COMMERCE COMMISSION v LODGE REAL ESTATE LTD & ORS [2017] NZHC 1497

COMMERCE COMMISSION v LODGE REAL ESTATE LTD & ORS [2017] NZHC 1497

There was an objective consensus among the Hamilton agencies that they would cease absorbing Trade Me's new per‑listing fees and (except Success) withdraw standard listings by January 2014 and transition to vendor funding; those communications and subsequent withdrawals constituted an arrangement or understanding and the defendants gave effect to it, but the arrangement did not have the purpose or effect of fixing, controlling or maintaining prices (or providing for same) for the contested services and therefore did not contravene s27/s30; the Commission's claim failed.

Citation
[2017] NZHC 1497
Parties
Plaintiff: Commerce Commission; First Defendant: Lodge Real Estate Limited; Second Defendant: Lugton's Limited; Third Defendant: Monarch Real Estate Limited; Fourth Defendant: Online Realty Limited; Fifth Defendant: Success Realty Limited; Sixth Defendant: Brian King; Seventh Defendant: Jeremy O'Rourke
Court
High Court
Jurisdiction
New Zealand
Judgment Date
2 November 2017
Procedural Posture
Competition / Antitrust (commerce Act 1986 S27 and S30) / Trial — Judgment on Liability (penalty Hearing to Follow If Liability Established)
Outcome
Commission's claim dismissed insofar as pursued against the first, third, sixth and seventh defendants; arrangement/understanding found but not a s30 price‑fixing contravention; defendants entitled to costs
Legal Topics
Price Fixing, Agreement/understanding Under S27, Deeming Provision S30, Vendor Funding of Advertising, Online Property Listing Platforms
Competition Law Antitrust Commercial Law Price Fixing Agreement/understanding Under S27 Deeming Provision S30 Vendor Funding of Advertising Online Property Listing Platforms

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Parties

Commerce Commission

Plaintiff

Lodge Real Estate Limited

First Defendant

Lugton's Limited

Second Defendant

Monarch Real Estate Limited

Third Defendant

Online Realty Limited

Fourth Defendant

Success Realty Limited

Fifth Defendant

Brian King

Sixth Defendant

Jeremy O'Rourke

Seventh Defendant

Procedural Posture

Competition / Antitrust (commerce Act 1986 S27 and S30) / Trial — Judgment on Liability (penalty Hearing to Follow If Liability Established)

Legal Issues

  1. 1 Whether defendants entered into a contract, arrangement or understanding
  2. 2 Whether defendants gave effect to any such arrangement or understanding
  3. 3 Whether the defendants were in competition with each other in respect of the relevant services

Ratio Decidendi

There was an objective consensus among the Hamilton agencies that they would cease absorbing Trade Me's new per‑listing fees and (except Success) withdraw standard listings by January 2014 and transition to vendor funding; those communications and subsequent withdrawals constituted an arrangement or understanding and the defendants gave effect to it, but the arrangement did not have the purpose or effect of fixing, controlling or maintaining prices (or providing for same) for the contested services and therefore did not contravene s27/s30; the Commission's claim failed.

Court Disposition

Commission's claim dismissed insofar as pursued against the first, third, sixth and seventh defendants; arrangement/understanding found but not a s30 price‑fixing contravention; defendants entitled to costs

Orders

  • Claim dismissed as to Lodge Real Estate Limited, Monarch Real Estate Limited, Brian King and Jeremy O'Rourke
  • Expert economic evidence of the defendants excluded from the trial record