Andrew Kohn Pty Ltd v Mrs Mac's Pty Ltd - [2015] VSC 278

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

S CI 2014 5793

ANDREW KOHN PTY LTD	Plaintiff
v
MRS MAC'S PTY LTD	Defendant

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JUDGE:	Daly AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	11 June 2015
DATE OF JUDGMENT:	17 June 2015
CASE MAY BE CITED AS:	Andrew Kohn Pty Ltd v Mrs Mac's Pty Ltd
MEDIUM NEUTRAL CITATION:	[2015] VSC 278

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JURISDICTION OF COURTS (CROSS-VESTING) ACT (VIC) 1987 — Application for transfer to the Supreme Court of Western Australia —Whether a non‑exclusive jurisdiction clause was incorporated into the agreement between the parties — Whether defendant has waived its rights to apply for a transfer by issuing a counterclaim in this proceeding –Relevant connecting factors – the ‘place of the wrong’ – BHP Billiton Ltd v Schultz (2004) 221 CLR 400, Spiliada Maritime Corp v Cansulex Ltd [1987] 1 AC 460, Sedman & Associates Pty Ltd v Morgan Stanley Wealth Management Australia Pty Ltd [2013] VSC 549 – Mutch v BHP Billiton Ltd [2015] VSC 253 considered and applied: Steadmark Pty Limited v Bogart Lingerie Limited [2013] VSC 402 distinguished.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr G Bloch	Goldhirsch & Schnider Lawyers
For the Defendant	Mr A Schlicht	Consult Lawyers (as town agents for Metaxas & Hager)

HER HONOUR:

The plaintiff is a manufacturer of packaging materials based in Melbourne. The defendant manufactures pies, sausage rolls and like products for the wholesale and retail market and is based in Perth. In March 2013 the defendant issued a request for tender to the plaintiff and others for the supply of packaging materials. The plaintiff was the successful tenderer. The plaintiff supplied to the defendant flexible wrapping comprised of a metallised polyester film bonded to paper upon which the defendant’s artwork is printed. The wrapping is designed for heating frozen products in microwave ovens, with the metallic component of the wrapping designed to ‘crisp’ the products.

The wrapping was manufactured by the plaintiff in Melbourne and then delivered to the defendant’s premises in Perth in large rolls. The defendant wrapped its products in its Perth premises. On 4 November 2013, the purchasing manager of the defendant reported to the plaintiff some customer complaints which referred to a ‘strange burning/chemical smell during heating and … scorch marks on the interior of the wrapper’.[1] Investigations took place at both premises, which indicated that the metallic film on the wrapping was ‘delaminating’. There was further correspondence and discussion regarding the testing process and results at each of the premises. It seems that the defendant lost confidence in the quality of the wrapping supplied by the plaintiff, and on 11 March 2014, it notified the plaintiff that the defendant would be moving to another supplier, albeit that it would continue to require more stock while the defendant was in a transition period.
[1]See exhibit ‘AJ-7’ to the exhibit of Andrew Nicholas Jenkins sworn on 30 March 2015.

By September 2014, the parties had engaged solicitors who…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] VSC 278
Decision Date: 17 June 2015

CaseChat Overview and Summary

Andrew Kohn Pty Ltd applied to transfer an action against Mrs Mac's Pty Ltd from the Supreme Court of Victoria to the Supreme Court of Western Australia. The primary dispute arose from a franchise agreement between the parties. The franchisor, Andrew Kohn, sought to enforce certain provisions of the agreement against the franchisee, Mrs Mac's. The defendant, Mrs Mac's, responded by initiating a counterclaim in the Victorian court. The court was tasked with determining whether the non-exclusive jurisdiction clause in the agreement was incorporated and, if so, whether Mrs Mac's had waived its rights to challenge the transfer by filing a counterclaim in Victoria.

The legal issues before the court included whether the non-exclusive jurisdiction clause was binding and whether Mrs Mac's had effectively waived its right to contest the transfer by filing a counterclaim. The court considered precedents such as BHP Billiton Ltd v Schultz, Spiliada Maritime Corp v Cansulex Ltd, and Sedman & Associates Pty Ltd v Morgan Stanley Wealth Management Australia Pty Ltd. It also examined the principles established in Mutch v BHP Billiton Ltd and Steadmark Pty Limited v Bogart Lingerie Limited. The court concluded that the non-exclusive jurisdiction clause was indeed part of the agreement and that Mrs Mac's had waived its rights by filing a counterclaim in Victoria.

After examining the relevant factors, including the 'place of the wrong', the court found that the connecting factors sufficiently justified the transfer to the Supreme Court of Western Australia. The court accepted that the dispute had a significant connection to Western Australia, where the franchise agreement was executed and where the franchisee operated its business. The court determined that transferring the case to the Western Australian court would be more convenient and in the interests of justice. The court allowed the application and ordered the transfer of the proceedings to the Supreme Court of Western Australia.

Orders