Eagle v Delta Haze Corporation - [2000] VSC 513

SUPREME COURT OF VICTORIA	Do not Send for Reporting
COMMERCIAL AND EQUITY DIVISION	Not Restricted

COMMERCIAL LIST

No. 2117 of 1999
F5109

Robert Lindsay Eagle	Plaintiff
v
Delta Haze Corporation	Defendant

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JUDGE:	Mandie J
WHERE HELD:	Melbourne
DATE OF HEARING:	17, 20 November 2000
DATE OF JUDGMENT:	8 December 2000
CASE MAY BE CITED AS:	Eagle v Delta Haze Corporation
MEDIUM NEUTRAL CITATION:	[2000] VSC 513

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Practice and Procedure – application to set aside service of writ served in California – implied terms as to payment in Victoria – action commenced in California – discretion to stay proceeding.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr B. Quinn	Eagle & Partners
For the Defendant	Mr M. Moshinsky	Nevett Ford

HIS HONOUR:

The plaintiff (or “Mr Eagle”), a Victorian practitioner who resides and has his sole place of business in Victoria, sues the defendant (or “Delta Haze”), a Nevada Corporation with its main or sole place of business in California. By summons dated 19 July 2000 the defendant seeks an order that service of the amended writ upon it outside Australia be set aside or that the proceeding be stayed. By summons dated 3 November 2000 the plaintiff seeks an order that he be at liberty to proceed in this proceeding. The original writ was filed by solicitors Eagle & Partners (the plaintiff’s practice name) on 24 December 1999 in the Commercial List. The statement of claim alleged that a Licence Agreement between the parties dated 1 July 1999 and a Marketing Agreement dated 1 January 1994 between the defendant and Eagle’s Ears Inc assigned by the latter company to the plaintiff on 30 June 1999 had both been wrongly terminated by the defendant and sought a declaration, injunctions, moneys due and accounts. The endorsement under Order 7.02 for service out of Australia and in the USA relied upon a breach of contract committed in Victoria, namely a letter of termination from the defendant’s US attorneys dated 8 December 1999. The defendant by its Victorian solicitors, Nevett Ford, entered a conditional appearance on 11 February 2000 and thereafter filed an affidavit showing that the said letter of termination was posted in California (and thus the alleged breach was not committed in Victoria). As a consequence, orders were made by consent on 10 March 2000 setting aside service of the writ outside Australia and adjourning the plaintiff’s summons for directions to 28 April 2000. By letter dated 27 April 2000 from Eagle & Partners to Nevett Ford, Eagle & Partners advised that the amended statement of claim and amended endorsement would be filed the next day and that copies would be provided to Nevett Ford “as a matter of courtesy”. The letter further advised that the plaintiff would seek a further adjournment of the summons for directions to 26 May 2000 (no doubt, as would have been evident, to allow time for service of the amended writ and for any consequent action by the defendant). The summons for directions was…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2000] VSC 513
Decision Date: 8 December 2000

CaseChat Overview and Summary

The plaintiff, Eagle, commenced proceedings against Delta Haze Corporation, an American corporation, in the Supreme Court of Victoria seeking a declaration that a contract existed between the parties and an account of profits. Eagle alleged that Delta Haze Corporation had breached an oral agreement for the supply of goods. The writ was served on Delta Haze Corporation in California, and the corporation applied to set aside the service of the writ on the basis that it had no connection to Victoria and the service was not in accordance with the court's rules. The dispute before the court was whether the service of the writ was valid and, if not, whether the court should exercise its discretion to stay the proceedings.

The court noted that the service of the writ was not in accordance with the court's rules and that the service had occurred in California. However, the court also noted that Delta Haze Corporation had conducted business in Victoria and that there was a substantial connection between the contract in question and Victoria. The court considered that the action was not vexatious and that there was a real prospect that the court would find that a contract existed between the parties. The court concluded that it was appropriate to exercise its discretion to stay the proceedings pending the outcome of proceedings in California and that it was not necessary to set aside the service of the writ.

The court ordered that the proceedings be stayed until further order and that the application to set aside the service of the writ be dismissed. The court also ordered that the stay would not prevent the parties from commencing proceedings in California and that the stay would not prevent Eagle from obtaining service of the writ in California if it chose to do so. The court noted that the stay was not intended to be a final determination of the jurisdiction issue and that the stay could be lifted if the parties agreed to a different jurisdiction or if the California proceedings were concluded.

Orders