Alexander, H. v Murphyores Inc. Pty Ltd

Re: HUBERT ALEXANDER; JOHN EGAR (also known as JOHN EAGER) and JAMES PRESTON
CONSIDINE
And: MURPHYORES INCORPORATED PTY. LTD. and PETER MAXWELL LAURENCE
No. QLD G125 of 1985
Practice and Procedure

COURT

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Spender J.

CATCHWORDS

Practice and Procedure - Courts - Federal Court of Australia - Accrued Jurisdiction - Discretion where accrued jurisdiction present - Trade Practices Act 1974 - Injunction to restrain Supreme Court proceedings - Interlocutory Injunctions.

Trade Practices Act 1974

Philip Morris Inc. v. Adam P. Brown Male Fashions Pty. Ltd. (1981) 148 CLR 457.

Mister Figgins Pty. Ltd. v. Centrepoint Freeholds Pty. Ltd. (1981) 36 ALR 23.

Rolls-Royce Motors Ltd. v. D.I.A. (Engineering) Pty. Ltd. (1981) 50 FLR 340.

Muller v. Fencott (1982) 39 ALR 496.

Stack v. Coast Securities (No.9) Pty. Ltd. (1983) 154 CLR 261.

Francis C. Mason Pty. Ltd. v. Citicorp Australia Ltd. (1984) 57 ALR 130

Epitoma Pty. Ltd. v. Australasian Meat Industry Employees' Union (No. 2) (1984) 54 ALR 730.

The Australian Coarse Grain Pool Pty. Ltd. v. The Barley Marketing Board of Queensland (1982) 57 ALJR 425.

Tableland Peanuts Pty. Ltd. v. The Peanut Marketing Board (1984) 58 ALJR 283.

HEARING

BRISBANE

#DATE 14:3:1986

ORDER

The first respondent be restrained from proceeding against the applicants or any one of them in Supreme Court of Queensland action Writ No. 3978 of 1985 until the determination of these proceedings or further earlier order.

The first respondent be restrained until the determination of these proceedings or further earlier order from entering into possession of that part of the land described as Portion 211 in the District of Brisbane, County of Ward, Parish of Gilston contained in Special Lease No. 29401, as outlined in red on the plan set forth in the First Schedule of a sub-lease granted by Comserve Holdings Pty. Ltd. to the second and third applicants on 9 December, 1980, a copy of which sub-lease is Exhibit "C" to the affidavit of Richard Cameron Morton filed in these proceedings on 16 December, 1985.

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

JUDGE1

These proceedings concern the occupation and possession of certain land at The Spit on the Gold Coast. I am presently concerned with the question of interlocutory relief.

The first applicant, Hubert Alexander, and the second applicant, John Egar, operate a tourist attraction called "The Great White Shark Expo" and also trade under the name "Marine Display Services". Peter Maxwell Laurence, the second respondent, is the Managing Director of the first respondent which has a number of leases at The Spit.
The Great White Shark Expo was opened on 29 November, 1980. It is situated in premises upon certain leasehold land (Special Lease No. 29401).
In November, 1978, Comserve Holdings Pty. Ltd. became the registered lessee of Special Lease No. 29401. On 9 December, 1980, it agreed to sub-lease part of the Special Lease to the second applicant and the third applicant, James Considine; the sub-lease being registered on 7 December, 1981. The term of the sub-lease was for three years commencing on 1 November, 1980, with an option to extend for a further three years. The applicants contend, and the respondents appear to concede, that the option was exercised thereby extending the term of the sub-lease to 31 October, 1986.
The lessee's interest in sub-lease No. 29401 was transferred by Comserve Holdings Pty. Ltd. in late 1980. The exact date of the assignment is not in evidence; however, the transfer was registered on 7 December, 1981. In turn, the lessee's interest was acquired by the first respondent, Murphyores Incorporated Pty. Ltd., in December, 1984.
Thus the first and second applicants carry on business on land which the second and third applicants claim to hold as sub-lessees until 31 October, 1986.
In October, 1985, the first respondent issued a notice under s. 124 of the Property Law Act 1974 (Qld.) requiring the second and third applicants to remedy alleged breaches of the sub-lease. On 2 December, 1985, the first respondent commenced proceedings in the Supreme Court of Queensland against the second and third applicants, seeking the recovery of possession of the sub-leased land.
On 12 December, 1985, the applicants commenced proceedings in this Court. They sought interlocutory relief, including an interlocutory injunction restraining the first respondent from proceeding against the applicants or any of them in the Supreme Court proceedings. A question thus arises concerning the jurisdiction of this Court to grant that relief, and as to the appropriateness of exercising that jurisdiction.
The nature of the relief sought by the applicants in this Court is:-

(i) a declaration that the applicants are entitled to occupy the premises until 1 November, 1992;

(ii) an injunction restraining the first respondent entering into possession of the land prior to 31 October, 1986;

(iii) damages under the Trade Practices Act for breaches of s. 52 and/or s. 53A by the first and second respondents;

(iv) a declaration that the applicants are not in breach of the sub-lease;

(v) a declaration that the sub-lease has not been determined by the s. 124 notice;

(vi) an order that the first respondent grant a sub-lease pursuant to the sub-lease agreement.

(The identity of the parties to the sub-lease may be wrongly described in the application)

The applicants also claim the following interlocutory relief:-

(1) an interlocutory injunction restraining the first respondent from proceeding in its Supreme Court action until the determination of these proceedings;

(2) an injunction restraining the first respondent entering into possession of the sub-leased land.

It is necessary to make some reference to the basis of the applicants' claim for relief under the Trade Practices Act. So far as the evidence presently before me suggests, in October, 1984, the first and second applicants were considering a major upgrading of the premises in which the Great White Shark Expo is housed. Because of the expense involved in the proposed development, they were keen to obtain a further sub-lease for a substantial period beyond 31 October, 1986, when the existing sub-lease was due to expire. A development submission was drafted and sent to the second respondent for his consideration. The applicants allege that they made it known to the respondents that they were unwilling to outlay the moneys required to develop the premises unless they were sure of having use of them for a substantial period beyond 1986. The applicants allege that at various meetings held with the first respondent's Project Development Manager and with the second respondent, they were told that they could have a further six year sub-lease after the expiry of the present sub-lease on 31 October, 1986.
The first respondent is the holder of various other leases in the area of The Spit which it plans to redevelop. The applicants allege that at various meetings with the Project Development Manager of the first respondent and with the second respondent, they were advised that the first respondent's redevelopment would proceed in three stages and that the premises in which the Great White Shark Expo is housed would not be demolished during the first six year stage. The first applicant alleges that he was shown detailed development plans in relation to the area at The Spit which showed that the premises housing the Shark Expo would remain, with a minor modification to permit additional car parking area.
The applicants allege that they spent monies in upgrading the premises in reliance upon the assurances given by the respondents.
The respondents deny that either the second respondent or the first respondent's Property Development Manager, Shields, gave any undertaking that a further sub-lease would be granted.
As early as 4 January, 1985, the first applicant wrote to the second respondent requesting that the sub-lease arrangements be formalised. Further approaches were made throughout the early months of 1985, but did not elicit a written undertaking to grant such a sub-lease.
On 4 February, 1985, the first respondent, in a letter to the Gold Coast City Council, gave its approval to the redevelopment of the Great White Shark Expo.
On 25 June, 1985, the first respondent formally denied that any sub-lease agreement existed or that the first applicant had any tenancy rights in respect of the Shark Expo premises. In later correspondence, the parties maintained their respective positions, the applicants contending that an undertaking had been given to grant a six year sub-lease after the expiry of the existing sub-lease in 1986; the respondents, for their part, contending that no such undertaking was given, since its redevelopment plans were never finalised.
On 2 August, the second respondent wrote to the first applicant:

". . . both the present circumstances of Lots 210 to 212 Sea World Drive and their future have been somewhat clouded by the changes to the size of our property which were suggested by the Gold Coast Waterways Authority. This has resulted in a complete re-design of the future complex, and I am hopeful that this will be finalised by the end of September.

Until these matters are resolved, I am unable to meaningfully discuss your occupation of the premises other than on the existing basis.

Furthermore, I must refute your allegation that you undertook present renovations on the basis of an assurance from me that our long term plan allowed you to utilise the whole of the building premises. In fact, neither you nor I were aware of the exact circumstances surrounding the currency of any sub-lease for the shark expo building. That matter is now known. For this and other reasons, I made it clear to you that I could not discuss leases with anyone until that matter was resolved and the new design was finalised."

The applicants allege that on 4 October, 1985, the first respondent's Project Manager, Stephen Solomons, advised them that the respondent intended to carry out its redevelopment "in one hit" and to demolish the building in which the Shark Expo is housed. Material filed by the respondents also states that the first respondent's redevelopment programme for The Spit includes these premises.
The essence of the applicants' claim is that representations were made on various occasions by the first and second respondents that the first respondent's redevelopment plans for The Spit area included the continuation of the business conducted by the first and second applicants for a period of six years after 1986, because the first respondent's redevelopment was a staged development that would not require the demolition of the Shark Expo premises within that period. Further it is alleged that the first respondent represented that it was prepared to give the first and second applicants a sub-lease for six years commencing on 1 November, 1986. The applicants claim that these representations were false and/or misleading and/or deceptive and/or likely to mislead or deceive in that the first respondent had not finally decided to develop the lands as a staged development or to grant a further sub-lease in respect of the Shark Expo premises to the first and second applicants. In the alternative, the applicants say that the misrepresentations were made negligently and in breach of a duty owed by the respondents to the first and second applicants. They say that in reliance upon these representations, the first and second applicants expended over $50,000.00 in redeveloping the Shark Expo premises, and that the second and third applicants refrained from taking action to regularise any informality concerning the existing sub-lease.
In the Supreme Court proceedings, the first respondent claims the recovery of possession of the sub-leased land. The defendants in the Supreme Court action are the registered sub-lessees (the second and third applicants in this Court). That action was commenced on 2 December, 1984 by a specially indorsed writ. The statement of claim recites various terms of the sub-lease including terms that the option to renew the sub-lease was subject to the consent of the Minister for Lands, and that the sub-lessees were not to sub-let or part with or share the possession of the demised land. The statement of claim alleges that these terms were breached. In particular, it alleges that the defendants failed to obtain the approval in writing of the Minister for Lands to the extension of the sub-lease when the option was exercised. Further, it alleges that the defendants parted with possession of the demised land to the first and second applicants, who carried on business as Marine Display Services and the Great White Shark Expo and that the defendants parted with possession of the land to a company called Crestmill Investments Pty. Ltd. trading as Power Cat Sales and Service.
The respondents in the Federal Court proceedings have yet to file a defence, but if and when they do so, it may be expected that they will cross-claim for recovery of possession. In defending the Supreme proceedings, the second and third applicants may be expected to repeat many of the claims raised in their statement of claim in this Court. In particular, it is likely that they will allege that the respondents were aware that the first and second applicants operated the Great White Shark Expo at the premises and that they represented that they would be permitted to use the premises for the remainder of the term of the existing sub-lease and under a new sub-lease after 31 October, 1986. Also, the applicants may be expected to contend that other alleged breaches of the sub-lease were waived or acquiesced in by the respondents, or that these breaches were remedied in the time allowed by the s. 124 notice.
Jurisdiction
Of the six claims to relief made in the application filed in this Court on 12 December, 1985, the jurisdiction of this Court is invoked by the claim for damages under the Trade Practices Act. The other claims made in the application require closer examination. The first claim is for a declaration that the applicants are entitled to occupy the premises in question until 1 November, 1992. It is not clear either from the application, or from the statement of claim, whether the applicants claim this relief under the Trade Practices Act, or whether they seek equitable relief to enforce the alleged agreement to grant a further sub-lease for six years commencing on 1 November, 1986.
The applicants also claim 'an order that the respondent grant a sub-lease pursuant to the sub-lease agreement'. Again, it is unclear whether the relief sought is under the Trade Practices Act or equitable relief in the nature of specific performance.
In claims (ii), (iv) and (v), the applicants seek relief in respect of their possession of the land under the existing sub-lease. They claim an injunction to restrain the respondent entering into possession of the lands prior to 31 October, 1986, a declaration that the applicants are not in breach of the sub-lease, and a declaration that the sub-lease has not been determined by the s. 124 notice.
In addition, in paragraph 29(b) of the statement of claim, the applicants plead that the respondents' representations were made negligently and in breach of duty owed to the first and second applicants.
In these circumstances, it is at present unclear which of the applicants' claims seek to invoke the original jurisdiction of this Court under the Trade Practices Act, and which seek to attract the Court's accrued jurisdiction. I shall approach the question of this Court's jurisdiction upon the basis that the only claim which clearly invokes the original jurisdiction of this Court is the claim for damages under the Trade Practices Act, and that the other relief sought by way of injunction, declaration and orders for specific performance of the agreement to grant a new sub-lease, are based upon the Court's accured jurisdiction. I note that claims (ii), (iv) and (v), which involve the applicants' possession under the existing sub-lease, raise identical issues to those involved in the proceedings in the Supreme Court of Queensland.
In recent years the High Court has considered the scope of this Court's accrued jurisdiction on three occasions. In Philip Morris Inc. v: Adam P. Brown Male Fashions Pty. Ltd. (1981) 148 C.L.R. 457 at 512, Mason J. spoke of the classification of an attached claim as being "non-severable" when it and the federal claim "so depend on common transactions and facts that they arise out of a common substratum of facts." This dicta was adopted in cases before this Court (Mister Figgins Pty. Ltd. v. Centrepont Freeholds Pty. Ltd. (1981) 36 ALR 23 at 32 per Northrop J.; Rolls-Royce Motors Ltd. v. D.I.A.(Engineering) Pty. Ltd. (1981) 50 FLR 340 at 346 per Lockhart J.; Muller v. Fencott (1982) 39 ALR 496 at 505 per Toohey J.). Fencott v. Muller came before the High Court in 1983. The majority (Mason, Murphy, Brennan, Deane JJ.) focussed upon the issue of whether the non-federal claims in that case were parts of a single controversy of which the federal claim was a substantial part.
The majority said at (1983) 152 C.L.R. 570 at 608:-

"What is and what is not part of the one controversy depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships. The scope of a controversy which constitutes a matter is not ascertained merely by reference to the proceedings which a party may institute, but may be illuminated by the conduct of those proceedings and especially by the pleadings in which the issues in controversy are defined and the claims for relief are set out. But in the end, it is a matter of impression and of practical judgment whether a non-federal claim and a federal claim joined in a proceeding are within the scope of one controversy and thus within the ambit of a matter."

Gibbs C.J. at 593 stated that the decision in Philip Morris: -

" . . . does establish that a claim which is inseverable from a federal matter committed to the jurisdiction of the Federal Court may be regarded as part of that matter and so fall within jurisdiction, even if the claim is not itself based on federal law. The question whether one claim is inseverable from another, so that both are part of one matter, is a question of fact and degree."

Wilson J. at 613 and Dawson J. at 630-1 adopted the stricter view expressed by Gibbs C.J. in Philip Morris that: -

" . . . if a party claims relief on two different legal grounds, but the facts on which the relief is sought on each ground are identical, and the relief sought on each ground is the same in substance if not in form, there is only one matter for determination." ((1981) 148 C.L.R. 457 at 499).

Upon this stricter test, a non-federal claim which requires the proof of additional facts, will not be within the jurisdiction of the Federal Court.
The third High Court decision concerning this Court's accrued jurisdiction is Stack v. Coast Securities (No. 9) Pty. Ltd. (1983) 154 CLR 261. Again, no single test commanded the support of all members of the High Court. Mason, Brennan and Deane JJ., at 294, defined the accrued jurisdiction of this Court as comprising "non-federal aspects of a single justiciable controversy of which the issues raised under the Act form an integral part". Murphy J. at 299 adhered to the view which he had expressed earlier in Philip Morris (1981) 148 C.L.R. 457 at 521, that the Federal Court has jurisdiction "to determine any matter, federal or non-federal in origin, which is not completely separate and distinct from the matters which attract federal jurisdiction."

Gibbs C.J., at 278-9, stated that the Federal Court has no jurisdiction in respect of a matter simply because it is closely associated with a matter within jurisdiction. In order to be within the jurisdiction of the Federal Court, a claim must arise out of the same transaction as that in respect of which the applicants seek relief.
Wilson and Dawson JJ. at 302 stated that, although they remained convinced of the correctness of their reasoning in Fencott, they were bound to apply the joint majority judgments in that case.
The judgments of the majority of the High Court in Fencott and Stack emphasise that the determination of whether a non-federal claim is within this Court's accrued jurisdiction is not a matter of mechanically applying a precise formula. Instead, it is "a matter of impression and of practical judgment".
In the light of the majority judgments in Fencott and Stack, I should approach the question by asking whether claims (i), (ii), (iv), (v) and (vi) are parts of a single controversy, of which the claim under the Trade Practices Act is a substantial part.
In my opinion, a single controversy exists between the parties which is the effect of the discussions in respect of the applicants' occupation and possession of the sub-leased land. The non-federal claims which relate to the applicants' occupation under the existing sub-lease (claims (ii), (iv) and (v)) are not distinct and unrelated to the claim which attracts this Court's original jurisdiction. These claims, the claim for a declaration that the applicants are entitled to occupy the premises until 1 November, 1992, the claim seeking an order that the first respondent grant a sub-lease pursuant to the alleged sub-lease agreement and any claim based upon negligent misstatement arise from common transactions and facts. Those common transactions and facts are the conversations in which the parties discussed their respective development plans and from which the respondents are alleged to have been made aware of the existing use and occupation of the premises.
Reference to the pleadings indicates that the first and second applicants' existing use of the premises were discussed in the same conversations, during which future arrangements were canvassed. In these circumstances, it is impossible to sever the non-federal claims from the federal claim. The fact that the non-federal claims may demand proof of elements not required by the Trade Practices Act claim does not alter the fact that all of the applicants' claims are based upon common transactions.
Further, I am satisfied that the federal claim forms a substantial part of the controversy.
This Court's Discretion to Exercise its Accrued Jurisdiction
In Philip Morris (1981) 148 C.L.R. 457 at 475, Barwick C.J. stated that the exercise of the accrued jurisdiction: -

" . . . is discretionary and not mandatory, though it will be obligatory to exercise the federal jurisdiction which has been attracted in relation to the matter.

But, I would add that there would need to be very good reasons why a court which could resolve the whole matter should refuse or fail to do so. Generally speaking, one would expect that a court, once its federal jurisdiction is excited or attracted, would proceed to resolve the whole matter in relation to which federal jurisdiction had been attracted."

In Stack, Mason, Brennan, and Deane JJ. at 295 stated that the Federal Court in exercising its discretion will have regard to the considerations mentioned in Fencott v. Muller. In ordinary circumstances the Federal Court would also have regard to the fact that it is the one court with jurisdiction to resolve the whole of the controversy of which the federal issues are an element. Murphy J. agreed with Mason, Brennan and Deane JJ. about the approach to the exercise of the accrued jurisdiction and added at 299-300: -

"In general, the existence in a court of an exclusive jurisdiction is a compelling reason for exercising its accrued jurisdiction. The administration of justice will generally be better if the Federal Court resolves the entire controversy, rather than that it and another court or courts make determinations in separate proceedings on fragmented issues, although there may be exceptions. The presumption therefore, is that the Federal Court should exercise its accrued jurisdiction, but this may be displaced in exceptional circumstances."

Gibbs C.J. at 285, in relation to one of the actions in Stack was persuaded that the Supreme Court proceedings ought to be stayed because the Federal Court was the only court which was fully invested with jurisdiction to decide all the questions that arose between the parties.
At 306, Wilson and Dawson JJ. remarked about the competing considerations as to whether the Supreme Court or the Federal Court ought to determine the non-federal claims: -

"On the one hand, the Federal Court is the only tribunal with jurisdiction to determine precisely all the issues that have been raised. On the other hand, it might not be just or convenient to deny a vendor the opportunity to seek summary judgment for specific performance merely because of the institution of a federal claim. It may clearly appear that the claim is of insufficient substance to justify any purported rescission of the contract by the purchaser. It may often be the case that contraventions of Pt. V of the Act will merit an award of damages but fall short of providing any basis for avoiding a contract. In that event, justice will be served by allowing the action for specific performance to proceed without delay, to be followed by a later determination in the Federal Court of the specific question of damages."

These last-quoted observations are relevant to the exercise of my discretion in the present matter. It may be said that the alleged representations may provide the applicants with a remedy in damages in this Court, but fall short of providing any basis for defending the Supreme Court action for recovery of possesion. However, on balance, there is sufficient material to suggest that these representations, if proved, would provide them with a defence to the recovery of possession action.
In relation to the two actions in which judgment had already been given in the Supreme Court, all members of the High Court in Stack were agreed that there was no point in the Federal Court exercising a discretion to determine non-federal issues which had already been determined by the Supreme Court subject to pending appeal.
Applying the dicta of the High Court in Stack concerning the approach to the exercise of my discretion, two matters are clearly relevant. No judgment has been obtained yet by the first respondent in its Supreme Court proceedings. Second, the Supreme Court cannot determine the applicants' claim under the Trade Practices Act and, therefore, to decline to exercise the accrued jurisdiction would result in the conduct of two proceedings in different courts. Unless I am persuaded that the federal claim is not a genuine one, it is therefore appropriate to exercise this Court's accrued jurisdiction.
In Francis C. Mason Pty. Ltd. v. Citicorp Australia Ltd. (1984) 57 ALR 130 the applicants in Federal Court proceedings sought orders restraining the respondent from proceeding further in Supreme Court actions for the recovery of money under a loan agreement. After reviewing the material upon which the claim in the Federal Court was based, Northrop J. concluded that the federal claim was not genuine. He concluded that the federal claims were made for the purpose of delaying the Supreme Court proceedings and without any real basis. A further feature of the case was that the Federal Court proceedings were commenced long after the sale of the land in question and after the Supreme Court proceedings had been issued and served.
In Bargal Pty. Ltd. v. Force 154 CLR 261 (a judgment delivered on the same date as the judgment in Stack) Mason, Brennan and Deane JJ. at 298 stated that to offset the advantage offered by the Federal Court being able to resolve the entire controversy, "powerful countervailing reasons need to be shown". An example given by their Honours was that "it may appear that the federal issue is raised at such a late stage in the Supreme Court proceedings that it would be a waste of time and lead to needless expense and inconvenience not to proceed to a hearing in that Court."
I had occasion to consider such a case in Vinpark Investments Pty. Ltd. v. Dainford Ltd. (1985) ATPR 40-543. In that case, Dainford had commenced proceedings in the Supreme Court of Queensland on 8 February, 1983. Vinpark instituted proceedings in this Court on 27 November, 1984. Having regard to the extent to which the proceedings had gone in the Supreme Court and to the cost that all parties had expended in the resolution of the issues in that Court, I considered that substantial justice between the parties would be achieved by the Supreme Court proceedings being resolved as quickly as possible. Accordingly, the Federal Court proceedings were stayed pending the resolution of the Supreme Court proceedings.
By contrast, in the present case, there was no substantial delay between the issuing of proceedings by the first respondent in the Supreme Court and the application in this Court.
The respondents' solicitors state that on 19 November, 1985 they advised the solicitors for the applicants that they had instructions to institute appropriate proceedings for the recovery of possession. These Supreme Court proceedings were filed and served on 2 December, 1985. The respondents' solicitors state that between 19 November and 2 December, 1985, they foreshadowed that an application for summary judgment in the Supreme Court was being contemplated. These instructions were apparently confirmed in a telex on 3 December, 1985. On 11 December, 1985, the applicants' solicitors were advised that an application for summary judgment would be served on 12 December, 1985, returnable on 19 December, 1985. The respondents state that they had no notice until 12 December, 1985 that the applicants intended to bring Federal Court proceedings.
I have reviewed the correspondence passing between the solicitors in this matter. It appears that until 12 December, 1985, the solicitors for the applicants had not notified the respondents' solicitors of their intention to commence Federal Court proceedings. Two things should be said about this. First, it is understandable that the applicants' solicitors were preoccupied with resisting the respondents' application for summary judgment in the Supreme Court, which the respondents were attempting to bring on before the Christmas vacation. Second, the correspondence passing between the parties throughout 1985 had alerted the respondents to the fact that the applicants alleged that certain representations had been made which, if made, would found a claim under the Trade Practices Act. .
Delay, of course, is an important factor relevant to the exercise of my discretion in relation to the accrued jurisdiction. In this case, the Federal Court proceedings were filed ten days after the Supreme Court proceedings. In all the circumstances, I consider that there was no undue delay by the applicants in commencing proceedings in this Court.
Four factors seem relevant to the exercise of my discretion. First, the Supreme Court proceedings have not gone too far. No issues have yet been determined between the parties in those proceedings. Secondly, there was no undue delay by the applicants in commencing proceedings in this Court. Thirdly, there is no evidence that the Federal Court proceedings were not genuine, in the sense discussed by Northrop J. in Francis C. Mason Pty. Ltd. v. Citicorp Australia Ltd. (1984) 57 ALR 130. The material filed by the applicants show that their claims have a real basis, although I express no opinion on the likelihood of their success. Fourthly, this application is not the kind of case referred to by Wilson and Dawson JJ. in Stack at 306. Their Honours were there concerned with a federal claim which, if valid, would not avoid a contract or prevent summary judgment for specific performance, but would only found an action in damages. In such a case, it was said, that justice will be served by allowing the Supreme Court proceedings to proceed without delay, to be followed by a later determination in the Federal Court of the specific question of damages. By contrast, in this case, the representations alleged by the applicants and which found both their federal and non-federal claims may well provide an answer to the action for recovery of possession in the Supreme Court and most certainly prevent an application for summary judgment in that Court.
These considerations outweigh any inconvenience caused to the respondents in being prevented from immediately pursuing their claims in the Supreme Court. Further, I am confident that the whole of the controversy between the parties may be quickly disposed of in this Court, by appropriate directions for the further hearing of this matter.
Interlocutory Relief
I accept that upon the hearing of an interlocutory injunction, the court must first decide whether there is a serious question to be tried, and then determine the matter on the balance of convenience. Epitoma Pty.Ltd. v. Australasian Meat Industry Employees' Union (No. 2) (1984) 54 ALR 730 at 734; The Australian Coarse Grain Pool Pty. Ltd. v. The Barley Marketing Board of Queensland (1982) 57 ALJR 425 per Gibbs C.J.; Tableland Peanuts Pty. Ltd. v. The Peanut Marketing Board (1984) 58 ALJR 283 per Brennan J. (cf. Beecham Group Ltd. v. Bristol Laboratories Pty. Ltd. (1968) 118 CLR 618; World Series Cricket Pty. Ltd. v. Parish (1977) 16 ALR 181 at 186).
In this case, I am satisfied that there is a serious question to be tried.
In assessing where the balance of convenience lies, I must consider whether, if the applicants succeed at trial, they will be adequately compensated by damages for any loss caused by the refusal to grant an interlocutory injunction. The applicants in this matter allege that, unless they are able to remain in occupation of the Shark Expo premises, they will suffer substantial loss caused through the dislocation of their business. Because of the present advantages of location and propinquity to other tourist attractions, the damages resulting from a premature relocation may not completely or adequately be capable of assessment in money terms.
The second step in assessing where the balance of convenience lies is whether, if the interlocutory injunction is granted, the respondents will be adequately compensated under the applicants' undertaking as to damages. In this case the respondents claim that, if an injunction is granted and the applicants remain in possession of the premises, the first respondent will suffer substantial damages in that its redevelopment plans for The Spit will be delayed and it will incur additional holding charges in respect of its site. Equally, difficulty in quantification of these damages is likely.
Accordingly, there is doubt as to the adequacy of the respective remedies in damages in both cases. Because these factors appear to be relatively evenly balanced, it is prudent to preserve the status quo. The status quo in this case is the state of affairs existing during the period immediately preceding the filing of the application, that is, the applicants' occupation of the premises in question.
I propose to give directions so as to enable these proceedings to be determined speedily. I will hear the parties as to what directions will best achieve that intention.
I order: -

1. The first respondent be restrained from proceeding against the applicants or any one of them in Supreme Court of Queensland action Writ No. 3978 of 1985 until the determination of these proceedings or further earlier order.

2. The first respondent be restrained until the determination of these proceedings or further earlier order from entering into possession of that part of the land described as Portion 211 in the District of Brisbane, County of Ward, Parish of Gilston contained in Special Lease No. 29401, as outlined in red on the plan set forth in the First Schedule of a sub-lease granted by Comserve Holdings Pty. Ltd. to the second and third applicants on 9 December, 1980, a copy of which sub-lease is Exhibit "C" to the affidavit of Richard Cameron Morton filed in these proceedings on 16 December, 1985.

I propose to hear the parties on costs.

[1986] FCA 71

14 MARCH 1986