DTS Automotive Group Pty Ltd v GAH Engineering Pty Ltd
[1990] FCA 325
•29 JUNE 1990
Re: DTS AUTOMOTIVE GROUP PTY LTD
AND: GAH ENGINEERING PTY LTD; PETER GORDON BEEHAG; PATRICIA ANN BEEHAG and
BRIDGESTONE AUSTRALIA LTD
No. ACT G59 of 1989
FED No. 325
Practice and Procedure
COURT
IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY
GENERAL DIVISION
Neaves J.(1)
CATCHWORDS
Practice and Procedure - Claim for specific performance of agreement for the sale of a business being carried on in Queensland and for the assignment of a lease of land in that State and for damages for breach of contract - Claim also for damages for alleged contravention of provisions of Trade Practices Act 1974 (Cth) - Proceeding commenced in Australian Capital Territory Registry of the Court - Application that proceeding be conducted or continued at Brisbane in the State of Queensland - Application refused - Proceeding transferred by the Court of its own motion to the Supreme Court of Queensland.
Federal Court of Australia Act 1976 (Cth), s.48
Jurisdiction of Courts (Cross-vesting) Act 1987 (Qld), s.4
Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth), sub-ss.5(4), 9(2)
HEARING
CANBERRA
#DATE 29:6:1990
Counsel and solicitors for DTS Automotive Group Pty Ltd: Mr R Blowes instructed by Macphillamy and Co. Pty Ltd
Counsel and solicitors for GAH Engineering Pty Ltd, Peter Gordon Beehag and Patricia Anne Beehag: Mr S Wilcox instructed by Snedden Hall and Gallop as agents for Nicol Robinson and Kidd
Counsel and solicitors for Bridgestone Australia Ltd: Mr D Galbraith of the firm of Abbott Tout Russell Kennedy
ORDER
1. The motion notice of which is dated 9 December 1989 be dismissed.
2. Pursuant to the provisions of sub-s.5(4) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth), the proceeding pending in this Court in which DTS Automotive Group Pty Ltd is the applicant and GAH Engineering Pty Ltd is the first respondent, Peter Gordon Beehag is the second respondent, Patricia Anne Beehag is the third respondent and Bridgestone Australia Ltd is the fourth respondent and which is numbered ACT G59 of 1989 be transferred to the Supreme Court of Queensland.
3. The costs of the motion be costs in the cause.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
JUDGE1
This is an application by motion on notice by GAH Engineering Pty Ltd, Peter Gordon Beehag and Patricia Anne Beehag for a direction under s.48 of the Federal Court of Australia Act 1976 (Cth) that a certain proceeding pending in the Australian Capital Territory District Registry of this Court be conducted and continued at Brisbane in the State of Queensland. That proceeding, which is numbered ACT G 59 of 1989, was commenced by application filed on behalf of DTS Automotive Group Pty Ltd ("DTS Automotive") on 18 October 1989. The respondents to the proceeding are GAH Engineering Pty Ltd ("GAH Engineering"), Peter Gordon Beehag, Patricia Anne Beehag and Bridgestone Australia Ltd ("Bridgestone").
It appears from the amended statement of claim filed on 21 December 1989 that DTS Automotive alleges that on or about 31 May 1989 it validly exercised an option reserved to it under an agreement made between it and GAH Engineering on 4 May 1989 for the purchase from the latter company of a tyre retailing business conducted by that company at 2928 Pacific Highway, Underwood, Queensland on the terms and conditions set out in an identified agreement for sale. It is alleged that GAH Engineering failed and refused to complete the agreement for sale and to carry out its obligations thereunder. It is further alleged that GAH Engineering breached certain warranties given by it in the agreement for sale. A further allegation is that, in the course of negotiations for the granting of the option and prior to the exercise of it, GAH Engineering and Mr and Mrs Beehag as directors of GAH Engineering made representations to DTS Automotive which were false and that those representations induced DTS Automotive to enter into the option agreement and to exercise the option. The representations alleged to have been made include a representation that the lease over the premises on which the business was conducted was in the name of GAH Engineering, that the relevant business name was registered in the name of that company and that there was no legal or other impediment to the transfer or assignment of the lease of the premises and the business name.
It is alleged against Bridgestone that it induced GAH Engineering not to perform its obligations under the agreement for sale or, alternatively, that it prevented or hindered such performance. It is further alleged against Bridgestone that, in concert with GAH Engineering and Mr and Mrs Beehag and in contravention of s.45D(1A) of the Trade Practices Act, it engaged in conduct for the purpose and having the effect of preventing DTS Automotive from engaging in trade or commerce.
DTS Automotive seeks various declarations and orders. The principal claim as against GAH Engineering is for an order for the specific performance by that company of the agreement for sale so far as the same remains to be performed, it being asserted that DTS Automotive is and always has been ready, willing and able to perform the agreement. Damages in substitution for an order for specific performance are sought in the event of such an order being withheld. An alternative claim is made for a declaration that DTS Automotive is absolved from future performance under the agreement for sale and for consequential damages. Damages are also sought against GAH Engineering for breaches of ss.52 and 53A of the Trade Practices Act 1974 (Cth) and against Bridgestone for a breach of s.45D (1A) of that Act.
The amended statement of claim bears the following endorsement pursuant to Order 10A, rule 5 of the Federal Court Rules -
"The applicant relies upon section 4(2) of the Jurisdiction of Courts (Cross-vesting) Act 1987 of the Commonwealth in respect of the claims made in this statement of claim other than those made under Trade Practices Act 1974, on the grounds that those claims, apart from the Jurisdiction of Courts (Cross-vesting) Act 1987 would have been capable of being instituted in the Supreme Court of Queensland."
DTS Automotive did not, however, as required by that rule, seek directions on whether the proceeding should be transferred under the Jurisdiction of Courts (Cross-vesting) Act.
There would appear to be some inconsistency between, on the one hand, the allegation in the amended statement of claim that DTS Automotive is and always has been ready, willing and able to perform the sale agreement and, on the other, the seeking by that company of a declaration, presumably on bases which include the alleged making by GAH Engineering of the false representations referred to above, that DTS Automotive is absolved from further performance under the agreement. However, in the light of the orders which I propose to make, I need not pursue the matter further.
GAH Engineering and Mr and Mrs Beehag have sought further and better particulars of certain of the matters alleged by DTS Automotive. On 24 January 1990 a defence to the amended statement of claim was filed on their behalf. In essence, the defence disputes that any binding agreement for the sale of the business came into existence and asserts that, although an option agreement was entered into, the exercise of the option thereunder was subject to certain conditions which were not, in the event, fulfilled, and, further, that the option was not exercised in the manner and within the time stipulated in the option agreement. The defence also denies that any of the representations alleged in the amended statement of claim were made and denies any liability to DTS Automotive as alleged.
No defence has been filed on behalf of Bridgestone although the prescribed time for doing so has expired. That company, while supporting the present application, took no active part in the hearing.
The application is supported by the two several affidavits of Peter Gordon Beehag sworn 27 November 1989 and 8 February 1990. DTS Automotive relies upon the affidavit of Gordon Patrick Smith sworn 2 February 1990. Counsel for GAH Engineering and Mr and Mrs Beehag referred to what was said by a Full Court of this Court in National Mutual Holdings Pty Ltd v. The Sentry Corporation (1988) 19 FCR 155 in relation to the test to be applied in determining an application under s.48 of the Federal Court of Australia Act and submitted that, taking into account the interests of all parties, the ends of justice in the determination of the issues between them, and the most efficient administration of the Court, the substantive proceeding could be conducted or continued most suitably in Brisbane. He referred, in particular, to the following circumstances as supporting the submission:
(a) The business the subject of the proceeding is operating from premises in a suburb of Brisbane;
(b) The lessor of those premises is resident in Queensland;
(c) The business name under which the business operates is registered in Queensland;
(d) Mr and Mrs Beehag reside in Queensland;
(e) GAH Engineering and Mr and Mrs Beehag are advised by legal advisers in Brisbane;
(f) DTS Automotive carries on business in Queensland although its principal place of business is in the Australian Capital Territory:
(g) The option agreement was signed by GAH Engineering and Mr and Mrs Beehag in Brisbane;
(h) The communications leading to the making of the option agreement were by facsimile transmission and by telephone between the parties in Brisbane and Canberra.
Counsel conceded that the weight to be attached to some of those factors was, to put it at its highest, minimal. Counsel also said that he could not point to a predominance of the witnesses likely to be required to give evidence as being resident in any one place.
Counsel for DTS Automotive opposed the application. He referred to the judgment of a Full Court of this Court in National Mutual Holdings Pty Ltd v. The Sentry Corporation (14 April 1989 - unreported) and submitted that the venue chosen by DTS Automotive could not be said to have been chosen capriciously and that no sufficient reason had been advanced to warrant the making of the order sought.
During the course of the hearing the Court, of its own motion, raised with the parties the question whether the proceeding should, pursuant to the provisions of sub-s.5(4) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth), be transferred to the Supreme Court of Queensland. Counsel for DTS Automotive opposed the making of any such order. Counsel for GAH Engineering and Mr and Mrs Beehag submitted that the proceeding could more appropriately have been commenced in the Supreme Court of Queensland and that that Court should be regarded as the preferred forum. Counsel for Bridgestone made no submission in relation to the question. The parties were afforded an opportunity to supplement by written submissions what had been said during the course of the hearing. That opportunity was not taken up by any party.
It is common ground that the case which DTS Automotive seeks to make, except in so far as it includes a claim based on the alleged contravention of ss.52 and 53A of the Trade Practices Act, would not fall within the jurisdiction of this Court but for the provisions of s.4 of the Jurisdiction of Courts (Cross-vesting) Act 1987 of the State of Queensland and sub-s.9(2) of the Jurisdiction of Courts (Cross-vesting) Act 1987 of the Commonwealth. Section 4 of the State Act provides that the Federal Court has and may exercise original jurisdiction with respect to State matters, an expression defined in sub-s.3(1) to mean a matter in which the Supreme Court of Queensland has jurisdiction otherwise than by reason of a law of the Commonwealth or of another State. Sub-section 9(2) of the Commonwealth Act provides that the Federal Court may exercise jurisdiction conferred on it by a provision of a law of a State relating to cross-vesting of jurisdiction. The Supreme Court of Queensland, on the other hand, has jurisdiction, apart from the Jurisdiction of Courts (Cross-vesting) Act of the Commonwealth, to entertain the proceeding, its jurisdiction to determine the claim in so far as it relies upon the Trade Practices Act being conferred by s.86 of that Act.
Sub-section 5(4) of the Commonwealth Act provides:
"(4) 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 of 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."
The provisions of par (a) of sub-s.5(4) of the Commonwealth Act are satisfied. Sub-paragraph (b)(i) has no application as there is no relevant proceeding pending in the Supreme Court of Queensland. The question is whether it appears to the Court that it is more appropriate or otherwise in the interests of justice within the meaning of those expressions in sub-pars (b)(ii) and (b)(iii) of sub-s.5(4) of the Commonwealth Act that the proceeding be determined by the Supreme Court of Queensland. If it so appears to this Court, the legislation requires that the proceeding be transferred to that Court.
As Northrop J. said in Mansell v. Cumming (1989) 86 ALR 637 at p 643:
"It is important that the Federal Court does not use the State cross-vesting legislation to deprive State Supreme Courts of their traditional jurisdiction."
Here, the principal issue between the parties is whether a binding agreement was made between GAH Engineering and DTS Automotive for the sale of a business being carried on in Queensland and the assignment of a lease of land situate in that State. DTS Automotive asserts that it did; GAH Engineering asserts to the contrary. The primary relief which DTS Automotive seeks is specific performance of such agreement. Other relief is sought on the basis that such an agreement was made between the parties and GAH Engineering is in breach of its terms giving rise to an entitlement in DTS Automotive to damages. The allegations that contraventions of ss.52, 53A and 45D(1A) of the Trade Practices Act have occurred are clearly subsidiary to the principal issue in the case. The circumstance that those allegations are made provides, in my view, no sufficient foundation for allowing a proceeding which is essentially one within the traditional jurisdiction of the Supreme Court of Queensland to be continued in this Court. It has not been suggested that there is any juristic advantage to the applicant in having the matter heard in the Australian Capital Territory. The circumstance that a hearing of the matter in the Supreme Court of Queensland may necessitate a number of persons travelling from Canberra to Brisbane to confer with counsel or to give evidence in the proceeding on behalf of DTS Automotive provides no sufficient justification for retaining the matter in this Court. The matter is eminently one to be determined by the Supreme Court of Queensland.
I, therefore, order that the motion notice of which is dated 9 December 1989 be dismissed. I further order, pursuant to sub-s.5(4) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth), that the proceeding be transferred to the Supreme Court of Queensland. In all the circumstances, it is appropriate that the costs of the motion be costs in the cause.
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