Livestock Transport (Sydney) Pty Ltd v Commonwealth of Australia
[2011] NSWSC 283
•11 April 2011
Supreme Court
New South Wales
Medium Neutral Citation: Livestock Transport (Sydney) Pty Ltd v Commonwealth of Australia [2011] NSWSC 283 Hearing dates: 4 April 2011 Decision date: 11 April 2011 Jurisdiction: Common Law Before: McCallum J Decision: Application dismissed
Catchwords: PROCEDURE - application to have proceeding transferred to Supreme Court of Queensland - where Commonwealth facing similar claim in that Court at the suit of a different party - common questions of fact and law raised in both proceedings - whether more appropriate that present proceeding be determined in the Supreme Court of Queensland - where interests of justice lie. Legislation Cited: Jurisdiction of Courts (Cross Vesting) Act 1987 Cases Cited: Australian Technology Fund Management v ATF Group [2009] NSWSC 673
Bankinvest AG v Seabrook (1988) 14 NSWLR 711
BHP Billiton v Shultz [2004] HCA 61; (2004) 221 CLR 400
James Hardie Company Ltd v Barry (2000) 50 NSWLR 357
Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460Category: Interlocutory applications Parties: Livestock Transport (Sydney) Pty Ltd (plaintiff, respondent to the motion)
Commonwealth of Australia (defendant, applicant on the motion)Representation: Counsel:
Mr Gemmell (for the plaintiff)
Mr R J Weber SC with Mr D Quayle (for the defendant)
Solicitors:
Indemnity Legal P/L (for the plaintiff)
Blake Dawson (for the defendant)
File Number(s): 2009/297821
Judgment
In August 2007 there was an outbreak of equine influenza in Australia. The virus ignored jurisdictional boundaries, spreading to horses in both New South Wales and Queensland.
Steps taken to contain the spread of the virus included the imposition of extended restrictions on the transport of horses. The present proceeding is a claim brought against the Commonwealth of Australia by a New South Wales horse transport company, Livestock Transport (Sydney) Pty Limited, to recover financial loss allegedly suffered as a result of the impact of those restrictions on its business. Livestock's claim is based on the contention that the introduction of the virus was due to negligence on the part of the Commonwealth in the management of the nation's quarantine system.
Three weeks before the commencement of this proceeding, the owner of a horse stud at Nobby in the State of Queensland, Clasul Pty Limited, brought a similar claim against the Commonwealth in the Supreme Court of Queensland. A large number of Clasul's horses became infected with equine influenza in late 2007. Clasul seeks to recover damages for lost stud and agistment fees, the cost of veterinary treatment and the value of a mare and a number of foals who allegedly died as a consequence of being infected with the disease.
The solicitors in the Queensland proceeding have informed the Supreme Court of Queensland that Clasul's action is "the lead case in a series of actions yet to be started by approximately 800 other parties" also represented by the same solicitors.
The application presently before the court is an application by the Commonwealth to have the present proceeding transferred to the Supreme Court of Queensland pursuant to section 5(2) of the Jurisdiction of Courts (Cross Vesting) Act 1987 so that the two claims can, if seen fit by that Court, be heard together. Livestock opposes the application.
So far as their cases on liability are concerned, the claims brought by Livestock and Clasul each arise out of essentially the same facts. Most if not all of the relevant events occurred within the State of New South Wales. The central issues raised by the claims concern the Commonwealth's operation of a quarantine facility at Sydney Airport and the Eastern Creek Quarantine Station, both of which are within the State of New South Wales. Eastern Creek is on the western fringes of Sydney.
Both claims are based on the allegation that equine influenza was introduced into Australia when a number of stallions imported from Japan arrived at Sydney Airport and were conveyed to Eastern Creek Quarantine Station. One of the stallions was allegedly infected with equine influenza at the time of his arrival. The plaintiffs allege that the virus subsequently spread within and escaped from the quarantine facility as a result of the fact that grooms, farriers and private veterinarians attending horses there were not required to take adequate steps to decontaminate themselves upon their departure.
The Commonwealth acknowledges, in those circumstances, that the primary factual inquiry common to both claims concerns events that occurred within New South Wales and that "some of the lay witnesses will hail from New South Wales".
The principal basis for seeking to have what is essentially a New South Wales claim transferred to be heard in Queensland is the existence of the Clasul proceeding. The Commonwealth brings the present application as a step towards having both proceedings heard together in Queensland so as to avoid duplication of costs and other resources and the risk of inconsistent findings in the two sets of proceedings.
In recognition of the undoubted costs burden that would be imposed upon Livestock if the application were granted, the Commonwealth has offered to pay Livestock's reasonable additional legal costs incurred as a result of the cross-vesting.
The Commonwealth relies upon subsections 5(2)(i) and (iii) of the Jurisdiction of Courts (Cross Vesting) Act, which provide:
(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) it appears to the first court that:
(i) 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
(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.
To the extent that the application is brought under section 5(2)(b)(i), the Court must consider two matters: whether this proceeding is related to the Queensland proceeding and whether it is more appropriate that this proceeding be determined by the Supreme Court of Queensland. The Commonwealth's reliance on section 5(2)(b)(iii) raises a separate question, namely whether it is in the interests of justice that this proceeding be determined by the Supreme Court of Queensland.
If it appears to the court that either of those inquiries favours determination of the proceeding by the Supreme Court of Queensland, the statute directs that the order be made. There is no residual discretion.
It is well established that, in considering whether to make an order for transfer, there is no prima facie presumption that the court the jurisdiction of which was properly invoked should exercise it: Bankinvest AG v Seabrook (1988) 14 NSWLR 711 at 727B per Rogers A-JA, Street CJ and Kirby P agreeing. The application in that case, thought to be the first contested application for a transfer order in this Court following the introduction of the cross-vesting legislation, was referred to the Court of Appeal so as to provide authoritative guidance as to the law and practice in this State relating to the cross-vesting scheme: at 715F and 717G.
The leading judgment was given by Rogers A-JA. His Honour explained the historical context in which the legislation had been introduced and (at 725G) emphasised the importance:
that full effect be given by the courts to the imaginative and detailed code for ensuring that throughout Australia disputes are dealt with by the one court and that be the court most appropriate for the particular dispute.
It follows that no particular significance attends the plaintiff's original choice of forum: BHP Billiton v Shultz [2004] HCA 61; (2004) 221 CLR 400 at 425 [26] - [27] per Gleeson CJ, McHugh and Heydon JJ; 439 [77] per Gummow J. The task is to inquire whether it appears to the court that the case falls within the terms of the provisions relied upon.
A majority of the Court in Bankinvest was of the view that it is inapt to speak in terms of an onus on the applicant, having regard to the fact that the court has power under section 5(7) to make an order of its own motion: at 727B per Rogers A-JA; Street CJ agreeing at 713E; Kirby P reserving that question at 716G. The view of the majority was embraced by Gummow J in BHP Billiton v Shultz at [71]. Notwithstanding views to the contrary (such as those expressed by Kirby P in his dissent on this point in Bankinvest and those expressed by Mason P in James Hardie Company Ltd v Barry (2000) 50 NSWLR 357 at [100]) the proper approach in this Court is that which accords with the majority view in Bankinvest.
Application under section 5(2)(b)(i): whether it is "more appropriate" to have the proceeding determined in Queensland
The first issue to be considered under section 5(2)(b)(i) is whether the present proceeding is "related to" the Clasul proceeding. There does not appear to be any great contest between the parties on that issue. The two proceedings have a common defendant. They raise common questions of fact and law as to whether equine influenza was introduced into Australia by the mechanism alleged by both plaintiffs and whether there was negligence on the part of the Commonwealth as alleged. There is a large measure of overlap between the two proceedings in those respects.
Indeed, the form of the allegations made in the pleadings in each proceeding in many instances exactly coincides. At the hearing of the present application, counsel for the Commonwealth provided for the aid of the court a copy of the statement of claim in the present proceeding marked up so as to show where an allegation was either identical to a paragraph in the statement of claim filed by Clasul or of the same or similar effect to a paragraph in that statement of claim. That comparison suggests that one of the pleadings was drafted with the other as a precedent, or that they were both drafted with the benefit of a common external precedent.
There are some differences. The causes of action relied upon by Livestock Transport are negligence and breach of statutory duty. The claim brought by Clasul is confined to a claim in negligence. Each claim raises different causation issues. Livestock's claim appears to turn largely on the issue whether the alleged escape of the virus from Eastern Creek Quarantine Station caused the imposition of the transport restrictions. Clasul's claim is based on the arrival of a form of the virus at Nobby and so appears to raise separate or additional questions of causation. There is no overlap between the cases as to the damages claimed.
It may be accepted, however, that the two cases raise a substantial and common central factual inquiry and a substantial and common central legal inquiry, as contended on behalf of the Commonwealth. The critical issue as to liability in each proceeding is the means by which the virus entered the general Australian population of horses in August 2007 and whether the Commonwealth owed each plaintiff a common law duty of care.
On that basis I accept, as contended on behalf of the Commonwealth, that there is likely to be a large number of common witness for the Commonwealth in each case and a substantial overlap in terms of discovery and expert evidence. In my view, it may comfortably be concluded that the present proceeding is "related to" the proceeding in Queensland within the meaning of section 5(2)(b)(i). That said, the relationship differs from that which exists in cases where all of the parties are common. Multiple claims by unrelated plaintiffs against a common defendant raise different considerations.
In any event, the critical question is whether it is "more appropriate" that the present proceeding be determined by the Supreme Court of Queensland. Save for the existence of the proceeding in Queensland, there would be no suggestion that it was more appropriate to determine Livestock's claim anywhere other than in New South Wales. As already noted, it is acknowledged on behalf of the Commonwealth that the events on which the primary common factual inquiry will centre occurred for the large part in New South Wales, at Sydney Airport, the Eastern Creek Quarantine Station and other places within this State. New South Wales is clearly the place of the alleged tort and the residence of the plaintiff. The Commonwealth may probably be regarded for all practical purposes as being resident in all jurisdictions, including New South Wales. Those considerations are generally regarded as being determinative of the issue of "appropriate court", although other factors may need to be assessed in determining where the interests of justice lie: James Hardie Company Ltd v Barry at 361 per Spigelman CJ.
Separately, the Commonwealth acknowledges that the transfer of the proceeding will visit additional costs and expenses on Livestock Transport. To some extent, that issue has been addressed by the offer by the Commonwealth to indemnify Livestock Transport for any additional expense it may incur as a result of the transfer order. The Commonwealth accepts, however, that the transfer of the proceeding will result in inconvenience which will not be totally remedied by its costs offer.
It was common ground that the proceedings in each jurisdiction are essentially at the same stage of progress. In each case, the pleadings are closed and the process of discovery is commencing or will soon commence.
Against those considerations, the Commonwealth submits that there is one overriding reason why it is more appropriate that the proceeding be determined by the Supreme Court of Queensland, namely that if the proceeding is not transferred there is a risk of the two courts in which the separate proceedings have been commenced making inconsistent findings of fact and law.
I can readily accept that, if the cases are managed such that both proceedings continue in different jurisdictions in tandem, there is at least a theoretical risk of inconsistent findings. Further, the prospect of the same group of witnesses having to give evidence twice in different proceedings is certainly an unhappy one.
However, I do not understand why it is thought to follow that the Queensland proceeding has the greater gravitational pull. In this respect, it might be observed that, just as the choice of jurisdiction by the plaintiff in this proceeding does not give rise to a prima facie presumption that the jurisdiction that has been invoked by it should be exercised, so it may be said that the Commonwealth's choice as to which proceeding it seeks to have transferred to be joined with the other should not determine the issue as to which is the more appropriate place to have the proceeding determined.
With one exception, every point relied upon by the Commonwealth as a ground for transferring this proceeding to Queensland is entirely equivocal as to the issue of the more appropriate jurisdiction, and one that would found a mirror submission if the transfer application were being considered by the Supreme Court of Queensland in the Clasul proceeding. The one exception is the fact that the solicitors in the Clasul proceeding have informed the court that there are 800 other parties behind the Clasul claim. There is no reason to doubt the integrity of that representation but it is difficult to give it any content without knowing more. In any event, in the absence of any issue estoppel, and having regard to the fact that the common law is uniform across Australia, a determination in either jurisdiction would be of the same value to those other parties.
Conversely, there are many factors that point specifically to New South Wales as the more appropriate jurisdiction. As noted on behalf of Livestock, the place of the tort is New South Wales; the parties are both located in New South Wales (albeit that the Commonwealth could also be said to be located in Queensland); all of the plaintiff's witnesses live in Sydney; it seems likely that a large number of the Commonwealth's witnesses will also live in Sydney and, in the event that the court orders a view of the quarantine facilities in question (which does not appear fanciful), those facilities are within a relatively small radius of Sydney. All of those considerations militate against the conclusion that the Supreme Court of Queensland is the more appropriate court to determine Livestock's claim.
I should note that Livestock relied upon some additional considerations in opposition to the relief sought, relating to the procedures available in each court. In my view, those matters were also equivocal. In particular I note that, contrary to a submission put on behalf of Livestock, it appears that the Queensland Supreme Court is equally well disposed to accommodate conferences among expert witnesses out of court, although the procedure of giving concurrent expert evidence has not been formally embraced in that jurisdiction as it has here. In any event, I have not placed any weight on those considerations. I accept the Commonwealth's submission that either court is equally well placed, from a procedural point of view, to determine the disputes.
Nonetheless, there is force in the submission put on behalf of Livestock that, while it would clearly be preferable to avoid duplication in the hearing of the main issues as to liability, the present proceeding does not satisfy the statutory requirements of section 5(2)(b)(i). Having regard to all of the matters raised by the parties, it does not appear to me that it is more appropriate that the present proceeding be determined by the Supreme Court of Queensland.
Application under section 5(2)(b)(iii): interests of justice
In Bankinvest , Rogers A-JA said of section 5(2)(b)(iii) (at 730D):
Self-evidently, this clause was designed to provide a basis for a transfer in circumstances where the requirements of subcl (i) and subcl (ii) are not satisfied. Thus, where there are no related proceedings pending in the other Supreme Courts, the dispute does not involve matters of inter-State law, in relation to which jurisdiction is acquired only by reason of the cross-vesting legislation, nonetheless, the court may effect a transfer.
His Honour considered that the "interests of justice" which the legislature evidently considered should be taken into account in that process were essentially the same as those specified by the House of Lords in Spiliada Maritime Corporation v Cansulex Ltd [1987] AC 460 (albeit in a different juridical context). What emerges from his Honour's discussion of that decision at 728 of the judgment in Bankinvest is that the court's inquiry should turn attention to determining "natural forum" or the forum with which the action has the most real and substantial connection. As already noted, the preponderance of connecting factors in the present case points to New South Wales as the natural forum, the only connection with Queensland being the existence of the Clasul proceeding.
As noted on behalf of the Commonwealth, the High Court has since observed that "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": Shultz at 421 [15] per Gleeson CJ, McHugh and Heyden JJ. The task is to consider whether the wider interests of justice in the present case warrant a transfer of the present proceeding away from its natural forum.
The Commonwealth relied upon the decision of McDougall J in Australian Technology Fund Management v ATF Group [2009] NSWSC 673. In that case, proceedings in two different State Supreme Courts raised a common issue of fact as to what was said at a particular meeting. His Honour said (at [12] to [13]):
It seems to me to be intolerable, particularly taking into account the dictates of s 56 of the Civil Procedure Act 2005, that this Court should undertake the tasks to which I have referred, as part of the process of determining the real issues in these proceedings, and that at the same time the Supreme Court of Victoria should undertake substantially the same tasks in resolving the issues in contest there.
It is obvious that in each case the Court will be required to make a judgment as to the credibility of the relevant witnesses and as to the events leading up to the meeting (by which I mean, the alleged overpayments and the circumstances relating to them). It cannot be in the interests of justice that those matters be determined twice: doubling the expense to the parties, doubling the consumption of Court time, and with the risk of inconsistent findings of credibility or fact.
It is trite to observe, however, that each case will raise different considerations as to the interests of justice. In Australian Technology Fund Management v ATF Group , the parties were effectively the same (the defendants in the Victorian proceedings were the directors of the plaintiff in the New South Wales proceedings). Further, an application to have the Victorian proceedings transferred to New South Wales had already been refused. In that circumstance, McDougall J placed some reliance on the fact that the proceeding commenced in Victoria would have to be determined by the Supreme Court of Victoria.
In my view, considerations of connection with the forum and balance of convenience to the plaintiff and the witnesses of both parties strongly point against transferring the present proceedings. I am not persuaded that the interest of the Commonwealth and the court system in avoiding duplication of resources and the risk to the Commonwealth of inconsistent findings weighs the balance in the other direction. Other ways might present themselves for minimising those potential vices, although I accept that such matters may not be entirely within the control of the Commonwealth.
Cases of multiple claims in different jurisdictions by unrelated parties against a common defendant raise peculiar difficulties. It must not be overlooked that although the wider interests of justice must be considered, the interests of justice also include the interests of the individual plaintiff in each case. As acknowledged on behalf of the Commonwealth, its offer as to costs will not entirely ameliorate the inconvenience to Livestock of having to prosecute its claim in Queensland, well away from any place that has anything to do with its claim. The likely inconvenience to a large number of witnesses is also a compelling consideration. Reimbursement of costs cannot ameliorate the additional disruption to work and family occasioned by interstate travel. Another consideration is the likely additional hearing time that would be visited upon each plaintiff if the two proceedings were heard together.
Having regard to all of those considerations, it does not appear to me that it is "otherwise in the interests of justice" that the present proceeding be determined by the Supreme Court of Queensland.
For those reasons, I make the following orders:
1. That the defendant's application be dismissed.
2. That the defendant pay the plaintiff's costs of the application.
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Decision last updated: 11 April 2011
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