Coffee Guru Investments Pty Ltd v MTAA Superannuation Fund (121 Marcus Clarke Street) Pty Ltd
[2013] ACTSC 27
COFFEE GURU INVESTMENTS PTY LTD v MTAA SUPERANNUATION FUND (121 MARCUS CLARKE STREET) PTY LTD
[2013] ACTSC 27 (13 February 2013)
EQUITY – Retail and Commercial Tenancy – Application for Interlocutory Injunction – Continuation of injunction restraining termination and eviction – Applicant still occupying premises – Whether serious issue to be tried – Allegations of misrepresentations – No materials contesting allegations – A serious issue to be tried exists – Whether balance of convenience favours granting the injunction – Significant impact from eviction – Damages inadequate remedy – Personal undertaking as to damages provided by applicant – Balance of convenience favours granting injunction – Application granted
JURISDICTION, PRACTICE AND PROCEDURE – Retail and Commercial Tenancy – Application to remit proceedings to the Federal Court – Jurisdiction of Courts (Cross-Vesting) Act 1993 (ACT) – Proceedings of some urgency – Uncertainty as to when matter can be heard in ACT Supreme Court – Some certainty of an early hearing date in the Federal Court – In the interests of justice that the proceedings be dealt with at earliest opportunity – Application granted
JURISDICTION, PRACTICE AND PROCEDURE – Retail and Commercial Tenancy – Application to transfer proceedings to the ACT Magistrates Court – Proceedings of some urgency – Uncertainty as to when matter can be heard in ACT Supreme Court – Earlier hearing date likely in Magistrates Court – Some uncertainty about jurisdiction in Magistrates Court – Inappropriate to transfer proceedings where there may be some argument as to jurisdiction – Application to remit proceedings to the Federal Court already granted – Application refused
Jurisdiction of Courts (Cross-Vesting) Act 1993 (ACT)
EX TEMPORE JUDGMENT
No. SC 366 of 2012
Judge: Burns J
Supreme Court of the ACT
Date: 13 February 2013
IN THE SUPREME COURT OF THE )
) No. SC 366 of 2012
AUSTRALIAN CAPITAL TERRITORY )
BETWEEN: COFFEE GURU INVESTMENTS PTY LTD
Appellant
AND:MTAA SUPERANNUATION FUND (121 MARCUS CLARKE STREET) PTY LTD
Respondent
ORDER
Judge: Burns J
Date: 13 February 2013
Place: Canberra
THE COURT ORDERS THAT:
The application for an injunction, dated 16 November 2012, is granted.
The application that the matter be remitted to the Federal Court, dated 8 February 2013, is granted.
The application that the matter be transferred to the ACT Magistrates Court, dated 9 November 2012, is refused.
The costs of the applications are costs in the cause.
There are three applications before me today. There is an application in relation to the continuation of an injunction which has been made, as I understand it, unopposed up to this point. That application was initially made to the court on 19 November 2012 and resulted in an order being made restraining the defendant to the current proceedings from acting upon or taking any further step in relation to or reliance upon any demands and termination notices which are set out therein until such further order of the court.
There is, secondly, an application that the matter be transferred to the Magistrates Court, and thirdly an application that the matter be remitted to the Federal Court of Australia pursuant to the provisions of the Jurisdiction of Courts (Cross-Vesting) Act 1993 (ACT). I’ll deal with the question of the continuation of the injunction because it appears to me that that is the appropriate matter to commence with.
The Application for Continuation of Injunction
The plaintiff alleges misleading representations as to future matters in a negotiation for entering into a lease. The plaintiff entered into a lease with the defendant with respect to certain premises in the ACT on 29 July 2010. It is alleged by the plaintiff that certain representations were made to it prior to it entering into the lease. The amended statement of claim sets out five representations. I don’t need to refer to them in detail here. I note that no defence at this time has been filed denying the matters which are set out in the plaintiff’s pleadings, nor has any evidence been filed for the defendant dealing with the issues of fact that are raised in the pleadings.
It’s well accepted, of course, that in order to grant or to continue an interlocutory injunction, the court must be satisfied that there is a serious issue to be tried, and also must be satisfied that the balance of convenience favours the making or continuation of the injunction.
Mr Erskine, on behalf of the defendant, has suggested that this matter should be approached on the basis that it is, in reality, an application for a mandatory injunction as opposed to an interlocutory injunction. That is intermingled with the question of what the legal position is with respect to the lease which was entered into by the parties and also the remedies that may be available to the plaintiff if it is successful in the current proceedings.
In my opinion, it is appropriate to approach this matter on the basis that it is an interlocutory injunction and therefore the principles to which I have referred apply. I am satisfied that there is a serious issue to be tried. As I have noted, the allegation is that there were misleading representations made to the plaintiff by or on behalf of the defendant in the process of negotiating the lease. At the present time there is no material before me contesting those allegations. Therefore, I am satisfied that there is a real issue that the representations were made and that they were misleading.
The question then is whether the balance of convenience favours the continuation of the injunction. In that regard Mr Erskine submits that damages would be an adequate remedy with respect to any breach or any cause of action available to the plaintiff, were it to be proved. I do not accept that proposition.
At the present time and in the current state of the pleadings, it is alleged that the plaintiff intended to use the premises which were the subject of the lease as a flagship premises as it was in a process of franchising. It alleges that harm has already been done to it by reason of its inability to proceed with the process of franchising because of its financial position arising out of the alleged misrepresentations.
Mr Erskine has taken me to the affidavit of Mr Crowe of 19 December 2012, in which Mr Crowe refers to opportunities for franchising with respect to another company which is not a party to the current proceedings. However, I do note that Mr Crowe, in his affidavit of 17 November 2012, deposed to the truth of all of the allegations contained in the amended statement of claim of 15 November 2012, so that at the present time there is evidence before me by way of the affidavit of Mr Crowe deposing to the truth of those allegations; that Mr Crowe says that the plaintiff company was proposing to engage in some process of franchising with respect to the business that it was then undertaking.
I think that it may be inferred that a significant impact on the plaintiff’s ability to market any franchise would occur if it was to be effectively evicted from the premises, and particularly in circumstances where it was alleged that the reason for the eviction was an inability to pay its rent or other outgoings under the lease. If it transpires that the reason why the plaintiff was in arrears of rent was because of the misleading conduct of the defendant, that would work great injustice upon the plaintiff. In my opinion, the balance of convenience lies in maintaining the injunction.
The third issue which needs to be considered is that of the undertaking as to damages. In the light of the statement made by Mr Orlov that Mr Crowe, who is the motivating party with respect to the plaintiff company, will provide a personal undertaking as to damages in addition to the undertaking as to damages to be given by the plaintiff, then in my opinion I can be satisfied on the material before me that it is appropriate to continue the current interlocutory injunction.
The Applications to Transfer or Remit
Now we turn to the question of whether this matter should be transferred to the Magistrates Court or remitted to the Federal Court.
The basis for the application for transfer of the matter to the Magistrates Court or remittal to the Federal Court is the likelihood that either of those two jurisdictions will be able to give an earlier hearing date with respect to these proceedings than this court will be able to guarantee at the present time.
It appears unlikely that the matter will be able to be prepared so as to put it before the court during the period when Sidis AJ will be available. The Master will not be sitting between now and when he retires at the end of May this year, and it is unclear at the present time when a new Master will be appointed. As such, there is considerable uncertainty at the present time as to when matters such as this will be able to be listed before this court, because there is uncertainty about what resources will be available to this court and when they will become available.
I accept that it is in the interests of justice to have proceedings such as these dealt with at the earliest opportunity. On the material which is before me, it is clear that there is some certainty in an early hearing date being available in the Federal Court, whereas there can be no certainty about such a date being available in this court. In addition, there is some uncertainty about the question of jurisdiction in the Magistrates Court, such that it seems to me to be inappropriate to contemplate the transfer of these proceedings to the Magistrates Court where there may then be some further argument as to the jurisdiction of that court.
I am satisfied that it is in the interests of justice to remit this matter to the Federal Court, because that is the only way in which I can guarantee that this matter will obtain a hearing date commensurate with the urgency of proceedings of this nature and accordingly, that’s the order that I make.
Otherwise the application with respect to transfer to the Magistrate’s Court, of course, is refused.
I order that the costs of today be costs in the cause.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Justice Burns.
Associate:
Date: 25 February 2013
Counsel for the Plaintiff: Mr M Orlov
Solicitor for the Plaintiff: Kamy Saeedi Lawyers
Counsel for the Defendant: Mr C Erskine SC
Solicitor for the Defendant: Trinity Law
Date of Hearing: 13 February 2013
Date of Judgment: 13 February 2013
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