Trade Practices Commission v Nicholas Enterprises Pty Ltd & Ors [1979] FCA 96

Trade Practices Commission v Nicholas Enterprises Pty Ltd & Ors [1979] FCA 96

There was an understanding reached between the Royal Oak (Nicholas Enterprises Pty Ltd) and Morphett Arms Hotel Pty Ltd on 22 November 1977 to reduce the beer allowance, with the purpose/effect of fixing, controlling, or maintaining a price element in competition; this contravened s.45(2)(a)(ii) and s.45(2)(b)(ii), as deemed by s.45A(1) of the Trade Practices Act 1974, given both parties were in competition for packaged beer in the metropolitan market. There was insufficient evidence of mutual understanding or commitment to find the same against Norwood (Saturno Holdings) or the Old Lion group.

Parties
Plaintiff: Trade Practices Commission; First Defendant: Nicholas Enterprises Pty. Limited; Second Defendant: Saturno Holdings Pty. Limited; Third Defendant: Rex Freehold Pty. Limited; Fourth Defendant: Morphett Arms Hotel Pty. Limited; Fifth Defendant: Lion Bus Co. Pty. Limited; Sixth Defendant: Merit Nominees Pty. Limited; Seventh Defendant: General Development Corporation Pty. Limited; Eighth Defendant: Agett Nominees Pty. Limited
Jurisdiction
Australia
Judgment Date
07 September 1979
Procedural Posture
Civil / Trial Judgment After Hearing and Submission of No Case to Answer
Outcome
Claim against Nicholas Enterprises Pty Ltd (Royal Oak) and Morphett Arms Hotel Pty Ltd upheld in part; claim against Saturno Holdings (Norwood) and Old Lion group (Lion Bus Co Pty Ltd, Merit Nominees Pty Ltd, General Development Corporation Pty Ltd, Agett Nominees Pty Ltd) dismissed; final orders (including penalty,...
Legal Topics
Price Fixing, Arrangements and Understandings, Burden of Proof, Admissibility of Evidence Under S.155, Directors' Authority, Relevant Market Definition, Parallel Conduct, Meaning of 'competition'
Competition Law Price Fixing Arrangements and Understandings Burden of Proof Admissibility of Evidence Under S.155 Directors' Authority Relevant Market Definition Parallel Conduct +1 more

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Parties

Trade Practices Commission

Plaintiff

Nicholas Enterprises Pty. Limited

First Defendant

Saturno Holdings Pty. Limited

Second Defendant

Rex Freehold Pty. Limited

Third Defendant

Morphett Arms Hotel Pty. Limited

Fourth Defendant

Lion Bus Co. Pty. Limited

Fifth Defendant

Merit Nominees Pty. Limited

Sixth Defendant

General Development Corporation Pty. Limited

Seventh Defendant

Agett Nominees Pty. Limited

Eighth Defendant

Procedural Posture

Civil / Trial Judgment After Hearing and Submission of No Case to Answer

Legal Issues

  1. 1 Whether an arrangement or understanding in contravention of s.45 of the Trade Practices Act 1974 existed between certain hotel operators to fix or control beer prices/allowances
  2. 2 Whether parallel conduct was sufficient to infer an understanding under the statutory test
  3. 3 Whether communications between directors/agents were admissible as evidence against corporations under s.84 and s.155 of the Act

Ratio Decidendi

There was an understanding reached between the Royal Oak (Nicholas Enterprises Pty Ltd) and Morphett Arms Hotel Pty Ltd on 22 November 1977 to reduce the beer allowance, with the purpose/effect of fixing, controlling, or maintaining a price element in competition; this contravened s.45(2)(a)(ii) and s.45(2)(b)(ii), as deemed by s.45A(1) of the Trade Practices Act 1974, given both parties were in competition for packaged beer in the metropolitan market. There was insufficient evidence of mutual understanding or commitment to find the same against Norwood (Saturno Holdings) or the Old Lion group.

Court Disposition

Claim against Nicholas Enterprises Pty Ltd (Royal Oak) and Morphett Arms Hotel Pty Ltd upheld in part; claim against Saturno Holdings (Norwood) and Old Lion group (Lion Bus Co Pty Ltd, Merit Nominees Pty Ltd, General Development Corporation Pty Ltd, Agett Nominees Pty Ltd) dismissed; final orders (including penalty,...