Islander Enterprises Pty Ltd v Commonwealth

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
ISLANDER ENTERPRISES PTY LTD v COMMONWEALTH
[2021] SASC 84
Judgment of the Honourable Justice S David

COURTS AND JUDGES - COURTS - JURISDICTION AND POWERS - CONCURRENT JURISDICTION OF DIFFERENT COURTS - TRANSFER OF PROCEEDINGS UNDER CROSS-VESTING LEGISLATION - WHERE APPROPRIATE AND IN INTERESTS OF JUSTICE - GENERALLY
On 5 August 2020, the applicant instituted proceedings in the Supreme Court of South Australia relying on two principle causes of action; breach of contract and representation and promissory estoppel.
On 2 December 2020, the respondent made an application pursuant to s 5(2)(b)(iii) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (SA) seeking an order transferring the proceedings to the Supreme Court of the Australian Capital Territory on the basis that it is in the interests of justice to do so.
The applicant in the substantive proceedings is opposed to the application.
Held, dismissing the application:
1. The transfer of proceedings is not in the interests of justice.
Jurisdiction of Courts (Cross-vesting) Act 1987 (SA) s 5(2)(b)(iii), referred to.
BHP Billiton v Schultz & Ors (2004) 221 CLR 400; Cini & Ors v Pets Paradise Franchising SA Pty Ltd & Ors (2008) 102 SASR 177; Crompton Specialties Pty Ltd v BASF Australia Ltd [2006] SASC 39; Garra Water Investments Pty Ltd (in liquidation) v Ourback Yard Nursery Pty Ltd & Garra [2010] SASC 326, considered.

ISLANDER ENTERPRISES PTY LTD v COMMONWEALTH
[2021] SASC 84
Supreme Court: Civil

DAVID J: This application is made pursuant to s 5(2)(b)(iii) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (SA) (‘the Act’). The Act provides that where a proceeding is pending in this Court and it appears to the Court that it is otherwise in the interests of justice that the relevant proceedings be determined by the Supreme Court of another State or Territory, this Court shall transfer the relevant proceedings to that other Supreme Court. The respondent in the substantive proceedings, the Commonwealth of Australia, seeks an order transferring the proceedings to the Supreme Court of the Australian Capital Territory (‘ACT’) on the basis that it is in the interests of justice to do so. The applicant in the substantive proceedings, a company ‘Islander Enterprises Pty Ltd’, is opposed to the application.
Background
The applicant is registered in Queensland. The sole director of the company, at the relevant time, was a Mr Christopher Langton (‘Langton’), who now resides in Coolangatta, Queensland. The applicant was engaged by the respondent under a services contract to provide air surveillance services operating out of Samoa. The contract was executed on or about 7 August 2014 and was for a period of 12 months. The contract provided for a review for the purposes of determining the future viability of the contract. On 5 August 2015, the respondent gave notice that the contract would not be renewed. Accordingly, the contract came to an end on 6 August 2015.
The contract provides that the laws of the ACT apply, and that the court of the ACT shall have non-exclusive jurisdiction to decide any matter arising out of the contract.
The relevant clause of the contract provides as follows:
9POLICY AND LAW
9.1 Applicable Law
9.1.1The laws of the Australian Capital Territory shall apply to the contract. The courts of that State or Territory shall have non-exclusive jurisdiction to decide any matter arising out of the Contract.
…
On 5 August 2020, the applicant instituted proceedings in the Supreme Court of South Australia by way of a Statement of Claim which seeks relief in the form of alleged losses and damages arising on two principle causes of action. The first cause of action is for breach of contract alleged to have arisen from the respondent’s purported failure to review the contract and to give notice of termination. Save for a plea that the respondent has not provided a notice by 30 March 2015 that the contract would not be renewed, the respondent denies those allegations. The second cause of action, as pleaded, arises in equity and is in the nature of estoppel by representation and promissory estoppel. The causes of action are pleaded by reference to alleged oral statements made by a defence officer in Samoa, Lieutenant Commander Parsons (‘Parsons’), who was the Commonwealth Representative under the contract, and Langton, who was the Director and Chief Executive Officer of the applicant. The respondent either denies that the relevant representations were made at all; does not admit such representations were made; or denies the alleged legal import of any representation that has been admitted.
Applicable legal principles
The cross-vesting legislation was considered by the High Court in BHP Billiton v Schulz & Ors.[1] In their joint judgment, Gleeson CJ, McHugh and Haydon JJ said:[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 has been 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 interest 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.
[1] (2004) 221 CLR 400.
[2] (2004) 221 CLR 400 at [14].
The principles to be applied in an application under the Act were also summarised by Bleby J in Cini & Ors v Pets Paradise Franchising SA Pty Ltd & Ors, where his Honour said:[3]
[3] (2008) 102 SASR 177 at [8].
…
·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)
As Duggan J said in Crompton Specialties Pty Ltd v BASF Australia Ltd:[4]
The enquiry whether it is in the interests of justice to transfer the present proceedings to the Supreme Court of Victoria has focused on the factors which might be said to connect the proceedings to the jurisdiction of one State or the other. They are the sort of considerations referred to by Higgins J in Dawson v Baker (1994) 123 FLR 194 and include the law to be applied, proper forensic advantage to one party or the other, residence, domicile, place of occurrence and the balance of convenience to parties and witnesses. The ultimate question, however, is whether it is in the interests of justice to exercise the power.
[4] [2006] SASC 39 at [5].
Respondent’s submissions
The respondent makes the following submissions in support of the application to transfer proceedings.
First, that the application arises in circumstances where neither the locus of dispute nor the parties to the dispute have any relevant connection to the jurisdiction of South Australia. The respondent submits that, to the extent that the dispute has any locus, it is more associated with Canberra than any other forum. The employees of the respondent in Canberra are alleged to have breached the contract by not conducting a review in Canberra and/or not sending notices of termination and other communications from Canberra to the applicant. The respondent submits the locus of the contractual dispute is more naturally aligned with Canberra, not South Australia.
Moreover, the parties are not resident in South Australia. The applicant is resident in Queensland, as is its primary director, Langton. The respondent submits that no weight can be placed on the fact that another director of the applicant, a Mr Michael Fuller (‘Fuller’), resides in South Australia as he was not a director during the contract, and he is not proposed to be called as a witness in relation to any matter arising out of the pleadings. The primary witness for the respondent, so far as the dispute concerning the alleged representations is concerned, is Parsons. He is resident in Cairns. The other relevant witness for the respondent is a Mr Stephen Broadbent, who resides in Canberra.
Secondly, the respondent submits that the only connection between the proceedings and this Court is the location of the applicant’s solicitors and counsel, who are based in Adelaide. As to the applicant’s submission that there is a costs agreement in place which does not require immediate payment, the respondent submits there is no evidence of any such agreement, and in any event, there is no impediment to the applicant’s solicitors and counsel continuing to act if the proceedings are transferred to Canberra.
Thirdly, the respondent relies on the non-exclusive jurisdiction clause of the contract. By virtue of that clause, the parties agreed that the applicable law of the dispute is the law of the ACT and that the courts of the ACT shall have non‑exclusive jurisdiction to determine any matter arising under the contract. The respondent submits that significant, indeed decisive, weight should be accorded to that agreement of the parties in circumstances where there is no countervailing factor demonstrating that this Court is the more appropriate forum.
Applicant’s submissions
The applicant, on the other hand, submits that one of the directors of the company, Fuller, resides in Adelaide and continues to provide instructions to the applicant’s solicitor and counsel, both of whom are located in Adelaide. Moreover, the applicant’s other director, Langton, resides in Queensland and is frequently overseas, requiring Fuller to provide instructions on behalf of the applicant. The applicant submits that should the matter be transferred to the ACT, Fuller would need to travel to Canberra to do so. Further, the applicant’s solicitors have no office in Canberra, and counsel presently instructed is based in Adelaide. Thus, the applicant would incur increased costs and inconvenience having to travel to Canberra to litigate the claim, or in having to instruct new solicitors or counsel in Canberra. The applicant also notes that the respondent is a well-resourced litigant.
Secondly, the applicant submits that a transfer of the proceedings would place an unnecessary burden on the applicant as the applicant’s solicitors and counsel in Adelaide are acting without the requirement for immediate payment. If the proceedings are transferred to the ACT, the applicant will not be able to support the considerable cost of sending solicitors and counsel to the ACT for trial. Furthermore, there is no guarantee that the applicant would be able to instruct new legal representatives prepared to act under the same financial arrangements or cost agreement.
Thirdly, and in respect of the non-exclusive jurisdiction clause, the respondent submits that the existence of the clause is not determinative on its own. The clause does not purport to make the named place an exclusive jurisdiction, but rather expressly reserves to the parties the option of choosing a different jurisdiction to that named in the contract. Further, the law applicable to the dispute is the common law and there are no special points of law or interpretation unique to the ACT which would affect the justice of the case.
Consideration
The respondent bears an evidential onus to establish a basis upon which a court may make an assessment that a court of the ACT is the more appropriate forum to litigate the proceedings, and that it is in the interests of justice to transfer the proceedings to that court.[5]
[5] Garra Water Investments Pty Ltd (in liquidation) v Ourback Yard Nursery Pty Ltd & Garra [2010] SASC 326 at [12]; Cini & Ors v Pets Paradise Franchising (SA) Pty Ltd & Ors (2008) 102 SASR 177.
Neither the locus of the dispute nor the parties to the dispute have any real connection with either South Australia or the ACT. The applicant is based in Queensland. The primary witness for the applicant, Langton, resides in Queensland. The primary witness for the respondent, Parsons, resides in Cairns. A witness for the respondent, Broadbent, resides in Canberra. However, the residence of the witnesses, and the balance of convenience as to those witnesses, is relatively neutral between the parties.
As mentioned, the applicant’s solicitors are based in Adelaide with no office in the ACT. The applicant’s counsel is in Adelaide. The applicant’s other current director, Fuller, resides in Adelaide. The respondent’s solicitors with conduct of the matter are based in Sydney, but the respondent’s solicitors also have an office in Canberra. The respondent’s counsel is based in Adelaide.
There was no evidence before me as to the existence of a cost agreement between the applicant and their solicitors which requires no immediate payment, nor that this agreement could not be entered with another Canberra based firm and/or counsel. Consequently, I put this submission to one side for the purposes of this application.
However, I am satisfied that the applicant would, at the very least, incur increased costs and inconvenience in their presently instructed solicitors and counsel having to travel to Canberra to litigate the claim, or in having to instruct new solicitors or counsel in Canberra. Whilst some of the work already completed would not need to be duplicated, there is an inevitable incurring of further costs by instructing new solicitors and counsel so they can become fully apprised of the materials. Fuller, who provides instructions for the applicant, also resides in Adelaide. With increased technology and advanced communications, the burden on the applicant continuing to obtain instructions from Fuller, should the matter be transferred to the ACT, is less than it may once have been. However, the residence of Fuller in Adelaide would still add a level of inconvenience and expense should the proceedings be transferred to the ACT, particularly at the commencement of any trial.
It is necessary to have regard to clause 9 of the contract. It is clear, and common ground, that the clause is not an ‘exclusive jurisdiction’ provision. An agreement between the parties as to jurisdiction and the governing law is a significant factor to take into account in an application under the Act.[6] However, in circumstances where the jurisdiction clause does not purport to make the named place an exclusive jurisdiction, but rather expressly reserves to the parties the option of choosing another jurisdiction to that named in the contract, and where there would be no relevant difference between the application of the law of South Australia and the laws of the ACT to the issues arising out of the pleadings, it is less relevant as a consideration.[7]
[6] Crompton Specialties Pty Ltd v BASF Australia Ltd [2006] SASC 39 at [14].
[7] Garra Water Investments Pty Ltd (in liquidation) v Ourback Yard Nursery Pty Ltd & Garra [2010] SASC 326 at [17].
As I have said, neither the locus of the dispute nor the parties to the dispute have any real connection to either jurisdiction, and neither this Court nor a court of the ACT is a convenient forum for the potential witnesses. However, I am satisfied that should the proceedings be transferred to the ACT, that will result in an increased financial burden for the applicant, who does not have an office in Canberra. The applicant’s legal representatives will need to travel to Canberra or instruct Canberra based solicitors and/or counsel or the applicant will need to instruct new solicitors and counsel. The applicant’s director may also need to travel to Canberra at some point during the proceedings. Bearing in mind, the more limited significance of the non-exclusive jurisdiction clause, for the reasons outlined earlier, I am not satisfied it is in the interests of justice to transfer the proceedings to the ACT.
I dismiss the respondent’s application.

[2021] SASC 84

7 July 2021