Feeley v Zaghloul
[2018] WASC 16
•19 JANUARY 2018
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: FEELEY -v- ZAGHLOUL [2018] WASC 16
CORAM: ALLANSON J
HEARD: 10 JANUARY 2018
DELIVERED : 19 JANUARY 2018
FILE NO/S: CIV 2542 of 2017
BETWEEN: KATHRYN-MAGNOLIA FEELEY
First Plaintiff
JOHN LEE O'KEEFE
Second PlaintiffAND
HASSAN ZAGHLOUL
Defendant
Catchwords:
Practice and procedure - Cross-vesting - Where matter in the District Court of Western Australia - Removal of proceeding to Supreme Court for consideration - Whether transfer of proceedings to the Supreme Court of the Australian Capital Territory in the interests of justice - Turns on own facts
Legislation:
Jurisdiction of Courts (Cross-Vesting) Act 1987 (WA), s 5, s 8
Result:
Matter transferred to the Supreme Court of the Australian Capital Territory
Category: B
Representation:
Counsel:
First Plaintiff : Mr R A C Cullen
Second Plaintiff : Mr R A C Cullen
Defendant: In person
Solicitors:
First Plaintiff : Cullen Macleod
Second Plaintiff : Cullen Macleod
Defendant: In person
Case(s) referred to in judgment(s):
Amaca Pty Ltd v Frost (2006) 67 NSWLR 635
BHP Billiton Ltd v Schultz (2004) 221 CLR 400
Distillers Co (Biochemicals) Ltd v Thompson [1971] AC 458
Puttick v Tenon Limited (formerly called Fletcher Challenge Forests Limited) [2008] HCA 54; 238 CLR 265
Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538
ALLANSON J: In 2017, Dr Hassan Zaghloul commenced an action against Kathryn‑Magnolia Feeley and John Lee O'Keefe (as the principal of the firm John O'Keefe) in the District Court of Western Australia, seeking relief including the repayment of legal fees, an equitable remedy by constructive trust, and damages. The defendants to that action ‑ plaintiffs in this application ‑ apply by originating summons for orders pursuant to the Jurisdiction of Courts (Cross-Vesting) Act 1987 (WA) transferring the proceeding to the Supreme Court of the Australian Capital Territory.
This application requires consideration of the combined operation of s 5 and s 8 of the Cross-Vesting Act. A proceeding can only be transferred if it is pending in the Supreme Court. Section 8(1) empowers the court to remove the proceeding in the District Court to the Supreme Court so that consideration can be given to whether it should be transferred to the Supreme Court of the Australian Capital Territory under s 5.
Section 5 applies to the proceeding, if removed to the Supreme Court under s 8(1), as if it were pending in the Supreme Court: s 8(2).
By s 5(2), relevantly to this application:
Where ‑
(a)a proceeding (in this subsection referred to as the relevant proceeding) is pending in the Supreme Court (in this subsection referred to as the first court); and
(b)it appears to the first court that ‑
…
(iii)it is otherwise in the interests of justice that the relevant proceeding be determined by the Supreme Court of another State or of a Territory,
the first court shall transfer the relevant proceeding to that other Supreme Court.
The plaintiffs rely on par (iii), that it is otherwise in the interests of justice that the proceeding be determined in the Supreme Court of the Australian Capital Territory.
Dr Zaghloul's claims in the action
Dr Zaghloul relies on multiple causes of action, which have different elements. Dr Zaghloul advised the court that he is filing an amended statement of claim in the District Court, and the amended claim may be more confined than that now filed. Despite the proposed changes, I did not understand that the factual basis of his claim would change.
In 2011, Dr Zaghloul was in dispute with his then employer, Woodside Energy Ltd. In about May 2012, he saw online advertising by Ms Feeley regarding compensation for psychiatric injury, and contacted her about his claims against Woodside. In June 2012, he instructed the plaintiffs to represent him in a case against Woodside and in July 2012 signed a costs agreement. A claim was filed in the Federal Court of Australia, ACT registry. Woodside applied to transfer the matter to the Perth Registry. At the time, Dr Zaghloul was insistent that it not be transferred. The conduct of the plaintiffs in relation to the transfer application was a source of conflict between Dr Zaghloul and his lawyers, and remains part of his action against them.
The other substantial elements of his claim appear to be:
(1) negligence by Ms Feeley in her advice regarding statutory caps on damages in Western Australia;
(2)negligence in other respects in the conduct of the claim, including discovery and failure to have an election for common law damages registered under the Workers Compensation and Injury Management Act (WA) before filing a statement of claim;
(3) misleading conduct by Ms Feeley regarding her expertise and experience in matters involving workplace injury causing psychiatric injury;
(4) failure to act on instructions; and
(5)unconscionable conduct in securing the costs agreement and demanding the transfer of funds.
The current statement of claim contains alternative allegations that the conduct of the plaintiffs was in breach of their fiduciary duties to Dr Zaghloul.
Dr Zaghloul claims damages, including aggravated damages for 'deterioration, aggravation, acceleration, or exacerbation' of his psychiatric injury, damages for loss, and exemplary damages. The current statement of claim also claims equitable remedies for breach of fiduciary duty.
Principles governing the application
The principles to be applied in this application are not controversial. In BHP Billiton Ltd v Schultz (2004) 221 CLR 400 [14], Gleeson CJ, McHugh and Heydon JJ said:
An application for transfer under s 5 of the Cross-vesting Act is brought upon the hypothesis that the jurisdiction of the court to which the application is made has been regularly invoked. If it appears to that court that it is in the interests of justice that the proceedings be determined by another designated court, then the first court 'shall transfer' the proceedings to that other court. There is a statutory requirement to exercise the power of transfer whenever it appears that it is in the interests of justice that it should be exercised. It is not necessary that it should appear that the first court is a 'clearly inappropriate' forum. It is both necessary and sufficient that, in the interests of justice, the second court is more appropriate.
The interests of justice concern the interests of both parties, rather than the selection of the most advantageous, or least disadvantageous, forum for one of them. The court must apply the statute without any presumption as to where the balance of the interests of justice might come down, and adopt what has been described as a 'nuts and bolts' management decision to decide which court, in the pursuit of the interests of justice, is more appropriate to hear and determine the substantive dispute.
The court looks for objective factors which help to identify the natural forum in which the dispute would fall to be decided. Relevant considerations may include the cost and efficiency of proceedings in the respective jurisdictions, and 'connecting factors' including:
•matters of convenience and expense such as availability of witnesses;
•the places where the parties respectively live or carry on business;
•the law governing the relevant transaction; and
•in a personal injury claim arising out of a claim in tort, significant weight is to be attached to the place of the tortious wrong, particularly where that coincides with the residence of the parties.
Matters relied upon by Dr Zaghloul
Submissions on the applicable law
Dr Zaghloul submits that:
(1)the proceedings are within the jurisdiction of the District Court;
(2)no grounds have been provided for their transfer to the Supreme Court; and
(3)they are not 'pending in the Supreme Court'.
Dr Zaghloul argues that he has a prima facie right to require the court to exercise the jurisdiction which he had regularly invoked, and the plaintiffs must show a real injustice to displace the court he has chosen. He submits that the plaintiffs must show the District Court is a 'clearly inappropriate' forum.
I do not accept those submissions.
First, in considering whether to remove the proceedings to this court, I am required to consider the question posed by s 8: should the proceedings be removed to this court so that consideration can be given to transfer to the Supreme Court of the Australian Capital Territory. The court is not called upon to consider whether the relief which Dr Zaghloul seeks lies within the jurisdiction of the District Court or why the proceedings were commenced in that court. The court has power to remit the proceeding back to the District Court if that is appropriate: s 8(3).
Second, it is not necessary to show that the District Court of Western Australia is a clearly inappropriate forum. There is no presumption in favour of the court in which proceedings are commenced.
Dr Zaghloul also argued, by reference to s 17 of the Supreme Court Act 1935 (WA), that the court's power to transfer proceedings is confined to transfer to a lower court. That submission does not take proper account of the express provisions of the Cross‑Vesting Act.
Factors relevant to the more appropriate forum
Dr Zaghloul lives in Perth. Since April 2011, he has been under medical and psychiatric treatment here. In his affidavit in response to the application, he states that he intends to rely on his doctor in Perth as a witness in the action, and also intends to call a Perth based lawyer as a witness. In submissions, he said, more generally, that 'there are likely to be several witnesses, including Ashurst lawyers, my medical treating team and possibly managers from Woodside, my former employer, in any trial'. All of them are Perth based.
Dr Zaghloul further says that his sole income is a disability payment, which he supplements from a lump sum compensation payment under the Workers Compensation and Injury Management Act 1981. He submits that the plaintiffs are in a much stronger financial position to afford the costs of travel.
Dr Zaghloul submits that the action is not connected with the Australian Capital Territory. First, he says the agreement with Ms Feeley and Mr O'Keefe was made in Western Australia. While he travelled to Canberra to sign a costs agreement in July 2012, he had already instructed Ms Feeley to commence a claim and Mr O'Keefe's firm had already withdrawn funds from its trust account. Second, the instructions were for proceedings in the Federal Court, and had no connection with the courts of the ACT. Third, the proceedings related to injury Dr Zaghloul suffered while working in Perth. Fourth, his action is for damages and not for any matter arising under the Legal Profession Act 2006 (ACT).
Dr Zaghloul also submits that he has a pending application for summary judgment, and that there is no corresponding procedure in the ACT. In oral submissions, he qualified that argument, submitting that there is no comparable procedure for summary judgment available at an early stage in the proceedings. I do not believe that submission is right. The Court Procedures Rules 2006 (ACT) provide for summary judgment in terms that do not differ substantially from O 14 of the Supreme Court Rules 1971 (WA). I have, however, taken into account that there is a pending application in the District Court.
Factors relied on by the plaintiffs
The plaintiffs submit that the matter should be cross-vested to the ACT based on these factors:
(1)all of the legal services they provided were in the ACT;
(2)any cause of action in negligence arose in the ACT and is subject to the Civil Law (Wrongs) Act 2002 (ACT);
(3)there may be a question of proportionate liability of a barrister in the ACT;
(4)the plaintiffs and the barrister have their principal place of business in the ACT;
(5)all witnesses (approximately four) to be called by the plaintiffs live in the ACT;
(6)solicitors and counsel retained on behalf of the plaintiffs are located in the ACT;
(7) all relevant events occurred in the ACT; and
(8)the substantive law to be applied to Dr Zaghloul's claim is the law of the ACT.
Consideration of competing factors
Matters of convenience and expense are balanced. The parties and their proposed witnesses live in different States or Territories. One side or the other will be required to travel. The plaintiffs may have more people who would be required to travel, should they use practitioners from the ACT, but are likely to have greater resources. The cost of witnesses travelling could be mitigated by the use of video conferencing.
Dr Zaghloul has presented limited evidence regarding his psychiatric condition. The proceedings are stressful for him. It is not possible, on the evidence available, to say what would be the effect on his health of litigating in the ACT compared to proceeding in Perth.
The costs agreement made between Dr Zaghloul and the plaintiffs is expressed to be pursuant to an offer made to him pursuant to the Legal Profession Act 2006 (ACT), and the agreement and any dispute concerning the agreement or legal costs is governed by the law of the ACT and in particular by pt 3.2 of the Legal Profession Act: costs agreement, preliminary and cl 15. On the allegations set out in the current statement of claim, it is arguable that the costs agreement was made after the retainer was entered into. It is unclear where the contract of retainer was formed, although it was to be performed by the plaintiffs wholly or substantially within the ACT.
Determining the place of a tortious wrong requires the court to look back over the series of events constituting it and then consider 'where, in substance, did this cause of action arise?': Distillers Co (Biochemicals) Ltd v Thompson [1971] AC 458, 468. Each case in which it is necessary to decide where a tort occurred 'turns on its facts and it will rarely be appropriate to try to reason on the basis of factual analogies': Amaca Pty Ltd v Frost (2006) 67 NSWLR 635, 641 [20], cited with approval in Puttick v Tenon Limited (formerly called Fletcher Challenge Forests Limited) [2008] HCA 54; 238 CLR 265, 276 [23].
In the present case, the alleged negligent conduct is all said to have occurred in the ACT, and in relation to proceedings then commenced or contemplated in the ACT registry of the Federal Court.
The claim of misleading conduct by misrepresentation may be found to have occurred where the statement was received by Dr Zaghloul: Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538, 568. But it is not possible to lay down a fixed rule. As Mason CJ, Dawson, Deane and Gaudron JJ, said in Voth:
If a statement is directed from one place to another place where it is known or even anticipated that it will be received by the plaintiff, there is no difficulty in saying that the statement was, in substance, made at the place to which it was directed, whether or not it is there acted upon. And the same would seem to be true if the statement is directed to a place from where it ought reasonably to be expected that it will be brought to the attention of the plaintiff, even if it is brought to attention in some third place. But in every case the place to be assigned to a statement initiated in one place and received in another is a matter to be determined by reference to the events and by asking, as laid down in Distillers, where, in substance, the act took place (568).
Considering all of these matters, I am satisfied that the Supreme Court of the Australian Capital Territory is the more appropriate forum for the determination of this proceeding. In substance, for at least the majority of his claims, Dr Zaghloul relies on conduct that occurred within the Territory, and was related to proceedings intended to be brought in the Federal Court registry in that place. The parties had agreed that disputes governing their costs agreement or the costs charged would be governed by the law of the ACT. The connection to Western Australia is more tenuous.
Dr Zaghloul is disadvantaged in either forum by being unrepresented. But I have no reason to believe that the practice and procedures of the Supreme Court of the Australian Capital Territory would not accommodate an unrepresented litigant. Dr Zaghloul is also potentially limited by his injury, but has not adduced evidence that shows that litigating in another place would make things worse.
Accordingly, I will order that the proceedings in the District Court of Western Australia be removed to the Supreme Court of Western Australia, and transferred to the Supreme Court of the Australian Capital Territory.
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