Evans v The Atrium, the Owners of Strata Plan 11104 - [2022] WADC 120

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION:   PERTH
CITATION:   EVANS -v- THE ATRIUM, THE OWNERS OF STRATA PLAN 11104 [2022] WADC 120
CORAM:   MASSEY DCJ
HEARD:   16 NOVEMBER 2022
DELIVERED          :   22 DECEMBER 2022
FILE NO/S:   CIV 2883 of 2021
BETWEEN:   DAVID RODERICK EVANS
Plaintiff
AND
THE ATRIUM, THE OWNERS OF STRATA PLAN 11104
Defendant

ON APPEAL FROM:
Jurisdiction              :   DISTRICT COURT OF WESTERN AUSTRALIA
Coram:   DEPUTY REGISTRAR HARMAN
File Number            :   CIV 2883 of 2021

Catchwords:

Appeal from Registrar - Strata Titles Act - Jurisdiction of District Court to hear counterclaim

Legislation:

District Court of Western Australia Act 1969 (WA)
District Court Rules 2005 (WA), r 15(6), r 29
Interpretation Act 1984 (WA), s 18
Rules of the Supreme Court 1971 (WA), O 18 r 2, O 59 r 9
Strata Titles Act 1985 (WA)
Strata Titles Amendment Act 2018 (WA)
Supreme Court Act 1935 (WA), s 4

Result:

Appeal allowed

Representation:

Counsel:

Plaintiff	:	Mr B J Willesee
Defendant	:	Mr C M Slater

Solicitors:

Plaintiff	:	M6:8 Legal
Defendant	:	Mountains Lawyers Legal Solutions

Cases referred to in decision:

Cheney v Moore [2020] WASC 227
Frigger v Mervyn Jonathon Kitay in His Capacity as Liquidator of Computer Accounting and Tax Pty Ltd (in Liquidation) [No 17] [2020] WASC 366
Hazart Pty Ltd v Rademaker (1993) 11 WAR 26
Kezic v St John of God Health Care Inc [2015] WASCA 220
Mohammadi v Bethune [2018] WASCA 98
Perkins Investments (WA) Pty Ltd ATF The Perkins Investments Trust and Austpro Management Services Group Pty Ltd [2021] WASAT 71

MASSEY DCJ:

This is an appeal from a decision of Deputy Registrar Harman on 11 August 2022 to order that the defendant's counterclaim dated 19 April 2022 be struck out and the defendant pay the costs of the application in any event.
The defendant seeks orders that the appeal be allowed and that it have leave to file the amended counterclaim in the form attached to the submissions of the defendant dated and filed 5 August 2022 and that the plaintiff pay the defendant's costs of the appeal and of the summons in any event.
For the reasons that follow, I am satisfied that the appeal should be allowed in part.

Overview

The defendant is a strata company incorporated under the Strata Titles Act 1985 (WA) (the Act).
By the amended statement of claim, the plaintiff claims that the defendant acknowledged being indebted to the plaintiff in the sum of $147,663.01 pursuant to a loan agreement dated 29 November 2019 (the November 2019 agreement).
In the alternative, the plaintiff claims that by agreements made on or about 29 September 2017 (the 2017 agreement), on or about 10 May 2018 (the 2018 agreement), on or about 6 March 2019 (the March 2019 agreement), and on or about July 2019 (the July 2019 agreement), the defendant requested the plaintiff to lend, and the defendant agreed to borrow monies from the plaintiff.
The plaintiff claims that he advanced $50,000 pursuant to the 2017 agreement to the defendant of which not more than $16,666.68 has been repaid and says that the defendant has not paid the remaining loan balance of $33,333.32. The plaintiff says further that he paid to the defendant $50,000 pursuant to the 2018 agreement of which nothing has been repaid. The plaintiff further alleges that he paid $50,000 pursuant to the March 2019 agreement of which nothing has been repaid and says further that, pursuant to the July 2019 agreement, he advanced to the defendant $7,129.31, none of which has been repaid.
Further, or in the alternative, the plaintiff alleges that the defendant is unjustly enriched, having received the sum of $157,129.31 from the plaintiff for its use and benefit at the expense of the plaintiff.
By the amended defence dated 3 September 2021, the defendant denies that the November 2019 agreement has been validly executed on behalf of the defendant. The defence alleges breaches of fiduciary duty owed by the plaintiff to the defendant as chairman of the Council of Owners of the defendant and says that the plaintiff breached his obligations to the defendant under the Act and his common law fiduciary obligations to act in the best interests of all the owners of Strata Plan 11104. It further alleges that the plaintiff engaged in unconscionable conduct and in conduct which was in direct conflict to his obligations to the defendant owed under the Act and the by‑laws contained in sch 1 and sch 2 of the Act.
It is unnecessary for me to set out in detail the basis of the defence in relation to the other alleged agreements, other than to say that the defendant denies liability. In relation to the July 2019 agreement, it is relevant to add that the defendant alleges that the plaintiff is an accountant, did not disclose to the defendant that the defendant was in financial distress or that he, in his personal capacity, was undertaking financial transactions with the defendant. The defendant also alleges that the plaintiff, in his role as treasurer of the Council of Owners, was responsible for keeping accurate financial records for the defendant and failed to do so and, further, that he knew or ought to have known that the Council of Owners had failed to raise levies which resulted in the defendant at the time of the alleged payments being unable to pay its debts as they fell due. The defendant further alleges that the plaintiff had an ulterior motive in not raising levies and claiming alleged debts owed to him.
The counterclaim was filed as a separate document to the defence on 18 April 2022. Prior to the hearing before the registrar, the plaintiff filed an amended counterclaim dated 5 August 2022 and it was that counterclaim which was the subject of argument before the registrar. I note that the orders made were that the counterclaim dated 12 April be struck out, but the argument was in relation to the amended counterclaim.
The amended counterclaim alleges that the plaintiff was, or held himself out to be, an accountant. He was also a member of the Council of Owners and held the positions of either the chairman or treasurer, or both, of the defendant in the period from about September 2017 to November 2019 and acted on behalf of or as agent for the appellant and was and is an owner of the strata units.
It is unnecessary for me to set out the entirety of the counterclaim. However, relevantly, the defendant alleges that the plaintiff owed to the defendant duties as a treasurer or chairman and as an agent of the appellant to:
(a)cause or require the defendant to observe the obligations of the Act and by‑laws;
(b)observe and follow the lawful instructions and decisions of the Council of Owners, of the appellant and the owners;
(c)manage the common property for the benefit of all the owners pursuant to s 35 of the Act;
(d)perform the functions of the defendant including those under s 35 of the Act, pursuant to s 44 of the Act and s 4 of the by‑laws;
(e)keep the books of account referred to in s 35(1)(f) of the Act; and
(f)prepare the statement of accounts referred to in s 35(1)(g) of the Act.
The defendant also says that the plaintiff, as a person appointed to administer and act on behalf of or as an agent of the defendant in relation to the legal, administrative and operational tasks relevant to the property of the defendant, owed the defendant a fiduciary or equitable duty:
(a)to act at all times in good faith and for the benefit of the defendant;
(b)to not use his position to benefit himself or cause detriment to the defendant;
(c)to act with the care, skill and diligence that would be exercised by a reasonably diligent person with his skill and experience and with the general knowledge, skill and experience that might be expected of a person carrying out the functions carried out by him in relation to the defendant; and
(d)a duty of care in tort to act with the skill, care and diligence that would be exercised by a reasonably diligent person with his knowledge of the defendant and with the knowledge, skill and experience that might be expected of a person carrying out the functions carried out by him in relation to the defendant.
The defendant alleges that the plaintiff owed both statutory and common law duties to the defendant.
The defendant alleges that the plaintiff breached his statutory duties pursuant to the act as well as breaching the duty set out in [14(3)] and [14(4)] above by failing to act in good faith when through his role as either or both the chairman and treasurer of the Council of Owners he knew of certain matters (set out at pars 8(c), (d) and (e) of the minute of amended counterclaim.)
The defendant, as it does in the defence, relevantly complains (at par 10 of the minute of amended counterclaim) that the plaintiff failed to raise levies to establish an administrative and reserve fund and instead caused the defendant to meet expenses by borrowing.

The issues for the appeal

The issues which I must resolve are:
(a)whether the court has jurisdiction to hear the defendant's counterclaim; and
(b)which party should bear the costs of, and incidental to, the chamber summons dated 10 May 2022.
In relation to the first and most substantive of these issues, the plaintiff's contention as to this court's lack of jurisdiction to hear the counterclaim arises from the terms of cl 30(2) of sch 5 of the Act, which provides as follows:
A proceeding under this Act that could have been, before commencement day, commenced in the District Court must instead be commenced in the Tribunal and the Tribunal has jurisdiction to hear and determine the matter.
The 'Tribunal' refers to the State Administrative Tribunal. The commencement date refers to 1 May 2020.

Legal principles applicable to the appeal

Rule 15(6) of the District Court Rules provides that an appeal from a registrar is to be by way of a new hearing of the matter that was before the registrar.
A new hearing means that the judge hearing the appeal must treat the application as if it was before the court for the first time: Kezic v St John of God Health Care Inc [2015] WASCA 220 [42].
The defendant, as the party which has appealed, is not required to show that the registrar made an error in the decision, the subject of the appeal: Cheney v Moore [2020] WASC 227 [9].
The court may rely upon additional evidence on the hearing of an appeal by way of a new hearing, subject to the court having a discretion to exclude such evidence: Hazart Pty Ltd v Rademaker (1993) 11 WAR 26, 28.
I am required, in essence, to determine the application to strike out the counterclaim afresh.

Principles of statutory construction

In determining the issue between the parties, I am required to consider cl 30(2) of sch 5 of the Act.
The general principles applicable to undertaking statutory construction have recently been summarised by the Court of Appeal in Mohammadi v Bethune [2018] WASCA 98 [31] - [36], which I set out below and apply to this matter as follows:
31 The principles of statutory construction are well known and do not require detailed exposition. Statutory construction requires attention to the text, context and purpose of the Act.  While the task of construction begins and ends with the statutory text, throughout the process the text is construed in its context.  Statutory construction, like any process of construction of an instrument, has regard to context. As Kiefel CJ, Nettle and Gordon JJ recently explained in SZTAL:
…
The starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, regard is had to its context and purpose. Context should be regarded at this first stage and not at some later stage and it should be regarded in its widest sense.  This is not to deny the importance of the natural and ordinary meaning of a word, namely how it is ordinarily understood in discourse, to the process of construction. Considerations of context and purpose simply recognise that, understood in its statutory, historical or other context, some other meaning of a word may be suggested, and so too, if its ordinary meaning is not consistent with the statutory purpose, that meaning must be rejected.
…
32 The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute.
33 The objective discernment of the statutory purpose is integral to contextual construction.  The statutory purpose may be discerned from an express statement of purpose in the statute, inference from its text and structure and, where appropriate, reference to extrinsic materials.  The purpose must be discerned from what the legislation says, as distinct from any assumptions about the desired or desirable reach or operation of relevant provisions.
34 Discernment of statutory purpose is particularly significant in cases, commonly encountered, where the constructional choice presented is from 'a range of potential meanings, some of which may be less immediately obvious or more awkward than others, but none of which is wholly ungrammatical or unnatural'.  In such a case, the choice 'turns less on linguistic fit than on evaluation of the relevant coherence of the alternatives with identified statutory objects or policies'.  As we will explain later in these reasons, we think this is such a case.
35 Thus, the material provisions of the Act must be understood, if possible, as parts of a coherent whole.
36 Statutory texts enacted by the same legislature are to be construed, so far as possible, to operate in harmony and not in conflict.Where two or more statutory enactments comprise the overlapping legislative scheme, the enactments should be construed accordingly, and the court should endeavour to produce a rational, sensible, efficient and just operation in preference to an inefficient, conflicting or unjust operation. (Footnotes omitted)
Section 18 of the Interpretation Act 1984 (WA) provides:
18. Purpose or object of written law, use of in interpretation
In the interpretation of a provision of a written law, a construction that would promote the purpose or object underlying the written law (whether that purpose or object is expressly stated in the written law or not) shall be preferred to a construction that would not promote that purpose or object.
Section 19 allows for consideration of certain extrinsic material in the interpretation of a provision of a written law. In this case, I have been referred to the second reading speech of the Minister and to the Explanatory Memorandum in relation to the Strata Titles Amendment Act 2018 (WA) (the Amendment Act), by which cl 30(2) of sch 5 of the Act came into effect.
I accept the plaintiff's contention that, from the text of cl 30(2), four features can be identified.
1.First, the relevant proceeding must be under the Act.
2.Secondly, it must be a proceeding that, prior to 1 May 2020, could have been commenced in the District Court.
3.Thirdly, it directs that such a proceeding must now be commenced in the Tribunal.
4.Fourthly, it gives jurisdiction to the Tribunal to hear and determine the matter.
I also accept that the first two features are the preconditions for engaging the clause and the second two features are the consequences of the clause being engaged.

Further Relevant provisions of the Act

Section 197(1) of the Act gives the Tribunal jurisdiction over 'scheme disputes'.
Scheme disputes include a dispute between 'scheme participants' about:
(a)the performance of, or the failure to perform, a function conferred or imposed on a person by this Act or the scheme by‑laws (s 197(1)(a)(ii)); or
(b)an alleged contravention of this Act (s 197(1)(a)(iii)); or
(c)a resolution or decision of a strata company or the council of a strata company, including its validity (s 197(1)(a)(iv)); or
(d)any other matter arising under this Act or the scheme by‑laws (s 197(1)(a)(vi)).
Scheme participants include:
(a)the strata company for the strata title scheme (s 197(2)(a)); and
(b)a member of the council of a strata company, or an officer of the strata company, for the strata title scheme, who is not a member of the strata company (s 197(2)(g)).
It is common ground between the parties that the defendant is the strata company for the strata scheme and that the plaintiff was a member of the council of the strata company.
It is also common ground that they are therefore scheme participants. I accept that both the plaintiff and the defendant are scheme participants.

Summary of the plaintiff's contention

Essentially, the plaintiff says that the counterclaim should be struck out as this court does not have jurisdiction to deal with the matters alleging breaches of the Act. The plaintiff also says that, given that the claims against the plaintiff in the counterclaim are based, at least primarily on allegations in respect of the performance of or the failure to perform a function conferred or imposed by the Act or in contravention of the Act, the claims are a scheme dispute and that the amended counterclaim therefore is a proceeding under the Act.
The plaintiff says that the amended counterclaim therefore is a claim that could have been commenced in the District Court and so engages the second precondition in cl 30(2). The plaintiff says that once those two preconditions are engaged then the clause operates in mandatory terms to require that the proceeding be commenced in the Tribunal.
The plaintiff says that although the term 'proceeding' is not defined in the Act, when regard is held to the ordinary meaning of the word its context in the Act and its usage to describe the same concept in similar legislation such as s 4 of the Supreme Court Act 1935 (WA) and the definition of action, cause and matter, it is apparent that it is the term often used to describe the full suite of processes by which something may be brought before the court or Tribunal.
The plaintiff says that it is well established that a counterclaim, although it may be heard at the same trial as the original action, is a distinct proceeding: Frigger v Mervyn Jonathon Kitay in his capacity as liquidator of Computer Accounting and Tax Pty Ltd (in liquidation) [No 17][2020] WASC 366 [10] and the cases cited therein.
In response to the defendant's contention that the counterclaim is not a proceeding commenced given that it is a counterclaim made in an existing action, the plaintiff says that the counterclaim is an independent action which, if the court had jurisdiction, may, for convenience, be heard along with the original action.
The defendant says that the purpose of the written law is clear and refers to the explanatory memorandum and second reading speeches in relation to the Amendment Act. The Minister referred to the objective of the various amendments, namely that the Tribunal was to become 'the one stop shop for strata disputes'.

Summary of the defendant's contention

The defendant says that the word 'proceeding', whilst not being defined in the District Court of Western Australia Act 1969 (WA), is often used as an umbrella term to describe generally disputes being resolved.
The defendant accepts that the purpose of the clause under consideration relates to commencing 'a proceeding under this Act'.
The defendant submits that cl 30(2) does not expressly address proceedings already correctly commenced elsewhere which subsequently raise matters pursuant to the Act. The defendant says that the clause does not exclude the jurisdiction of the District Court or other courts, nor prohibit the defendant raising in its defence and counterclaim issues addressing the Act.
The defendant says that the proceedings were commenced in the District Court by the plaintiff and that the defence and counterclaim are therefore filed in proceedings which have already been commenced.

Alternatively, the defendant says that the counterclaim against the plaintiff is brought against him both as a scheme participant but also against him for breaches of fiduciary duties not the subject of duties owed under the Act. The defendant accepts that the parties are scheme participants but says that the entirety of the dispute is not a scheme dispute.
The defendant submits that the evidence in relation to the aspects which form part of the scheme dispute is inextricably linked with the evidence which is the subject of those disputes that are not scheme disputes (to which I will hereinafter refer to as non-scheme disputes). The defendant says that the effect of the orders sought by the plaintiff would be that the Tribunal would have to consider duties or obligations under the Act which arise out of the same facts, documents and circumstances to which the District Court would have to have regard when considering the non‑scheme disputes.
The position of the defendant is that the Parliament could not possibly have intended the bifurcation of a dispute between this court and the Tribunal when the same facts will need to be considered in relation to both scheme and non‑scheme disputes.
The submission of the defendant is that I should read the word 'proceeding' as referring to the proceedings as a whole and that, given there are non‑scheme disputes inextricably linked to the scheme dispute, then this is a proceeding which cl 30(2) does not mandate must be commenced in the Tribunal.

The decision in Perkins Investments (WA) Pty Ltd ATF The Perkins Investments Trust and Austpro Management Services Group Pty Ltd [2021] WASAT 71 (Perkins)

Both parties referred me to the decision in Perkins and, to varying extents, relied upon it in support of their arguments.
In that case, Pritchard P considered the question of proceedings involving an issue under the Act being litigated outside of the Tribunal.
In that case, Perkins had commenced proceedings for declarations that a contract for the sale of land was avoided, pursuant to s 69D and s 70 of the Act. It contended that its right to avoid the contract arose under pt 5 of the Act.
It was accepted at [55] that the proceedings brought by Perkins were correctly commenced in the Tribunal and that Perkins was obliged to commence the proceedings in the Tribunal [57].
The respondent in the Tribunal sought to transfer the Tribunal proceedings to the Supreme Court where it had instituted proceedings seeking relief, including declarations that the contract was binding, a declaration that the applicants were estopped from denying that they were bound by the contract, specific performance of the contract, an account for profit and alternatively damages for equitable compensation.
The grounds of the application to transfer the proceedings out of the Tribunal into the Supreme Court were set out at [42] as follows:
… that the parties' evidence, the matters in issue and the relief sought in these proceedings will form part of the (proceedings in the Supreme Court), that the Supreme Court has jurisdiction to deal with all matters in dispute between the parties and to award all necessary relief, including specific performance of the contract, and that the contract and the building contract are interrelated and must be considered part of the same overall bargain between the parties.
The defendant relies on [58] of the judgment, where Pritchard P said:
… In my view, nothing in cl 30(2) prohibits the purchaser from advancing such an argument, whether by way of defence or counter‑claim, in response to proceedings commenced by the vendor, in another court, to enforce performance of the Contract.
The defendant further relies on Pritchard P's observations at [60] that:
… far clearer words of exclusion would be required to confer jurisdiction on the Tribunal, so as to exclude the Supreme Court's long‑standing jurisdiction to deal with questions concerning the validity of a contract for the sale of land and disputes about the performance of such contracts, and to grant relief including specific performance.
Furthermore, the defendant referred to [59]:
In my view, it is highly unlikely that the Parliament would have intended to bifurcate such proceedings by requiring that questions about a notice of avoidance under s 69D of the Former Act be determined exclusively in the Tribunal, while all other questions in relation to the validity of the contract for the sale of the strata lot would be dealt with in another court.
Ultimately, the defendant contends that the approach adopted by Pritchard P means that the jurisdiction of this court to determine disputes arising under the Act was not expressly extinguished. The prohibition is on commencing a proceeding. The position of the defendant is that clearer words were required to infer an intention to bifurcate the resolution of disputes which addressed both common law or equitable claims and claims relating to breaches of the Act, or scheme disputes as defined.
In response, the plaintiff says that the decision in Perkins does not impact on the construction of cl 30(2) contended for by the plaintiff or on the outcome of the appeal. The plaintiff relies on Pritchard P's finding that Perkins was obliged to bring its claim for recovery in the Tribunal and says that, by analogy, the defendant is obliged to bring its claim in the Tribunal.
The defendant also says that the passage relied on in [58] relates to Supreme Court proceedings rather than District Court proceedings.
The plaintiff also submits that whereas cl 30(2) specifically refers to proceedings which could have been commenced in the District Court there is no equivalent provision for proceedings which could have been commenced in the Supreme Court and therefore there is a difference between a removal of the proceedings from the Tribunal to the Supreme Court and that which is encountered here.
The plaintiff further says that the submission of the respondent that bifurcation of the proceedings would be the inevitable result of the plaintiff's contention is not correct. The plaintiff submits that the Tribunal is empowered to deal with the entirety of the counterclaim. The plaintiff says that the counterclaim is still a proceeding under the Act because of the allegations involving scheme participants who are alleged to have behaved in contravention of s 197 and that the Tribunal has jurisdiction to deal with any ancillary disputes.
Contrary to the submissions of the plaintiff, I do not consider that there is a material difference between the considerations governing the removal of the proceedings in Perkins and the considerations which arise in this case.
First, the proceedings commenced in the Tribunal were entirely related to rights conferred by the Act. That is why they were correctly commenced in the Tribunal. They could not have been commenced in any other forum.
Secondly, Pritchard P found that the proceedings commenced in the Tribunal could have been commenced in the District Court [55]. That is, they met one of the preconditions for the engagement of cl 30(2). Notwithstanding that the proceedings met that precondition, her Honour was still prepared to find that this did not confer an exclusive jurisdiction on the Tribunal [55].

The outcome of the appeal

I accept that a counterclaim is a separate proceeding to the claim initiated by the plaintiff. Therefore, the counterclaim is itself a proceeding which has been commenced in the District Court. In my view, that finding is consistent with the wording in O 18 r 2 of the Rules of the Supreme Court 1971 (WA) and with the authorities cited to by the plaintiff.
However, the counterclaim seeks relief not only for matters which fall within the definition of scheme disputes, but also for the non‑scheme disputes, including the matters set out above [14].
In my view, the word 'proceeding' used in cl 30(2) refers to the whole of the proceeding, rather than to any specific part of it.
Whilst I accept that the plaintiff and defendant are 'scheme participants' as defined in the Act, it is apparent that the dispute in its entirety is not a scheme dispute. Whilst the Tribunal has jurisdiction over scheme disputes pursuant to s 197(1) it does not have jurisdiction over the non‑scheme disputes which are part of the defendant's counterclaim.
If the entirety of the dispute, as was the case in Perkins, was a scheme dispute then it may be that the proceeding must be commenced in the Tribunal. That is not the case here.
I adopt what Pritchard P said in Perkins at [60] that 'far clearer words of exclusion would be required to confer jurisdiction on the Tribunal so as to exclude this court's longstanding jurisdiction to deal with questions concerning the validity of claims for breaches of fiduciary duty and other relief unrelated to scheme disputes'.
In my view, there can be no doubt that this court has jurisdiction to deal with the non-scheme disputes whilst the Tribunal also has jurisdiction to deal with the specific question relating to the scheme dispute matters.
In my view, the jurisdiction of this court to determine scheme disputes has not been extinguished. What is prohibited is the commencement of a proceeding.
Again, adopting the words of Pritchard P in Perkins at [58], in my view, nothing in cl 30(2) prohibits the defendant from advancing arguments relating to breaches of fiduciary duties, whether by defence or counterclaim, in response to proceedings commenced by the plaintiff in this court.
As I have mentioned, the defendant in its defence alleges breaches of fiduciary duty by the plaintiff. It also alleges breaches of the Act by the plaintiff. No objection is taken to those matters, and properly so given that the defence is responsive to the claim of the plaintiff.
Both the defence and counterclaim also allege a failure on the part of the plaintiff to raise levies.
Furthermore, the evidence relating to the alleged breaches of common law raised in the counterclaim duties will, in some instances, be the same as the alleged breaches of statutory duties.
These matters demonstrate the absurdity of bifurcating proceedings relating to the counterclaim. It will be necessary for the District Court to consider the defence relating to the alleged breaches of the Act by the plaintiff, as well as the allegations of the failure to raise levies raised in the defence, and it seems nonsensical that it should not also consider those breaches in relation to the act when considering the counterclaim rather than have those matters determined in another forum. Further, separate forums will have to determine alleged breaches of common law duties and statutory duties which may arise from the same evidence.
In my view, that is not a result which Parliament intended. It is highly unlikely that Parliament would have intended to bifurcate the proceedings in this way.
It may be that if the whole of the counterclaim related to a scheme dispute then a different result would occur. However, that is not the case which I have to determine.
However, in my view, the word 'proceeding' must refer to a proceeding, the whole of which relates to matters over which the Tribunal has jurisdiction; in this case in relation to a scheme dispute.
If Parliament had intended that any part of a proceeding seeking relief for a scheme dispute must be commenced in the Tribunal then words to that effect could have been used in cl 30(2).
In this case, the 'matter' to which cl 30 refers is the claim for damages for breaches arising out of both scheme disputes and disputes which are not scheme disputes. The grant of that relief will depend upon the decision‑making body determining both scheme and non‑scheme disputes.
Given my finding that Parliament did not extinguish the jurisdiction of this court to determine scheme disputes then it is my view that the findings I have made produce a rational, sensible, efficient and just operation, rather than the inefficient, conflicting or unjust operation which would arise by virtue of the inevitable bifurcation of the proceedings.
For those reasons, I uphold the appeal and set aside the decision of the learned deputy registrar.

Costs

A further issue raised in this appeal was as to the question of costs. The deputy registrar ordered that the costs of the application be paid by the appellant in any event.
The defendant says that if the plaintiff does not succeed on the jurisdiction point then the question arises as to whether the respondent should have the cost of its summons.
That submission is made because it is said that there was insufficient conferral prior to the summons being filed.
The original application sought to strike out the defendant's counterclaim, not only on the jurisdiction basis but also because of the adequacy of the pleading.
An affidavit of Ms Mabel Lai-Fun Chua sworn 10 May 2022 was provided to the registrar and I was also referred to it. Ms Chua is the principal of the firm of solicitors who act for the plaintiff.
The annexures to that affidavit reveal that a letter dated 5 May 2022 was sent from the plaintiff's solicitors raising issues about the counterclaim. That letter alleged that the District Court does not have jurisdiction.
Additionally, the plaintiff alleged that the then counterclaim should be struck out pursuant to O 20 r 19(1)(a), (b) and (c). The plaintiff alleged that the counterclaim was not sufficiently intelligible to understand the case the plaintiff had to meet, no cause of action had been identified, the references to breaches of fiduciary duty contained no material facts relating to what specific fiduciary duties were owed and how they had been breached, there were allegations of vague and imprecise assertions as well as other complaints about the drafting of the counterclaim.
The letter concluded by inviting the defendant to consent to a discontinuance of the counterclaim by 12 pm on 10 May 2022, as that was the last day for the plaintiff to file a strike out application in respect of the counterclaim. The letter said that if no response was received by that time then an application to strike out would be made without further notice.
By email sent at 12.17 pm on 9 May 2022, the defendant's solicitors responded by letter enclosing a memorandum of consent orders.
The letter indicated that the defendant was not in a position to respond to all the points raised by the plaintiff in the short timeframe allowed. The defendant indicated that it understood the concern was as to the time by which an application to strike out the counterclaim had to be filed. In order to alleviate that concern the defendant indicated that it would consent to an extension of the time limited by O 20 r 19 and attached a consent order allowing for that extension.
As to the substantive matters raised, the defendant responded by saying that it disagreed that the counterclaim was not properly brought from a jurisdictional aspect.
The plaintiff responded by letter dated 10 May 2022. It said that it declined the defendant's request to defer the making of any strike out application to a date after mediation. Furthermore, the plaintiff's position was that r 29 of the District Court Rules stated that O 59 r 9 of the Rules of theSupreme Court did not apply and invited the defendant to provide authority for the assertion that the plaintiff was required to exhaust conferral prior to applying for a strike out.
The application to strike out the counterclaim was filed on 10 May, the same date upon which the last letter from the plaintiff was sent.
The defendant says that in filing the application before the defendant had sufficient time to consider the matters raised the plaintiff did not involve itself in proper conferral and this should be relevant on the issue of costs.
Prior to the hearing before the deputy registrar, the defendant served the amended counterclaim addressing the complaints that had been raised in the letter of 5 May 2022.
Ultimately, the hearing before the deputy registrar proceeded on the jurisdictional issue, the other issues having been resolved.
In my view, it is regrettable that the opportunity for conferral was not exhausted prior to the application being made. Whilst the plaintiff says that there is no excuse for the defendant to take until 7 August before resolving the other complaints about the counterclaim, in my view, that is explicable by the fact that the application to strike out the counterclaim had already been filed. The imperative for the defendant to respond with any urgency was therefore gone.
In my view, that lack of conferral is relevant on the issue of costs. The application may not have needed to be brought if the conferral process had played out.
In my view, the plaintiff should pay that part of the costs of the application before the registrar which related to the jurisdictional issue with which I have dealt in the first part of these reasons. However, the defendant should not have the costs of that part of the application which relate to the attack on the pleading.
For those reasons, I will order that the plaintiff pay the defendant's costs of the application before the registrar which relate exclusively to the jurisdiction issue.
The orders I therefore propose are as follows:
1.The appeal is allowed.
2.The defendant has leave to file the amended counterclaim attached to the defendant's submissions dated and filed 5 August 2022.
3.The plaintiff pay the defendant's costs of the chamber summons dated and filed 10 May 2022.
I will hear the parties on the issue of costs of the appeal and in relation to the proposed orders.

I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
TM
Judicial Support Officer
13 JANUARY 2023