B2Binsider Pte Ltd v Fantech Capital BV
[2024] FedCFamC2G 426
•10 May 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
B2Binsider Pte Ltd v Fantech Capital BV [2024] FedCFamC2G 426
File number(s): SYG 1540 of 2023 Judgment of: JUDGE GIVEN Date of judgment: 10 May 2024 Catchwords: PRACTICE AND PROCEDURE – Application for substituted service of documents to be served outside of Australia – how Federal Court Rules applied – whether necessary to attempt service under Hague Convention prior to seeking orders for substituted service – where respondents have received documents – whether orders deeming service appropriate Legislation: Competition and Consumer Act 2010 (Cth) s 5, sch 2 ss 18, 86, 138A
Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) rr 1.06, 6.14, sch 1 item 6
Federal Court Rules 2011 (Cth rr 10.24, 10.41, 10.42, 10.43, 10.44, 10.45 10.48, 10.49 10.52
Cases cited: Australian Competition and Consumer Commission v Kokos International Pty Ltd [2007] FCA 2035
Australian Information Commission v Facebook Inc [2020] FCA 531; 144 ACSR 88
Bray v F Hoffman- La Roche Ltd (2003) 200 ALR 607
Cmr of Taxation v Oswal [2012] FCA 1507; 91 ATR 684
Cmr of Taxation v Zeitouni (2013) 306 ALR 603
Commissioner of Taxation v Oswal [2012] FCA 1507
Connelly (liquidator), in the matter of CIMC Rolling Stock Australia Pty Ltd (in liq) v One Rail Australia (FLA) Pty Ltd (No 3) [2021] FCA 1183
Ford, Careers Australia Group Ltd (in liq) v Mansfield [2022] FCA 173
Humane Society International Inc v Kyodo Senpaku Kaisha Ltd [2007] FCA 124
Laurie v Carroll (1958) 98 CLR 310
Noco Company v Hong Jong Haowei Technology co, Ltd [2023] FCA 533
Park (as trustee of the bankrupt estate of Tschannen) v Tshannen and Another (2016) 341 ALR 452
Re Deposit and Investment Co Ltd (1991) 30 FCR 463
Southwell v Maladina [2002] FCA 802; 194 ALR 51
Voth v Manildra Flour Mills Pty Ltd (1990) 97 ALR 124
Wilding v Bean [1891] 1 QB 100
Division: Division 2 General Federal Law Number of paragraphs: 49 Date of hearing: 6 May 2024 Place: Sydney Counsel for the Applicants: A Gandar Solicitor for the Applicants: Kerrs Law Pty Ltd Solicitor for the Respondents: No appearance ORDERS
SYG 1540 of 2023 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: B2B INSIDER PTE LTD
First Applicant
DAVID WOOD
Second Applicant
AND: FANTECH CAPITAL BV
First Respondent
WIM PONNET
Second Respondent
TERRY DOWNING (and another named in the Schedule)
Third Respondent
ORDER MADE BY:
JUDGE GIVEN
DATE OF ORDER:
6 MAY 2024
THE COURT ORDERS THAT:
1.Orders 1 to 8 (inclusive) of the Orders made on 30 November 2023 are vacated.
2.Pursuant to r 10.44 of the Federal Court Rules 2011 (Cth) (FCA Rules) the applicants have leave to serve the Documents (as defined in the notation below), other than the originating application (in respect of which leave is not required), outside Australia.
3.Pursuant to r 10.24 of the FCA Rules, the applicants are authorised to effect substituted service of the Documents on each of the first, second and third respondents as follows:
(a)to the first respondent by sending a copy of the Documents by email, marked
to the attention of the ‘Proper Officer’ of the first respondent to the email address: [email protected];
(b)to the second respondent by sending a copy of the Documents by email, marked to his attention, to the email address [email protected]; and
(c)to the third respondent by sending a copy of the Documents by email, marked to his attention, to the email address [email protected].
4.Personal service and service in accordance with the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters 1965 of the Documents, on the first, second and third respondents are dispensed with.
5.The applicants must serve the Documents on each of the first, second and third respondents by the means specified in Order 3 above by 5:00pm on 13 May 2024.
6.The applicants must serve a copy of these Orders on the fourth respondent by 5:00pm on 13 May 2024.
7.Service of the Documents is deemed to have been effected on each of the first, second and third respondents immediately once the steps set out in each of Orders 3(a), (b), and (c) (respectively), has occurred.
8.The first respondent must appoint a legal representative and file and serve a Notice of Address for Service on or by 27 May 2024.
9.The second and third respondents are to file and serve Notice/s of Address for Service on or by 27 May 2024.
10.Until further order, or until a Notice of Address for Service is filed by or on behalf of the first, second and third respondents, service of any documents in these proceedings can be effected on the first, second and third respondents by sending a copy to them at each of the respective email addresses in Order 3 above.
11.The matter is adjourned for further direction before Judge Given at 9:30am on 6 June 2024 in person in Court room 13.1 Level 13, 80 William Street Woolloomooloo.
12.The costs of today are reserved.
13.Liberty to apply on 2 days’ notice.
THE COURT NOTES THAT:
A.In this order, the Documents are:
a.the originating applicant dated 28 September 2023;
b.the statement of claim dated 28 September 2023;
c.the genuine steps statement dated 10 October 2023;
d.a notice as referred to in r 10.43B of the FCA Rules; and
e.a copy of these Orders.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
(Revised from transcript)JUDGE GIVEN:
Before the Court is an Application in a Proceeding filed on 25 March 2024 by which the applicants seek a variety of orders relating to service of the first to third respondents (inclusive) (Application). The documents in respect of which service is sought are:
(a)the originating applicant dated 28 September 2023;
(b)the statement of claim dated 28 September 2023; and
(c)the genuine steps statement dated 10 October 2023;
(Documents).
The fourth respondent has already been served with the Documents and entered an appearance.
By a Statement of Claim filed with the Court on 28 September 2023 (SOC), the applicants bring proceedings against the respondents alleging conduct which is said to be misleading or deceptive, or likely to mislead or deceive, in contravention of s 18 of the Australian Consumer Law (ACL), which is Schedule 2 to the Competition and Consumer Act 2010 (Cth) (Act).
The first respondent is a limited liability company, incorporated in the Netherlands.
The second respondent is a natural person, and is said by the SOC to be a resident of the Netherlands (although the Court is now told he may be resident in Switzerland).
The third respondent is said by the SOC to be resident in England.
BACKGROUND
These proceedings first came before the Court for directions on 2 November 2023, on which occasion the first to third respondents were not present at Court, nor was there any appearance for them. Orders were made on that occasion adjourning the matter to later in November for further directions, in the anticipation that the absent respondents may be served in the interim.
On 30 November 2023, the Court (erroneously) made orders for substituted service of the first to third respondents, not by reference to the relevant provisions of the Federal Court Rules 2011 (Cth) (FCA Rules). When the Court later apprehended that error, and brought it to the applicants’ attention, the Application came to be filed.
In support of the Application, the applicants rely on three Affidavits deposed by their solicitor, Mr Aaron Edmonds, being Affidavits affirmed on each of:
(a)29 November 2023 (First Edmonds Affidavit);
(b)1 December 2023 (Second Edmonds Affidavit); and
(c)21 March 2024, being an Affidavit relevantly addressing matters required by r 10.43(3) of the FCA Rules (Third Edmonds Affidavit).
Tendered today was a bundle of relevant emails of a range of dates spanning, November and December of 2022, which emails are said to relevantly underpin parts of the SOC (marked Exhibit “1A”). An additional email, which had been omitted as an annexure to the Second Edmonds Affidavit was marked Exhibit “2A”.
By the SOC, the applicants allege that various representations were made by the emails which form “Exhibit 1A”. In essence, those emails went to proposing a particular business venture which involved an exclusive opportunity to acquire 100% of Major League Rugby in North America (MLR League), and the majority interest of each of the current and future franchises for that sport (exclusive deal representation). The venture was proposed to be funded through a particular funding proposal (funding representation).
The applicants allege that, to the extent that they made representations as to future matters, the respondents had no reasonable grounds for making the exclusive deal representation and funding representation (together, the representations), and that the representations were false. In support of this, the applicants claim that (unbeknownst to the second applicant) a deadline for funding of the funding representation expired on 20 December 2022. This is said to have had the effect that the funding proposal for the exclusive deal was no longer viable, such that the representations were not viable. The representations are therefore said to have been misleading and deceptive for the purposes of the ACL.
APPLICABLE RULES
Rule 1.06(2) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (Rules) relevantly provides as follows:
1.06 Application
(1) It is intended that the practice and procedure of the Court in general federal law proceedings be governed principally by these Rules.
(2) However, if in a particular case the Rules are insufficient or inappropriate, the Court may apply the Federal Court Rules or the Federal Court (Criminal Proceedings) Rules 2016 in whole or in part and modified or dispensed with, as necessary.
(3) Without limiting subrule (2), the provisions of the Federal Court Rules set out in Schedule 1, apply, with necessary changes, to general federal law proceedings.
Note: These Rules have effect subject to any provision made by an Act, or by rules or regulations under an Act, with respect to the practice and procedure in particular matters (see subsection 217(2) of the Act).
As noted at [4] to [6] above, the first, second and third respondents are outside Australia.
This Court’s Rules do not make provision for service of documents outside Australia.
By reference to r 1.06(3) of the Rules and item 6 of Schedule 1 thereto, rr 10.41 to 10.52 of the FCA Rules are applied as forming part of the Rules. By reason of the interaction of rr 10.24, 10.45 and 10.49 of the FCA Rules, it is also appropriate for the purpose of these reasons to use r 1.06(3) of this Court’s Rules to also apply r 10.24 of the FCA Rules in the present case (see [44] below).
Rule 10.42(j) of the FCA Rules relevantly provides that:
10.42 When an originating application may be served outside Australia without leave
An originating application may be served outside Australia without leave in the following cases:
…
(j) if the proceeding arises under a law of the Commonwealth, a State or a Territory, and:
(i) any act or omission to which the proceeding relates was done or occurred in Australia; or
(ii) any loss or damage to which the proceeding relates was sustained in Australia; or
(iii) the law applies expressly or by implication to an act or omission that was done or occurred outside Australia in the circumstances alleged; or
(iv) the law expressly or by implication confers jurisdiction on the Court over persons outside Australia (in which case any requirements of the law relating to service must be complied with).
Rule 10.43 of the FCA Rules provides:
10.43 When an originating application may be served outside Australia with leave
(1) In any proceeding, if service is not allowed under rule 10.42, an originating application may be served outside Australia with the leave of the Court.
(2) An application for leave under this rule must be made on notice to every party other than the party intended to be served.
(3) An application for leave under this rule must be accompanied by an affidavit stating any facts or matters related to the desirability of the Court assuming jurisdiction, including the place or country in which the person to be served is or possibly may be found, and whether or not the person to be served is an Australian citizen.
(4) The Court may give leave if satisfied that:
(a) the proceeding has a real and substantial connection with Australia; and
(b) Australia is an appropriate forum for the proceeding; and
(c) in all the circumstances the Court should exercise jurisdiction.
(5) A sealed copy of every order made under this rule must be served with the document to which it relates.
Rule 10.45 of the FCA Rules provides:
10.45 Application of other rules
The other provisions of this Part apply to service of a document on a person outside Australia in the same way as the provisions apply to service on a person in Australia, to the extent that the provisions are:
(a) relevant and consistent with this Division; and
(b) consistent with:
(i) if a convention applies—the convention; or
(ii) if the Hague Convention applies—the Hague Convention; or
(iii) in any other case—the law of the country in which service is to be effected.
There are also two rules within Part 10 of the FCA Rules which deal with the issue of substituted service. Rule 10.49, which is within Division 10.4 of the FCA Rules (pertaining specifically to service outside of Australia) provides as follows:
10.49 Substituted service
If service on a person outside Australia, in accordance with a convention, the Hague Convention or the law of a foreign country, was not successful, a party may apply to the Court without notice for an order:
(a) substituting another method of service; or
(b) specifying that, instead of being served, certain steps be taken to bring the document to the attention of the person; or
(c) specifying that the document is taken to have been served:
(i) on the happening of a specified event; or
(ii) at the end of a specified time.
Note: Without notice is defined in the Dictionary
Rule 10.24 which is within Division 10.2 of the FCA Rules (pertaining to service generally) provides as follows:
10.24 Substituted service
If it is not practicable to serve a document on a person in a way required by these Rules, a party may apply to the Court without notice for an order:
(a) substituting another method of service; or
(b) specifying that, instead of being served, certain steps be taken to bring the document to the attention of the person; or
(c) specifying that the document is taken to have been served:
(i) on the happening of a specified event; or
(ii) at the end of a specified time.
Note: Without notice is defined in the Dictionary
SERVICE OUTSIDE OF AUSTRALIA
Pursuant to r 10.42 of the FCA Rules in the current form, an originating application may (now) be served outside of Australia without leave of the Court. The dispensation of a requirement for leave is a relatively recent development. As the Federal Court recently observed:
Division 10.4 of the Rules, relating to service out of Australia, was substantially amended with effect from 13 January 2023. The main change was to remove the requirement for leave before service of an originating application outside of Australia in specified categories of cases. These categories are set out in r 10.42. There is no doubt that the present proceeding falls within several of the paragraphs in r 10.42. In particular, this is a case where the proceeding arises under a law of the Commonwealth and any act or omission to which the proceeding relates was done or occurred in Australia (see r 10.42(j)(i)). Further, this is a case where the proceeding is for an injunction to restrain the performance of any act in Australia (see r 10.42(d)(i)).
see Noco Company v Hong Jong Haowei Technology co, Ltd [2023] FCA 533 (Noco) at [9] per Moshinsky J.
The amendments referred to in Noco, which took effect from early January of 2023, essentially removed the requirement that leave be obtained for service of originating applications outside of Australia in certain cases. The dictionary to the FCA Rules defines an originating application as being an application starting a proceeding, including a cross-claim in the proceeding against a person who was not previously a party, but not a notice of appeal. The previous requirement that leave be granted for service outside of Australia has some significance when considering the question of substituted service outside of Australia, for reasons which will be addressed shortly. It can also be observed as a result of the recent amendments to the FCA Rules, that there are relatively few authorities applying the FCA Rules in their current form, and some care must be taken in applying decisions about service outside Australia and substituted service, which were made prior to those amendments.
It is contended for the applicants that r 10.42(j) of the FCA Rules is satisfied because the originating application relates to a cause of action under the ACL, as set out in Schedule 2 of the Act. Relevant acts to which the proceedings relate are said to have occurred in Australia. The applicants contend that the question of whether the Court has jurisdiction in this matter by virtue of the occurrence of certain acts in Australia, is answered by the fact that the relevant conduct is constituted by the receipt of emails, including those which form Exhibit “1A”, sent by various of the respondents to the applicants. The emails are said to have been directed to, and expected to be received in, Australia. While cases to that effect have focused on electronic communications (including emails) having been sent from overseas corporations (or offices, to their Australian subsidiaries) I see no relevant difference to the sending of communications by the respondents to the applicants in circumstances where, prima facie, it is open to say that those emails were directed to, and likely to be read in Australia: Voth v Manildra Flour Mills Pty Ltd (1990) 97 ALR 124 per Mason CJ, Brennan, Deane, Dawson, Toohey & Gaudron JJ and Bray v F Hoffman- La Roche Ltd (2003) 200 ALR 607 per Carr, Branson and Finkelstein JJ.
To the extent that part of what is pleaded by the SOC appears to be an alleged material omission (namely, a failure to inform the applicants that a deadline for funding had expired, relevant to the success of the proposed deal) there may still remain an extant question about where that particular conduct took place (it being an omission) such that there remains a possibility that there will be matters which potentially engage s 5 of the Act. However, on the face of the SOC, I am sufficiently satisfied for the purposes of the present application that prima facie the Court has jurisdiction in respect of the claim brought under s 18 of the ACL. I have also had regard to ss 86 and 138A of the Act, which prescribes the conferral of jurisdiction of this Court in respect of that legislation.
I am satisfied that the subject matter of the proceedings sufficiently arises under a law of the Commonwealth such that, pursuant to r 10.42(j)(i) of the FCA Rules, leave is not required to serve the originating application outside of Australia. In Noco (supra) at [10], Moshinsky J also considered the question of the service of “ancillary documents”, such as a Statement of Claim, in circumstances where the originating application can be serve outside of Australia without leave. His Honour concluded:
Therefore, the originating application can be served outside Australia without leave. Insofar as the ancillary documents (such as the statement of claim, the amended interlocutory application and the affidavits in support) are concerned, it is appropriate to grant leave pursuant to r 10.44 for the service of these documents outside Australia. This follows naturally from the position that the originating application can be served outside Australia.
In the present case, the additional documents in respect of which service outside of Australia is sought are the SOC and the applicants’ genuine steps statement.
I am satisfied in the circumstances of this case, applying Noco, that to the extent that leave is not required in respect of the originating application, out of an abundance of caution it would be appropriate to make orders to the effect pursuant to r 10.44 of the FCA Rules, by reference to r 10.42(j)(i) of the FCA Rules. Accordingly, the SOC and the genuine steps statement filed by the applicants on 28 September 2023 and 12 October 2023 (respectively), will be included in any such order.
Substituted Service
That now brings us to the question of substituted service. This question is slightly more fraught, by virtue of the interaction between rr 10.49 and 10.24 of the FCA Rules (see [20] and [21] above). Rule 10.24 of the FCA Rules has similar effect to r 6.14 of this Court’s Rules.
From annexures to the First Edmonds Affidavit it appears that, on 12 October 2023, correspondence was sent to each of the respondents, raising an array of matters related to the cause/s of action now the subject of these proceedings. Among those matters was a request that each of the respondents provide their current addresses for service by no later than 4:00pm on Friday, 20 October 2023. By a lengthy response to that letter, sent jointly on behalf of each of the individual respondents (together with the first corporate respondent (and to another individual who is not named as a respondent to these proceedings)), the respondents addressed a number of the matters in detail. In respect of service, the respondents said only the following:
Service: While you cite Australian legislation for serving process, we remain firm in our conviction that the appropriate conventions, specifically the Hague Convention, must be adhered to for international matters.
No addresses for service have been given by the first, second and/or third respondents in response to the 12 October 2023 letter or at all.
In Noco, Moshinsky J said the following on the interaction between rr 10.49 and 10.24 of the FCA Rules:
[13] Rule 10.49 is premised on service by one of the three methods referred to in the rule having been unsuccessful, which implies that some attempt has already been made. The applicant does not seek to rely on that rule in the present case, as the applicant contends that it is not practicable to serve the originating application under the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, done at The Hague on 15 November 1965 (Hague Convention) (this being the method of service that would otherwise be appropriate in the circumstances of this case).
[14] An issue arises whether, by reason of the presence of a specific rule for substituted service in Div 10.4 (namely, r 10.49) the general rule regarding substituted service (namely, r 10.24) is available in a case involving service out of the jurisdiction.
[15] This issue was considered (in the context of the Rules as they stood before the amendments to Div 10.4 described above) in Australian Information Commission v Facebook Inc [2020] FCA 531; 144 ACSR 88 (Facebook). In that case, Thawley J concluded that, having regard to r 10.45 (application of other rules), the general substituted service rule (r 10.24) was available notwithstanding the presence of r 10.49: see Facebook at [62]–[66]. In particular, Thawley J stated at [66]:
This Court has held, in circumstances analogous to the present, that an order for substituted service may be made under either r 10.24 or r 10.49: Cmr of Taxation v Zeitouni (2013) 306 ALR 603 at [60] (Katzmann J); see also: Australian Competition and Consumer Commission v Kokos International Pty Ltd [2007] FCA 2035 at [18] (French J); Commissioner of Taxation v Oswal [2012] FCA 1507 at [32] (Gilmour J). Even if that position is incorrect, I would have ordered substituted service under r 10.49, with a dispensation from the implicit requirement to attempt service under r 1.34, for equivalent reasons to those for which I will order substituted service under r 10.24, explained next.
[16] In my view, the reasoning in Facebook is equally applicable under the current provisions. While wording changes have been made to rr 10.45 and 10.49, they remain in substantially the same terms as before the amendments. The current form of r 10.49 has been set out above. The current form of r 10.45 is as follows:
By the Third Edmonds Affidavit, the requisite matters required by r 10.43 were addressed in respect of the locations and citizenship of the various relevant respondents. It is also the case, as is evidenced by the Second Edmonds Affidavit, that following the erroneous making of orders for substituted service under the Rules in November of 2023, each of the relevant respondents was sent the originating application, SOC and genuine steps statements by email to the respective email addresses (see Second Edmonds Affidavit together with Exhibit “2A”).
I am satisfied that each of the first, second and third respondents have received the Documents by email. That is because each of them sent a (relevantly identical) email to the applicants by which they each acknowledged receipt of the Documents, but raised objections on the basis of jurisdiction, and the Hague Convention.
I am also satisfied that when asked to provide addresses for service so that service could be affected outside of Australia, the first, second and third respondents (while apparently professing to be sticklers for compliance with the Hague Convention) have refused and/or failed to provide such addresses so that they could be duly served with the Documents by a method provided for under the Hague Convention.
It is contended for the applicants that it is open to infer that the relevant respondents, if not trying to evade service entirely, are at least trying to delay that service taking place. I am certainly prepared to infer the latter.
Returning to the relevant authorities in respect of substituted service outside of Australia, there are somewhat divergent decisions of the Federal Court as to the appropriate interaction and applicability of rr 10.49 and 10.24 of the FCA Rules in such circumstances. As I observed to the applicants’ Counsel at the hearing of the Application, while the effect of r 1.06 the Rules enables the application of the FCA Rules in this Court, I remain bound by the decisions of the Federal Court in relation to the FCA Rules.
The divergence of opinion in question arises from the fact that r 10.49 of the FCA Rules is expressed in terms which differ from those in r 10.24. In Park (as trustee of the bankrupt estate of Tschannen) v Tshannen and Another (2016) 341 ALR 452 (Park) Edelman J said the following at [15]:
The difficulty with the orders sought for substituted service in this case is that r 10.49 requires that some attempt will have been made for service in accordance with the relevant Convention. It provides “if service was not successful on a person in a foreign country”. The concept of a lack of success involves, at least, some attempt. This contrasts with the general provision in r 10.24 for substituted service which permits substituted service if “it is not practicable to serve a document on a person in a way required by these Rules” (emphasis added).
I note that the decision in Park predates the changes to the FCA Rules to which I referred earlier and with which Moshinsky J dealt in Noco. More recent cases upon which the applicants rely include Ford, Careers Australia Group Ltd (in liq) v Mansfield [2022] FCA 173 (Ford), in which O’Bryan J dealt with the interaction between rr 10.24 and 10.49 of the FCA Rules, albeit again while pre-dating the changes which relate to the question of leave to serve documents outside of Australia.
In Ford, Justice O’Bryan dealt with the above-mentioned interaction of the FCA Rules thusly:
[26] By virtue of r 10.45, r 10.24 (substituted service) will apply to foreign service provided that the rule is consistent with Div 10.4 and the applicable convention or foreign law governing foreign service: Zeitouni at [21] per Katzmann J.
[27] In considering the question of consistency, it is well established that it is inappropriate for a court to consider any application for substituted service overseas unless leave for service outside Australia has been given pursuant to r 10.43: see Zeitouni at [26]–[32] per Katzmann J, and the cases cited therein. As set out above, the grant of leave to serve on a person outside Australia is conditional upon the matters set out in r 10.43(4), namely, that the Court has jurisdiction in the proceeding, that the proceeding is of a kind mentioned in r 10.42, and the party has a prima facie case for relief. To grant an order for substituted service under r 10.24 without first granting leave to serve outside of Australia under r 10.43 would be to apply r 10.24 in a manner inconsistent with Div 10.4. The reason for this lies in the essential role of service in enlivening the Court’s jurisdiction.
[28] At common law, the Court’s jurisdiction in actions in personam depends on a defendant’s presence in the geographical jurisdiction of the Court (this Court’s jurisdiction being Australia-wide). This common law position is, however, subject to statutory extensions to jurisdiction that provide for the service of process outside of the jurisdiction where there is some link between the forum and the subject matter involved: Re Deposit and Investment Co Ltd (1991) 30 FCR 463 at 464 per Lockhart J, citing Laurie v Carroll (1958) 98 CLR 310 (Laurie v Carroll) per Dixon CJ, Williams and Webb JJ (at 322–323). It is for this reason that an order for substituted service should not be made in relation to a person outside the jurisdiction who has not been the subject of an order for leave to serve outside of the jurisdiction. Such an order would, in effect, circumvent the requirement (codified by r 10.43) for the Court to be satisfied that it is appropriate to extend its jurisdiction to a person located overseas: Laurie v Carroll at 332 . The power to order substituted service cannot be used as a way of effecting service outside the jurisdiction for want of any other power to do so: Park v Tschannen [2016] FCA 137; 341 ALR 452 (Park) at [10]–[11] per Edelman J, citing Southwell v Maladina [2002] FCA 802; 194 ALR 51 per Dowsett J; Wilding v Bean [1891] 1 QB 100 at 102 ; and Laurie v Carroll at 325 .
[29] A question that has not been finally resolved is whether r 10.24 can be relied on in respect of substituted service outside of Australia, even in circumstances where leave has been granted under r 10.43, or whether r 10.24 is necessarily inconsistent with Div 10.4 (within the meaning of r 10.45). The matter of substituted service outside Australia is addressed by r 10.49 which permits substituted service if service on the person in a foreign country in accordance with a convention or the relevant foreign law was not successful. This requires that some attempt must first be made to serve in accordance with the relevant convention or foreign law: Park at [15]. In contrast, r 10.24 permits substituted service if “it is not practicable to serve a document on a person in a way required by the Federal Court Rules ” and does not require that some attempt first be made to serve in another manner.
[30] In Park, Edelman J contemplated (at [16]) that r 10.49 requires steps to have been taken to attempt service because of principles of international comity, as well as the importance of personal service (and the need for some reason to depart from it). His Honour stated:
It would not be consistent with comity for an agreed regime to provide for a form of service outside the jurisdiction if the laws of that jurisdiction permitted a party immediately to substitute an alternative form of service. As Dixon CJ, Williams and Webb JJ remarked, if the position were otherwise, “the strict conditions regulating and limiting service out of the jurisdiction upon defendants abroad would be ineffective; for they could be avoided by obtaining an order for substituted service within the jurisdiction”: Laurie v Carroll [1958] HCA 4; (1958) 98 CLR 310 , 325. Another reason is the importance of personal service and the need for some reason to exist before orders are made for departure from it. As the High Court observed at 323 in Laurie, service was historically closely associated with jurisdiction and it had been assumed that the foundation of jurisdiction was physical power. That historical foundation is one of the reasons for the importance of personal service. The other is its foundations in natural justice.
[31] In that case, however, orders for substituted service were only sought under r 10.49 and Edelman J did not need to decide whether r 10.24 should be considered inapplicable in respect of foreign substituted service because it dispenses with the need to attempt service.
[32] In a number of decisions, this Court has concluded that orders for substituted service outside Australia may be made under r 10.24 where leave to serve out of the jurisdiction has been obtained under r 10.43: see Australian Competition and Consumer Commission v Kokos International Pty Ltd [2007] FCA 2035 at [18] per French J (in respect of the predecessor provisions); Humane Society International Inc v Kyodo Senpaku Kaisha Ltd [2007] FCA 124 (Humane Society) at [6]–[7] per Allsop J; Cmr of Taxation v Oswal [2012] FCA 1507; 91 ATR 684 at [32] per Gilmour J; Zeitouni at [60] per Katzmann J; and Australian Information Commission v Facebook Inc [2020] FCA 531; 144 ACSR 88 (AIC v Facebook ) per Thawley J at [66]. I consider it appropriate to follow those decisions. In any event, if r 10.24 were to be considered inapplicable in the circumstances of service outside Australia by reason of inconsistency with r 10.49, the Court would have power to make an order for substituted service under r 10.49 in equivalent circumstances by exercising power under r 1.34 to dispense with the requirement that personal service be attempted before substituted service can be effected: see, for example AIC v Facebook at [66] ; Connelly (liquidator), in the matter of CIMC Rolling Stock Australia Pty Ltd (in liq) v One Rail Australia (FLA) Pty Ltd (No 3) [2021] FCA 1183 (Connelly) at [72]–[74] per Downes J. In Park (at [18]), Edelman J considered that, while there may be instances where the power in r 1.34 could be exercised to dispense with the requirement under r 10.49 for personal service to be attempted, such instances are likely to be rare. His Honour went on to say (at [18]):
One rare example might be a case where there is real urgency for service and where the evidence suggests an impossibility or serious impracticability in service by the means contemplated in the Convention. This is not such a case, even taking into account the need for the Trustee to commence the bankruptcy process and the commencement, but current delay, in the public examination.
In Noco, continuing from that which is extracted above at [31]. Moshinsky J stated:
[17] In my view, the removal of the requirement of leave for service out of the jurisdiction (this being the main change to Div 10.4) does not affect the applicability of the reasoning in Facebook. Accordingly, I consider that the general substituted service rule (r 10.24) is available in a case involving service out of the jurisdiction. Further, consistently with the approach taken in Facebook at [66], if that were not the position, I would have ordered substituted service under r 10.49, with a dispensation from the implicit requirement to attempt service, for equivalent reasons to those set out below for making the order for substituted service under r 10.24.
[18] The principles relating to the making of an order for substituted service under r 10.24 were referred to in Facebook at [67]–[68]. Further, Thawley J made observations about the relevance of principles of comity in the context of service out of the jurisdiction: at [72]. I adopt those statements of principle and observations.
Prior to the amendment of the FCA Rules in early 2023, it appears that the question of the order in which matters should proceed where service was required outside of Australia (and therefore leave was required), was that it was not until:
(a)leave had been granted to serve documents outside of Australia; and
(b)attempts had unsuccessfully been made to serve those documents by a method under the Hague Convention;
that an application for substituted service would be heard by the Court, and orders made (if warranted).
It seems that the decisions which post-date Park do contemplate the possibility (and, in fact, have applied the FCA Rules in such a way) that the Court has a discretion to make orders for substituted service without service having first been unsuccessfully attempted, notwithstanding the fact that that service would ordinarily be required to take place in accordance with the Hague Convention.
The requirement for an order for substituted service, which in this Court is r 6.14 of the Rules, and in the general part of Part 10 of the FCA Rules is r 10.24, requires an impracticability to serve documents in a way which is otherwise required. In the specific facts and circumstances of this case, I am satisfied that it is not practical to serve the respondents by a method under the Hague Convention. That is because physical addresses for those respondents are not known, and I am satisfied that the applicants have taken sufficient steps to obtain those addresses, including, but not limited to specifically asking the respondents for them, which request was met by silence. There is also something to be said for the fact that in this day and age, provided a Court can be satisfied that an email address is an email address to which documents might come to a party’s attention that particularly in international matters, this might be the most practicable way of serving persons, in any event. Yet, the observations of Edelman J in Park (supra) at [16] remain applicable and I take into account the significance and strictness of conditions which pertain to service outside of Australia in accordance with the Hague Convention.
While respecting those strictures, in the present case, I am satisfied that orders for substituted service should be made because of the conclusion I have reached above about attempts of the relevant respondents to delay service.
As observed at [29] above, this Court has its own Rules for substituted service, such that it is not strictly necessary to look to the FCA Rules for a provision to rectify any incompleteness. However, it is more appropriate to make orders for substituted service under r 10.24 of the FCA Rules because of the effect of r 10.45 of the FCA Rules, which gives effect to the ability to apply other rules under Part 10 of the FCA Rules to serve a document on a person outside of Australia: see Ford (supra) at [26] per O’Bryan J.
Deemed service
Lastly, a question was raised by Counsel for the applicants today as to whether or not, if the Court was satisfied that substituted service was appropriate, the Court could simply make orders under r 10.48 of the FCA Rules deeming that service has already been effected based on the degree of satisfaction that the Documents have already come to the attention of the first, second and third respondents.
In the present case, I am not satisfied that an order deeming service would be appropriate. While I do not resile from my earlier observations that I am fully satisfied that the Documents have come to the attention of the relevant respondents, in the interests of alleviating any question of the effectiveness of any substituted service, it would be preferable for substituted service orders to be validly made and service effected in reliance on those valid orders.
Accordingly, I am of the view that it is preferable for the process of service by email to take place again, so that there can be no doubt that, under valid substituted service orders, the respondents have been served, and a timetable can be set afresh.
I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Given. Associate:
Dated: 13 May 2024
SCHEDULE OF PARTIES
SYG 1540 of 2023 Respondents
Fourth Respondent:
DAVID GIBSON
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