PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judge: YATES J
• Judgment Date: 21 May 2020
• Neutral Citation: [2020] FCA 685
• Date: 21 May 2020

FEDERAL COURT OF AUSTRALIA

PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission [2020] FCA 685

Appeal from:	Australian Competition and Consumer Commission v PT Garuda Indonesia Ltd (Remedies) [2019] FCA 786
File number:	NSD 1011 of 2019
Judge:	YATES J
Date of judgment:	21 May 2020
Catchwords:	PRACTICE AND PROCEDURE – application for stay of appeal until further order – in circumstances where appellant has failed to comply with an order of the Court to pay pecuniary penalties – the power of the Court to control its own proceedings – power to grant a stay of proceedings – whether contempt demonstrated
Legislation:	Corporations Act 2001 (Cth) ss 124, 129, 601CD Federal Court of Australia Act 1976 (Cth) ss 25(2B)(ab), 28, 31 Federal Court Rules 2011 (Cth) r 42.12 Foreign States Immunities Act 1985 (Cth) s 3(1)
Cases cited:	Alexander v Cambridge Credit Corporation Limited (Receivers Appointed) (1985) 2 NSWLR 685 Australasian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 Australian Competition and Consumer Commission v PT Garuda Indonesia Ltd (Remedies) [2019] FCA 786; 370 ALR 637 Australian Securities and Investments Commission v Australia and New Zealand Banking Group Limited [2019] FCA 964; 138 ACSR 42 Australian Competition and Consumer Commission v World Netsafe Pty Ltd (No 3) [2003] FCA 159; 127 FCR 542 Bond Corporation Pty Limited v Thiess Contractors Pty Limited (1986) 14 FCR 193 Foster v Australian Competition and Consumer Commission [2014] FCA 240; 219 FCR 563 Hadkinson v Hadkinson [1952] P 285 Hughes Motor Service Pty Ltd v Wang Computer Pty Ltd (1978) 35 FLR 346 Hwang v Lawrie [2013] QCA 204; [2014] 1 Qd R 562 Jorgensen v Fair Work Ombudsman [2019] FCAFC 113; 371 ALR 426 Kazal v Thunder Studios Inc (California) [2017] FCAFC 111; 256 FCR 90 KP Cable Investments Pty Ltd v Meltglow Pty Ltd (1995) 56 FCR 189 Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83; 149 FCR 494 Metcash Trading Ltd v Bunn (No 5) [2009] FCA 16 Muller v Fencott (1981) 53 FLR 184 Powerflex Services Pty Ltd v Data Access Corp (1996) 67 FCR 65 PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission [2011] FCAFC 52; 192 FCR 393 PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission (Penalty Stay Application) [2019] FCA 1317 Siminton v Australian Prudential Regulation Authority (No 3) [2008] FCAFC 89; 168 FCR 140 Stokes (by a tutor) v McCourt [2013] NSWSC 1014 Trade Practices Commission v Manfal Pty Limited (1990) 27 FCR 284 Young v Jackman (1986) 7 NSWLR 97
Date of hearing:	2 March 2020
Registry:	New South Wales
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	Economic Regulator, Competition and Access
Category:	Catchwords
Number of paragraphs:	63
Counsel for the Appellant:	Mr T Brennan
Solicitor for the Appellant:	Norton White
Counsel for the Respondent:	Mr J A Halley SC and Ms H Younan
Solicitor for the Respondent:	Australian Government Solicitor

ORDERS

		NSD 1011 of 2019
BETWEEN:	PT GARUDA INDONESIA LTD ARBN 000 861 165 Appellant
AND:	AUSTRALIAN COMPETITION AND CONSUMER COMMISSION Respondent

JUDGE:	YATES J
DATE OF ORDER:	21 MAY 2020

THE COURT ORDERS THAT:

1. The respondent’s amended interlocutory application dated 28 October 2019 (the interlocutory application) be dismissed.

2. The respondent pay the appellant’s costs of the interlocutory application.

3. Leave be granted to the appellant to amend its notice of appeal dated 25 June 2019 by adding the following ground of appeal:

The Court erred by exceeding the power conferred on the Court by including in order 1 the words “within 28 days”.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

YATES J:

INTRODUCTION

1. On 30 May 2019, the appellant, PT Garuda Indonesia Ltd (Garuda), was ordered to pay, within 28 days, pecuniary penalties amounting to $19 million (the pecuniary penalty order): Australian Competition and Consumer Commission v PT Garuda Indonesia Ltd (Remedies) [2019] FCA 786; 370 ALR 637. The penalties were imposed for contravention of ss 45(2)(a)(ii) and 45(2)(b)(ii) of the Trade Practices Act 1974 (Cth) arising from a number of understandings that Garuda reached and implemented with other international airlines to impose various pre-determined surcharges on the supply of air cargo services from overseas ports to Australian ports. The contraventions occurred variously between October 2001 and October 2006.

2. On 25 June 2019, Garuda filed a notice of appeal seeking, amongst other orders, an order that the application by the respondent, the Australian Competition and Consumer Commission (the Commission), for pecuniary penalties be dismissed or, alternatively, that the question of penalties be redetermined by the Full Court. In the meantime, Garuda has not paid the penalties.

3. The Commission seeks a stay of the appeal until further order, in reliance on s 25(2B)(ab) of the Federal Court of Australia Act 1976 (Cth) (the Act), which provides:

A single Judge (sitting in Chambers or in open court) or a Full Court may:

…

(ab) make an interlocutory order pending, or after, the determination of an appeal to the Court; …

4. As advanced in oral submissions by the Commission, the basis for the stay is that Garuda has deliberately and wilfully failed to comply with a very significant order of the Court (the pecuniary penalty order) in circumstances where it has provided no plausible justification for that failure. The Commission submits that the Court could have no confidence that, in light of its conduct in the matter to date (as to which see below), Garuda will comply with any pecuniary penalty order as upheld or varied on appeal.

5. The application for the stay is opposed.

Background

6. As ordered, the penalties were due to be paid on or before 27 June 2019. On 17 June 2019, the Commission’s solicitor, the Australian Government Solicitor (the AGS), wrote to Garuda’s solicitors, Norton White, informing them of the account into which the penalties were to be paid. Payment was not made by the due date. Consequently, the AGS wrote to Norton White on 1 July 2019 drawing attention to the non-payment and seeking, in effect, an explanation.

7. On 3 July 2019, Norton White responded, saying that the AGS’s letter had been forwarded to Garuda in Indonesia. After further correspondence from the AGS, Norton White informed the AGS that those with responsibility for processing the payment of the penalties understood that Garuda was required to inform the Indonesian Ministry for State Enterprises of the pecuniary penalty order and to “await the direction of the Ministry”. Norton White said:

This situation arises because Garuda, as the national carrier for Indonesia, is subject to...