Asta Solutions Pty Ltd v Bitscore Distributor Pty Ltd

IN THE COUNTY COURT OF VICTORIA

AT MELBOURNE

COMMERCIAL DIVISION

Revised
(Not) Restricted
Suitable for Publication

GENERAL LIST

Case No. CI-24-04074

Asta Solutions Pty Ltd	Plaintiff
v
Bitscore Distributor Pty Ltd & Ors (according to the attached schedule of parties)	Defendants

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JUDGE:	HIS HONOUR JUDGE ANDERSON
WHERE HELD:	Melbourne
DATE OF HEARING:	17 October 2024
DATE OF RULING:	22 October 2024 (Revised)
CASE MAY BE CITED AS:	Asta Solutions Pty Ltd v Bitscore Distributor Pty Ltd & Ors
MEDIUM NEUTRAL CITATION:	[2024] VCC 1629

RULING
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Subject:Appropriate State court for proceeding
Catchwords: Practice and Procedure – Whether court of another State the more appropriate forum – Agreement for the development of software – Development work performed in plaintiff’s principal office in Melbourne by its employees – Large workforce with distinctive roles – Principal issue in the proceeding relates to the nature and extent of the development work performed – Whether fact that the Sydney-based defendant’s four resident directors who would be witnesses was more compelling – Comparative financial position - Defendant a start-up company that did not yet have a profit making capacity – Plaintiff an established company with regional offices including in Sydney.
Legislation Cited: s20 Service and Execution of Process Act 1992 (Cth)

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Ms G. Walker	ASTA Law
For the Defendant	Ms O. Callahan	Kyard Business Law

HIS HONOUR:

The first defendant, Bitscore Distributor Pty Ltd (Bitscore), makes application pursuant to s 20 of the Service and Execution of Process Act 1992 (Cth) for an order staying the proceeding on the basis that the Court should be satisfied the District Court of New South Wales is the appropriate court to determine all the matters in issue between the parties.
The parties’ written and oral submissions were comprehensive. They referred to relevant authority, and the appropriate matters the legislation and the authorities require the Court to take account of.
Counsel distilled these matters down into the following critical considerations:
a.whether the issues to be determined in the proceeding had a real and substantial connection to any particular jurisdiction;
b. the places of residence of the likely witnesses;
c.the places of business of Asta and Bitscore;
d.the relative financial positions of these parties.
The proceeding was issued in this Court. The plaintiff, Asta Solutions Pty Ltd (Asta), seeks to recover the total sum of $399,368.80 from Bitscore pursuant to an agreement to develop and market software, entered into by these parties on 23 September 2024 (the development agreement).
There are three other defendants, two are directors of Bitscore and the third was a director of Bitscore during the period the development agreement was operating. These three directors are defendants because of allegations made by Asta that it continued to perform services under the development agreement as a result of representations made to it by each of these directors.
The three defendants have not yet filed appearances in the proceeding, although Bitscore’s application was supported by an affidavit sworn by the third defendant Vagner Jorden, who is still a director of Bitscore. No defence has been filed by Bitscore.
The issues raised by the Statement of Claim and by Mr Jorden’s affidavit as to the matters likely to be in dispute in the proceeding are:
a.Asta’s entitlement to claim monies are owed pursuant to the development agreement;
b.whether certain services provided by Asta pursuant to the development agreement were provided following the making of actionable representations by each of the three directors;
c.whether Asta “failed to provide the relevant services [to Bitscore pursuant to the development agreement] as contracted and represented by” Asta.
It is presently not contested that Asta’s work under the development agreement was carried out by a large team of employees working at Asta’s main office in Melbourne. It appears that, in relation to Bitscore and its directors, their involvement occurred whilst they were in Sydney. During the course of the project, there were communications by telephone and email.
The development agreement set out the “Scope of work” and the four “phases” of the project in Schedule A, and the payment terms for each phase and for the provision of additional “professional services” in Schedule C.
It is presently uncontested that between October 2022 and April 2023, Asta performed work under the development agreement and provided additional professional services. Asta rendered 15 invoices to Bitscore. Only the first two were paid. The development agreement was purportedly terminated by Bitscore on 13 April 2023. However, Asta’s performance under the development agreement and the veracity of its invoices was apparently not disputed by Bitscore until a letter of 21 June 2023.
It is in this context that I consider the matters in issue in this application. The factual background is limited. The issues in dispute in the proceeding have not been formally articulated by Bitscore in a defence, and presumably also a counterclaim. Bitscore’s directors have not filed appearances. However, I must determine Bitscore’s application on the basis of the material before me, and in circumstances where Bitscore bears the onus of persuading the Court to stay the proceeding.
Bitscore has premises only in Sydney. That is where it operates. The three other defendants live in Sydney. So does a further director, Zackery Robinson who Mr Jorden said, “had responsibility in the performance of the development agreement” and would be a witness in the proceeding.
Asta has premises in a number of centres in Australia and New Zealand. Its main office is in Melbourne. The office in Sydney is a relatively small operation. I consider that the location of the respective offices of Asta and Bitscore is not a matter of significance in the determination of the application.
Asta’s likely witnesses live in Melbourne, Bitscore’s in Sydney. It would be more convenient and less expensive for each party if the proceeding were to be conducted in a court located in their own city.
Bitscore submits that this factor should favour the District Court of New South Wales as the appropriate forum. In its written submissions, Bitscore conceded that Bill Angelidis, the sole director of Asta who lives in Melbourne, would be a necessary witness for Asta. However, in relation to the 16 employees listed in the Statement of Claim as having worked on the project for Asta, Bitscore says that it is “not foreseeable that any of these employees will be necessary as witnesses”.
This submission was apparently made on the assumption that the only relevant evidence these employees could give would relate to the number of hours they had worked, and that those matters were not significant, as the defendants would be “likely to admit the timesheets”.
I do not accept this submission. The development agreement specifically provided in clause 10, that work by Asta pursuant to the development agreement might only be performed by Asta’s “employees”. The Statement of Claim lists in the particulars to paragraph 13, the role and the hours worked by each of the 16 employees, as revealed by their time sheets.
Mr Angelidis is described as the “Project Lead and Business Development Manager”. He worked a total of 130 hours. Other employers with the following position descriptions worked the total number of hours indicated: Development SME (130 hours), 3 Software Developers (190, 105 and 125 respectively), Developer and Architect (190), UX/UI Designer and Tester (34), Business Development Manager (75), Development Lead (180), Quality Assurance Tester (90), Project Manager (180), PM & Systems Architect (190), Development Blockchain SME (210), Blockchain Developer (85), AWS Administrator (130) and Web Design (90).
Whatever were the specifics of the work performed by each of these employees, it is obvious from the different role descriptions and the number of hours worked by each of them, that they are likely to have made a significant and distinctive contribution to the project. Although the Statement of Claim comprehensively refers to the work performed by Asta and to “progress updates” provided to Bitscore during the performance of the works, the issues of the specific work performed by Asta, and whether that work entitled it to make the claims it did under the development agreement, appear to be presently very much disputed by Bitscore.
However, what is clear is that Bitscore has not presently adduced evidence to establish that the convenience of its likely witnesses has a stronger basis for determining the appropriate court, than the position of Asta. It is likely that many more witnesses from Asta will give evidence than the number of witnesses from Bitscore. To establish its case, Asta will need to produce evidence that the work it performed matched the requirements of the first and second phases, and to a degree the third phase, of the project described in the development agreement and the further professional services it was asked to provide.
The second matter pressed by Bitscore was its relative financial position compared with that of Asta. There were no financial records before the Court. Bitscore was incorporated on 31 May 2021. It is a “start-up” company which, as it was suggested was to be expected, had not yet reached profit making capacity. On the other hand, Asta had 25 years of successfully trading behind it.
Notwithstanding, in October 2022, Bitscore entered into the development agreement by which it committed itself to pay a total of $765,000 by about August 2023 together with further amounts for professional services provided by Asta. In fact, as alleged and not presently contested, it paid a total of $139,833.32 for the first two invoices and did not pay the further 13 invoices totalling $399,368.80 for the work Asta claimed it had performed.
In my view there is no evidence before the Court in this regard or otherwise that would justify the Court concluding that the proceeding should be stayed.
In the circumstances, the first defendant’s summons dated 23 September 2024 will be dismissed. The parties have subsequently agreed that Bitscore should pay Asta’s costs of and incidental to the summons to be assessed by the Costs Court on a standard basis in default of agreement.

SCHEDULE OF PARTIES

ASTA SOLUTIONS PTY LTD (ACN 086 783 851) Plaintiff

- And –

Bitscore Distributor Pty Ltd (ACN 650 625 752)

First Defendant

and
Eric Gerges Second Defendant
and
Vagner Jorden Third Defendant
and
Michael Holmes Fourth Defendant

[2024] VCC 1629

22 October 2024 (Revised)