Esanda Finance Corporation Limited v Forte
[2000] WADC 94
•12 APRIL 2000
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS
LOCATION: PERTH
CITATION: ESANDA FINANCE CORPORATION LIMITED -v- FORTE [2000] WADC 94
CORAM: COMMISSIONER MARTINO
HEARD: 31 MARCH 2000
DELIVERED : 12 APRIL 2000
FILE NO/S: CIV 279 of 1999
CIV 2511 of 1999
BETWEEN: ESANDA FINANCE CORPORATION LIMITED
Plaintiff
AND
ALESSANDRO FORTE AND MARIA LORETTA FORTE
Defendants
Catchwords:
Practice and procedure - Remitting of action - Local Court - District Court
Legislation:
Hire-Purchase Act 1959 - s24
District Court of Western Australia Act 1969 - ss6, 74 and 75
Local Courts Act 1904 - ss40 and 41
Local Court Rules 1961- O5 r1
Result:
Local Court action remitted to the District Court
Representation:
Counsel:
Plaintiff: Mr Timoney
Defendants: Mr MacPherson
Solicitors:
Plaintiff: Stables Scott
Defendants: Mossensons
Case(s) referred to in judgment(s):
Fisher v Callaghan (1985) 2 SR (WA) 333
Las Vegas Motors v McClements [1979] WAR 60
Case(s) also cited:
Wing Luck Foods v Lay Choo Lim [1989] WAR 358
Greetings Group Ltd v Patrick Steven Maher t/as Patrick Hunter & Associates, unreported; DCt WA; Library No 1837; 13 July 1987
Custom Credit Corporation Ltd v Lynch (1993) 2 VR 469
Custom Credit Corporation Ltd v Lupi (1992) 1 VR 99
Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226
COMMISSIONER MARTINO:
Introduction
There are two applications before me. One is an application in CIV 279 of 1999 in which the plaintiff ("Esanda") seeks on order pursuant to s75 of the District Court of Western Australia Act 1969 ("the District Court Act") remitting an action in the Local Court to this Court. The other is an application in CIV 2511 of 1999 in which the defendants ("the Fortes") seek an order pursuant to s74 of the District Court Act remitting that action to the Local Court. In each of the actions in this Court the plaintiff and the defendant are the same. The two applications were heard together and these reasons will be published in both matters.
The proceedings in both Courts arise out of one transaction. That transaction is a hire-purchase agreement made on 29 May 1997 ("the hire-purchase agreement").
By proceedings commenced in the Local Court on 30 March 1998 and numbered 15383 of 1998 ("the Local Court proceedings") the Fortes applied pursuant to s24(2) of the Hire-Purchase Act 1959 for an order that the hire-purchase agreement be set aside. By an action commenced in this Court on 29 June 1999 and numbered CIV 2511 of 1999 ("the District Court action") Esanda claimed against the Fortes the sum of $48,778.26 and interest pursuant to the hire-purchase agreement. In the District Court action the Fortes have filed a defence and counterclaim. The counterclaim is for a declaration that the hire-purchase agreement is void and for damages.
The issues
The parties agree that it would be desirable for the matters between them arising out of the hire-purchase agreement to be resolved in one Court. The issues for me to determine are:
1.Whether I have jurisdiction to make the order sought by Esanda and by the Fortes;
2.If so which action, if any should, be remitted.
Jurisdiction to remit the Local Court proceedings to this Court
Section 24(1) of the Hire-Purchase Act 1959 provides:
"24(1) In any proceedings under this Act or arising out of a hire-purchase agreement or instituted pursuant to subs(4) where it appears to the court that the transaction is harsh and unconscionable (by reason of a provision for terms charges or other charges that are, in the circumstance of the case, excessive or by reason of any other provision of whatever kind) or is otherwise such that the Supreme Court in its equitable jurisdiction would give relief the court may re-open the transaction and take an account between the parties thereto."
Section 24(2) (c) of the Hire-Purchase Act 1959 provides:
"(2)The court by which a transaction is re-opened under this section may, notwithstanding any statement or settlement of accounts or any agreement purporting to close previous dealings and create a new obligation - ….
(c)set aside either wholly or in part or revise or alter any agreement made or security given in connection with the transaction;"
Section 24(3) of the Hire-Purchase Act 1959 gives both the District Court and the Local Court jurisdiction to grant relief under s24 irrespective of the jurisdictional limits that apply to those Courts.
The Local Court proceedings were commenced by the Fortes by a document described as an application which is in a form similar to a motion. Order 5 r1 of the Local Court Rules 1961 provides:
"1.All proceedings authorised to be commenced in a local court by or under the Act shall, except when otherwise provided by the Act or these rules, be commenced by the entry of a plaint, and shall be called actions."
Section 6 of the District Court Act defines the word action as follows:
"In this Act, unless the contrary intention appears – 'action' means a civil proceeding commenced by writ or in such other manner as is prescribed by Rule of Court and includes suit but does not include any criminal proceeding by the Crown;"
Counsel for the Fortes referred to the judgment of Hammond DCJ (as he then was) in Fisher v Callaghan (1985) 2 SR (WA) 333 in which his Honour held that proceedings commenced in the District Court by originating summons are a matter and not an action for the purposes of s74(2) of the District Court Act. He submitted that the Local Court proceedings are a matter and not an action since they were commenced by an application and not the Local Court equivalent of a Writ and that in consequence the Local Court proceedings did not come within s75 of the District Court Act and could not be remitted to the District Court.
I have referred to the provisions of O5 r1 of the Local Court Rules 1961. There is no provision in either the Local Court Act 1904, the Local Court Rules 1961 or the Hire-Purchase Act 1959 authorising the commencement of proceedings in the Local Court claiming relief under s24 of the Hire-Purchase Act 1959 by the form of motion with which Mr and Mrs Forte commenced the Local Court proceedings.
In Las Vegas Motors v McClements [1979] WAR 60 the Full Court of the Supreme Court of Western Australia held that the reference of a dispute to a Local Court under s38 of the Motor Vehicle Dealers Act 1973 is to be commenced by the entry of a plaint and is an action as that word is defined in s3 of the Local Courts Act 1994.
It is my view that the Local Court constitute an action for the purposes of the Local Courts Act 1904. Counsel for the Fortes oral and written submissions were to that effect and I agree with the submissions on that point. In my view the definition of action in s6 of the District Court Act 1969 does not apply to the use of that word in s75. The contrary intention appears from the fact that the section concerns "an action…. in a Local Court". In my view the word action is used in s75 as meaning an action as that word is defined and used in the Local Courts Act 1904. The Local Court proceedings are an action for the purposes of the Local Courts Act 1904. I conclude therefore that I do have jurisdiction to remit the Local Court proceedings to the District Court.
Jurisdiction to remit the District Court action to the Local Court
Section 74(1) of the District Court Act provides that when an action is brought in the District Court that might have been brought in the Local Court without the consent of the defendant the defendant may apply to have the action remitted to the appropriate Local Court and the Court or Judge shall make an order accordingly unless the Court or Judge considers that under the circumstances of the case it is advisable that the action should be tried in the District Court. The District Court action is for $48,778.26 and interest. The jurisdiction of the Local Court is $25,000 – s30. On the face of it therefore the claim made in the District Court action could not have been brought in the Local Court. However s34(2) (b) of the Local Courts Act provides that the jurisdiction of a Local Court in cases of a counterclaim shall not be excluded by reason that the counterclaim is for an amount of money exceeding the jurisdiction of the Court provided that the plaintiff does not object in writing within the prescribed time to the Court giving relief exceeding that which the Court would otherwise have jurisdiction to administer.
Counsel for the Fortes submitted that s74 does apply to the District Court Act because although the claim is outside the original jurisdiction of the Local Court the claim could have been brought as a counterclaim in the Local Court proceedings without the Fortes' consent. Although the Fortes would then have had the option of objecting to the Court giving relief claimed that would not affect the validity of the commencement of the counterclaim. Counsel for the Fortes has also informed me that his instructions are that his clients would not object to the Local Court giving the relief exceeding the Local Court's jurisdiction in Esanda's counterclaim if such a counterclaim were to be made. While he did not have authority to give an undertaking that his clients would not object to the Court giving that relief he could see no difficulty in making an order remitting the District Court action to the Local Court conditional upon such an undertaking being given.
I accept that Esanda could counterclaim in the Local Court proceedings the relief it is seeking in the District Court and that I do have jurisdiction to remit the District Court action to the Local Court under s74 of the District Court Act.
Which action, if any, should be remitted
As the Local Court proceedings and the District Court action involve the same parties and arise out of the same transaction it would be desirable for the claims to be dealt with at the same time in the same Court for reasons of efficiency and the saving of costs. The parties agree that the claims should be heard in the same Court. Their difference is as to which Court.
In the ordinary course claims for relief in excess of $25,000 but less than $250,000 are commenced in the District Court. In my view it would be preferable for Esanda's claim to be determined in this Court because it is the Court in which such a claim would ordinarily be heard. In an affidavit sworn by Alessandro Forte in CIV 279 of 1999 on 31 January 2000 Mr Forte has deposed that upon advice from the solicitors the Fortes specifically chose to bring their application in the Local Court because it would be a simpler and cheaper venue for their claim. I accept that the Local Court's scale is lower than the District Court scale of costs and that costs would therefore be lower in the Local Court. However the District Court scale of costs is the scale that is appropriate to the pursuit and defence of a claim in the amount claimed by Esanda in the District Court action and while I agree that it is desirable for costs to be kept as low as possible the position remains that under the original jurisdiction given by Parliament to the Local Court and the District Court it is in the District Court that it would ordinarily be appropriate for Esanda's claim to be determined.
In my view the appropriate course to take is to remit the Local Court proceedings to this Court and to dismiss the Fortes' application to remit the District Court action to the Local Court.
In his affidavit sworn in support of Esanda's application on 15 December 1999 John Ross, Manager Recoveries of Esanda has deposed that it is Esanda's intention that if the Local Court proceedings are remitted to the District Court Esanda will apply to have the actions consolidated and heard together. I propose to order that within 14 days Esanda file a copy of the order remitting the Local Court proceedings to the District Court and that within 14 days of the Local Court file being transferred to the District Court Esanda make application to have the actions consolidated.
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