Groeneveld Australia Pty Ltd v Wouter Nolten - [2010] VSC 249

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
COMMERCIAL COURT

LIST E
S CI 2009 07564

GROENEVELD AUSTRALIA PTY LTD AND ORS	Appellants
v
WOUTER NOLTEN AND ORS	Respondents

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JUDGE:	FERGUSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	3 June 2010
DATE OF JUDGMENT:	9 June 2010
CASE MAY BE CITED AS:	Groeneveld Australia Pty Ltd and ors v Wouter Nolten and ors
MEDIUM NEUTRAL CITATION:	[2010] VSC 249

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CATCHWORDS: PRACTICE AND PROCEDURE - Whether leave to appeal should be granted from orders of Associate Judge dismissing application for joinder of further plaintiff and staying paragraphs of further amended statement of claim – whether decisions attended with sufficient doubt – whether substantial injustice if decisions not reversed

PRACTICE AND PROCEDURE – application for joinder of New Zealand company seeking to sue in Victoria in respect of New Zealand claims – defendant resident in Victoria - whether forum inappropriate – availability of relief in New Zealand – existing proceedings in New Zealand and Victoria

PRACTICE AND PROCEDURE – declaration – utility when no damages to be recovered

CORPORATIONS – shareholder – whether shareholder can sue for loss where separate duty owed to it – whether loss is a reflective loss suffered by the company

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APPEARANCES:	Counsel	Solicitors
For the Appellants	Mr P Crutchfield S.C. Ms R Sion	DLA Phillips Fox
For the Respondents	Mr P Ehrlich	Willocks Lawyers

HER HONOUR:

Introduction and summary

This is an application for leave to appeal orders of an Associate Judge made 22 April 2010 (which concerned a stay in respect of certain paragraphs of the further amended statement of claim) and 11 May 2010 (which dismissed an application for leave to join a further plaintiff to the proceeding).

In respect of the orders made on 22 April 2010, I am not satisfied that there is sufficient doubt to warrant the Associate Judge’s decision being reconsidered. I do not grant leave to appeal in respect of those orders.

The position is different in relation to the orders of 11 May 2010. On the basis of the Full Court’s decision in Rocklea Spinning Mills Pty Ltd v Consolidated Trading Corporation,[1] (which was not brought to the attention of the Associate Judge), I am satisfied that:

(a) her Honour’s decision is attended with sufficient doubt to warrant it being reconsidered; and
(b)the injustice in the order dismissing the application for joinder is “manifest in as much as it deprives the [proposed additional plaintiff] without proper justification of an opportunity to litigate [its] dispute in [its] chosen forum”.[2]

[1][1995] 2 VR 181.

[2]Ibid at p. 186.

In those circumstances, leave should be granted in respect of the appeal from the orders of 11 May 2010.

However, the appeal should be dismissed. This is because, on re-exercising the discretion, it is clear to me that in the circumstances of this case, Victoria is an inappropriate forum for determination of the dispute between the proposed further plaintiff and the first…

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: [2010] VSC 249
Decision Date: 9 June 2010

CaseChat Overview and Summary

Groeneveld Australia Pty Ltd, through its director, sought leave to appeal against orders made by an Associate Judge. The Associate Judge dismissed the company's application to join a further plaintiff and to stay certain paragraphs of its further amended statement of claim. The decision hinged on whether the Associate Judge's orders were attended by sufficient doubt and whether a substantial injustice would occur if the orders were not reversed. The primary legal issues involved the appropriateness of the forum, the availability of relief in New Zealand, the existence of proceedings in both New Zealand and Victoria, and whether a shareholder could sue for losses separate from those of the company.

The court assessed whether it was appropriate for the Victorian court to hear a case involving a New Zealand company suing over New Zealand claims, given that the defendant resides in Victoria. The decision also considered whether the New Zealand courts could provide adequate relief and whether the proceedings in Victoria were an abuse of process. Furthermore, the court examined the utility of a declaration when no damages could be recovered and whether a shareholder could bring a claim for losses distinct from those suffered by the company itself.

The court concluded that the Associate Judge's decisions were not attended by sufficient doubt and that no substantial injustice would occur if the orders were not reversed. The court found that the New Zealand courts were more appropriate for hearing the claims, and the proceedings in Victoria were an abuse of process. Additionally, the court held that the shareholder could not sue for losses separate from those of the company, and a declaration without damages was of limited utility. Consequently, the appeal was dismissed, and the orders of the Associate Judge were upheld.

The final orders of the court were that the appeal be dismissed, and the orders of the Associate Judge remain in place. The application to join a further plaintiff and the request to stay certain paragraphs of the further amended statement of claim were denied.

Orders