Telstra Corporation Ltd v ACCC

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 24 November 2008
• Neutral Citation: [2008] FCA 1758

FEDERAL COURT OF AUSTRALIA

Telstra Corporation Ltd v ACCC

[2008] FCA 1758

TRADE AND COMMERCE – Trade Practices Act 1974 (Cth), PartXIC, telecommunications industry and access regime –dispute between Telstra and Optus regarding access to Unconditioned Local Loop Service (ULLS) in multi-dwelling units (MDUs) – resolution of access dispute by Australian Competition and Consumer Commission (ACCC) – final determination made by ACCC establishing regime for ordering and provisioning of ULLS – whether final determination lawfully made

ADMINISTRATIVE LAW – judicial review – grounds of review – appeal under Administrative Decisions (Judicial Review) (ADJR) Act 1977 (Cth), s 5 – whether final determination unlawfully made on grounds that, in making final determination, ACCC: (1) did not take into account Telstra’s direct costs of providing access to the ULLS (s 152CR(1)(d)); or (2) did not properly have regard to industry code as model terms and conditions (152AQB(9)) or otherwise (s 152CR(2)); or (3) failed to specify with reasonable precision or certainty terms and conditions relating access (s 152CP(2)); or (4) was so unreasonable that no reasonable person could have so exercised the power (Wednesbury unreasonableness); or (5) exceeded its jurisdiction by incorrectly assuming a matter upon which the exercise of its jurisdiction depended (s 152CP(1))

TRADE AND COMMERCE – Trade Practices Act, PartXIC, Div 8 – extent to which ACCC’s earlier determination adopted industry code standards regarding ordering and provisioning of ULLS – mandatory terms of s 152AQB(1)(b) and (3) which stated respectively that ACCC “must make a written determination setting out model terms and conditions relating to access to each core service” and that ACCC “must take all reasonable steps to ensure that” such a determination is made within six months after commencement of section – whether ACCC had discretion to declare some but not all model terms and conditions relating to core service

STATUTORY INTERPRETATION – clear words used by Parliament requiring ACCC to make written determination to set out model terms and conditions relating to ULLS and to take all reasonable steps to do so within six months – explanatory memorandum qualifying clear words in Bill

Held: Final determination by ACCC invalid

(1) Wordsof Minister must not be substituted for text of law, particularly where text of law imposes responsibilities and liabilities on persons, including corporations, who contravene it – the earlier determination of model terms and conditions can and should be construed as a valid exercise of power under s 152AQB(2) by treating ambiguous language in it as intended to comply with the unambiguous terms of the Act

(2) When s 152CR(1)(d) required ACCC, in making final determination, to “take…into account” Telstra’s direct costs in providing access to ULLS, ACCC was required to take that matter into account, together with other matters referred to in that section, and give weight to them as fundamental elements in making its decision – ACCC required to give matter “fundamental weight” in sense that it was to treat consideration of factors (as opposed to factors themselves) as central element in deliberative process – such consideration was not reflected in ACCC’s reasons for final determination

(3) ACCC’s final determination required Telstra to provide access to ULLS in manner which did not have regard to industry code as model terms and conditions as required by s 152AQB(9)

(4) Alternatively, ACCC so misunderstood and misconstrued industry code that it failed to take relevant matter into account pursuant to s 152CR(2)

(5) Final determination was uncertain both in expression and operation because it failed to specify terms and conditions relating to access to ULLS with reasonable precision

(6) ACCC’s exerciseof powerin making finaldetermination was unreasonable – absence of any foundation in fact for fulfilment of conditions (being existence of ULLS) upon which, in point of law, existence of ACCC’s power depended

(7) In making final determination, ACCC exceeded its jurisdiction under s 152CP

WORDS & PHRASES - “must have regard to”, “must take into account”, “fundamental weight”, “ordering and provisioning”, “declared service”, “core service”, “communications wire”, “direct costs”, “model terms and conditions”, “all reasonable steps”

Acts Interpretation Act 1901 (Cth), ss 15AB, 46

Administrative Decisions (Judicial Review) Act 1977 (Cth), sub-ss 5(1), (2), 16(1)(a)

Trade Practices Act 1974 (Cth), Part XIC: Div 1, ss 152AA, 152AB, 152AC; Div 2, ss 152AQA, 152AQB; Div 3, ss 152AR, 152AY; Div 8, ss 152CL, 152CLA, 152CM, 152CO, 152CP, 152CQ(1)(f), (7), 152CR(1)(d)

Ancher, Mortlock, Murray & Woolley Pty Ltd v Hooker Homes Pty Ltd 2 [1971] NSWLR 278 cited

Associated Provincial Picture Houses Ltd v Wednesbury Corp [1948] 1 KB 223 cited

Australian Communist Party v The Commonwealth (1951) 83 CLR 1 cited

Australian Retailers Association v Reserve Bank of Australia (2005) 148 FCR 446 referred to

Australian Tea Tree Oil Research Institute v Industry Research and Development Board (2002) 124 FCR 316 cited

Avon Downs Pty Limited v Commissioner for Taxation (1949) 78 CLR 353 referred to

Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 cited

Cann’s Pty Limited v The Commonwealth (1946) 71 CLR 210 considered

Collector of Customs v Agfa Gevaert Ltd (1996) 186 CLR 389 followed

Commonwealth v Pharmacy Guild of Australia (1989) 91 ALR 65

East Australian Pipeline Pty Ltd v Australian Competition and Consumer Commission (2007)233 CLR 229 followed

Eastern Trust Co v McKenzie, Mann & Co [1915] AC 750 cited

Elliott v Minister for Immigration (2007) 156 FCR 559 cited

Enfield City Corporation v Development Assessment Commission (2000) 199 CLR 135 cited

Foster v Minister for Customs (2000) 200 CLR 442 cited

George v Rockett (1990) 170 CLR 104 cited

Gill v Donald Humberstone & Co Ltd [1963] 1 WLR 929 referred to

Herald-Sun TV Pty Ltd v Australian Broadcasting Tribunal (1985) 156 CLR 1 cited

Khan v Minister for Immigration and Ethnic Affairs (1987) 14 ALD 291 cited

King Gee Clothing Company Pty Limited v The Commonwealth (1945) 71 CLR 184 considered

Klein v Domus Pty Ltd (1963) 109 CLR 467 referred to

Langton v Independent Commission against Corruption (2000) 49 NSWLR 164 cited

Minister for Aboriginal Affairs v Peko Wallsend Ltd (1986) 162 CLR 24 followed

Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 cited

Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 cited

Minister for Immigration v Gray (1994) 50 FCR 189 cited

NAJT v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 147 FCR 51 cited

Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 followed

Public Service Board (NSW) v Osmond (1986) 159 CLR 656 cited

Racecourse Co-operative Sugar Association Ltd v Attorney-General (Qld) (1979) 142 CLR 460 cited

Re Bolton; Ex parte Beane (1987) 162 CLR 514 applied

Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 198 ALR 59 cited

Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 referred to

Reg v Hunt; Ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 followed

SZEJF v Minister for Immigration and Multicultural and Indigenous Affairs [2006] FCA 724 cited

Television Corporation Ltd v The Commonwealth (1963) 109 CLR 59 applied

Telstra Corporation Limited v Australian Competition and Consumer Commission [2008] FCA 1436 referred to

Telstra Corporation Ltd v The Commonwealth (2008) 243 ALR 1; [2008] HCA 7 cited

The Commonwealth v New South Wales (1923) 32 CLR 200 followed

The Queen v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Co Pty Limited (1953) 88 CLR 100 referred to

The Queen v Toohey; Ex parte Meneling Station Pty Limited (1982) 158 CLR 327 followed

Tobacco Institute of Australia v National Health & Medical Research Council (1996) 71 FCR 265 cited

Tran v Minister for Immigration (2006) 154 FCR 536 cited

Upper Hunter County District Council v Australian Chilling and Freezing Co Ltd (1968) 118 CLR 429 cited

Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 cited

Visa International Service Association v Reserve Bank of Australia (2003) 131 FCR 300 followed

Westfield Management Limited v Perpetual Trustee Company Limited [2007] HCA Trans 367 cited

Zhang v Canterbury City Council (2001) 51 NSWLR 589 cited

TELSTRA CORPORATION LIMITED (ACN 051 775 556) v AUSTRALIAN COMPETITION AND CONSUMER COMMISSION and OPTUS NETWORKS PTY LIMITED (ACN 008 570 330)

NSD 2545 of 2007

RARES J

24 november 2008

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 2545 of 2007

BETWEEN:	TELSTRA CORPORATION LIMITED (ACN 051 775 556) Applicant
AND:	AUSTRALIAN COMPETITION AND CONSUMER COMMISSION First Respondent OPTUS NETWORKS PTY LIMITED (ACN 008 570 330) Second Respondent

JUDGE:	RARES J
DATE OF ORDER:	24 November 2008
WHERE MADE:	SYDNEY

THE COURT DECLARES THAT:

1. The final determination made by the first respondent under s 152CP of the Trade Practices Act 1974 (Cth) on 30 November 2007 in relation the access dispute notified by the second respondent on 21 September 2006 was invalid.

THE COURT ORDERS THAT:

2. The final determination made by the first respondent on 30 November 2007 be quashed with effect from 30 November 2007.

3. The matter be remitted to the first respondent for hearing and determination according to law.

4. The second respondent pay the applicant’s costs.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 2545 of 2007

BETWEEN: TELSTRA CORPORATION LIMITED (ACN 051 775 556) App...