Full Court Matters - February 2001

(Other than Applications for Special Leave to Appeal)

FEBRUARY 2001

THE COMMONWEALTH OF AUSTRALIA v. YARMIRR & ORS (D7/2000)

YARMIRR & ORS v. THE NORTHERN TERRITORY OF AUSTRALIA & ORS (D9/2000)

Court Appealed from: Full Court of the Federal Court of Australia

Date of Judgment: 3 December 1999

Date special leave granted: 4 August 2000

On 22 November 1994, five clans of Aboriginal peoples applied under the Native Title Act 1993 (Cth) for a determination of native title in relation to an area of sea territory in the vicinity of Croker Island in the Northern Territory. They claimed exclusive occupation, possession, use and enjoyment of the claimed area as well as lesser rights. More specifically, the native title rights and interests claimed included a right of access to waters and sea bed, a right to control the access of others to the waters and sea bed, and an exclusive right to hunt, fish and gather food and material in the waters and from the sea bed and a right to trade in the resources of the claim area. The rights claimed also included exclusive possession of the waters and seabed and exclusive ownership of living marine organisms found permanently or from time to time within the waters or on the seabed. The Aboriginal groups also claimed rights to receive and to pass on the religious and cultural knowledge associated with the waters and the land and the right and responsibility to care for and to protect the sites of significance in the waters and on the land.

The application was heard by Olney J between 22 April 1997 and 21 August 1997. The Commonwealth and the Northern Territory as well as a group known as the "fishing industry parties" were all party to these proceedings. The Aboriginal groups relied on the evidence of senior members of their clans and the expert evidence of two anthropologists with extensive expertise and experience in Aboriginal land tenure in the region, in the preparation of genealogies and the mapping of sites.

On 6 July 1998, the trial Judge handed down his decisions and made findings in relation to the nature and constitution of the clans (or estate groups), the extent of their estates and the nature and content of the rights they enjoyed in the particular estates pursuant to traditional law and custom. While the trial Judge upheld the Aborigines' claims with respect to native title in relation to the whole of the claim area, he held that the rights could not confer possession and occupation of the sea and sea bed to the exclusion of all others. His Honour found that the Aborigines had established non-exclusive native title rights to fish, hunt and gather within the claimed area, and to access the area for specified purposes. He further held that those limited rights could be recognised by virtue of the off-shore operation of the Native Title Act. His Honour also held that the Aborigines had rights and obligations to protect places of spiritual and cultural importance from unauthorised and inappropriate use.

Both the Aboriginal groups and the Commonwealth appealed from Justice Olney's judgment and orders. The Northern Territory and fishing industries parties supported the Commonwealth in each appeal.

On 3 December 1999, the Full Court handed down its judgment, unanimously dismissing the appeal of the Commonwealth. In relation to the Aboriginal claimants, the majority of the Court held that the trial Judge erred in seeking to establish the nature of the rights and interests enjoyed under the traditional laws and customs of the Aboriginal groups at the time at which the Crown acquired sovereignty. Their Honours dismissed the appeal with respect to the Aborigines' claim of exclusive rights of fishing and rights to exclude others from the claim area. They also rejected the Aborigines' claim to a right to trade in the resources of the claim area.

The grounds of appeal of the Commonwealth (D7/2000) are:

• Whether the majority erred in that it wrongly construed the Native Title Act so as to provide the basis for recognition of native title beyond the limits of the Northern Territory;

• Whether the majority erred in that it ought to have held that no native title exists within that part of the claim area outside the limits of the Northern Territory for reasons that the common law does not, of its own force, apply outside the said limits; no law of the Commonwealth or of the Northern Territory provides a basis for the recognition of native title outside the said limits; and in the absence of a law of the Commonwealth or of the Northern Territory making such provision, no basis exists for the recognition of native title outside the said limits;

• Whether the majority erred in failing to hold that no native title exists in that part of the claimed area which lies beyond the seaward limit of the coastal waters of the Northern Territory as defined by the Coastal Waters (Northern Territory Powers) Act 1980 (Cth) for the reasons set out above and for the further reasons that neither the Commonwealth nor the Northern Territory has radical or other title in or to the said area and the extension by Australia of its territorial sea to 12nm did not so affect the legal character or status of that area that it ceased to be regarded for the purposes of the common law as territory external to Australia and governed by international law subject only to the valid exercise of legislative power by the Commonwealth, the states and the territories; and

• In the absence of any/sufficient evidence of traditional or other occupation or use by the First Respondents, the learned trial judge erred in determining that native title exists in a particular part of claimed area and the Full Court erred in failing to determine that the trial judge had so erred and in failing to amend the determination of the trial judge accordingly.

The grounds of appeal of the Aboriginal claimants' (D9/2000) are:

• Whether the majority of the Full Court erred in failing to hold that under traditional laws/customs observed by them, native title holders had a significant spiritual connection with the waters and sea-bed in the claim area, had spiritual responsibility for the claim area, were entitled to require that people and vessels stay outside particular areas at particular times in accordance with traditional laws and customs, had an exclusive right to fish, hunt and gather in the claim area, had a right to possess, occupy, use and enjoy the claim area generally to the exclusion of all others, had a right to control the use and enjoyment of the resources in the claim area;

• Whether the majority erred in failing to hold that the public rights to fish, to navigate and of innocent passage in the claim area did not preclude recognition of exclusive rights of fishing, hunting and gathering by native title holders nor prevail over any such inconsistent rights of native title holders;

• Whether the majority erred in having held that to constitute native title rights and interests, s223 of the Native Title Act required only that the rights and interests be those currently possessed under traditional laws and customs observed and the trial judge, having found that traditional laws and customs required that persons other than members of the particular estate group of native title holders required permission of a senior member of the estate group to use and enjoy the sea-country of the estate group, the majority erred in failing to hold that the trial judge erred in holding that traditional law and custom did not extend to exclusive control of the use and enjoyment of the claim area because it could not have binding effect on non-Aboriginal people; and

• Whether the majority erred in holding that the application extended to the waters which overlay the shores of the land and islands from time to time between the low and high water marks and whether it erred in failing to hold that the application did not extend to such waters because the column of air or waters from time to time over the inter-tidal zone was included in the fee simple estate granted to the Ninth Respondent (the Land Trust) under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) (which included the inter-tidal zone) and was in terms excluded from the application under the Native Title Act.

HENVILLE & ANOR v. WALKER & ANOR (P55/2000)

Court Appealed from: Full Court of the Supreme Court of Western Australia

Date of Judgment: 9 August 1999

Date special leave granted: 16 June 2000

In 1995 the respondents, through the first respondent Mr Walker, represented to the appellants, through the first appellant Mr Henville, that the property market in Albany favoured the sale of quality home units, and that if certain units were to be built on a certain property of which Mr Walker was the selling real estate agent, each could be sold for $250,000 to $280,000.

In reliance on those representations, Mr Henville, a retired architect and property development consultant purchased the property in Albany. He proceeded to construct three quality home units on the property. The units, however, were sold for prices that in the aggregate amounted to $545,000. The cost of the development amounted to $846,846.51. The appellants claimed, as damages, the costs less the net proceeds of sale, on the basis that the respondent had engaged in misleading conduct in breach of s52 of the Trade Practices Act.

It was the respondents' case at trial that it was Mr Henville's own conduct in relying upon his feasibility assessment (which underestimated the costs associated with the development) that had been the cause of the appellants' loss and damage.

At trial, it was found that Mr Walker's representations had constituted misleading conduct that caused the appellants to sustain loss, however, it was also found that there were several other causes which had contributed to the loss. These included carelessness on the part of Mr Henville and his adviser in calculating the costs of the development and other factors that had led to the costs of construction being increased. The amount of damages awarded at trial sought to accommodate these various causes.

The respondents appealed, arguing that Mr Walker's misleading conduct was not, in law, the true cause of the loss or, in the alternative, that the appellants had failed to properly prove their loss. The appeal was upheld.

The grounds of appeal are:

• Whether the Full Court erred in interpreting the word 'by' in s82 of the Trade Practices Act 1974 (Cth) felt compelled to identify and isolate a cause of the appellants' loss and damage instead of acknowledging there were to concurrent causes (the respondent's misleading and deceptive conduct and the appellant's folly);

• Whether the Full Court in applying the common sense test of causation erred in testing whether the respondent's misleading conduct caused loss by, in effect, inquiring into what the appellants would have done or what would have occurred had the representation constituting the misleading conduct (as to the selling price of each unit) been true instead of misleading, rather than by testing causation by reference to what the appellants would have done had the respondents' conduct not occurred and or had the respondents represented the true position;

• Whether the Full Court erred in artificially elevating conduct that was in effect contributory negligence to the sole cause of the appellant's loss and damage;

• Whether the Full Court erred in finding that an absence of evidence segregating losses attributable to the respondents' misleading conduct, and losses incurred by the appellant's inadequate financial resources and delays, precludes an entitlement on the part of the appellants to any award of damages whatsoever and/or that there was an absence of evidence segregating such losses.

PETERS (WA) LTD v. PETERSVILLE LTD & ANOR (P64/2000)

Court Appealed from: Full Court of the Federal Court of Australia

Date of Judgment: 14 September 1999

Date special leave granted: 4 August 2000

In the early 1900's an American, Mr F A B Peters, established various Peters ice cream manufacturing businesses around Australia. Separate businesses were established under separate ownerships in New South Wales, Victoria, Queensland and Western Australia. In the late 1920's the operators of those separate businesses entered into agreements under which they did not encroach on each others' markets and cooperated in relation to the sharing and marketing of technical information. The respondent became the operator of the Western Australian business in 1929, under the name of "Peters American Delicacy Co (WA) Limited".

In the 1930's, a group of families in Queensland founded Pauls Ltd to compete in the ice cream market with the Peters company in Queensland. In 1960 Pauls Ltd and Peters companies in Queensland amalgamated to form a company referred to by the trial Judge as "QUF". By 1980, QUF manufactured ice cream in Queensland, Victoria and Western Australia which it sold in Queensland under both the Peters and Pauls brands, but elsewhere solely under the Pauls brand. By that time, all of the other Peters ice cream businesses (other than in Western Australia and Queensland), had been consolidated into a company called Petersville Ltd, the first named respondent.

In 1980, Petersville and QUF established a partnership under the name "Australian United Foods" (AUF) and manufactured and sold ice cream under the Pauls brand nationally and under the Peters brand in every state except Western Australia. At that time, the appellant manufactured and sold ice cream under the Peters brand in Western Australia and continues to do so. On 15 February 1983 AUF sold their Western Australian ice cream business to the appellant under an agreement entered into on that day. The contract contained a clause entitled "Future Arrangements" which operated as a constraint on both QUF and Petersville selling, supplying or distributing such products or carrying on such a business for the period of the "Licensing Arrangements" referred to in the contract.

The question before the primary Judge and on appeal to the Full Court of the Federal Court of Australia related to the validity of the future arrangements clause which was clause 7 of the principal agreement. Clause 7.1 set out various covenants not to sell, supply or distribute ice cream in Western Australia during the period of particular licensing arrangements referred to in Article 5 of the principal agreement. The first term of the licensing arrangement ended in December 1997 and the appellant exercised the first of 3 options, each for a 5 year extension, when the matter was first heard.

The appellant contended that the restraint was connected with an ongoing contractual relationship between the parties and in particular was connected with, and incidental to, licensing arrangements for the use of the respondent's brand or mark "Pauls" in Western Australia. The trial judge accepted that there was a connection but that the restraint was not confined to the protection of the licensor's right in relation to the Pauls mark and all product names that had extended to any ice cream or frozen confection sold under any name whatsoever and was not confined within Western Australia.

His Honour concluded that the restraints imposed such a fetter that the licensing and other arrangements when read with the restraint, could not be characterised as agreements for the regulation and promotion of trade, but had the predominant character of being in restraint of trade within the common law meaning. His Honour then addressed whether the restraint could be said to be reasonable having regard to the interest of the parties at the time it was entered into. In holding that the protection given by the covenant was beyond that which was reasonably required, his Honour took into account the fact that a substantial sum was paid for the good will of the business, the fact that under the provisions of the principle agreement, the respondent's employees remained with the business as employees of the appellant and this would have substantially assisted in maintaining the business. Thus, his Honour held that the restraint was void and that there was no legislation in Western Australia which enabled the Court to alleviate that consequence.

On appeal to the Full Court of the Federal Court of Australia, the appellant argued that the doctrine of restraint of trade does not apply to ordinary commercial contracts for the regulation and promotion of trade provided that the prevention of work outside the contract is directed towards the absorption of the parties' services. The Full Court noted that authorities on restraint of trade have been concerned with the practical effect of the covenant and that, upon a review of the evidence, the Court was of the view that the restrictions imposed amounted to a restraint. They further held that the restraint was not reasonable and that while some restraint could be justified one of such duration could not.

The appellant also raised s51(2)(e) of the Trade Practices Act 1974 (Cth) which provides that, in determining whether a contravention of some of the provisions of Part IV has been committed, regard is not to be had: "in the sale of a contract for the sale of a business ... to any provision of the contract that is solely for the protection of the purchaser in respect of the goodwill of the business". The Full Court found that it was not apparent why the appellant submitted that the restraint was within the scope of that provision, since the section has regard to what is not to be taken into account in determining whether another provision had been contravened.

The grounds of appeal are:

• Whether the Full Court erred in holding that the common law restraint of trade doctrine applied to the covenant in that it posed the wrong test, namely, whether the covenant was within a "category of restraint which the Courts have held to be justified, and therefore exempt from the common law doctrine";

• Whether the Full Court should have recognised that the common law doctrine has no application to covenants which are a normal incident of a positive and continuing commercial relationship and which are no more than co-extensive with that relationship or in the alternative, whether the Court erred in failing to hold that the covenant was reasonable and in the publics' interests; and

• Whether the Full Court erred in concluding that the covenant did not come within the scope of s51(2)(e) of the Trade Practices Act 1974 (Cth) when it should have held that the goodwill to which that section refers includes sources of goodwill including licensing and other ongoing commercial relationships and that the covenant was solely for the protection of the purchaser in respect of goodwill.

DOGGETT v. THE QUEEN (B54/2000)

Court Appealed from: Court of Appeal of the Supreme Court of Queensland

Date of Judgment: 29 October 1999

Date special leave granted: 21 June 2000

In June 1999 in the District Court of Queensland, the appellant was convicted of 7 counts of various sexual offences in relation to a girl under the age of 16 years. At the time of the offences, the complainant was aged between 8 and 15 years. The offences were alleged to have been committed from between October 1979 and November 1986.

At trial, apart from the evidence of the complainant, there was evidence of a recent taped telephone conversation between the complainant and the appellant during which he admitted to having molested her as a child and expressed regret at having done so.

The appellant appealed to the Court of Appeal, on the ground that the verdicts were unsafe and unsatisfactory. The appellant later added a ground relating to the trial judge failing to adequately warn the jury of the danger of convicting, having regard to the complainant's lengthy delay in making a complaint.

In coming to its conclusion to dismiss the appeal, the Court of Appeal concluded that a direction of the kind discussed in Longman v. The Queen (1989)165 CLR 79, was not required. Essentially, the Court held that because of the highly corroborative nature of the recorded telephone call, it would have been wrong to suggest to the jury that it would be dangerous to convict on the appellant's testimony regarding events that had occurred so long ago.

The ground of appeal is:

• Whether the Court of Appeal erred in deciding that it was unnecessary for the trial judge to direct the jury that, as the evidence of the complainant could not be adequately tested after the passage of such a significant period of time, it would be dangerous to convict on the complainant's evidence alone unless the jury, scrutinising the evidence with great care, were satisfied of its truth and accuracy.