Casaceli v Natuzzi SPA

Case [2012] FCA 691

FEDERAL COURT OF AUSTRALIA

Casaceli v Natuzzi S.p.A. [2012] FCA 691

Citation: Casaceli v Natuzzi S.p.A. [2012] FCA 691
Parties: PETER ANGELO CASACELI, JANET CHRISTINE CASACELI, NATACELI PTY LIMITED (ACN 095 685 297) and CASACELI NOMINEES PTY LIMITED (ACN 125 141 157) AS TRUSTEE FOR THE CHATSWOOD PROPERTY TRUST v NATUZZI S.P.A. (ABN 86 544 745 364) (FORMERLY KNOWN AS INDUSTRIE NATUZZI S.P.A.), NATCD PTY LIMITED (ACN 055 640 983) and ILAN SKORNICKI
File number: NSD 396 of 2012
Judge: JAGOT J
Date of judgment: 29 June 2012
Catchwords: ARBITRATION – application for stay of proceeding pursuant to s 7(2) International Arbitration Act 1974 (Cth) – whether dispute involves a matter under the arbitration agreement ‘capable of settlement by arbitration’
Legislation:

Australian Consumer Law
Competition and Consumer Act 2010 (Cth)
Federal Court Rules 2011
International Arbitration Act 1974 (Cth)
Trade Practices Act 1974 (Cth)
Trade Practices (Industry Codes – Franchising) Regulations 1998 (Cth)

Convention on the Recognition and Enforcement of Foreign Arbitral Awards.  330 UNTS 3. (entered into force 10 June 1958)

Cases cited: Comandate Marine Corporation v Pan Australia Shipping Pty Ltd (2006) 157 FCR 45; [2006] FCAFC 192
Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR 160
Lake Cumbeline Pty Ltd & Ors v EFFEM Foods Pty Ltd (t/as Uncle Ben's of Australia) [1997] FCA 292
Lightsource Technologies Australia Pty Ltd v Pointsec Mitsubishi Motors Corp v Soler-Chrysler Plymouth Inc 473 US 614 (1985)
Mobile Technologies AB (2011) 250 FLR 63; [2011] ACTSC 59
Recyclers of Australia Pty Ltd v Hettinga Equipment Inc (2000) 100 FCR 420; [2000] FCA 547
Tanning Research Laboratories Inc v O'Brien (1990) 169 CLR 332
Terra Amata Ltd v Tensacciai Co (No 1897, 15 July 2006, Milan Court of Appeal)
Date of hearing: 21 and 22 June 2012
Date of last submissions: 28 June 2012
Place: Sydney
Division: GENERAL DIVISION
Category: Catchwords
Number of paragraphs: 54
Counsel for the Applicants: Mr M B J Lee SC and Mr C Bannan
Solicitor for the Applicants: Levitt Robinson Solicitors
Counsel for the First Respondent: Mr R M Smith SC and Mr J A C Potts
Solicitor for the First Respondent: Corrs Chambers Westgarth
Counsel for the Second and Third Respondents: Mr C G Roth of Charles G Roth & Co

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION

NSD 396 of 2012
BETWEEN:

PETER ANGELO CASACELI
First Applicant

JANET CHRISTINE CASACELI
Second Applicant

NATACELI PTY LIMITED (ACN 095 685 297)
Third Applicant

CASACELI NOMINEES PTY LIMITED (ACN 125 141 157) AS TRUSTEE FOR THE CHATSWOOD PROPERTY TRUST
Fourth Applicant
AND:

NATUZZI S.P.A. (ABN 86 544 745 364) (FORMERLY KNOWN AS INDUSTRIE NATUZZI S.P.A.)
First Respondent

NATCD PTY LIMITED (ACN 055 640 983)
Second Respondent

ILAN SKORNICKI
Third Respondent

JUDGE:

JAGOT J

DATE OF ORDER:

29 JUNE 2012

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.Proceeding NSD 396 of 2012, to the extent that the proceeding involves any claim as between the…

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AGLC
Casaceli v Natuzzi SPA [2012] FCA 691
Case
[2012] FCA 691
Decision Date

CaseChat Overview and Summary

In the Federal Court, Casaceli Nominees, its directors Mr and Mrs Casaceli, and Nataceli Pty Ltd filed a proceeding against Natuzzi SpA, Natuzzi SpA’s subsidiary Natcd Pty Ltd and Mr Skornicki, the managing director of Natcd Pty Ltd. The proceeding was filed after Natuzzi SpA terminated a Dealership Agreement between Natuzzi SpA and Nataceli Pty Ltd. The proceeding seeks various orders, including orders that the proceeding be stayed and the matters in dispute be referred to arbitration in accordance with an arbitration clause in the Dealership Agreement. Natuzzi SpA applied for the proceeding to be stayed and the matters in dispute to be referred to arbitration.
The court had to decide whether the proceeding must be stayed in whole or in part and the parties referred to arbitration in accordance with s 7(2) of the International Arbitration Act. The court found that the proceeding must be stayed and the matters in dispute referred to arbitration. The court held that the proceeding involved the determination of a matter that was capable of settlement by arbitration. The court held that the matter in dispute concerned a defined legal relationship between the parties, and concerned a subject matter capable of settlement by arbitration. The court held that the matter was within the scope of the arbitration clause in the Dealership Agreement.

The court stayed the proceeding and referred the parties to arbitration in accordance with the arbitration clause in the Dealership Agreement. The court ordered that the proceeding be stayed to the extent that the proceeding involved any claim as between the third applicant and first respondent. The court ordered that the proceeding otherwise be stayed pending the outcome of the arbitration of the matter. The court ordered that Casaceli Nominees pay Natuzzi SpA’s costs of the interlocutory application filed on 30 March 2012 as agreed or taxed.

Orders

Orders of the court

1. Proceeding NSD 396 of 2012, to the extent that the proceeding involves any claim as between the third applicant and first respondent (the matter), be stayed and the matter be referred to arbitration in accordance with Article 27 of the agreement between the third applicant and first respondent entered into on 22 January 2002 and styled the Dealership Agreement.

2. Proceeding NSD 396 of 2012 otherwise be stayed pending the outcome of the arbitration of the matter.

3. The third applicant pay the first respondent’s costs of the interlocutory application filed on 30 March 2012 as agreed or taxed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The issue in this case is whether the proceeding must be stayed in whole or part and the parties referred to arbitration in accordance with s 7(2) of the International Arbitration Act 1974 (Cth) (the International Arbitration Act). Section 7(2) provides as follows:(2)Subject to this Part, where: (a)proceedings instituted by a party to an arbitration agreement to which this section applies against another party to the agreement are pending in a court; and (b)the proceedings involve the determination of a matter that, in pursuance of the agreement, is capable of settlement by arbitration; on the application of a party to the agreement, the court shall, by order, upon such conditions (if any) as it thinks fit, stay the proceedings or so much of the proceedings as involves the determination of that matter, as the case may be, and refer the parties to arbitration in respect of that matter. By s 3(1) of the International Arbitration Act “arbitration agreement” means an agreement in writing of the kind referred to in sub-article 1 of Article II of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted in 1958 by the United Nations Conference on International Commercial Arbitration at its twenty-fourth meeting (the Convention). Sub-article 1 of Article II of the Convention provides that:Each Contracting State shall recognize an agreement in writing under which the parties undertake to submit to arbitration all or any differences which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration. The respondents contend that the proceeding does not involve the determination of a matter that, in pursuance of the arbitration agreement, is capable of settlement by arbitration. To understand the dispute between the parties it is necessary to explain the circumstances which have led to the proceeding.RELEVANT CIRCUMSTANCESDealership agreement On 22 January 2002 two companies, Industrie Natuzzi S.p.A. (a company incorporated under Italian law) (Natuzzi SpA) and Nataceli Pty Ltd (a company incorporated under Australian law) (Nataceli) entered into an agreement styled the “Dealership Agreement”. Under the Dealership Agreement Natuzzi SpA agreed that Nataceli should have exclusive rights to sell certain products in New South Wales and the Australian Capital Territory. Originating application By early 2012 the commercial relationship between Natuzzi SpA and Nataceli appears to have broken down. Natuzzi SpA gave Nataceli notice terminating the Dealership Agreement on 2 March 2012. On 12 March 2012 Nataceli, its directors Mr and Mrs Casaceli and a trustee company controlled by Mr and Mrs Casaceli known as Casaceli Nominees Pty Ltd as Trustee for the Chatswood Property Trust (Casaceli Nominees) filed an originating application in this court against Natuzzi SpA and another company Natcd Pty Ltd (Natcd) as well as the managing director of that other company, Mr Skornicki.