Allstate Life Insurance Co v Australia & New Zealand Banking Group Ltd (No 27)

[1996] FCA 73

CATCHWORDS

PRACTICE AND PROCEDURE - anti-suit injunction - applicants sue New York law firm "S" arising out of same facts as those which had given rise to these proceedings - respondents join S as cross respondent in this Court claiming contribution or indemnity - S moves for dismissal or stay of New York action on ground of forum non conveniens - S's motion in New York fails at first instance and on appeal - S then applies to this Court for injunction restraining applicants from pursuing the action against it in New York - S having said that if it fails, it will wish to cross claim in New York against respondents and another cross respondent to these proceedings, they seek injunction restraining S from cross claiming against them in New York - basis of jurisdiction to grant anti-suit relief - factors relevant to exercise of discretion - comity - different tests governing forum non conveniens applications and applications for anti-suit injunction - reasons supplementary to Reasons for Judgment (No 22) dated 19 January 1996.

ALLSTATE LIFE INSURANCE CO & ORS v AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED & ORS (No 27)

Nos NG 381 of 1994, NG 523 of 1991, NG 622 of 1991 and NG 635 of 1991.

Lindgren J
Sydney
21 February 1996

IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES DISTRICT REGISTRY )
GENERAL DIVISION                 )
  No NG 381 of 1994

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

No NG 523 of 1991

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

No NG 622 of 1991

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

No NG 635 of 1991

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

CORAM:Lindgren J

PLACE:Sydney

DATE:21 February 1996

MINUTE OF ORDERS

THE COURT ORDERS THAT:

1. The proceedings be stood over to Friday 23 February 1996 at 9.30 am for the making of orders (including orders as to costs) in conformity with Reasons for Judgment (No 22) dated 19 January 1996 and Reasons for Judgment (No 27) dated 21 February 1996.

1. The parties supply to the Associate to Lindgren J by 5.30 pm on Thursday 22 February 1996:

(a)agreed form of short minutes of orders, or, if agreement has not by then been reached, the forms of
short minutes of orders for which they will respectively contend;

(b)outlines of submission to be made in relation to the orders appropriate to be made in respect of Ariel Fund Ltd et al v Bear Stearns & Co Inc (Index No 121513/94 in the Supreme Court of the State of New York) ("the Bear Stearns action").

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 )
GENERAL DIVISION                 )
  No NG 381 of 1994

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

No NG 523 of 1991

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

No NG 622 of 1991

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

No NG 635 of 1991

BETWEEN:

ALLSTATE LIFE INSURANCE CO and the parties listed in Annexure A to the third further amended statement of claim.
  Applicants

AND:

AUSTRALIA & NEW ZEALAND BANKING GROUP LIMITED ACN 005 357 522 and the parties listed in Annexure B to the third further amended statement of claim.
  Respondents

CORAM:Lindgren J

PLACE:Sydney

DATE:21 February 1996

REASONS FOR JUDGMENT (No 27)
     (Supplementary reasons on anti-suit injunctions)

GENERAL

On 19 January 1996 I published Reasons for Judgment (No 22) and gave directions for the making of any further submissions relating to two matters.  Those submissions have now been received.  These Reasons are supplementary to Reasons for Judgment (No 22) with which they are to be read.  I use here the abbreviated forms of reference which I used in those Reasons.

TWO ISSUES RAISED IN REASONS FOR JUDGMENT (No 22)

In Reasons for Judgment (No 22) I raised two issues on which I invited further submissions.  I have concluded that neither of the considerations raised dictates the decisions to be made on the present motions. 

In relation to the "invocation [by the applicants] of federal jurisdiction in respect of a 'matter'", the inescapable fact is that there is no relevant "matter" or "controversy" as between the applicants and Skadden in these proceedings.  Sub-sections 19 (1) of the FCA Act and 86 (1) of the TP Act give the Court jurisdiction in relation to, inter alia, certain non-federal claims in relation to a matter, in respect of which claims it would not otherwise have jurisdiction.  The Court's accrued jurisdiction in respect of such non-federal claims has never been exclusive: Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 at 295-298 (Mason, Brennan, Deane JJ). In any event, there is no "anchoring" federal claim made by the applicants against Skadden here. Even if there were, for the reasons mentioned, the sections referred to would not require the Court to hold that it has become invested, to the exclusion of the New York court, with jurisdiction in respect of those claims under the common law of New York which have been pleaded by the applicants against Skadden in New York.

Section 22 of the FCA Act, which imposes an obligation to grant remedies, does not give jurisdiction and is limited by reference to the necessity of "a legal or equitable claim brought forward in the matter".  There is in these proceedings neither a "matter" as between the applicants and Skadden nor any legal or equitable claim brought forward by the applicants against Skadden.

In relation to the "joinder of issue as between Skadden and the applicants by the seeking of a 'negative declaration'", Skadden has now submitted that it wishes to cross claim against the applicants seeking the following declaration:

"A declaration that they [Skadden] are not liable to the cross respondents [the applicants in the proceedings] or any of them in respect of any of the causes of action alleged against them in the New York Proceedings [the Ithaca action, the Executive Life action, the Scheiber action and the Colonial action]".

I decide below that Skadden should be granted anti-suit relief without reference to the question whether it should or should not be permitted in these proceedings to seek a declaration of non-liability.  It may therefore be that the question raised by Skadden will not call for decision.  I will not decide it unless requested to do so.

THE APPLICANTS' CONDUCT

I noted in Reasons for Judgment (No 22) competing considerations for and against the granting of the anti-suit relief sought and stated a number of "prima facie positions".  Some factors which weigh to varying extents against the granting of relief are the territorial connection between the State of New York and the New York actions and the parties to them; the decision by Justice Cahn, affirmed by the Appellate Division of the Supreme Court of the State of New York, that Skadden and USTC had not discharged the heavy burden of displacing the debenture holders' prima facie right to resort to the New York court; and the juridical advantage of jury trial in New York.  A factor which favours the granting of relief is the potential, not just for conflicting results, but for conflicting results productive of great difficulty and expense for Skadden in recovering contribution or indemnity in respect of a judgment against it in New York.

Consistently with the in personam nature of the injunctive jurisdiction and its connection with Equity, I must, in my view, attend carefully to the conduct of the parties before me, and in particular for present purposes, the conduct of the applicants.  It is convenient to do so chronologically.

1. By the time when, on 9 January 1992, the United States District Court denied the bank defendants' motion for dismissal of Linter II on the ground of forum non conveniens, 14 of the present 17 applicants were proceeding in this Court against the present first to 45th respondents, that is, the Initial Banks, the Subsequent Banks, Linter Textiles and the Subsidiaries, and, as well, against USTC.  In dismissing the motion, District Judge Patterson noted that a plaintiff's choice of forum should rarely be disturbed on the ground of forum non conveniens.  After referring to factors for and against dismissal on that ground, his Honour concluded as follows:

"Prosecution of this action in Australia might be somewhat more convenient for the numerical majority of the witnesses involved.  The overall expense involved might be less in Australia and its court than here, and it would clearly be more convenient for the Bank Defendants.  Those factors alone, however, are insufficient to deny Plaintiffs their chosen home forum.  The Bank Defendants have not met the substantial burden of proof required for this Court to dismiss this case in favour of prosecution in Australia." (782 F Supp 215 (SDNY 1992) at 226)

1. Linter I, against Linter Group, Linter Textiles, the Subsidiaries, some Linter Officers and the Liquidators, was dismissed on 1 June 1992 because District Judge Patterson "granted comity" to the insolvency proceedings in the Supreme Court of New South Wales.

1. Linter II was dismissed as against the Linter defendants on 21 December 1992 by the same Judge on the same ground.  The reason why his Honour dismissed Linter II against the bank defendants on the ground of forum non conveniens is revealed by the following passages from his Honour's Opinion:

"The length of time during which the Linter companies have been in liquidation in Australia has created additional burdens for the Bank Defendants so as to warrant dismissal based on forum non conveniens.

First, as liquidation has progressed, the former officers and employees of the Linter Defendants have ceased to be party witnesses and, as a result, are now beyond the subpoena power of this Court. ...

Second, the ongoing nature of the liquidation proceedings has necessitated the dismissal of the Linter Defendants from this action on the ground of comity.  The dismissal of the Linter Defendants eliminates the Bank Defendants' opportunity to pursue cross claims for contribution against the Linter Defendants in this forum. ...  If the Bank Defendants must defend themselves in this forum and then go to Australia to seek contribution for any damages assessed, they risk inconsistent judgments as to the extent of the plaintiffs' losses and of the Linter Defendants' responsibility for those losses. ...

The trial of Linter II in this Court is likely to increase the overall costs to all parties of litigation arising out of the sale of the LTCL [Linter Textiles] debentures. ... When this Court denied the Bank Defendants' previous motion to dismiss, Linter I was still pending in this forum, the Linter Defendants were still parties to this action, and the Court did not have the benefit of the recent decisions in Australia.  Subsequent developments have since rendered Australia the only continent on which all claims arising out of the purchase of the LTCL debentures may be litigated.  Because trial of the plaintiffs' claims against the Bank Defendants will probably require much of the same evidence that would be presented by the plaintiffs against the Linter Defendants and by the Bank Defendants against the Linter Defendants, consolidation of these actions on a single continent has the potential to save the parties significant expense and promote economical use of judicial resources.

Accordingly, the balance of convenience has shifted so that the Bank Defendants now risk a substantial prejudice and all parties risk a significant increase in overall expense if this action is tried here rather than in Australia. The Bank Defendants' motion to dismiss on the basis of forum non conveniens is granted." ([1992] Fed Sec L Rep (CCH) 97 317 (SDNY) at 95,608-95,609). (emphasis supplied)

1. On 2 June 1993 the United States Court of Appeals, Second Circuit, affirmed Judge Patterson's dismissals of Linter I and Linter II.  It held that there had been no abuse of discretion in the granting of comity to the liquidation proceedings in New South Wales or in the dismissal of Linter II as against the bank defendants on the ground of forum non conveniens.  The Court referred to, inter alia, the bank defendants' loss of the opportunity to cross claim against the Linter defendants as follows:

"The dismissal of the Linter companies also eliminated the Banks' opportunity to pursue its cross claims for contribution and indemnification.  As the Supreme Court has recognised, the inability to implead other parties is a factor favouring dismissal on the ground of forum non conveniens. ...  Here, if the trial is held in Australia the Banks will be able to assert their cross claims simultaneously with appellants' action against them.  As the Court recognised, consolidating all claims in Australia avoids a situation where the Banks would have to pursue their cross claims in Australia while defending against appellants' claims in the United States.  Such a scenario not only represents a waste of judicial resources, but also creates a risk of inconsistent judgments." (1994 F 2d 996 (2d Cir) (1993) at 1002).

1. The passages quoted above gave warning to the applicants that there would apparently be difficulty in suing at least Linter companies, and perhaps any other party wishing to cross claim against the Linter companies, in a court in the United States. 

The windings up of the Linter Companies have not been completed and will not be completed until these proceedings have been heard and determined.  The Linter Companies are not defendants in New York.  However, Skadden filed a notice in the New York court that but for this Court's injunctions against it, it would have filed and served with its Answer and Affirmative Defences, third party complaints against the 11 Initial Banks, Linter Group, Linter Textiles, the Liquidators, Freehills and Price Waterhouse.  Skadden and 11 other parties have cross claimed against the Linter Companies in these proceedings (see below).  I do not know whether the New York court would permit Skadden, or other parties which it may permit Skadden to implead before it, to implead Linter Group, Linter Textiles and the Liquidators as desired by Skadden.  However, there is at least a real possibility, perhaps a likelihood, that the New York court would not permit this, preferring to grant comity to the liquidation proceedings as the US District Court had done.

The observations in Linter II of District Judge Patterson and of the United States Court of Appeals, Second Circuit, remain applicable to the position of Skadden as defendant and the position of any cross defendant it may be permitted to implead, in relation to any cross claim desired to be brought by it or them against the Linter Companies or the Liquidators.

1. When the Ithaca action was commenced against Skadden in April 1994, the plaintiffs in that action (the Ariel Entities) announced to the world, and in particular to the then and future parties to these (Federal Court) proceedings (the applicants joined as respondents Linter Group, the Liquidators and the Linter Officers shortly afterwards on 24 June 1994 and Freehills on 11 October 1994) that they asserted that Skadden, a New York law firm with an office in Sydney, was liable to compensate them for the very losses for which they were seeking damages in these proceedings.

It is important to consider what the applicants knew or must be taken to have known in and since April 1994.  At and since that time, four things must have been clear to them:

(a)that in this Court, the respondents (as they were from time to time), would wish to cross claim for contribution or indemnity against Skadden;

(b)that in the New York court, Skadden would wish to implead, for the purpose of claiming contribution or indemnity, the respondents targeted by the applicants from time to time in these proceedings;

(c)that there was a real possibility, perhaps a likelihood in view of the Opinions of the US District Court and the United States Court of Appeals, Second Circuit in Linter II, that the New York court would not permit Skadden to implead at least the Linter Companies and perhaps the Initial Banks and other parties as well; and

(d)that this Court had exclusive jurisdiction to hear and determine the claims for damages under the TP Act and accrued non-exclusive jurisdiction to hear and determine other claims brought forward in the same matter.

The applicants knew, or must be taken to have known, as at April 1994, and subsequently when they joined as respondents Linter Group, the Liquidators and the Linter Officers in June 1994 and Freehills in October 1994, that the result naturally to be expected was that there would be substantially duplicated in this country and in New York, to the extent that the New York court permitted it, a complex network of claims and cross claims. 

I pause to note that in these proceedings there are in fact on file currently a total of 31 cross claims for contribution or indemnity.  These include 12 against Skadden, four by Skadden, and 12 against the Linter Companies.  The 12 against Skadden were, of course, brought after Skadden was first sued in New York in the Ithaca action in April 1994.  In the Ithaca action the plaintiffs plead against Skadden "fraud", "aiding and abetting fraud" and "aiding and abetting fraud through reckless disregard of obligation to disclose information received" under the common law of New York.  In SIFA's amended cross claim, for example, SIFA pleads misleading and deceptive conduct based on substantially the same conduct of Skadden's as its conduct which is alleged against it in New York.

Skadden has on file in this Court four cross claims against the Linter Companies, the Linter Officers and the Initial Banks (one cross claim), Freehills and Price Waterhouse.  The cross claims for contribution or indemnity which Skadden has given notice that it would, but for the injunction against it, have made in New York (noted earlier) are directed against substantially the same parties (they do not include the Subsidiaries or the Linter Officers but include the Liquidators).  It is reasonable to think that any parties which Skadden is permitted to implead in New York will wish to duplicate there the cross claims made by them in these proceedings, including the other 11 cross claims against the Linter Companies.

The applicants knew or must be taken to have known as at April 1994 and subsequently that Skadden would, or might well, be placed in a position of having to defend, over a lengthy period and at considerable cost, substantially the same allegations against it in this Court and in New York.

Although Skadden is a "New York law firm", it has had at all material times an office in Sydney.  Accordingly, there has never been an obstacle to its being joined by the applicants as a respondent, or by respondents as a cross respondent.  The applicants do not submit that there is any jurisdictional obstacle to a pleading against Skadden in these proceedings of the causes of action which they plead against it in the New York actions.  Common law fraud under the law of New York has already been pleaded against, for example, Linter Textiles, the Initial Banks and Freehills.   Moreover, on 11 July 1995, Beaumont J granted the applicants "leave to amend to bring claims against Skadden Arps in terms of the Complaints annexed [to the order] at any time up to the close of the applicants' case."

The undoubted potential difficulty in a defendant's not being able to bring all cross claims for contribution or indemnity in the proceedings in which the defendant's liability is sought to be established, was treated as decisive for anti-suit injunction purposes by the House of Lords in Aerospatiale.  It was regarded as cogent for forum non conveniens purposes by the United States District Court, Southern District of New York and the United States Court of Appeals Second Circuit, in Linter II, but not by the Supreme Court of the State of New York at first instance or in its Appellate Division in the New York actions.  In my view, at least in a case characterised by the history, complexity, likely duration and cost of the present proceedings, the factor is persuasive.
In summary, the alternatives on the one hand that Skadden might have to defend substantially the same allegations against it in lengthy hearings in this Court and in New York then have to sue one or more parties for contribution or indemnity in Australia, and on the other hand that there might be substantially duplicated in New York the numerous claims and cross claims made in this case, both foreseeable by the applicants and avoidable by them by the simple device of joining Skadden as an additional respondent in these proceedings, point to vexatious and oppressive conduct against Skadden and should not be countenanced in the absence of strongly countervailing considerations.   Those factors which favour the withholding of anti-suit relief do not negate that quality of the applicants' conduct and do not dissuade me from granting an injunction.

Moreover, the applicants must be taken to have foreseen that their launching of the New York actions was apt to lead to oppression of those parties to these proceedings permitted to be impleaded, in New York, the more so if they had to return to Australia to claim contribution or indemnity from any party which they were not permitted to join in New York.   This again indicates vexatious and oppressive conduct by the applicants.  At least one respondent, Freehills, had moved for an injunction directly against the applicants, restraining them from proceeding with the New York actions.

SECTION 1318 OF THE CORPORATIONS LAW - PRICE WATERHOUSE

In response to the cross claims against it, Price Waterhouse has, inter alia, sought relief under sub-s 1318 (1) of the Corporations Law ("the Law"). It has also moved for leave to file cross claims applying in this Court for relief under sub-s 1318 (2) of the Law in respect of the cross claim threatened to be made against it in New York by Skadden and the cross claim which it alleges USTC has threatened to make against it in New York.

Sub-sections 1318 (1) and (2) of the Law are as follows:

"(1)If, in any civil proceeding against a person to whom this section applies for negligence, default, breach of trust or breach of duty in a capacity as such a person, it appears to the court before which the proceedings are taken that the person is or may be liable in respect of the negligence, default or breach but that the person has acted honestly and that, having regard to all the circumstances of the case, including those connected with the person's appointment, the person ought fairly to be excused for the negligence, default or breach, the court may relieve the person either wholly or partly from liability on such terms as the court thinks fit.

(2)Where a person to whom this section applies has reason to apprehend that any claim will or might be made against the person in respect of any negligence, default, breach of trust or breach of duty in a capacity as such a person, the person may apply to the Court for relief, and the Court has the same power to relieve the person as it would have had under subsection (1) if it had been a court before which proceedings against the person for negligence, default, breach of trust or reach of duty had been brought."

Sub-section 1318 (4) provides that s 1318 applies to, inter alia, an expert in relation to a matter relating to a corporation in relation to which matter the civil proceeding referred to in sub-s (1) has been taken or the claim referred to in sub-s (2) will or might arise.  Price Waterhouse claims to have been an expert in relation to a matter relating to Linter Textiles in relation to which allegations of negligence, default and breach of duty are made against it in these proceedings and are threatened to be made against it in New York by Skadden and, as Price Waterhouse alleges, by USTC.

The expressions "court" and "Court" are defined in ss 9 and 58AA of the Law. The expression "court" is defined to mean any court when exercising the jurisdiction of, in effect, the State or the Capital Territory (defined to mean the Australian Capital Territory and the Jervis Bay Territory) which enacted the Law in question. The expression "Court" is defined to mean, relevantly, the Federal Court of Australia when exercising the jurisdiction of, as relevant, the Law of the enacting State or the Capital Territory.

It may well be, in view of the definition of "court", that the New York court could not grant to Price Waterhouse the relief for which sub-s 1318 (1) provides.  Accordingly, as noted above, Price Waterhouse has filed a notice of motion seeking leave to file cross claims against Skadden and USTC seeking relief under sub-s 1318 (2) in respect of the claims threatened to be made against it in the New York court.  In view of the conclusion which I reached above, apparently it will not be necessary for me to determine Price Waterhouse's motion.  All that need be said at present is that the potential juridical disadvantage to Price Waterhouse of not being able to rely on sub-s 1318 (1) in New York and the desirability, for more abundant precaution, of its applying for and obtaining relief in advance from this Court under sub-s 1318 (2), are burdensome complexities and aspects of oppression which disappear if all claims to be made against Price Waterhouse are made in this Court.

COMITY - FORUM NON CONVENIENS

As I attempted to explain in Reasons for Judgment (No 22), applications for a stay on the ground of forum non conveniens and applications for anti-suit relief are governed by different principles and are determined from different standpoints.  Neither remedy is readily granted, since, in each case, a person entitled to do so has invoked a court's jurisdiction.  However the test may be expressed, only rarely will a court, domestic or foreign, interfere with such a person's access to the court.

But the in personam nature of an application for an anti-suit injunction focuses attention on the conduct of the party sought to be enjoined and the consequences of that conduct, particularly within the domestic litigation.  That line of inquiry is at least unfamiliar, if not irrelevant, in the more general forum non conveniens context. 

It is therefore not to be wondered at that a court may refuse a stay sought on the forum non conveniens ground, only to witness the granting of an injunction against the plaintiff or applicant before it.  The careful granting of such an injunction does not represent a failure of the enjoining court to recognise the demands of comity or to accord respect to the foreign court.  The injunction is the result of its more specific inquiry as to the presence of oppression or vexation within the context of the case before it brought about by the conduct of a party over whom it has jurisdiction.  All this is true of the present case.  In particular, I reject unhesitatingly the applicants' submission that anti-suit relief can be granted only if I determine that the New York court could not reasonably have reached the conclusion which it did on Skadden's motion for dismissal on the forum non conveniens ground.

CONCLUSION

I would have preferred to be determining the present motions with the benefit of the decision and reasoning of the New York court on the question whether to allow Skadden and USTC, over opposition on the forum non conveniens ground, to bring in New York the various proposed cross claims for contribution or indemnity.  I have considered deferring a decision on the present motions pending the outcome of motions to implead in New York but have decided against that course.

Even if the New York court permitted Skadden and others to bring all the cross claims for contribution or indemnity they desire so that the present proceedings were to be substantially duplicated in New York, that would eliminate only one of the two alternative forms of oppression, foreseeable by the applicants in and since April 1994, to which I referred earlier.  The other would have come to fruition.

Further, Skadden's and USTC's proposed targets have indicated they will strongly contest any attempt to implead them in New York. I accept that they will to do so.  There may well be appeals.  Once the position in New York was finally resolved, I would have to decide the motions for anti-suit relief.  All this would take time.  Yet the trial of these proceedings is due to commence 18 March, in just less than four weeks' time.

For all the reasons mentioned in Reasons for Judgment (No 22) and in the foregoing Reasons, I think that the relevant applicants should be enjoined from pursuing the New York actions against Skadden, that is to say, the Ithaca action, the Scheiber action, the Executive Life action and the Colonial action.

The applicants should not be enjoined from pursuing the USTC action (USTC has not sought an injunction against the applicants) but USTC should be enjoined from cross claiming in the USTC action against the various respondents and cross respondents to these (Federal Court) proceedings.

Separate submissions were not addressed to the Bear Stearns action.  In that action the Ariel Entities seek a declaration that they are the owners of all rights, claims and choses in action in connection with transfers of the debentures.  Justice Cahn granted Skadden leave to intervene because of its interest in establishing a defence which it raised in the four actions against it in New York to the effect that the plaintiffs lacked "standing" and because of the desirability of avoiding inconsistent decisions in those actions and the Bear Stearns action itself.  Justice Cahn ordered that Skadden be added as a party defendant.

The issue of the applicants' "title to sue" will not arise in the New York actions against Skadden in view of the injunctive relief which I have foreshadowed.  The applicants' "title to sue" will arise and be determined in the course of these proceedings.   There may be some reason why the Ariel Entities will wish to pursue the Bear Stearns action.  There may be no good reason why they should be enjoined from doing so.  I will, however, allow an opportunity for the parties to make submissions in this respect.

The proceedings will be stood over to a date for the making of orders in conformity with Reasons for Judgment (No 22) and the foregoing Reasons and for the making of submissions on the matter last mentioned.  There will be directions for the bringing in of short minutes of orders accordingly.

I certify that this and the preceding 20 pages are a true copy of the Reasons for Judgment of the Honourable Justice Lindgren.

Associate:

Dated:21 February 1996

Heard:       13, 14 November 1995

Last written
submission
received:     7 February 1996

Place:       Sydney

Decision:     21 February 1996

Appearances:  Mr F M Douglas QC and Mr D R Stack of counsel instructed by Deacons Graham & James appeared for the applicants.

Mr A Sullivan QC and Mr S J Gageler and Dr A Bell of counsel instructed by Dibbs Crowther & Osborne appeared for the 1st cross respondent (Skadden).

Mr P Hely QC and Mr M Pembroke SC instructed by Allen Allen & Hemsley appeared for the 1st,
7th, 8th, 9th and 11th respondents (Allens' Banks).

Mr L Aitken of counsel instructed by Minter Ellison appeared for the 2nd respondent (BNZ).

Mr P Durack of counsel instructed by Clayton Utz appeared for the 3rd respondent (Barclays).

Mr T Vero of Clayton Utz appeared for the 4th respondent (Chase).

Mr J Karkar QC and Mr P Anastassiou of counsel instructed by Mallesons Stephen Jaques appeared for the 5th and 6th respondents (Citibanks).

Mr S D Robb QC and J W J Stevenson of counsel instructed by Middleton Moore & Bevins appeared for the 10th respondent (SIFA).

Mr P W Gray of counsel instructed by Gilbert & Tobin appeared for the 52nd respondent (Dillon).

Mr T M Jucovic QC with Mr R Smith and Mr L V Gyles of counsel instructed by Norton Smith appeared for the 54th respondent (Freehills).

Mr T F Bathurst QC with Mr R McHugh of counsel instructed by Blake Dawson Waldron appeared for the 207th cross respondent (Price Waterhouse).