.


Along with the public warning power, the most controversial new power given to the Australian Competition and Consumer Commission (ACCC) is the power to issue infringement notices. Under this power, the ACCC is able to issue on-the-spot fines to traders for particular conduct without taking a matter to court.

Section 134A of the Competition and Consumer Act 2010 (CCA) defines “infringement notice provision” to include:

  • unconscionable conduct
  • unfair practices
  • unsolicited consumer contracts
  • lay-by agreements
  • product safety provisions
  • warranties against defects
  • display notices
  • proof of transactions
  • itemised bills
  • repairer’s obligations
  • breaches of the substantiation notice provisions.
The ACCC cannot issue infringement notices for the following provisions of the Australian Consumer Law (ACL):
  • misleading or deceptive conduct (s 18)
  • some of the prohibitions on offering rebates, gifts and prizes without intending to supply (s 32(1)) 
  • some forms of bait advertising (s 35(1) [1]
  • most prohibitions on wrongly accepting payment (s 36(1), (2), (3)); and
  • · unsolicited directory entries, goods or services (s 40, 43).
The operation of the infringement notice provisions is complicated because s 134A states that certain parts of sections will be infringement notice provisions, while other parts of the same sections will not be infringement notice provisions.

For example, s 32(1), which relates to offering a rebate, gift, prize or other free item without the intention of actually providing it, is not an infringement notice provision. However, s 32(2), which places an obligation on a person to supply a rebate, gift, prize or other free item either within the stipulated time or within a reasonable time, is an infringement notice provision.

Other examples relate to bait advertising and wrongly accepting payment. Section 35(1) prohibits a person from advertising a good or service if there are reasonable grounds for believing that they will not be able to supply the goods or services at all or in reasonable quantities. This section is not an infringement notice provision. However, s 35(2), which requires a person to supply goods or services which are advertised at a specified price at that specified price for a reasonable period, is an infringement notice provision.

Finally, s 36(1), (2) and (3), which prohibit wrongly accepting payment for goods or services, are not infringement notice provisions. However, s 36(4) which imposes an obligation on a person to supply a good or service within any stipulated time or within a reasonable time once they have accepted consideration or payment for that good or service, is an infringement notice provision.

There does not appear to be any hard and fast rule why certain of the provisions in s 32, 35 and 36 are infringement notice provisions and others are not infringement notice provisions.

The onus the ACCC needs to satisfy in order to issue an infringement notice is set out in s134A(1) of the CCA which states:

If the Commission has reasonable grounds to believe that a person has contravened an infringement notice provision, the Commission may issue an infringement notice to the person.
Infringement notices are not effective if issued in relation to conduct which is more than 12 months old.

Only one infringement notice may be issued in relation to an alleged contravention. The infringement notice penalty must be paid within 28 days of the notice being issued. The maximum penalties which can be obtained through the use of an infringement notice are $66,000 for a listed corporation, $6,600 for an unlisted corporation and $1,320 for an individual.

Once the infringement notice has been paid, no civil or criminal proceedings may be started or continued against the person by or on behalf of the Commonwealth[2] in relation to the conduct the subject of the infringement notice. The way that the Parliament intended the ACCC to use the new infringement notice powers was outlined in the relevant Explanatory Memorandum as follows:

The limitation on the size of the financial penalty specified in the infringement notice and restrictions preventing the ACCC or ASIC from taking other action in relation to conduct dealt with using this mechanism are intended to ensure that it is not used for more serious contraventions as an alternative to existing Court processes. However, if a person fails to comply with an infringement notice and a Court subsequently determines that a contravention has occurred, the Court can impose a significantly higher pecuniary penalty.[3]

Between the time that the ACCC obtained the power to issue infringement notices on 15 April 2010 and August 2011, it issued 63 infringement notices, of which 59 had been paid.[4]

The total penalties obtained through these 59 infringement notices were in excess of $300,000. By the end of October 2011, the ACCC had received payments for 61 infringement notices.[5]

ACCC’s use of its infringement notice powers

The first infringement notices were issued to eight small restaurant and café owners who had failed to have separate menus showing the total prices charged on weekends and public holidays. This conduct was considered to have breached the former s 53C of the Trade Practices Act 1974 (TPA).[6]

Interestingly, only four of these businesses paid the infringement notices by the due date. As a result, the ACCC commenced legal proceedings against four of the businesses for the underlying breach of s 53C.[7] Two of the cafes subsequently agreed to settle the ACCC’s proceedings by consent. They were each penalised $13,200, which was twice the amount initially sought in the infringement notice.[8]

In separate proceedings, the ACCC was able to secure a penalty of $15,000 against Signature Brasserie and $20,000 against the former owner of Babar Café and Bar for the underlying breach.[9]

This series of café cases provides a number of insights into how the ACCC has been using its infringement notice powers. First, the ACCC will not hesitate to take legal action against a business which fails to pay an infringement notice by the due date. Second, if the ACCC does take action against a company for the underlying breach it is likely to secure a significantly higher penalty than the amount initially sought under the infringement notice. In the three litigated café cases, the ACCC secured penalties which were 2 to 3 times higher than the amount which the ACCC had initially been seeking under the infringement notice.

The next significant case was the ACCC’s decision to issue infringement notices in relation to the conduct of the David Lawrence, Marcs and Jigsaw retail stores, which were all owned by M Webster Holdings Pty Ltd.[10]

In this case, the ACCC was concerned that the three retail stores were making misleading representations on their receipts and in-store signs about consumer guarantees. The ACCC alleged that these stores were advising their consumers that they did not have to offer exchanges, refunds or credits for sale items which were not of acceptable quality. Significantly, the ACCC decided to issue three infringement notices contributing to a total penalty of $19,800 rather than simply one infringement notice to the corporate entity, M Webster Holdings Pty Ltd. The ACCC appears to have formed the view that it was justified in issuing three infringement notices because there were three separate contraventions of the TPA — ie each of the retail stores had promoted a misleading refund policy.

Shortly after this matter, the ACCC issued four infringement notices to Dodo Australia Pty Ltd (Dodo).[11] In this matter, the ACCC was concerned that Dodo had made false or misleading representations about the price of its Unlimited ADSL2+ broadband plan. However, rather than issuing one infringement notice to Dodo, the ACCC issued four notices on the basis that Dodo had made the alleged misrepresentations in four different types of media — namely, in TV advertisements, on its website, on billboards and on radio. Accordingly, Dodo had to pay a total penalty of $26,400.

In June 2011, the ACCC announced that six separate Harvey Norman franchisees had paid infringement notices in relation to alleged bait advertising.[12] This decision immediately caused some confusion as most practitioners had understood that the infringement notice power did not apply to bait advertising. However, a careful reading of s 134A of the CCA shows that only s 35(1) of the ACL is excluded from the scope of the infringement notice power and not s 35(2). Therefore, the ACCC may issue infringement notices in relation to some forms of bait advertising.

By far the most controversial use of the ACCC’s new infringement notice powers was the ACCC’s decision to issue 27 infringement notices to Optus in relation to its “Max Cap” plans.[13] Optus was required to pay a total penalty of $178,200 for allegedly making false or misleading representations about the price, nature and characteristics of its services. In its media release, the ACCC sought to explain its decision to issue 27 infringement notices to Optus:

The ACCC decided it was appropriate to issue 27 infringement notices ($6,600 for each notice) to Optus based on the number of advertisements published and the various representations made within those advertisements.
The obvious implication of this approach is that if a business makes a large number of misrepresentations for an extended period of time in a wide variety of different media, the size of the penalty could rise exponentially.


There are quite a number of valid concerns about the ACCC’s power to issue infringement notices.

Separation of powers issues

The ACCC’s new power to issue infringement notices was considered as quite controversial when it was introduced due to a concern that it raised separation of powers issues — namely, the blurring of executive and judicial functions. The power to impose a pecuniary penalty on a business for a breach of legislation may be characterised as the exercise of a judicial function, which should properly reside in the courts, rather than with a federal government agency, such as the ACCC. There are still many practitioners who believe that giving enforcement agencies the power to issue on-the-stop fines in this way is likely to be unconstitutional.

Challenging the infringement notice

Section 134G of the CCA provides that a person who has been issued with an infringement notice may make representations to the ACCC seeking the withdrawal of the infringement notice. There is no more guidance in the CCA or from the ACCC about how this provision is to apply in practice. Obviously, the business will have to provide some quite compelling reasons to the ACCC to justify the ACCC withdrawing the infringement notice.

The ACCC has received a number of requests to have an infringement notice withdrawn and has also withdrawn an infringement notice in at least one case.

In the Goody case[14] and the Le Sands case[15], the solicitors for the respondents asked the ACCC to withdraw the infringement notice on the basis that they had rectified their menus to show the full price. In both cases, the ACCC notified the respondents that they would not be withdrawing the infringement notices.

Despite being advised by the ACCC that the infringement notices would not be withdrawn, the businesses did not pay the infringement notices by the due date. As a result, the ACCC commenced legal proceedings against the businesses.

Unfortunately, these cases do not provide any details as to why the ACCC did not agree to withdraw the infringement notices.

It appears that the ACCC will not agree to withdraw an infringement notice if the request is made outside the infringement notice compliance period. Section 134G(6) of the CCA states:

To be effective, the withdrawal notice must be given to the person within the infringement notice compliance period for the infringement notice.
Therefore, it stands to reason that if a withdrawal notice will only be effective if it is given to the person within the infringement notice compliance period, then the ACCC cannot withdraw a notice after the infringement notice compliance period has expired.

I also note the helpful commentary on this issue in the Australian Competition and Consumer Law Reporter:

The ACCC may refuse to withdraw an infringement notice, even if a contravention is rectified … If withdrawal is sought, the 28-day infringement notice compliance period must be kept in mind. It might be prudent to request an extension of the compliance period under s 134F(2) when seeking withdrawal of the infringement notice …[16]
The ACCC can extend the time to comply with an infringement notice by a maximum of 28 days (s 134F(3)) where it believes it is appropriate to do so.

One obvious justification for requesting the withdrawal of an infringement notice would be if there was an error in the notice itself. This occurred in the Le Sands case where there was an error in one of the Schedules to the infringement notice. As a result, the ACCC withdrew the infringement notice and issued a new infringement notice in relation to the same conduct.

Another situation where it would be appropriate for the ACCC to consider withdrawing an infringement notice is where the business can show that the issuing of the notice is unfair in some way. Some examples of unfairness would include where the contravention arose from an honest mistake or where the business can show that the issuing of the infringement notice is going to have a disproportionately negative impact on the business.

It is also theoretically possible for a business to challenge the ACCC’s decision to issue an infringement notice on administrative law grounds. This would involve arguing that the ACCC did not have reasonable grounds to believe that a person had contravened an infringement notice provision. However, the costs of challenging the ACCC’s decision to issue an infringement notice on administrative law grounds is likely to be significantly greater than just paying the infringement notice.

Another option for a business which does not believe that it has contravened the ACL and believes that it should not have to pay the infringement notice, is to decide not to pay the infringement notice and fight the substantive case in court. Again, the cost of pursuing this option will be much greater than the financial penalty being sought under the infringement notice in the first place.

ACCC’s use of infringement notices

There is also a valid argument that the way in which the ACCC has used its infringement notice powers in a number of cases has been inconsistent with the way Parliament intended that the power should be used. As stated above, the Explanatory Memorandum, cited above, made it quite clear “that (the infringement notice power) is not [to be] used for more serious contraventions as an alternative to existing Court processes”.

Arguably, the Dodo and Optus cases as well as the Harvey Norman bait advertising cases should all have been treated as more serious contraventions of the ACL and not been the subject of infringement notices.[17]


The ACCC has also developed a practice in relation to infringement notices which has caused considerable consternation amongst legal practitioners, particularly the Law Council of Australia. The ACCC has adopted a practice in most matters where it has issued an infringement notice to also seek an s 87B undertaking from the business concerned.[18]

It makes a great deal of sense for the ACCC to seek a s 87B undertaking from a business when also issuing it with an infringement notice as there is little point in the ACCC simply fining a business for illegal conduct without also requiring that the business implement some measures to prevent further breaches of the CCA and ACL. The best way to achieve such preventative steps is to require the business to establish a compliance program consisting of the:

  • appointment of an in-house compliance officer;
  • introduction of specific annual compliance training; and
  • implementation of a complaints handling system.
However, the difficulty which arises in relation to the ACCC’s approach is that it is also the ACCC’s usual practice to seek admissions of a contravention of the CCA or ACL in all s 87B undertakings. As stated in the ACCC’s s 87B policy document a typical element of an s 87B undertaking will be:

… an acknowledgment or admission from the company or business that the conduct of concern constitutes or was likely to constitute a breach of the Act.[19]
The concern expressed by the Law Council was that the ACCC’s actions in requiring an admission from a business in an s 87B undertaking was inconsistent with the terms of s 134D of the CCA which states that the payment of an infringement notice does not constitute an admission by the business of the underlying breach.[20]

While the Law Council’s observations about this issue are valid, the simple solution in these circumstances is for legal practitioners to advise their clients not to agree to make any admissions in an s 87B undertaking when the undertaking is being provided to the ACCC in the context of an infringement notice. I think it is highly unlikely that the ACCC will simply abandon both the infringement notice and the s 87B undertaking, and commence legal proceedings against the business for the sole purpose of obtaining admissions, particularly as the conduct is, by definition, a “less serious” contravention.


Another valid point made by the Law Council in its submission to the ACCC relates to the failure by the ACCC to issue any substantive guidelines on how and when it will be exercising its infringement notice powers.[21]

Even though one can discern some broad principles about the ACCC’s use of its powers from reviewing the various matters discussed above, this is no substitute for formal guidance from the ACCC. Furthermore, while my brief review of ACCC cases has identified a number of broad principles about “how” the ACCC will use their infringement notice power, this review provides little guidance on “when” the ACCC will use these powers.

A more in-depth analysis of the particular matters where the ACCC has used its infringement notice powers may provide some guidance on “when” the ACCC is likely to use this power. The following table records the types of conduct which have been the subject of infringement notices from April 2010 until October 2011:

Table: Infringement notices paid between 15 April 2010 to 28 November 2011[22]

Based on the above table, it seems safe to conclude that the ACCC has tended to use its new infringement notice powers most extensively in relation to misrepresentations about price. One can also safely assume that the ACCC’s use of its infringement notice powers in relation to price misrepresentations is likely to increase quite significantly with the introduction of the carbon price.

The other major area where the ACCC has used its infringement notice powers is in relation to misrepresentations concerning sponsorship and approval. This encompasses both misrepresentations that a company has particular sponsorship or affiliations as well as misrepresentations that goods have sponsorship, approval, performance characteristics, accessories, uses or benefits they do not have.


The ACCC has shown a great propensity to use its new infringement notice powers since their introduction in April 2010. Although the ACCC did not issue and receive payment of its first infringement notice until July 2010, since then it has issued and received payment of a further 60 infringement notices. This is a rate of just under four infringement notices a month.

The failure of the ACCC to issue any guidelines on how and when it will use its infringement notice powers has created a great deal of uncertainty. This uncertainty has been compounded by the way in which the ACCC used its infringement notice powers in relation to the Optus “Max Cap” matter.

The good news is that in September 2011 the ACCC advised the Law Council that it would be releasing draft guidelines on the use of its infringement notice powers in late 2011. (NB: Unfortunately this has not yet occurred). It is hoped that these guidelines will be able to provide both legal practitioners and businesses with some meaningful parameters on how and when the ACCC will be using its infringement notice powers in the future.

[1] See the discussion of the Harvey Norman matters below.
[2] The expression “by or on behalf of the Commonwealth” is a reference to the ACCC and the various state and territory fair trading regulators. These organisations are referred to collectively as the ACL regulators. This article will only focus on the activities of the ACCC.
[3] Explanatory Memorandum to the Trade Practices Amendment (Australian Consumer Law) Bill 2009 (the No 1 Amendment Bill), para 8.38.
[4] The ACCC’s initial experience with Australian Consumer Law remedies and powers, Speech by Peter Kell, Deputy Chair of the ACCC to the 36th Competition and Consumer Workshop, 26–28 August 2011, 1, available at - (Speech by Peter Kell).
[5] ACCC Infringement Notices Register,
[6] ACCC News Release, Misleading menus invite Infringement notices, NR 129/10, 1 July 2010.
[7] ACCC News Release, ACCC institutes against cafés for alleged menu breaches, NR 186/10, 9 September 2010.
[8] ACCC v Gourmet Goody’s Family Restaurant Pty Ltd [2010] FCA 1216; ACCC News Release, Restaurant menus misled consumers, NR 243/10, 4 November 2010
[9] Australian Competition and Consumer Commission v Le Sands Restaurant and Le Sands Café Pty Ltd t/as Signature Brasserie (2011) ATPR ¶42-342; [2011] FCA 105; Australian Competition and Consumer Commission v AI Constructions (ACT) Pty Ltd [2010] FCA 1377; ACCC News Release, Former café operator ordered to pay $20,000 penalty, NR 265/10, 8 December 2010.
[10] ACCC News Release, David Lawrence, Jigsaw and Marcs pay infringement notices, offers undertaking over refund policy, NR 274/10, 16 December 2010.
[11] ACCC News Release, Dodo pay infringement notices, NR 004/11, 6 January 2011.
[12] ACCC News Release, Six Harvey Norman franchisees pay for not stocking cameras, NR 090/11, 7 June 2011.
[13] ACCC News Release, Optus pays for ‘max cap’ advertising, NR 084/11, 18 May 2011.
[14] ACCC v Gourmet Goody’s Family Restaurant Pty Ltd [2010] FCA 1216.
[15] Australian Competition and Consumer Commission v Le Sands Restaurant and Le Sands Café Pty Ltd t/as Signature Brasserie (2011) ATPR ¶42-342; [2011] FCA 105.
[16] CCH, Australian Competition and Consumer Law Reporter at ¶35-110.
[17] The Harvey Norman group were the subject of a successful ACCC legal action in 2004 for bait advertising — ACCC News Release, Federal Court orders declarations, ACCC accepts undertakings from Harvey Norman over misrepresentation and bait advertising action, MR 151/04, 10 August 2004.
[18] An s 87B undertaking is a court enforceable agreement between the ACCC and a business whereby the business agrees to carry out a number of remedial steps.
[19] Section 87B of the Trade Practices Act: Guidelines on the use of enforceable undertakings by the Australian Competition and Consumer Commission, September 2009, p5.
[20] Law Council of Australia, Use of Infringement Notices by the ACCC, Submission to ACCC, 19 August 2011, 6–7, available at
[21] The ACCC did issue a Business Snapshot in 2011 entitled ACCC powers to issue infringement, substantiation and public warning notices, available at However, this document could not be considered a guideline on how and when the ACCC will use its infringement notice powers.
[22] ACCC Infringement Notices Register,

Thursday, 1 March 2012

The Untold Story: The ACCC’s role in the Waterfront Dispute - Part 15 - The Litigation Continues

Part 15: The Litigation Continues


We were very happy with ourselves for having obtained the interim injunctions against the MUA in relation to the international boycotts and also to have commenced our second set of legal proceedings against the MUA.

However, we were quite perplexed as to how Justice North had been allocated to be the judge in relation to these second proceedings. Given that we had commenced the legal proceedings in Sydney, against a Sydney based organisation in relation to alleged illegal conduct which was occurring in Newcastle and Adelaide, it seemed strange to us that we had been allocated a Melbourne based judge.

Continuing the injunctions

Our first aim after securing our temporary injunctions was to try to obtain further evidence to justify the continuation of the injunctions against the MUA. As stated in the last post, we had obtained injunctions up until 4 June 1998. Therefore, if we wanted to extend those injunctions, we had to obtain further evidence which showed a continuing threat from ITF affiliated unions to vessels loaded in Australia by non-union labour.

The process we undertook to obtain this evidence was to call up the owners of the 23 targeted vessels to find out whether there was any risk that their vessels may not be unloaded on arrival at an overseas port. The evidence we were looking for was a communication from an overseas ITF affiliated union to the ship owner advising them that their vessel would not be permitted to either berth or unload when it arrived at a particular overseas port.

We also tried to obtain evidence from these ship owners about the loss or damage which may result if their vessel was not permitted to berth or unload. This loss or damage would usually arise from either the shipping company incurring addition costs due to delays, such as demurrage and time charter costs, or the costs associated with food cargoes going off.

We had mixed success in obtaining this evidence. Some shipowners were only willing to provide the ACCC with the most rudimentary information. Others did not want to assist the ACCC at all.

Despite the uneven support received from various shipowners, the ACCC was able to obtain a respectable amount of evidence to support its argument that the injunctions should be continued.

On 5 June 1998, Justice Bryan Beaumont of the Federal Court accepted the ACCC’s arguments and agreed to continue the interim orders until 11 June 1998. He also ordered that on 11 June 1998, there would be a full interlocutory hearing before Justice North.[1]

We had decided not to pursue further orders against the MUA requiring them to withdraw any calls for assistance to boycott the Canada Columbus or Direct Kea following assurances from the MUA that they had complied with the previous order.

I must admit I never understood why the full interlocutory hearing was to be heard by Justice North. The orders which the ACCC were seeking related to the ACCC’s initial legal proceedings which was on Justice Beaumont’s docket. Justice North was the judge who was allocated to hear the second set of legal proceedings, which related to the alleged illegal boycott conduct by the MUA in Newcastle and Adelaide.

At the time, it was widely reported that the MUA’s lawyers were keen to have the ACCC’s first case transferred to Justice North’s docket. The MUA argued that this transfer should occur because the issues raised in the ACCC’s first set of legal proceedings were very similar to the matters which Justice North was already presiding over in the MUA litigation. However, this submission did not make any sense given that the case which Justice North was presiding over was the MUA’s conspiracy action against Patrick and the Howard Government.

In our view, there was absolutely no similarly between the two cases, in terms of either the relevant legislation or the parties. Even the fact that the MUA was involved in both cases was not really a similarity given that they were the plaintiff in one case and the respondent in the other.

Before Justice North

We appeared before Justice North on 11 and 12 June 1998 to argue that the interim orders should be continued. Unfortunately, it became apparent to us almost immediately that it was going to be an uphill battle to extend our interim orders. It was abundantly clear that Justice North was very unsympathetic to our position.

The MUA lawyers argued before Justice North that the MUA had never called on its overseas affiliates to engage in any boycott conduct and that they were not intending to take such action in the future. Despite the fact that this submission was against the weight of the evidence, Justice North appeared to accept it at face value. Indeed, he did not waste any time telling the ACCC precisely what he thought of our case:

If there is no present danger of the (MUA) doing what the regulator fears, then it’s an inevitable conclusion that the ACCC is pursuing an application that has no real practical purpose. And that could be described as a waste of public money. [2]
Indeed, Justice North made the comment that the ACCC’s case was a waste of public money on a number of occasions.

As you can imagine, the media headlines the next day focused heavily on Justice North’s comments that the ACCC’s case was a waste of public money. The following is a sample of some of the newspaper headlines which appeared after Justice North’s comments:

  • ACCC wasting public money: judge [3]
  • MUA boycott battle a waste of money: judge [4]
  • Judge queries ‘waste of cash’ [5]
  • Judge slams action on MUA [6]
During the hearing, the MUA lawyers had also made a number of serious allegations that the ACCC had withheld evidence from the court. We did not quite understand how the MUA lawyers could be making this submission given that it was not an ex parte hearing and that we were under no legal obligation to advise the court of any evidence, of which we were aware, which may have conceivably assisted the respondent.

Despite our view that this particular submission was without merit and should not have been made, it also appeared to us that Justice North was leaning towards accepting this submission.

Fortunately, for the ACCC, we had an ace up our sleeve which we were able use to change the course of the hearing decisively in our favour.

A few weeks before this interlocutory hearing the ACCC had sought information from various telecommunications companies under the Telecommunications (Interception and Access) Act 1979. Under this legislation enforcement agencies, such as the ACCC, were able to obtain telecommunications data, ie telephone bills, which recorded all the calls made to and from a particular telephone number.

What we had decided to do was to obtain copies of all the MUA’s telephone bills, both for its branch offices and for individual MUA officials in an effort to establish whether the MUA had been in regular contact with the ITF or any of its overseas affiliates.

I remember spending many hours trying to identify the owners of the various phone numbers which the MUA officials had called over the preceding few months. I did this by accessing publicly available reverse telephone number search programs in the US, Europe or the UK. When such search programs were not available, I did Google searches of the telephone numbers in the hope of getting lucky and being able to identify the owner of the telephone number.

Through these searches, I was able to establish a pattern of regular communication between a number of the senior MUA officials and their various overseas counterparts, particularly senior officials of the ITF and ILWU. In most cases, the MUA official had used their own personal mobile phone to call their counterpart overseas on their own personal mobile phone.

It became apparent to the ACCC that this circumstantial evidence would be quite compelling in debunking the MUA’s arguments that they had not been in regular contact with their overseas affiliates in order to encourage them to boycott particular vessels.

I had prepared a lengthy affidavit which spelled out in excruciating detail the various communications between various senior MUA officials and their overseas counterparts, including when the calls had been made and the duration of each call. While the ACCC could not prove what was actually said during these conversations, the obvious inference from this evidence was that MUA officials had been inciting their overseas counterparts to boycott the vessels which had been loaded or unloaded using non-union labour.

Returning now to the interlocutory hearing before Justice North, one has to understand the position which the ACCC was facing just before lunchtime on 12 June 1998.

Justice North had just spent the first day of the interlocutory hearing (ie Thursday 11 June 1998) telling the ACCC that its case was a waste of public money.

He had then indirectly suggested to the ACCC that it should abandon its case against the MUA because the broader dispute between the MUA, Patrick and the Howard Government was close to being resolved – as stated by Justice North:

Can it be right that the court entirely shuts its eyes to the very possibility that the dispute which excited the regulator’s interest might be resolved?[7]
Add to this the fact that Justice North appeared to be on the verge of accepting the MUA’s serious (and completely unfounded) allegations that the ACCC had withheld evidence from the court, and one can appreciate that the ACCC was in a very unenviable position.

It was in that context that we decided, just before the lunch break, to serve on the MUA a copy of my affidavit recording all the telephone communications which had occurred between MUA officials and their overseas counterparts.

When we all returned from lunch on 12 June 1998, the MUA’s whole demeanour had undergone a radical transformation. Gone was the MUA's pre-lunch swagger - indeed, their whole demeanour had become downright sheepish.

Furthermore, the MUA had now done a complete back flip on its earlier position that it would never agree to the ACCC’s demands.

I remember Justice North looking very surprised when the MUA advised him after lunch that they were now willing to agree to the ACCC’s demands.

Justice North made the relevant orders by consent and then congratulated the parties on reaching such a practical solution. The result of the hearing is best explained in the ACCC’s new release which stated:[8]

The Maritime Union of Australia has today advised the Federal Court that it will write to the International Transport Workers Federation withdrawing any call for the ITF and its affiliates to engage in boycott conduct of ships loaded with non-MUA labour in Australia between 7 April and 10 May 1998. The Australian Competition and Consumer Commission has advised the Court that this withdrawal addresses some of the concerns of the ACCC.
The ACCC's counsel, Mr John Trew, QC, has advised the Court that it has had concerns at the apparent ongoing communication between the MUA, the ITF and its affiliates which in the context of the international boycott of ships suggests the ongoing involvement of the MUA in the alleged boycotts of non-MUA loaded ships. The ACCC has advised the Court that it is prepared for the matter to be adjourned and to see whether the MUA's withdrawal is effective.
The ACCC sought interim orders from the Court to remove the alleged MUA request for and involvement in international boycotts of those Australian ships because of its concern for the effect on Australian business of such boycotts.
The ACCC will be actively monitoring the MUA's activities in this area and the matter will now proceed to a final hearing of the ACCC's claim for substantive relief. Justice North congratulated the parties on reaching a practical resolution of difficult issues at this time.
As is apparent from the second paragraph above, we could not help alluding, fairly pointedly, to the evidence which we had obtained concerning the regular telephone communications between the MUA and its overseas affiliates.

I recall that after the hearing had finished the MUA lawyers immediately approached us in the foyer of the court to ask us how we had been able to obtain the evidence contained in my affidavit concerning the MUA official's communications with their overseas counterparts. Our lawyer, quite nonchalantly, responded to their question with the words:

Haven't you ever heard of the Telecommunications (Interception and Access) Act 1979?
I suspect that from that day on every MUA official made certain to never again call any of their colleagues from the ITF or overseas affiliates using their own personal mobile phones.

Boomerang Ship [9]

One of the most appalling events during the Waterfront dispute was the fate of the Columbus Canada which was dubbed the Boomerang Ship in the Australian media.

The Columbus Canada has been loaded in Australia using non-MUA labour before setting sail for the US. Unfortunately, this vessel became the target of a concerted campaign of boycotts by US dockworkers which prevented it from unloading its cargo. As a result of these boycotts, the vessel was ultimately forced to return to New Zealand to be unloaded by union labour.

The Columbus Canada left Australia on 21 April 1998, loaded primarily with food, such as frozen and chilled meat, wine and cheese. There was 700 tonnes of meat on the vessel, valued at around $3 million, and 2300 tonnes of other food products. It was also one of the first vessels which had been loaded by non-MUA labour to leave Australian shores. Its first port of call, after picking up further cargo in New Zealand, was Los Angeles in the US.[10]

On arrival at Los Angeles, the vessel was prevented from unloading its cargo due to picket lines organised by the ILWU. The picketers allowed the New Zealand cargo to be unloaded but refused to allow any of the Australian cargo off the vessel.

After numerous attempts to unload the Australian cargo in Los Angeles over a period of 18 days, the owners of the vessel, the Columbus Line, met with picketers at the Matson Terminal and agreed that no Australian cargo would be unloaded in Los Angeles. Rather they agreed to send the vessel back to New Zealand where the Australian cargo was transferred to another Columbus line vessel and shipped back to the US.

The boycott of the Columbus Canada caused an outcry amongst the meat industry, business groups, farmers and the Howard Government. Criticism of the union’s actions became more intense following reports that some of the chilled meat on the vessel had started to rot.

The Australian meat industry was very critical of the actions of the unions due to the damage which this boycott caused to both the particular exporters whose products had been held up, as well as to Australia’s reputation as a reliable exporter of meat.

While the ACCC had made the fate of the Columbus Canada the focus of its case for interim orders against the MUA in Australia, unfortunately, our orders were unable to prevent the union’s actions towards this vessel.

[1] Interim injunction, continued, ACCC news release, dated 5 June 1998 -
[2] MUA boycott battle a waste of money: Judge, The Daily Telegraph, 12 June 1998, p. 23
[3] The Canberra Times, 12 June 1998, p.4
[4] Daily Telegraph, op. cit., p. 23.
[5] Financial Review, 12 June 1998, p. 3.
[6] Herald Sun, 12 June 1998, p. 6.
[7] Daily Telegraph, op. cit., p. 23.
[8] Maritime Union of Australia, ACCC news release, 12 June 1998 -
[9] The boomerang ship, Herald Sun, 28 May 1998, p. 11
[10] Ibid.