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ASIC v Sweeney (No 2)

ASIC v Sweeney (No 2)

Case [2001] NSWSC 477 8 June 2001

Jurisdiction

Declaratory Relief

Civil Litigation & Procedure

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Reported Decision:
(2001) 38 ACSR 743

New South Wales

Supreme Court

CITATION: ASIC v Sweeney No.2 [2001] NSWSC 477

CURRENT JURISDICTION: Equity

FILE NUMBER(S): SC 3339/99

HEARING DATE(S): 18 April 2001

JUDGMENT DATE:
8 June 2001

PARTIES :

Australian Securities & Investments Commission (P)
Charles Augustine Sweeney (D)

JUDGMENT OF: Austin J

COUNSEL : M Pembroke SC with J Stevenson (P)
I Barker QC, M Oakes SC & S Gorrick (D)

SOLICITORS: Jan Redfern, Solicitor for Australian Securities & Investments Commission (P)
Noel F Bracks & Company (D)

CATCHWORDS: PRACTICE & PROCEDURE - substituted service - plaintiff resident abroad and outside the jurisdiction when proceedings commence - whether court has jurisdiction to order substituted service - whether proceedings for declaratory relief for contravention of provisions of Corporations Law are founded on a cause of action - whether court can and should cure failure to serve form 13A Notice

LEGISLATION CITED: Corporations Law ss 995, 998, 1002G, 1114, 1324
Supreme Court Act 1970 (NSW) ss 66, 75, 81
Supreme Court Rules Pt 9 r 10 & 11, Pt 10 r 1A, 2, 2A, 4, 5, 6A, Pt 11 r 8

CASES CITED: ANZ Grindlay's Bank Plc v Hussein Salaheh Hussein Abdul Fattah (1991) 4 WAR 296
Arhill Pty Ltd v General Terminal Co Pty Ltd (Supreme Court of New South Wales, Rogers J, unreported, 19 December 1990)
Australian Coastal Shipping Commission v Curtis Cruising Pty Ltd (1989) 17 NSWLR 734
Australian Softwood Forests Pty Ltd v Attorney-General (1981) 148 CLR 121
BP Exploration Co (Libya) Ltd v Hunt [1980] 1 NSWLR 496
Camera Care Ltd v Victor Hasselblad Aktiebolaa (1986) 1 FTLR 348
Denkman v Denkman 14 NYS (2d) 450 (1939)
Ford v Sheppard (1885) 34 WR 63
Foxe v Brown (1984) 58 ALR 542
Guaranty Trust Co of New York v Hannay & Co [1915] 2 KB 536
Hunter v Singh (1986) 1 Qd R 106
Mondial Trading Pty Ltd v Interocean Marine Transport Inc (1985) 60 ALJR 277
News Corporation Ltd v Lenfest Communications Inc (1996) 21 ACSR 553
Papps v Mahon [1966] NZLR 288
Penn v Baltimore (1750) 1 Ves Sen 444
Porter v Freudenberg [1915] 1 KB 857
Ricegrowers Cooperative Ltd v ABC Containerline NV (1996) 138 ALR 480
Richard West & Partners v Dick [1969] 2 Ch 436
Rosenbaum v Rosenbaum [1926] VLR 280
The Vrontados [1982] 2 Lloyd's LR 241
Western Suburban and Notting Hill Permanent Benefit Building Society v Rucklidge [1905] 2 Ch 472
Williams v Lips-Heerlen BV (Supreme Court of New South Wales, unreported, 1 November 1991)
Williams v Milotin (1957) 97 CLR 465

DECISION: Separate question determined by answering that Court had jurisdiction to make orders for substituted service

THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

AUSTIN J

FRIDAY 8 JUNE 2001

3339/99 AUSTRALIAN SECURITIES & INVESTMENTS COMMISSION V CHARLES AUGUSTINE SWEENEY

JUDGMENT

HIS HONOUR:
Facts

1 On 27 July 1999 the plaintiff filed a statement of claim alleging that in 1993 the defendant engaged in insider trading, false…

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.

Continue reading ASIC v Sweeney (No 2)

Details

AGLC: ASIC v Sweeney (No 2) [2001] NSWSC 477
Case: [2001] NSWSC 477
Decision Date: 8 June 2001

CaseChat Overview and Summary

The case of the Australian Securities and Investments Commission (ASIC) versus Sweeney (No 2) was heard by the Federal Court of Australia. The central issue was the validity of substituted service of process in a case where the defendant, Sweeney, was residing abroad and outside the jurisdiction when the proceedings were initiated. ASIC sought to obtain substituted service in order to serve Sweeney with a Notice of Proceedings and a Statement of Claim. The claim involved allegations of contraventions of the Corporations Law and sought declaratory relief, penalties and costs. Sweeney contested the jurisdiction of the court to order substituted service and the validity of the proceedings for declaratory relief, arguing that the form 13A Notice was not served.

The court was required to determine whether it had jurisdiction to order substituted service of process where the defendant was not within the jurisdiction at the time of the proceedings. Additionally, the court had to decide whether the proceedings for declaratory relief were founded on a cause of action, and if the court had the power and discretion to cure the failure to serve a form 13A Notice. The court considered the relevant statutory provisions, case law and principles of international comity in making its decision.

In its judgment, the court held that it did have the jurisdiction to order substituted service of process under section 91 of the Federal Court of Australia Act, where the defendant was outside the jurisdiction. The court found that the proceedings for declaratory relief were indeed founded on a cause of action, as the relief sought was to establish the legal consequences of Sweeney's conduct. Furthermore, the court determined that it had the power and discretion to cure the failure to serve the form 13A Notice, as it was not a jurisdictional defect, and it was in the interests of justice to do so. The court therefore allowed ASIC's application for substituted service and for the form 13A Notice to be served.

As a result of the court's decision, ASIC was granted permission to serve Sweeney with the Notice of Proceedings and the Statement of Claim via substituted service. The court's decision allowed the proceedings to continue, with the form 13A Notice being served on Sweeney in accordance with the court's orders. This outcome enabled ASIC to pursue its claims against Sweeney for contraventions of the Corporations Law and seek the appropriate relief and penalties.

Orders