FEDERAL COURT OF AUSTRALIA
Garrett v Make Wine Pty Ltd [2015] FCA 593
Citation: Garrett v Make Wine Pty Ltd [2015] FCA 593 Appeal from: Application for leave to appeal: Garrett v Make Wine Pty Ltd [2014] FCA 1258 Parties: ANDREW MORTON GARRETT v MAKE WINE PTY LTD, VOK BEVERAGES PTY LTD and TREASURY WINE ESTATES VINTNERS LIMITED File number: VID 731 of 2014 Judge: BEACH J Date of judgment: 17 June 2015 Catchwords: PRACTICE AND PROCEDURE – application for leave to appeal summary dismissal – no sufficient doubt to warrant reconsideration – application dismissed Legislation: Bankruptcy Act 1966 (Cth) s 129AA
Federal Court of Australia Act 1976 (Cth) s 37AOCases cited: Decor Corporation Pty Ltd v Dart Industries Inc (1991)
33 FCR 397
House v The King (1936) 55 CLR 499Date of hearing: 13 March 2015 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 77 Counsel for the Applicant: The Applicant appeared in person Counsel for the Respondents: Mr R Senathirajah Solicitors for the Respondents: Corrs Chambers Westgarth
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 731 of 2014
BETWEEN: ANDREW MORTON GARRETT
ApplicantAND: MAKE WINE PTY LTD
First RespondentVOK BEVERAGES PTY LTD
Second RespondentTREASURY WINE ESTATES VINTNERS LIMITED
Third Respondent
JUDGE:
BEACH J
DATE OF ORDER:
17 JUNE 2015
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
1.The applicant’s application for leave to appeal is dismissed.
2.The applicant is to pay the respondents’ costs of and incidental to his application.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 731 of 2014
BETWEEN: ANDREW MORTON GARRETT
ApplicantAND: MAKE WINE PTY LTD
First RespondentVOK BEVERAGES PTY LTD
Second RespondentTREASURY WINE ESTATES VINTNERS LIMITED
Third Respondent
JUDGE:
BEACH J
DATE:
17 JUNE 2015
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
The applicant has sought leave to appeal from the decision and orders of Mortimer J pronounced on 21 November 2014 in proceeding VID248/2014. Her Honour gave judgment in favour of the respondents on the principal ground that the proceeding was an abuse of process. She also made orders against the applicant pursuant to s 37AO of the Federal Court of Australia Act 1976 (Cth) (FCA). Each of the orders made were interlocutory. Before proceeding further, I should note that on 26 February 2015, Pagone J made a vexatious litigant order against the applicant pursuant to s 37AO of the FCA. It was in a broader form than that made by her Honour.
In my opinion, leave to appeal should be refused.
The hearing before me proceeded on 13 March 2015 with the applicant relying upon voluminous material and diffuse grounds of asserted error said to have been made by her Honour.
On 4 May 2015, the applicant sought leave to bring an application to re‑open the hearing before me and to adduce new evidence that he said arose by…
Continue reading Garrett v Make Wine Pty Ltd
Sign in free to access the full text
Details
- AGLC
- Garrett v Make Wine Pty Ltd [2015] FCA 593
- Case
- [2015] FCA 593
- Decision Date
CaseChat Overview and Summary
In the matter of Garrett v Make Wine Pty Ltd, the applicant, a former Australian winemaker, sought leave to appeal the summary dismissal of his proceeding against the respondents, which included Make Wine Pty Ltd, Vok Beverages Pty Ltd, and Treasury Wine Estates Vintners Ltd. The applicant's claims centred on a 2000 Deed of Settlement and alleged breaches of entitlements and improper use of trademarks and intellectual property. The respondents applied for the proceeding to be dismissed summarily or permanently stayed on various grounds, including abuse of process and standing issues. The court dismissed the proceeding as an abuse of process and declined to grant summary judgment on the merits of the claims but did uphold some of the respondents' arguments on standing and Anshun estoppel.
The court found that the applicant's claims were an abuse of process due to his history of litigation against the respondents. This conclusion was based on the established principle that a bankrupt cannot bring proceedings to protect, enhance, or add to property divested on bankruptcy, as outlined in Samootin v Shea. The court held that the applicant's causes of action in relation to the 2000 Deed vested in his trustee in bankruptcy and did not revert to him upon his discharge from bankruptcy. The court also noted that the applicant's discharge from bankruptcy did not revive his ability to bring claims concerning the 2000 Deed, as the causes of action were still subject to the trustee's control. Consequently, the proceeding was dismissed.
The court dismissed the applicant's application for leave to appeal and ordered the applicant to pay the respondents' costs of and incidental to his application. This decision underscores the importance of standing and the consequences of bankruptcy on a litigant's ability to pursue certain claims in court.
The court found that the applicant's claims were an abuse of process due to his history of litigation against the respondents. This conclusion was based on the established principle that a bankrupt cannot bring proceedings to protect, enhance, or add to property divested on bankruptcy, as outlined in Samootin v Shea. The court held that the applicant's causes of action in relation to the 2000 Deed vested in his trustee in bankruptcy and did not revert to him upon his discharge from bankruptcy. The court also noted that the applicant's discharge from bankruptcy did not revive his ability to bring claims concerning the 2000 Deed, as the causes of action were still subject to the trustee's control. Consequently, the proceeding was dismissed.
The court dismissed the applicant's application for leave to appeal and ordered the applicant to pay the respondents' costs of and incidental to his application. This decision underscores the importance of standing and the consequences of bankruptcy on a litigant's ability to pursue certain claims in court.
Orders
Orders of the court
1. The applicant’s application for leave to appeal is dismissed.
2. The applicant is to pay the respondents’ costs of and incidental to his application.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Before proceeding further, it is appropriate to set out the background to the proceeding below and the matters her Honour was required to deal with. I have gratefully drawn on her Honour’s meticulous and careful summary. BACKGROUND During the 1980s and 1990s the applicant was a well-known Australian winemaker. The proceeding before her Honour concerned the ongoing consequences for the applicant of a decision he made in 2000, as part of the settlement of litigation in South Australia, to divest himself of many of his winemaking interests, including his interests in trade marks. In the proceeding before her Honour, the applicant made a wide range of claims against the three respondents, especially against the third respondent, Treasury Wine Estates Vintners Ltd (TWEV). In broad terms, those claims concern a Deed of Settlement made between him and TWEV (when it was called Mildara Blass) and a number of other parties in July 2000 (2000 Deed). All of his claims involved either allegations of payments he says he was entitled to under the Deed, breaches of other entitlements he says were given to him under the 2000 Deed or allegations about dealing in and use of trade marks and other intellectual property assigned by the applicant to TWEV under the Deed. His battle with the third respondent (in its current and previous corporate iterations) has been drawn out and predates the 2000 Deed. His claims against the first respondent, Make Wine Pty Ltd (Make Wine), and the second respondent, Vok Beverages Pty Ltd (Vok) are new, but derive from assignments of intellectual property to them by TWEV. That intellectual property has formed part of the subject matter of protracted disputes between the applicant and TWEV. The respondents applied before her Honour under r 26.01 of the Federal Court Rules 2011 (Cth) for the proceeding to be dismissed summarily, or permanently stayed, on a number of grounds; no reliance was placed on s 31A of the FCA. They also applied for orders under s 37AO of the FCA seeking to declare the applicant a vexatious litigant and requiring him to seek and obtain leave to commence any further proceedings against them in this Court. Her Honour dismissed the proceeding as an abuse of process. But she declined to dismiss the proceeding by way of summary judgment on the merits of the applicant’s legal and factual arguments. Her Honour did, however, uphold some of the respondents’ arguments on standing and Anshun estoppel. Her conclusions on those matters, and on abuse of process, resulted in her Honour dismissing the proceeding. Her Honour also made orders under s 37AO against the applicant. Her Honour gave the following summary of the facts on the material before her. The applicant entered the winemaking industry in the early 1980s. He developed a company called “The Wine Company”, through which he made a wide range of wine and which by 1989 had a turnover of $12 million, with an annual crush of 6,500 tonnes. He created and registered the business name of “Andrew Garrett Wines” in the mid-1980s, and developed a stylised signature of his name which became regularly used on wine labels. He registered trade marks from the early 1990s which involved his signature. During the same period there was an expansion of the business through the introduction of investors.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
“FWE” was defined in the Macks Deed as the entity originally known as Mildara Blass Ltd, which changed its name to Beringer Blass Wine Estates Ltd and then to Foster’s Wine Estates Ltd. It is now Treasury Wines Estates Vintners Ltd. The “Royalty Stream” was defined in the Macks Deed as the 10-year quarterly payments the parties to the 2000 Deed agreed were payable to the applicant and his then wife in their personal capacities and as trustees for the Andrew Garrett Family Trust. The “Litigant’s Fund” was defined in the Macks Deed as the fund held by the Federal Court into which FWE (as it then was) paid the Royalty Stream payments pending the resolution of the dispute as to whom they were payable.Summary judgment grounds The respondents sought summary judgment in respect of all the applicant’s claims against them. Her Honour refused to grant summary judgment on the basis of any lack of legal or factual merit of the various claims, putting to one side the question of standing. However, she summarily dismissed the proceeding on the principal ground that it was an abuse of process. The respondents also put separate submissions that the applicant had no standing in relation to several of his causes of action. They submitted that all but one of the causes of action relied upon by him had vested in his trustee in bankruptcy from at least the date of the sequestration order applying to the applicant on 24 September 2004. They submitted that, even after the applicant’s discharge from his bankruptcy, those causes of action remained vested in his trustee. The respondents conceded, however, that the cause of action concerning cl 15 of the 2000 Deed accrued after the applicant’s discharge from bankruptcy. There was no issue about his standing in relation to that claim. The applicant maintained that his discharge from bankruptcy revived his ability to bring claims of the kind he now makes. Her Honour held at [88]:However, because of the other bases on which the respondents put their r 26.01 application, I have concluded some of the respondents’ contentions on standing and estoppel should succeed and that their abuse of process arguments should be accepted. In that sense, Mr Garrett has no reasonable prospects of successfully prosecuting his claims in this proceeding, not because of any independent assessment by this Court of the legal and factual merits of the claims, but rather because of the existence of those other factors. On the specific question of lack of standing, her Honour held at [99], [100], [102] to [108] the following:99There could be no controversy over Mr Garrett’s standing in relation to any of these claims but for his bankruptcy. 100On the effect of his bankruptcy, the respondents relied on the case of Samootin v Shea [2010] NSWCA 371. On this issue the lead judgment was given by Campbell JA, with Beazley and Hodgson JJA agreeing.102The Court found Mrs Samootin lacked standing to bring the application for leave to appeal. It noted that the property which vested in a trustee in bankruptcy at bankruptcy included choses in action, relying on Daemar v Industrial Commission of NSW (No 2) (1990) 22 NSWLR 178 at 184-185 per Kirby P, with whom Clarke and Meagher JJA agreed. That proposition is well established: see also Re Bankrupt Estate of Cirillo; Ex parte Official Trustee in Bankruptcy (1996) 65 FCR 576 at 583 per Branson J; see also Samootin v Official Trustee in Bankruptcy (No 2) [2012] FCA 316 at [19] per Katzmann J.103The Court of Appeal also found (at [95]) that discharge of a bankrupt from bankruptcy does not cause any assets that have vested in the Official Trustee to revert to the bankrupt. Campbell JA further found (at [99]):Similarly, if an asset that the bankrupt owned at the time of the bankruptcy but that was thought to be worthless is shown, after the bankrupt has been discharged, to have some value, that asset remains vested in the Official Trustee, and if the Official Trustee is of the view that that value is worth realising, it is only the Official Trustee who has the power to realise that value.104I respectfully agree with the reasoning of Campbell JA at [92]-[100], and consider that it applies to Mr Garrett’s circumstances.105Campbell JA referred to Cummings v Claremont Petroleum NL (1996) 185 CLR 124, which in my respectful opinion is also relevant to the matters in issue on this application. At 136, Brennan CJ, Gaudron and McHugh JJ held that:… a bankrupt has no right to bring or prosecute proceedings to protect, enhance or add to the property of which he has been divested on bankruptcy.106 The Court also held, at 138, thatA bankrupt’s contingent interest in a surplus does not give him an interest which would allow him to sue to enforce proprietary rights….107Mr Garrett’s causes of action in relation to alleged breaches of the 2000 Deed, and any interests he had to be paid, or rights he had available for exercise, under that Deed which could have resulted in additional funds being available for creditors vested in his trustee in bankruptcy. Having been divested of that property on bankruptcy, he does not reacquire it after his discharge and is not able to issue proceedings in relation to the 2000 Deed.108There may, as the respondents conceded, be some doubt whether these principles apply to the cause of action in relation to cl 15 of the 2000 Deed, which did not and could not have arisen until after Mr Garrett’s discharge from bankruptcy. Whether one potential cause of action under the 2000 Deed could survive the bankruptcy and be available to Mr Garrett is not, in my opinion, immediately obvious. To so conclude may be inconsistent with the approach taken in Samootin [2010] NSWCA 371 and the authorities there referred to. However I do not need to decide this because in my opinion any claim by Mr Garrett in relation to cl 15 of the 2000 Deed is precluded for reasons of abuse of process.
Ratio Decidendi
Legal Principle Established
Full text does not contain this section.