Bedshed Franchising Pty Ltd v Global International Logistics Pty Ltd
[2014] WASC 336
•19 SEPTEMBER 2014
BEDSHED FRANCHISING PTY LTD -v- GLOBAL INTERNATIONAL LOGISTICS PTY LTD [2014] WASC 336
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2014] WASC 336 | |
| Case No: | CIV:1477/2014 | 12 SEPTEMBER 2014 | |
| Coram: | ALLANSON J | 19/09/14 | |
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Application allowed in part | ||
| B | |||
| PDF Version |
| Parties: | BEDSHED FRANCHISING PTY LTD GLOBAL INTERNATIONAL LOGISTICS PTY LTD |
Catchwords: | Practice and procedure Discovery of particular categories Turns on own facts |
Legislation: | Rules of the Supreme Court 1971 (WA) |
Case References: | Nil |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
GLOBAL INTERNATIONAL LOGISTICS PTY LTD
Defendant
Catchwords:
Practice and procedure - Discovery of particular categories - Turns on own facts
Legislation:
Rules of the Supreme Court 1971 (WA)
Result:
Application allowed in part
Category: B
Representation:
Counsel:
Plaintiff : Mr D H Solomon
Defendant : Mr N W Kalmund
Solicitors:
Plaintiff : Solomon Brothers
Defendant : Hotchkin Hanly
Case(s) referred to in judgment(s):
Nil
1 ALLANSON J: This matter is still at a comparatively early stage. Pleadings have closed and the parties propose to discover specified categories of documents for the purpose of discovery before mediation. Many of the proposed document categories are agreed. The plaintiff, however, seeks discovery of six categories of documents ([3] - [8] in the plaintiff's minute of proposed categories dated 11 September 2014) which are not agreed.
2 The six categories are listed in the minute of proposed categories under the heading 'Knowledge of terms of franchise agreement'. The plaintiff justifies the request by reference to the following plea.
3 The plaintiff is a party to franchise agreements with a number of franchisees (the Bedshed franchisees). Relevantly, those agreements:
(1) Are not uniform but are pleaded to fall within three groups: the Version 4 and 5 Franchise Agreements; the Version 6 and 7 Franchise Agreements; and the Version 8 Franchise Agreements.
(2) In or about 2008, the Bedshed franchisees commenced proceedings against the plaintiff with respect to the 'Bedshed Import Programme' in those agreements. The proceedings were settled in about September 2010 on terms which included varying the franchise agreements.
(3) Under the agreements as varied: either the plaintiff or the Bedshed franchisees could import products from overseas; Bedshed franchisees were not obliged to buy imported products from the plaintiff; and the plaintiff would cease operating the Bedshed Import Programme within 60 days, and was not obliged to offer an import programme to its franchisees or operate an import programme (statement of claim (SOC) [8.1] - [8.3]).
4 The agreement between the plaintiff and its franchisees, however, still included provision for the selection of an 'Approved Product Range' and 'Approved Suppliers'. Further, the plaintiff and the body representing franchisees would appoint 'Import Facilitators'. An appointed Import Facilitator was required to enter into an arrangement with the plaintiff (SOC [8.5] - [8.6]).
5 Further, the plaintiff pleads an implied term, implied to give business efficacy to the agreement, that franchisees must source the majority of imported products from Approved Import Facilitators (SOC [10]).
6 The plaintiff further pleads that, on its proper construction, the varied franchise agreement permits franchisees to jointly import products with the plaintiff, but not to import them other than jointly with the plaintiff (SOC [11]). Further, each imported product must be an Approved Product, the supplier must be an Approved Supplier, and the product must be either acquired directly from the supplier, or by an Approved Import Facilitator (SOC [11.3]).
7 There is an alternative plea in par 12 that, on its proper construction, a franchisee may import products, other than jointly with the plaintiff, but subject to the same restrictions. In particular, franchisees must not acquire products from a non-approved Import Facilitator who is not an Approved Supplier (SOC [12.2]).
8 The plaintiff alleges (among other things) that the defendant has tortiously interfered with the contractual relations between the plaintiff and its franchisees by persuading, inducing, or procuring franchisees to acquire imported products from the defendant who is not an Approved Supplier or an Approved Import Facilitator (SOC [27]). It alleges that the defendant has so tortiously acted in circumstances where:
(1) In about September 2010, the plaintiff and the defendant made an oral agreement that the plaintiff would authorise the defendant to facilitate the importation of Approved Products for a fee (SOC [13]).
(2) On or about 25 September 2012, the plaintiff and the defendant entered into a written Import Facilitator Agreement under which the plaintiff authorised the defendant to facilitate the importation of Approved Products (SOC [15]).
(3) The defendant terminated the Import Facilitator Agreement by notice to the plaintiff, with the agreement ending on 15 July 2013 (SOC [17] - [18]).
(4) The defendant has agreed to sell or supply imported products to the Bedshed franchisees, and further, or alternatively, has offered to continue to sell or supply imported products at a discount, after the termination of the Import Facilitator Agreement.
9 An element of the tort alleged is that the defendant has knowledge of the contract and the intent to prevent or hinder its performance. The plaintiff pleads knowledge in pars 22 - 24 of the SOC. In effect, it pleads that the defendant knew that the agreement between the plaintiff and its franchisees permitted franchisees to acquire imported products only from Approved Suppliers or Approved Import Facilitators; to acquire the majority of their imported products from an Approved Import Facilitator (that is, it had knowledge of the implied term); and did not permit franchisees to acquire products from a non-approved Import Facilitator.
10 It is in these circumstances that the plaintiff seeks discovery of the categories of documents in pars 3 - 8 of the minute of proposed categories:
3. All documents containing or recording or referring to negotiations for, and entry into, the 2002 Supplier Agreement.
4. All documents concerning or referring to FCD commencing to supply Bedshed Franchising and Bedshed franchisees or any of them in or about 2006.
5. All documents concerning or referring to GIL commencing to supply, or facilitate the importation of products for, Bedshed Franchising and Bedshed franchisees or any of them in or about September 2010.
6. All documents containing or recording or referring to negotiations for, and entry into, the Import Facilitator Agreement.
7. All documents concerning or referring to or relating to the revised Supplier Agreements emailed to AFI and FCD in or about May 2011.
8. All documents:
8.1. providing or concerning or referring to Bedshed Franchising's Approved Product Grid;
8.2. giving notice that, or referring to the fact that, certain products supplied by:
8.2.1. AFI and FCD or either or them; and
8.2.2. other overseas or domestic suppliers,
are approved or non-approved;
8.3. giving notice that, or referring to the fact that, certain suppliers are approved or non-approved.
12 First, where the plaintiff relies on the terms of an agreement made or varied in September 2010, in settlement of the dispute with its franchisees, and in particular where it relies on an implied term in that agreement, I am not satisfied that it has made out a case for the relevance of documents relating to the earlier agreements in pars 3 and 4.
13 Second, it is not apparent on the pleadings or the material before me what the acronym FCD stands for.
14 Third, the breadth of the categories in pars 5, 6, and 7 far exceeds documents relevant to the knowledge of the defendant of the terms of the agreement between the plaintiff and its franchisees. Discovery by reference to categories, as sought by the plaintiff, can be more onerous than discovery under the longstanding principles governing the interpretation of O 26 r 1 of the Rules of the Supreme Court 1971 (WA). It may be possible for the plaintiff to craft its description of the category of relevant documents more precisely so as to limit the documents sought to the issue of knowledge. But unless the plaintiff does so, particularly where it is agreed between the parties that this tranche of discovery is for the purpose of allowing an effective mediation, I am not satisfied that the resources and cost required to discover these categories of documents are proportionate to the end to be achieved.
15 The category of document described in par 8 is more closely defined, and the category is so described that I am satisfied those documents are relevant to the issue of knowledge.
16 I would order discovery of documents in par 8 (together with those categories which are not in dispute) but otherwise dismiss the application for discovery.
17 Should the matter proceed beyond mediation, consideration will have to be given to the joining of the relevant franchisees.
0
0
1