Hackett v Hackett

[2010] SASC 32

SUPREME COURT OF SOUTH AUSTRALIA

(Applications Under Various Acts or Rules: Civil)

HACKETT v HACKETT & ANOR

[2010] SASC 32

Judgment of The Honourable Justice Gray

22 February 2010

PROCEDURE - COURTS AND JUDGES GENERALLY - COURTS - CONCURRENT JURISDICTION OF DIFFERENT COURTS - TRANSFER OF PROCEEDINGS UNDER CROSS-VESTING LEGISLATION - WHERE APPROPRIATE AND IN INTERESTS OF JUSTICE - GENERALLY

Application to transfer proceedings to Supreme Court of New South Wales pursuant to cross-vesting legislation - whether New South Wales proceeding a related proceeding - whether transfer to New South Wales in interests of justice.

Held: application granted - South Australian proceeding related to New South Wales proceeding - transfer of proceedings in the interests of justice - appropriate to make cross-vesting order.

Jurisdiction of Courts (Cross-Vesting) Act 1987 (SA) s 5, referred to.
BHP Billiton Ltd v Schultz (2004) 221 CLR 400; Cini v Pets Paradise Franchising (SA) Pty Ltd (2008) 102 SASR 177; Australian Rail Track Corp Ltd v Mineral Commodities Ltd [2006] SASC 27; Dawson & Baker (1994) 120 ACTR 11, considered.

HACKETT v HACKETT & ANOR
[2010] SASC 32

CIVIL

GRAY J.

1. This is an application for the cross-vesting of the within proceedings to the Supreme Court of New South Wales.  On 18 February 2010 I made a cross‑vesting order.  I now publish my reasons for that order.

2. Before addressing the evidence adduced in support of the application it is convenient to identify the statutory powers to cross-vest and to set out the principles developed in a number of authorities in relation to these powers.

   The statutory scheme

3. Section 5(2) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (SA) relevantly provides:

   (2)     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)     —

   (i)it appears to the first court that the relevant proceeding arises out of, or is related to, another proceeding pending in the Supreme Court of another State or of a Territory and it is more appropriate that the relevant proceeding be determined by that other Supreme Court; or

   (ii)     it appears to the first court that having regard to—

   (A)whether, in the opinion of the first court, apart from this Act and any law of the Commonwealth or another State relating to cross-vesting of jurisdiction, the relevant proceeding or a substantial part of the relevant proceeding would have been incapable of being instituted in the first court and capable of being instituted in the Supreme Court of another State or Territory; and

   (B)the extent to which, in the opinion of the first court, the matters for determination in the relevant proceeding are matters arising under or involving questions as to the application, interpretation or validity of a law of the State or Territory referred to in subsubparagraph (A) and not within the jurisdiction of the first court apart from this Act and any law of the Commonwealth or another State relating to cross vesting of jurisdiction; and

   (C)     the interests of justice,

   it is more appropriate that the relevant proceeding be determined by that other Supreme Court; or

   (iii)it appears to the first court that 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.

4. In BHP Billiton v Schultz,[1] the High Court gave consideration to the cross-vesting scheme.  Gleeson CJ, McHugh and Heydon JJ relevantly observed:[2]

   In the context of the Cross-vesting Act, one is not concerned with the problem of a court, with a prima facie duty to exercise a jurisdiction that has been regularly invoked, asking whether it is justified in refusing to perform that duty. Rather, the court is required by statute to ensure that cases are heard in the forum dictated by the interests of justice. 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 reason why a plaintiff has commenced proceedings in a particular court might, or might not, concern a matter related to the interests of justice. It might simply be that the plaintiff's lawyers have their offices in a particular locality. It is almost invariably the case that a decision as to the court in which an action is commenced is made by the plaintiff's lawyers, and their reasons for making that choice may be various. To take an example at the other extreme, it might be because a plaintiff is near death, and has a much stronger prospect of an early hearing in one court than in another. The interests of justice are not the same as the interests of one party, and there may be interests wider than those of either party to be considered. Even so, the interests of the respective parties, which might in some respects be common (as, for example, cost and efficiency), and in other respects conflicting, will arise for consideration. The justice referred to in s 5 is not disembodied, or divorced from practical reality. If a plaintiff in the Tribunal were near to death, and, in an application such as the present, it appeared that the Supreme Court to which transfer was sought could not deal with the case expeditiously, that would be a consideration relevant to the interests of justice. Justice would ordinarily dictate that the interest of the plaintiff in having a hearing would prevail over the interest of the defendant in such benefit as it might obtain from the plaintiff's early death. The capacity of the Tribunal to deal expeditiously with cases has always, and rightly, been regarded as relevant to the interests of justice, bearing in mind the condition of many sufferers from dust diseases.

   On the other hand, there may be conflicting interests of such a kind that justice would not attribute greater weight to one rather than the other. The advantage which a plaintiff might obtain from proceeding in one court might be matched by a corresponding and commensurate disadvantage to a defendant. The reason why a plaintiff commenced proceedings in one court might be the same as the reason why the defendant seeks to have them transferred to another court. In such a case, justice may not dictate a preference for the interests of either party.

   …

   In many cases, there will be such a preponderance of connecting factors with one forum that it can readily be identified as the most appropriate, or natural, forum. In other cases, there might be significant connecting factors with each of two different forums. Some of the factors might cancel each other out. If the action is between two individuals, and the plaintiff resides in one law area and the defendant in another, there may be no reason to treat the residence of either party as determinative, although, as already noted, it will ordinarily be the residence of the defendant that is important to establish jurisdiction. Weighing considerations of cost, expense, and convenience, even when they conflict, is a familiar aspect of the kind of case management involved in many cross-vesting applications.

   [1]    BHP Billiton Ltd v Schultz (2004) 221 CLR 400.

   [2]    BHP Billiton Ltd v Schultz (2004) 221 CLR 400 at [14]-[16], [19].

5. In Cini v Pets Paradise Franchising (SA) Pty Ltd,[3] Bleby J summarised the principles to be drawn from BHP in the following paragraph, which I respectfully adopt:[4]

   [3]    Cini v Pets Paradise Franchising (SA) Pty Ltd (2008) 102 SASR 177.

   [4]    Cini v Pets Paradise Franchising (SA) Pty Ltd (2008) 102 SASR 177 at [8].

   Neither party sought to depart from the principles upon which the cross-vesting scheme is based as described by the High Court in BHP Billiton Ltd v Schultz. Those principles may be summarised as follows:

   -It is not relevant to ask whether this Court is justified in refusing to exercise the jurisdiction conferred on it. Rather, it must ensure that the case is heard in the forum dictated by the interests of justice.

   -The question is not whether this Court is an inappropriate forum. It is both necessary and sufficient that, in the interests of justice, the other Court is more appropriate.

   -The Court is required to ensure that cases are heard in the forum dictated by the interests of justice. It is not a question of the exercise of a discretion.

   -The interests of justice are not necessarily the same as the interests of any one party.

   -Because it is necessary to identify the more appropriate forum, no specific emphasis can be given in favour of the choice of forum made by the plaintiff.

   -It is inapt to speak of the applicant for an order for transfer as bearing a burden of persuasion analogous to an onus of proof.

   [footnotes omitted]

6. A further helpful authority in relation to the principles governing applications to transfer proceedings, is the decision of Debelle J in Australian Rail Track Corp Ltd v Mineral Commodities Ltd.[5]  In that case, his Honour extensively examined those principles and extracted the following checklist of factors relevant to “the interests of justice”, as formulated by the Australian Capital Territory Full Court in Dawson v Baker:[6]

   -      application of substantive law;

   -      forensic advantage or detriment conferred by procedural law;

   -      a choice made by a plaintiff of a forum and the reasons for that choice;

   -      substantive connections with the forum;

   -      balance of convenience to parties and witnesses; and

   -      convenience to the court system

   [5]    Australian Rail Track Corp Ltd v Mineral CommoditiesLtd [2006] SASC 27.

   [6]    Australian Rail Track Corp Ltd v Mineral CommoditiesLtd [2006] SASC 27 at [21] citing Dawson v Baker (1994) 120 ACTR 11.

7. Debelle J then observed:[7]

   Those factors substantially reflect the connecting factors identified by Lord Goff in Spiliada.  They had been identified in the cases cited in Dawson v Baker.  Plainly, the weight to be given to the plaintiff’s choice of forum must be qualified by what has been said in BHP Billiton v Schultz.  However, as was pointed out by Gleeson CJ, McHugh and Heydon JJ in BHP Billiton v Schultz at [15], there may be reasons for the choice of forum which are relevant when considering the interests of justice. One example is the capacity of a court or tribunal to deal expeditiously with a claim where, say, the death of a plaintiff may be imminent.

   An examination of issues such as balance of convenience to the parties and the witnesses might demonstrate conflicting advantages and disadvantages to each party.  In other words, as was noted by Gleeson CJ, McHugh and Heydon JJ in BHP Billiton v Schultz at [16]:

   On the other hand, there may be conflicting interests of such a kind that justice would not attribute greater weight to one rather than the other.  The advantage which a plaintiff might obtain from proceeding in one court might be matched by a corresponding and commensurate disadvantage to a defendant.  The reason why a plaintiff commenced proceedings in one court might be the same reason as the reason why the defendant seeks to have them transferred to another court.  In such a case, justice may not dictate a preference for the interests of either party.

   As Callinan J said, one person’s legitimate advantage is another person’s disadvantage.

   [7]    Australian Rail Track Corp Ltd v Mineral CommoditiesLtd [2006] SASC 27 at [21]-[22].

8. The cross-vesting application is brought on the basis that the relevant proceeding, the proceeding in this Court, is related to a proceeding pending in the Supreme Court of New South Wales, or it is otherwise in the interests of justice that the Supreme Court of New South Wales determine the relevant proceeding.

   The South Australian proceedings

9. In the within proceedings, Johnjames Hackett, the plaintiff and the respondent to this application, asserts that he reached an agreement with Dr Earle Hackett, his father, in 1998, concerning the ownership of land located respectively in New South Wales and South Australia.  These proceedings are the relevant proceeding for the purposes of the cross-vesting legislation.  Johnjames Hackett claims that he part-performed the agreement and alleges that some seven years later, in 2008, Dr Hackett breached the agreement by transferring the South Australian property, a property at Norton Summit, into the joint names of himself and his wife Karin Hackett.  Johnjames seeks a declaration that he is the beneficial owner of the Norton Summit property and for delivery up of that property.  In the alternative, he seeks a declaration that Dr Hackett and his wife Karin hold the property on trust for himself.  The defence filed by Dr Hackett and his wife, the defendants in the relevant proceedings and the present applicants, denies that Dr Hackett entered into the alleged agreement.  They have indicated that they propose to counter-claim, seeking an order for possession of the Norton Summit property.

10. During the course of the application to cross-vest, counsel appearing for Johnjames foreshadowed the possibility of an amendment to his claim, to allege an alternative claim.  It was said that if no agreement was reached between Johnjames and Dr Hackett an estoppel arises, based on the representations made by Dr Hackett in the letter said to constitute the agreement.  No amended plea has been formulated and no particulars have been provided.

    The New South Wales proceedings

11. Proceedings have been issued in the New South Wales Supreme Court by Jane Hackett, against Dr Hackett and his wife.  Jane is a daughter of Dr Hackett and a sister of Johnjames.  In the New South Wales proceedings, Jane asserts that between late 2003 and 2006 she and her husband discussed with Dr Hackett the acquisition of the Norton Summit property in South Australia by Jane and her husband.  The proposed acquisition of the Norton Summit property involved Jane relinquishing an interest she had in a property in New South Wales at Arthur Street, Edgecliff.  As a consequence of the arrangement reached, Jane alleges that she transferred her half interest in the Arthur Street property to Dr Hackett who subsequently transferred the title to that property into the joint names of himself and his wife. 

12. In the New South Wales proceedings, Jane initially sought a transfer of the Norton Summit property to herself and her husband, Jon Lemon.  By an amendment to the claim in late 2009, that relief was no longer pursued.  However, Jane seeks the return of her half interest in the Arthur Street property.  Notwithstanding the amendment, Jane has retained in her statement of claim her detailed plea regarding the discussions concerning Norton Summit and the arrangement entered into between herself and Dr Hackett.  That factual basis has continued to be maintained in support of Jane’s claim in relation to the Arthur Street property.

13. It is relevant to record that caveats claiming equitable interests in the Norton Summit property have been lodged, and presently remain on the title of that property, to protect claimed interests of Jane and Johnjames.  During the course of the cross-vesting hearing, counsel for Johnjames informed the Court that he understood that Jane would be applying to withdraw her caveat.  This understanding was confirmed by counsel for the applicants. 

14. It is also relevant to record that a third sibling, Susan Hackett, has a caveat on the title of the Arthur Street property in relation to a claimed interest in that property.  Susan is a party to a cross-claim by Dr Hackett and Karin in the New South Wales proceedings.

    The family context

15. Having identified the general nature of the two sets of proceedings it is convenient to say a little about the family relationships.  Dr Hackett, a retired medical practitioner, had three children by his first wife.  His first wife died many years ago.  Those three children are Jane born in 1948, Susan born in 1951 and Johnjames born in 1953.  Susan lives in New South Wales, Jane is married and lives in Chicago but plans to return to Australia and Johnjames is unmarried and lives in the Norton Summit property. 

16. It appears that Dr Hackett suffered from depression during the 1970s and at times thereafter.  Since the year 2006 he has suffered from physical and mental deterioration.  He is now quite unwell.  He will be unfit to give evidence.  He is represented in the New South Wales proceedings by a guardian, his wife Karin. 

17. A medical report on file from the Director of Geriatric Services at the War Memorial Hospital, Waverley, describes Dr Hackett’s condition:

    I regret to inform you that I am unwilling to act as an expert witness in this matter, but I am happy to make the following comments in regard to his current state of health, as I believe he is not medically fit to give evidence.

    Dr. Hackett has been a patient of mine since November 2006.  I have subsequently reviewed him in February 2008 and September 2008 at my clinic, and on several occasions this year when he has been admitted to hospital.  During my initial assessments of Dr. Hackett, I did not formally assess his cognition, purely because of time limitations.  At the time, there were so many issues to plough through in great detail, that there was simply not time to formally assess his cognition.  As time has progressed, it is clear that Dr. Hackett has developed a progressive, vascular dementia.

    He is now in hospital under my care, awaiting placement in a nursing home.  He is totally confused at times, has intermittent receptive aphasia (can’t comprehend what is being said to him) and at times is totally unintelligible in his speech.  He is now dependant in all activities of daily living and requires assistance to transfer, mobilise and go to the toilet.

    Therefore, he is not fit to give testimony and he will not be able to be present in court.  From my perspective, there is some urgency in settling his financial affairs.  As it stands, he will have to go to whatever nursing home that currently has a vacancy, and he will be regarded as a “concessional” patient (i.e. no assets).  If his financial matters can be resolved, it may be that he will be able to afford to go to a nursing home with somewhat better facilities.

18. Dr Hackett married Karin in or about 2008.  However, they had been living in a de facto relationship for about 25 years.  Dr Hackett was born in 1921 and his wife, Karin was born in 1935.  It would appear that Dr Hackett has two principal assets; the property at Norton Summit and the property at Arthur Street in New South Wales.  Each property is owned by Dr Hackett and his wife as joint tenants.  The transfer by Dr Hackett of the properties into the joint ownership of himself and his wife, was said to have taken place in or about 2007 or 2008.  The property at Arthur Street is the matrimonial home and has been for many years. 

1. If Johnjames is successful in the relevant proceeding, he will obtain a full interest in the Norton Summit property to the exclusion of his father and his step‑mother.  If Jane is successful in the New South Wales proceedings she will recover to the exclusion of her father and step-mother a half interest in the Arthur Street property.  This would leave a half interest in the Arthur Street property which would, by virtue of the joint ownership, be transferred in its entirety to Karin on the death of Dr Hackett, if she were to survive him. 

2. There is no direct evidence before the Court as to Dr Hackett’s mental state in 1998 when the discussions regarding the Norton Summit property occurred with Johnjames, if those discussions occurred at all.  Similarly, there is no direct evidence as to Dr Hackett’s mental state at the time of the alleged conversations with Jane in relation to the properties. 

   Consideration of the application

3. In my view the relevant proceedings and the New South Wales proceedings are related.  To achieve justice in the resolution of the proceedings in South Australia or the proceedings in New South Wales will require the trial Judge to having a clear understanding of the family relationships as evidenced by the discussions that have taken place over a period of many years.  The conduct of Dr Hackett as alleged in the New South Wales proceedings, is conduct that is inconsistent with the claim being pursued by Johnjames in South Australia.  The agreement alleged by Johnjames, and the conduct at the time of that agreement, is inconsistent with Dr Hackett’s alleged conduct in discussing the transfer of the Norton Summit property with Jane some years later.  As pleas for estoppel may be advanced by Johnjames in the relevant proceedings, the case for the one judge hearing all disputes at the one time becomes a powerful consideration with respect to the fair disposal of the proceedings.

4. Following the hearing of the application and the production of a copy of the letter said to form the agreement and to be the basis of Johnjames’ entitlement, counsel for Dr Hackett and Karin sought leave to make further submissions addressing the letter and its relevance to the cross-vesting application. It was said that the letter raised significant questions relevant to the New South Wales proceedings, including: whether the agreement evidences a consistent mode of dealing in which non-binding family arrangements were discussed; whether Dr Hackett was the true author of the letter; the relevant knowledge and intentions of Jane and her husband; whether the agreement is a tripartite agreement between Susan, Johnjames and Dr Hackett or possibly additional parties, and; whether the letter supports Jane’s contention that the Norton Summit property was intended to be transferred to her.  Written submissions in response were also filed by counsel for Johnjames denying that the letter raises any relevant questions in relation to the New South Wales proceedings. 

5. The letter forming the basis of the South Australian proceeding provides:

   Dear Johnjames,

   During your absence in Oz we Connemara Hacketts, led by our Leader, Jon, have thought up a Devilish Plan.

   When I return to Sydney I will make over Norton Summit to you provided that you make over the Edgecliff flat to Susan who provided you have done that will make over her savings to reduce the debt on Norton Summit to a level which Jon and I together with everyone over the next couple of years ought to be able to get more under control because he has now much reduced the mortgage on Cloonderowen.

   This Devilish Plan should relieve you or anyone else of having to adopt any other Devilish Plan such as marrying a Rich Person or anyone else for that matter.   Love to Rupert and to yourself.

   from Earle

   & Jane

   & Susan

   & Jon

   The terms of this letter confirm, in my view, that the issues in the relevant proceeding are related to the issues arising in the New South Wales proceeding.

6. Dr Hackett’s state of health is such that he will be unfit to give evidence in the proceedings.  However, counsel for Dr Hackett informed the Court that his client wished to be present and observe the proceedings.  There is nothing in the evidence before me that suggests he would not be capable of doing so with appropriate nursing support at Court.  As the proceedings concern his family and assets, that wish should be respected if at all possible.

7. The New South Wales proceedings were commenced in 2008 and a provisional trial date has been set for May 2010.  Two days have been set aside in New South Wales for a hearing of the matter with a possible allocation of a third day.  My review of the papers suggests that an efficiently handled trial should be capable of resolving both matters within two or three days.  It would appear to be advantageous that the matters proceed as consolidated proceedings, or at least be heard at the same time in May 2010.  This may be particularly desirable having regard to Dr Hackett’s age and declining health.  However, this is a matter to be determined by the trial Judge.

8. Counsel for Johnjames submitted that his client’s poor health as a result of alcoholism, together with a lack of funds, would greatly disadvantage him in being able to conduct his proceedings in New South Wales.  However, it was accepted that there is no reason why he could not retain his present solicitor as counsel to conduct litigation in New South Wales with appropriate assistance from practitioners in New South Wales. 

9. In my view there is no advantage or disadvantage in any material sense to the parties to have the proceedings disposed of in South Australia or New South Wales.  I refer in particular to the costs of the proceedings and the convenience of the parties. 

10. The application of the principles outlined by the High Court in Schultz makes it appropriate, in my opinion, for this Court to cross-vest the relevant proceedings to New South Wales.  South Australia is not an inappropriate forum to resolve Johnjames’ dispute.  It is an appropriate forum.  However, the question is whether New South Wales is a more appropriate forum having regard to the interests of justice.  This is a question of the determination of what are the dictates of the interests of justice.  Having regard to all of the foregoing circumstances it is appropriate to cross-vest these within proceedings to the New South Wales Supreme Court.