Buckley v Gibbett
[1996] FCA 836
•18 Sep 1996
CATCHWORDS
PRACTICE - cross-vesting - transfer of proceedings - transfer from Federal Court to Supreme Court of South Australia - whether proceedings related - whether transfer appropriate or in the interests of justice - evidence of impecuniosity of applicants and first respondent - relevance of video link facility in Federal Court - whether introduction of increased fees to Federal Court relevant
Corporations Act 1989
Corporations (South Australia) Act 1990
Corporations (Western Australia) Act 1990
Crown Proceedings Act 1992 (SA)
Fair Trading Act, s10
Fair Trading Act 1987 (SA), s56
Health Act 1911 (WA)
The Health (Food Hygiene) Regulations 1993 (WA)
Jurisdiction of Courts (Cross-Vesting) Act 1987
Sale of Goods Act (SA)
South Australian Timber Corporation Act 1979
Trade Practices Act 1974 (Cth), s52
Wrongs Act 1936 (SA)
Bankinvest AG v Seabrook (1988) 92 FLR 153
Bourke v State Bank of New South Wales (1989) 85 ALR 61
Cascade Group Ltd v Carlton United Breweries Ltd (1992) ATPR 41-172
Re Hamilton-Irvine (1990) 94 ALR 428
Harrison v Trewhella (1994) 13 WAR 394
Lamshed v Lamshed (1992) 35 FCR
GREGORY MAURICE BUCKLEY and BRISK SHAVINGS SUPPLIES PTY LIMITED (ACN 060 902 605) v KENNETH MAXWELL GIBBETT and BRISK SHAVINGS AUSTRALIA PTY LIMITED (ACN 060 902 614) and FORWOOD PRODUCTS PTY LIMITED (ACN 008 089 727) and SOUTH AUSTRALIA TIMBER CORPORATION and ABBOTT & ASSOCIATES PTY LIMITED (ACN 009 298 542) and STEPHEN HILTON ABBOTT
NO WAG 55 OF 1996
R D NICHOLSON J
PERTH
18 SEPTEMBER 1996
IN THE FEDERAL COURT OF AUSTRALIA )
WESTERN AUSTRALIA DISTRICT REGISTRY )
GENERAL DIVISION ) NO WAG 55 OF 1996
B E T W E E N: GREGORY MAURICE BUCKLEY
First Applicant
and
BRISK SHAVINGS SUPPLIES PTY LIMITED
(ACN 060 902 605)
Second Applicant
and
KENNETH MAXWELL GIBBETT
First Respondent
and
BRISK SHAVINGS AUSTRALIA PTY LIMITED
(ACN 060 902 614)
Second Respondent
and
FORWOOD PRODUCTS PTY LIMITED
(ACN 008 089 727)
Third Respondent
and
SOUTH AUSTRALIA TIMBER CORPORATION
Fourth Respondent
and
ABBOTT & ASSOCIATES PTY LIMITED
(ACN 009 298 542)
Fifth Respondent
and
STEPHEN HILTON ABBOTT
Sixth Respondent
MINUTE OF ORDER
JUDGE MAKING ORDER: R D NICHOLSON J
DATE OF ORDER: 18 SEPTEMBER 1996
WHERE MADE: PERTH
THE COURT ORDERS THAT:
1.The motion of the first and second respondents filed on 30 July 1996 be refused.
Paragraph 2 of the motion of the third and fourth respondents filed on 22 July 1996 be refused.
The applicants and the fifth and sixth respondents file and serve written submissions on costs within 7 days with a right to the remaining parties to reply within a further 7 days.
The matter be set down for directions on 10 October 1996 at 10.0am.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA )
WESTERN AUSTRALIA DISTRICT REGISTRY )
GENERAL DIVISION ) NO WAG 55 OF 1996
B E T W E E N: GREGORY MAURICE BUCKLEY
First Applicant
and
BRISK SHAVINGS SUPPLIES PTY LIMITED
(ACN 060 902 605)
Second Applicant
and
KENNETH MAXWELL GIBBETT
First Respondent
and
BRISK SHAVINGS AUSTRALIA PTY LIMITED
(ACN 060 902 614)
Second Respondent
and
FORWOOD PRODUCTS PTY LIMITED
(ACN 008 089 727)
Third Respondent
and
SOUTH AUSTRALIA TIMBER CORPORATION
Fourth Respondent
and
ABBOTT & ASSOCIATES PTY LIMITED
(ACN 009 298 542)
Fifth Respondent
and
STEPHEN HILTON ABBOTT
Sixth Respondent
CORAM:R D NICHOLSON J
DATE:18 SEPTEMBER 1996
PLACE:PERTH
REASONS FOR JUDGMENT
Motions are brought on behalf of the first and second respondents and on behalf of the third and fourth respondents seeking an order removing this action ("the Federal Court proceeding") to the Supreme Court of South Australia. The motion on behalf of the third and fourth respondents also sought an order that this action be tried with a proceeding in the Supreme Court of South Australia ("the South Australian proceeding"). However, it was accepted on their behalf that the motion was too broadly drawn in this respect and counsel for these parties undertook, if the transfer application was successful, to apply to the Supreme Court of South Australia for the two proceedings to be heard together. It is also agreed on behalf of the third and fourth respondents that a further motion brought by them for striking out certain allegations in the applicants' statement of claim does not presently fall for resolution.
Federal Court proceeding
The Federal Court proceeding was instituted by an application lodged on 17 May 1996. The statement of claim describes the first applicant as an accountant and as at all material times after 13 July 1993 a director and shareholder in the second applicant. The first respondent is claimed to have been at all such material times a director and shareholder in the second respondent. Both the second applicant and the second respondent are described as companies incorporated under the Corporations Act 1989 and the Corporations (Western Australia) Act 1990.
In contrast the third respondent is described at the material times as a company incorporated under the Corporations Act 1989 and the Corporations (South Australia) Act 1990. It is alleged to have carried on business under the name "Forwood Products". The fourth respondent is described as a corporation established pursuant to the South Australian Timber Corporation Act 1979. It is claimed that prior to 1 July 1993 it carried
on business selling timber and timber by‑products, inter alia, under the name Mt Gambier Pine Industries. It is claimed the business of the third respondent materially was an amalgamation of the businesses previously carried on by the Government of South Australia in the name of the Goods and Forests Department of South Australia and the South Australian Timber Corporation, namely the sale of timber and timber by-products.
The fifth respondent is described as a company incorporated under (inter alia) the Corporations (Western Australia) Act 1990 and carrying on the business of accountancy. The sixth respondent is described as an accountant employed by the fifth respondent and being a director of it who at all times acted as agent for and on behalf of the first and second respondents.
The claim then pleads:
"10.On a date or dates prior to 1 July 1993 the Fourth Respondent in response to an inquiry from the First Respondent represented to him that it could supply pine shavings free of toxins and dust being suitable for use in the packaging of live lobsters for export....
11.The Fourth Respondent knew and intended that the First Respondent would rely on the representations pleaded in paragraph 10 in purchasing shavings and commencing and carrying on business selling shavings to be used in the packaging of live lobsters for export.
12.In the circumstances in which the representations pleaded in paragraph 10 were made by the Fourth Respondent to the First Respondent the natural probable and foreseeable consequence of the making of the representations was that the First Respondent and/or persons acting on his behalf would repeat the substance of them to persons considering acquiring shavings for use in the packaging of live lobsters for export."
These paragraphs do not concern the applicants and involve the alleged making of representations by the fourth respondent to the first respondent. No particulars are given to par10 of the pleading, it being there stated that provision of particulars will be dependent upon discovery and interrogatories to be provided by the respondents.
Paragraphs 13 and 14 of the claim then address alleged representations by the sixth respondent to the first applicant. Paragraph 13 pleads representations made on or about 9 June 1993 in Mount Lawley in Western Australia. The heart of these pleaded representations is that the first respondent had been informed by Mt Gambier Pine
Industries a timber mill in Mt Gambier ("the Mill") could supply shavings for packaging of live lobster for export free of toxins and dust as well as clean and untainted.
Paragraph 14 pleads on or about the same date at the same place, the sixth respondent provided to the first applicant a document entitled "history". That document is alleged to have stated (inter alia) that timber used to produce the shavings required the first respondent in South Australia was not treated with any toxic chemicals so that the pine shavings supplied by the first respondent were a superior product because they contained no toxins.
The claim then turns to pleadings of representations said to have been made to the first applicant in South Australia.
Paragraph 15 pleads on or about 18 June 1993, at the home of the first respondent's mother in Adelaide, the first respondent stated to the first applicant (inter alia) that he had asked representatives of the Mill about the contents of chemicals in the shavings and had been assured they were chemically free. He otherwise is said to have repeated statements made by the sixth respondent pleaded in par13.
Paragraph 16 pleads on the same date at the same place the first respondent gave the first applicant another copy of the "history".
Paragraph 17 pleads on or about 4 July 1993 the first respondent stated to the first applicant at the first respondent's residence the shavings he supplied were toxin free and of a standard acceptable to the lobster industry.
The claim then turns to pleadings relating to reliance. In par18 it is pleaded that acting in reliance on the representations pleaded in pars10, 11, 13-17, the first applicant on or about 9 July 1993 entered into Heads of Agreement with the first respondent providing in effect for the parties to cause the second applicant and second respondent to be incorporated and enter into certain agreements. The effect of those agreements it is claimed, will be that the second respondent will purchase fine wood shavings ("shavings")
from the third respondent and supply them to the second applicant for use in the packaging of live lobsters for export from Western Australia. This pleading is developed further in pars19-26 in which it is claimed in particular that the first applicant agreed to cause the second applicant to pay $50,000 to the second respondent on signing of the agreement, which sum was paid on 9 July 1993, and that the first applicant caused the second applicant to acquire 11% of the capital of the second respondent for the same amount.
Then in par27 it is claimed that on or about 21 July 1993 the first applicant acting on behalf of the second applicant toured the Mill in the presence of the Customer Service Manager employed by the third respondent ("Hay") who advised the shavings were chemically treated but the treatment was so low the result was the shavings were considered chemically free.
Then in pars28 and 29 it is pleaded the first applicant, in reliance on the representations and matters pleaded in pars10‑17 and 27, paid $50,000 to the first respondent and loaned $50,000 to the second applicant for the purposes previously referred to in pars24 and 25 and incurred additional expenses.
The pleading of falsity of the representations is made in par32.
Three causes of action are then pleaded. The first appears in pars33 and 34 where it is said that each of the respondents in making the representations pleaded in pars10, 11, 13-17 and 27 owed a duty of care to the applicants to take reasonable care which was breached.
The second is pleaded in pars35-37 as a breach of contract. It is claimed that on or about 20 October 1993 the first respondent informed the first applicant he had been informed by the third respondent the shavings supplied by it had been treated with a substance described as "penta" and were therefore unsuitable for their purpose. The second respondent being unable to supply shavings which were suitable is said to have committed a repudiatory breach of Heads of Agreement. On or about 4 November 1993 it is
claimed the applicants elected to accept the repudiation and terminate the Heads of Agreement by giving oral notice to the first respondent.
The third cause of action is that the representations made by the respondents were misleading and deceptive conduct by the respondents within the meaning of s52 of the Trade Practices Act 1974 (Cth) and s10 of the "Fair Trading Act". The jurisdiction of origin of the latter act is not pleaded but the section reference means it can only be understood as a reference to the Western Australian Act.
Specific damages of $123,073 are sought together with general damages and interest as well as costs.
South Australian proceeding
On 16 November 1995 the first and second respondents as plaintiffs brought the South Australian proceeding against the third respondent and the State of South Australia as defendants. Although the second defendant as named is not a party to the Federal Court action, the claim makes apparent that the naming of the State is said to be pursuant to the provisions of the Crown Proceedings Act 1992 (SA) as the party liable for the acts and omissions of the fourth respondent.
For convenience and ease of cross-reference, the parties to the South Australian proceeding will be described in the manner in which they appear in the Federal Court proceeding and the second defendant in the South Australian proceeding will be described as the fourth respondent in the Federal Court proceeding.
The claim in the South Australian proceeding commences by alleging the fourth respondents supplied the first respondent with a large quantity of pinus radiata shavings between October 1992 and 30 June 1993 and similarly supplied the second respondent between 1 July 1993 and 22 October 1993. The first supply is alleged to have been pursuant to an agreement between the first and fourth respondents and, after 1 July 1993, as a novation by the substitution of the second respondent for the first respondent and the third for the fourth respondent.
The claim then moves to set up a claim in contract. The pleading (par8) is that at the time of the making of the agreement in October 1992 the first respondent expressly or by implication made known to the fourth respondent the particular purpose for which it required the shavings so as to show the first respondent relied upon the fourth respondent's skill, judgment and advice that the shavings were goods which it was in the course of the fourth respondent's business to sell. It is particularised that the first respondent expressly informed the servants and agents of the fourth respondent the shavings were to be onsold for use as packaging for the export of live crayfish from Western Australia and South Australia and so had to be processed without the use or addition of any chemicals which might be regarded as toxic or harmful either to the crayfish themselves or to their ultimate human consumers. In par9 it is pleaded it was an express or alternatively an implied condition of the agreement that the fourth respondent warranted the shavings supplied would be reasonably fit for the said purpose. Leaving aside the pleading related to novation, the claim then alleges breach of the agreement and of the conditions and warranties in that the shavings were not reasonably or at all fit for the purpose. The plaintiff relies on the provisions of the Sale of Goods Act (SA).
An alternative claim is then developed in pars14-18. The same representations are relied upon. It is claimed (par17) that the representations of the third and fourth respondents were false so that they contravened s56 of the Fair Trading Act 1987 (SA), the equivalent of s52 of the Trade Practices Act (Cth).
The claim then turns to pleading negligent misstatement. After setting up the relevant representations it is pleaded (par20) the third and fourth respondents breached a duty of care which they owed the first and second respondents in making and adopting and failing to correct the representations and warranties made by their servants and agents.
The plea for loss and damage (par21) claims the loss of the price paid; storing processing and distributing costs; loss of profits and damages in respect of liability of the first and second respondents to third parties for defective deliveries and inability to complete promised deliveries.
Relevant legislation
The motions invite the Court to exercise its jurisdiction arising under the Jurisdiction of Courts (Cross-Vesting) Act 1987 ("the Act"). It is common ground these proceedings can only be transferred to the Supreme Court of South Australia if one of the three criteria specified in s5(4)(b) of the Act is satisfied: Bourke v State Bank of New South Wales (1989) 85 ALR 61 at 76-7; Lamshed v Lamshed (1992) 35 FCR at 113. That section reads:
"Where:
(a)a proceeding (in this sub-section referred to as the "relevant proceeding") is pending in the Federal Court or the Family court (in this sub‑section referred to as the "first court"); and
(b)it appears to the first court that -
(i)the relevant proceeding arises out of, or is related to, another proceeding pending in the Supreme Court of a State or Territory and it is more appropriate that the relevant proceeding be determined by that Supreme Court;
(ii)having regard to -
(A)whether, in the opinion of the first court, apart from this Act and any law of a State relating to cross‑vesting of jurisdiction, the relevant proceeding or a substantial part of the relevant proceeding would have been incapable of being instituted in the first court and capable of being instituted in the Supreme Court of a State or Territory;
(B)the extent to which, in the opinion of the first court, the matters for determination in the relevant proceeding are matters arising under or involving questions as to the application, interpretation or validity of a law of the State or Territory referred to in sub‑sub‑paragraph(A) and not within the jurisdiction of the first court apart from this Act and any law of a State relating to cross‑vesting or jurisdiction; and
(C)the interests of justice,
it is more appropriate that the relevant proceeding be determined by that Supreme Court; or
(iii)it is otherwise in the interests of justice that the relevant proceeding be determined by the Supreme Court of a State or Territory,
the first court shall transfer the relevant proceeding to that Supreme Court."
Although it was initially contended on behalf of the third and fourth respondents there was no jurisdiction for any court to bring an action against them as emanations of the Crown in the right of the State of South Australia, it is now accepted on their behalf that issues of Crown immunity do not now arise.
Reliance was placed on behalf of all parties on the reasons for judgment in Bankinvest AG v Seabrook (1988) 92 FLR 153 particularly at 154 where Street CJ described the decision to be made as a "nuts and bolts" management decision as to which court, in the pursuit of
interests of justice, is the more appropriate to hear and determine the substantive dispute. I follow the majority in Bankinvest and Sheppard J in Cascade Group Ltd v Carlton United Breweries Ltd (1992) ATPR 41-172 in approaching the application of the section as involving a balancing of relevant factors rather than the discharge of an onus of proof. I do not consider the applicants' choice of forum is a factor to be weighed because the Act provides the tests which must be satisfied for a transfer to be made: cf Bourke at 78.
As to s5(4)(b)(i) - for one proceeding to arise out of another there must be a causal connection between them: Re Hamilton‑Irvine (1990) 94 ALR 428 at 432. For proceedings to be "related" they must be associated or connected with each other: Re Hamilton-Irvine at 433. Furthermore commonality of facts does not necessarily mean that proceedings are related or arise from other proceedings: Cascade.
It must also be the case under s5(4)(b)(i) that it is "more appropriate" that the proceeding be determined by the Supreme Court. The phrase "more appropriate" in this sub-section can be equated with "in the interest of justice" in s5(4)(b)(iii): Bankinvest at 170. What the Court must do is to look at the connecting factors when deciding if it is more appropriate or in the interest of justice to transfer a matter: Bankinvest at 168-9; and Harrison v Trewhella (1994) 13 WAR 394 at 403-4.
So far as concerns s5(4)(b)(ii), the matters to which the Court shall have regard are cumulative: Bourke at 177; Lamshed at 113. All matters referred to in s5(4)(b)(ii) must be satisfied.
I accept the submission made for the fifth and sixth respondents that s5(4)(b)(ii) cannot be satisfied in the present case because the Federal Court action was capable of being initiated in this Court in the absence of the Act. In considering the applicability of s5(4)(a) or (c) it is therefore necessary to consider the issues of the relationship between the Federal Court proceeding and the South Australian proceeding and the considerations of the interests of justice, which subsume the question of the appropriateness of the Federal Court proceeding being determined by the Supreme Court of South Australia.
Relationship of proceedings
In my opinion the Federal Court proceeding either "arises out of" or "is related to" the South Australian proceeding. For the fifth and sixth respondents it was contended the actions in each of the proceedings were essentially separate and discrete, the primary claim in the South Australian proceeding being said to be in contract.
However, close examination of each of the pleadings shows that at their heart they are related and that the Federal Court proceeding is pleaded in a way which occasions it to arise out of the circumstances in the South Australian proceeding. This is because the claims in the Federal Court proceeding in both negligence and Trade Practices rely not only on representations from parties to the applicants but also upon representations made by the fourth respondent to the first respondent, as pleaded in pars10 and 11 of the claim in the Federal Court proceeding. Furthermore, it is pleaded that the sixth respondent acting on behalf of the respondent acted as agent for and on behalf of the first and second respondents. It is at that point that the two proceedings are intrinsically linked.
The causes of action in each of the proceedings are also the same and it is not correct to characterise the primary claim in the South Australian proceeding as the claim in contract. Each of the proceedings involve claims in negligence, contract and Trade Practices or the Fair Trading Act equivalent.
Furthermore, all of the parties in the South Australian proceeding are respondents to the Federal Court proceeding.
While it is the case the Federal Court proceeding is more wide ranging than the South Australian proceeding in that it additionally involves the applicants and fifth and sixth respondents, the essential commonality of facts and of parties results in the requirements of relationship being satisfied. So long as the claims in respect of negligence and Trade Practices assert legal obligations between the first and second respondent and the applicants it is not the case that pars10, 11 and 12 in the Federal Court proceeding constitute mere verbiage having nothing to do with the applicants.
It is the case that the fifth and sixth respondents have no direct relationship with the South Australian proceeding. However, I do not consider the claims made in the Federal Court proceeding against those parties have the effect of depriving the Federal Court proceeding of its character of one which arises out of or is related to the South Australian proceeding.
Appropriateness and Interests of Justice
Factors submitted on behalf of the first to fourth respondents as arguably favouring the action being heard by the Supreme Court of South Australia are:
South Australia is the forum of real and substantial connection particularly because:
(a)the representations in the Federal Court proceeding alleged to have been made by the fourth to the first respondent are said to have occurred in South Australia;
(b)the representations said to have been made by the first respondent to the first applicant are said to have occurred in South Australia;
South Australia is where the first-fourth respondents carried on business;
South Australia is the place of the subject matter of the dispute being where the pine shavings concerned were produced and supplied, where the bulk of the alleged misrepresentations occurred and where the alleged breach of duty of care took place;
South Australia is favoured by some considerations of convenience and expense;
if there are to be any contribution proceedings between the first four respondents these should be determined under the Wrongs Act 1936 (SA);
the South Australian proceeding was commenced prior to the Federal Court proceeding;
one court should determine the substantive issues, the risk of inconsistent findings on the same factual issues being inappropriate and against the interests of justice;
any cross-claims by the first and sixth respondents against the third and fourth respondents will be facilitated by transfer to one court.
The evidence of the first respondent was that he and the second respondent have sustained direct financial losses exceeding $385,000 as a result of the contamination without regard to lost profits or income. His evidence is that he and his family have been left almost destitute save for anything he may recover as a result of the South Australian proceeding. He further deposes that as a consequence the only practical prospects of a successful recovery the first applicant may have against the first and second respondents depend upon a successful finding of liability against the third and fourth respondents. His evidence is also that he is currently on social security benefits and living only just within the limits of his resources to carry on the South Australian proceeding. His mother, who is a potential witness in the Federal Court proceeding, has recently had an illness akin to a stroke and any attendance by her in Western Australia may be detrimental to her health.
Factors which the applicants contend support no transfer are as follows:
(A)The only witnesses from South Australia apparently relied upon by the respondents are the first respondent, his mother and Hay who it is said could give evidence by video. However, this overlooks witnesses on behalf of the third and fourth respondents if the Federal Court proceeding or any portion of it is open to be maintained against those respondents.
(B)Transfer to South Australia may have the consequence that the first applicant would be unable to pursue his claim. His affidavit evidence is that he has limited resources as a consequence of putting everything into the business of the second respondent.
(C)The applicants are not parties to the South Australian proceeding and could not become such.
(D)The transfer of the proceeding would not necessarily result in the two proceedings being heard together so there would be no benefit or cost savings.
(E)It is asserted the draft Statement of Claim in this proceeding was provided to the respondents in South Australia on 22 September 1995 and nevertheless they elected to proceed in the Supreme Court of South Australia. There is evidence of the applicants having been informed of the South Australian proceeding.
(F)The applicants will lose control of the Federal Court proceeding and are concerned that the South Australian proceeding will be conducted with due diligence.
(G)In the circumstances the inference should be drawn that the conduct of the parties to the Supreme Court proceeding is consistent with an intention to shut out the applicants.
(H)The Federal Court has both the jurisdiction and the tools to provide for a video link which may be required to properly determine the Federal Court proceeding.
The respondents chose to do business in Western Australia and supply shavings there and so should be prepared to face litigation in Western Australia.
In his affidavit the first applicant deposes he is an accountant who is presently earning an income by working as a general handyman in Perth. His evidence is that he put virtually everything he owned into the business of the second respondent. Consequently he now has limited resources. He does not believe he could fund the action if it were transferred to South Australia.
In reply there is evidence of the first respondent, unanswered, that the first applicant's wife is an accountant gainfully employed as such.
In the case of both the first applicant and the first respondent there is evidence that if the matter is resolved contrary to their submissions they will be required to engage solicitors in their home State and in the jurisdiction in which the litigation is to be determined.
Factors which it is said make transfer inappropriate from the view point of the fifth and sixth respondents are:
(a)the applicants and the fifth and sixth respondents reside in and carry on business in Western Australia;
(b)the second respondent was incorporated in Western Australia;
(c)the alleged representations made by the sixth respondent and the pleadings relating to the fifth respondent concern matters allegedly made in Western Australia;
(d)the meetings with the fifth respondent were held in Western Australia;
(e)the heads of agreement document was drafted and signed in Western Australia;
(f)the agreement provided for the supply of wood shavings by the second respondent the second applicant in Western Australia for the packaging of live lobsters for export from Western Australia;
(g)part of the applicants' claim involves proof of contraventions of the Health Act 1911 (WA) and The Health (Food Hygiene) Regulations 1993 (WA);
(h)the applicants' expert witnesses and other witnesses reside in Western Australia;
the documents of the fifth and sixth respondents are located in Western Australia;
(j)a transfer to South Australia would result in an increase of and duplication of costs for the applicants and the fifth and sixth respondents; and
(k)the inconvenience of travelling to South Australia in order to prepare for and attend the trial would result in the sixth respondent being absent from his duties as an accountant and a director of the fifth respondent.
The evidence of the fifth respondent is that he and the sixth respondent will suffer prejudice if the Federal Court proceeding is transferred. The fifth respondent would be required to be absent from Western Australia and so from the business of the sixth respondent. I do not find the prejudice to him would be in the same order as the prejudice to both the first applicant or the first respondent if the motions were resolved contrary to their submissions.
It is accepted on behalf of the applicants and the first and second respondents that the fifth and sixth respondents stand in a somewhat special position. For the applicants it is maintained that the fifth and sixth respondents will be in a better position to cross-claim against the third and fourth respondents if the transfer is allowed. For the first and second respondents it is said there is no serious prejudice to these respondents in the transfer taking place.
On 1 September 1996 amendments to the Federal Court of Australia Regulations came into operation having the effect of introducing a revised and increased schedule of fees in respect of applications and hearings in the this Court. Following the hearing of this matter the parties were invited to consider whether and to what extent the introduction of these fees affected the applications for cross-vesting. The third and fourth respondents
declined to make further submissions. For the first and second respondents it was submitted that any prejudice claimed by the applicants in having to run their case in South Australia would be counterbalanced by the prejudice of having to pay the daily hearing fees if the matter proceeds in the Federal Court in Perth. However, for the applicants it was submitted the new fees would not affect the position because the cost involved in meeting them would be "a mere fraction" of the additional costs they would be obliged to meet if the action were transferred to the Supreme Court of South Australia. For the applicants it was again stressed that the evidence of the first applicant was that if the action was transferred to the Supreme Court of South Australia he did not consider he could continue to fund it. For the fifth and sixth respondents it was submitted the fees were irrelevant. I do not accept that submission because if the fees in the Federal Court are arguably materially higher than in the Supreme Court that could be relevant where the impecuniosity of the applicants is a factor raised on the evidence. In the light of the submissions on this aspect for the applicants, however, it is apparent they do not consider the advent of the fees creates any prejudice for them so the introduction of the fees is a neutral matter on this occasion.
The above factors show there is a counter balance between the following essential considerations. Firstly, favouring a transfer, is the interrelationship of the proceedings and the desirability of avoiding two courts determining the making and liability of representations said to have been made by the third and fourth respondents. Secondly, in favour of no transfer occurring, the serious issues of cost and convenience to the applicants and the first respondent if transfer is to occur, including a probability that the applicants may not be able to pursue their claims and the first respondent may not be able to defend the Federal Court proceeding.
In my opinion some of the potential prejudice to the first respondent in the motion being refused is capable of being avoided. It is open for arrangements to be made with the South Australian registry of the Federal Court for documents in the Federal Court proceeding to be filed there, for the first respondent, his mother and any further of his witnesses to give evidence by video link from the Adelaide registry. If the South Australian proceeding had been issued and pursued in the Federal Court it may have been
that it could have remained there with the Western Australian witnesses utilising video link facilities from Perth. However, that is not the case and there is no evidence of the existence of video link facilities in the Supreme Court of South Australia to enable that to occur if the motions were granted.
I find all the factors, both in their essentials and generally, fairly evenly balanced. However, the scope of the Federal Court proceeding and the impact which transfer would have on the applicants and the fifth and sixth respondents and the possibility of minimisation of prejudice to the first respondent by use of the Federal Court's video link facilities in respect of the Federal Court proceeding, in my opinion tip the balance against the making of the orders sought.
That will leave the overlapping issues to be dealt with by the doctrine of issue estoppel in one way or the other. It has not been shown why that would, in the circumstances, be inappropriate.
For these reasons I would refuse both motions for transfer.
I certify that this and the preceding 17 pages are a true copy of the Reasons for Judgment of his Honour Justice R D Nicholson.
Associate:
Date:18 September 1996
APPEARANCES
Counsel for the Applicant: Mr H Robinson
Solicitors for the Applicant: Haydn Robinson & Co
Counsel for the
1st and 2nd Respondents: Mr M Hoile
Solicitors for the
1st and 2nd Respondents: Herman Bersee
Counsel for the
3rd and 4th Respondents: Mr G Muecke
Solicitors for the South Australian Crown
3rd and 4th Respondents: Solicitors
Counsel for the
5th and 6th Respondents: Mr A Goldblatt
Solicitors for the
5th and 6th Respondents: Parker & Parker
Date of Hearing: 30 August 1996
Date of Judgment: 18 September 1996
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