Corrigan v Ridge and Associates Pty Ltd (Civil Dispute)

[2016] ACAT 114

ACT CIVIL & ADMINISTRATIVE TRIBUNAL

CORRIGAN v RIDGE & ASSOCIATES PTY LTD (Civil Dispute) [2016] ACAT 114

XD 228/2016

Catchwords:              CIVIL DISPUTE – jurisdiction of tribunal – breach of contract – exclusive jurisdiction clause in contract – whether a material part of the cause of action occurred in the ACT – whether the tribunal is an inconvenient forum to hear the matter

Legislation cited:      ACT Civil and Administrative Tribunal Act 2008 ss 16, 22, 32, 36

Magistrates Court Act 1930 s 262

Cases cited:Global Partners Fund Limited v Babcock & Brown Limited (in liq) and Ors (2010) 79 ACSR 383

Maxwell v Bedding (Australia) Pty Ltd [2016] ACAT 64
Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197
Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538

Tribunal:                   Senior Member H Robinson

Registrar K Soper

Date of Orders:  17 October 2016

Date of Reasons for Decision:         17 October 2016

AUSTRALIAN CAPITAL TERRITORY  )

CIVIL & ADMINISTRATIVE TRIBUNAL       )          XD 228/2016

BETWEEN:

BRENDAN CORRIGAN

Applicant

AND:

RIDGE & ASSOCIATES PTY LTD

Respondent

TRIBUNAL:   Senior Member H Robinson

Registrar K Soper

DATE:17 October 2016

ORDER

The Tribunal orders that:

1.The interim application for dismissal of the proceedings of the ground that the Tribunal lacks jurisdiction is dismissed.

………………………………..

Senior Member H Robinson

for and on behalf of the Tribunal

REASONS FOR DECISION

1.The Tribunal apologises to the parties for the delay in finalising this interim decision, and appreciates the parties’ patience during the period during which the decision was reserved.

2.The interim issue is whether the Tribunal has jurisdiction to hear this dispute, having regard to the localities in which the majority of the events happened. The parties agreed that this issue should be dealt with on an interim application basis before proceeding to a substantive hearing.

Background

3.A number of facts relevant to the interim application are not in dispute.

4.The applicant, Mr Corrigan, was engaged by the respondent to prepare a report for a native title matter (report). He was engaged on the project because another anthropologist had been unable to finish it. The parties agreed that the amount payable for the work was $4,000.00. The applicant finalised what he understood the work to entail and invoiced the respondent for the full $4,000. The respondent declined to pay the invoice on the basis that the work undertaken did not match the brief. The terms of the contract between the parties, including the description of the work to be undertaken, and the requirements for the report are the key issues in dispute.

5.The applicant seeks to recover the invoiced amount of $4,000. The respondent says it is not liable to pay, as the applicant is in breach of the contract between the parties, and has not delivered what he was required to do under the contract.

6.At the time of making the offer of engagement to the applicant, the respondent was based in New South Wales. At the time of receiving the offer, the applicant was resident in the Australian Capital Territory. The negotiations consisted of emails and telephone calls between the parties.

7.Amongst other things, an email from the respondent to the applicant contained a link to documents stored in a virtual ‘dropbox’. One of the documents in the dropbox was a brief that was addressed to the anthropologist who had been engaged on the project prior to the applicant (the brief). The respondent argues that, as the applicant was finalising the work of the other anthropologist, he must be taken to have agreed to the same terms. Significantly, the brief contained an ‘exclusive jurisdiction’ term, submitting to the exclusive jurisdiction of the law and courts of NSW.

8.Although the Applicant lived in the Australian Capital Territory, his ABN was at all relevant times registered in the Northern Territory. The respondent had understood, incorrectly, that the applicant lived in NSW. It is not, for the purposes of the interim application, in dispute that the applicant performed all the work under the agreement while residing, and being physically present, in the ACT.

The Jurisdictional Issue

9.The respondent says that there are three jurisdictional reasons why this matter cannot, or should not, proceed in the tribunal.

10.Firstly, the respondent argues that the terms of the exclusive jurisdiction clause in the brief apply. This clause provides:

24.           APPLICABLE LAW
a. This Agreement will be construed and take effect in accordance with the laws governing New South Wales.

b. We and the Consultant each submit to the jurisdiction of the Courts of New South Wales and this Clause may be pleaded as a bar to any action or suit brought in any Court in any other place.

11.While choice of law clauses of this nature are not always enforceable, in general courts will attempt to give effect to them, in accordance with the general rule that parties (at least in commercial settings) should be held to their contractual agreements.[1]   

[1] For example, Global Partners Fund Limited v Babcock & Brown Limited (in liq) and Ors (2010) 79 ACSR 383

12.The difficulty in this case is that applicant denies that the terms of the brief are incorporated into the contract, and especially denies that the exclusive jurisdiction clause is incorporated. Which party is correct can only be determined following a hearing of the substantive matter, after hearing evidence from the parties. It is neither appropriate nor possible for the Tribunal resolve the matter now, at an interim stage, with no testamentary evidence from either party about the existence of the clause. It is therefore not appropriate to dismiss the proceedings on the basis of the alleged exclusive jurisdiction clause.

13.Still, by proceeding in this forum, the applicant should be aware that there is a risk that the Tribunal will conclude that the exclusive jurisdiction clause is a term of the contractual relationship and consequently, the contractual arrangements are governed by the law and courts of NSW. If this were to happen, the Tribunal would be unable to finally determine the matter, and proceedings in this forum may be stayed or dismissed, perhaps late in the process, to enable proceedings to be commenced in another forum. This could incur additional costs or inconvenience to both parties.

14.The second basis for the respondent’s argument is that the claim does not fall within the tribunal’s statutory jurisdiction.

15.The tribunal is a creature of statute and its jurisdiction in determined solely by legislation. The tribunal’s jurisdiction to hear civil disputes is set out in Part 4 of the ACT Civil and Administrative Tribunal Act 2008 (ACT) (ACAT Act). A ‘civil dispute’ is defined in section 16 of the ACAT Act, relevantly, as follows:

Meaning of civil dispute and civil dispute application—Act
In this Act:

civil dispute means a dispute in relation to which a civil dispute application may be made.

civil dispute application means an application that consists of 1 or more of the following applications:

(a)   a contract application;

(b)...

16.This matter involves questions of contract law, which clearly fall within the definition of a ‘civil dispute’ for the purposes of the ACAT Act.

17.Section 22 of the ACAT Act then provides that:

22.Tribunal jurisdiction and powers of Magistrates Court

(1)The tribunal has, in relation to civil dispute applications, the same jurisdiction and powers as the Magistrates Court has under the Magistrates Court Act 1930 part 4.2 (Civil jurisdiction).

(2)However, a rule may prescribe provisions of the Magistrates Court Act 1930, part 4.2 that do not apply in relation to the tribunal.

18.There are no relevant rules within the meaning of clause 22(2). The relevant provision of the Magistrates Court Act is section 262, which provides that:

262   Cause of action arising, or defendant resident, outside ACT

The Magistrates Court has jurisdiction to hear and decide a proceeding if—

(a)   the defendant was resident in the ACT when the claim was served on the defendant, even though all of the cause of action in the proceeding arose outside the ACT; or

(b)            both of the following apply, even though the defendant is not in the ACT:

(i)a material part of the cause of action in the proceeding arose in the ACT, even though part of the cause of action arose outside the ACT;

(ii)the claim is served on the defendant in Australia or an external territory.

19.The respondent is not resident in the ACT, so section 262(1)(a) does not apply. Rather, regard must be had to section 262(b), and particular to the requirement in 262(b)(i) that a “material part of the cause of action in the proceeding arose in the ACT”.

20.There is limited case law that deals with what a “material part of the cause of action” is. In Maxwell v Bedding (Australia) Pty Ltd [2016] ACAT 64, the Tribunal had regard to the Macquarie Dictionary to concluded that that:

... it seems that to be a ‘material’ part of a cause of action, the relevant part need not be a major part, but it must relate to the claim, or have some consequence for it. Something of consequence for the claim must have happened in the ACT.[2]

[2] At [62]

21.Did a ‘material’ or ‘consequential’ parts of a cause of action in this case occur in the ACT?

22.The ‘cause of action’ in this case is a breach of contract. That a contract was formed is not in dispute. Rather, the issues relate to the terms of that contract and whether the parties have performed their obligations in compliance with those terms.

23.There is no real dispute that the performance of the contract took place primarily, if not exclusively, in the ACT. The performance of the contract (or the failure to perform) is a material part of the cause of action in this matter. Accordingly, the Tribunal is satisfied that the facts of this matter bring it within the ambit of section 262 of the Magistrates Court Act and within the Tribunal’s jurisdiction.

Forum non conveniens

24.Although not entirely clear, it appears that the respondent’s third ground is that, even if the Tribunal does have the jurisdiction to hear this matter, it should decline to do so for the reason that the ACAT is an inconvenient forum in which to litigate this matter – a forum non conveniens.

25.Courts have a general power to stay or transfer proceedings where they are a “clearly inappropriate forum”.[3]

[3] Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197; Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538

26.In Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 the High Court identified the relevant principles as follows:

First, a plaintiff who has regularly invoked the jurisdiction of a court has a prima facie right to insist upon its exercise. Secondly, the traditional power to stay proceedings which have been regularly commenced, on inappropriate forum grounds, is to be exercised in accordance with the general principle empowering a court to dismiss or stay proceedings which are oppressive, vexatious or an abuse of process and the rationale for the exercise of the power to stay is the avoidance of injustice between parties in the particular case. Thirdly, the mere fact that the balance of convenience favours another jurisdiction or that some other jurisdiction would provide a more appropriate forum does not justify the dismissal of the action or the grant of a stay. Finally, the jurisdiction to grant a stay or dismiss the action is to be exercised “with great care” or “extreme caution”.[4]

[4] at 554

27.It is not clear how broadly this discretion is available to the Tribunal, given the obligations the Tribunal has to hear matters, set out in section 36 of the ACAT Act as follows:

36 Applications to be heard

The tribunal must hear each application made to it unless the tribunal—

(a)   refuses to hear the application, or part of the application, or dismisses it; or

(b)   decides not to hold a hearing.

Note 1        The tribunal may refuse to hear an application, or part of an application, or dismiss it under s 32 (2) (a) and (b) and decide not to hold a hearing under s 54.

Note 2        The tribunal may make rules to facilitate the early resolution of matters arising in applications, including rules about referring an application to an agency that the tribunal considers is more appropriate to handle the application (see s 25 (1) (c)).

28.There is no express power in the ACAT Act to dismiss a matter because it may be more appropriately heard in another jurisdiction. There is, however, in section 32(1)(c) of the ACAT Act a power to dismiss a matter for an “abuse of process”, and it may be that where the Tribunal is so clearly an inappropriate forum as to meet the Voth test, proceeding in the Tribunal may amount to an abuse of process.

29.It is not necessary to decide in this case.  No doubt, the Tribunal may not be the most convenient forum to here this matter –the uncertainty over the terms of the contract and possible incorporation of the exclusive jurisdiction clause mean that New South Wales may be more convenient. However, the test of not whether NSW is more convenient, but whether the ACT is clearly inappropriate.  It is not. The applicant lives in this jurisdiction and the work under the contract was performed in this jurisdiction. The ACAT is a forum designed for cost effective determination of relatively low-value commercial disputes. There is nothing inherently inappropriate about the applicant commencing proceedings here – bearing in mind, of course, the risks in relation to the exclusive jurisdiction clause being found to have been a term of the agreement.

Conclusion

30.There is at present no basis for the granting of a stay or dismissing the application on jurisdictional grounds. The interim application is dismissed.

………………………………..

Senior Member H Robinson

for and on behalf of the Tribunal

HEARING DETAILS

FILE NUMBER:

XD 228/2016

PARTIES, APPLICANT:

Brendan Corrigan

PARTIES, RESPONDENT:

Ridge & Associates Pty Ltd

COUNSEL APPEARING, APPLICANT

N/A

COUNSEL APPEARING, RESPONDENT

N/A

SOLICITORS FOR APPLICANT

N/A

SOLICITORS FOR RESPONDENT

N/A

TRIBUNAL MEMBERS:

Senior Member H Robinson

Registrar K Soper

DATES OF HEARING:

8 April 2016