Murdoch Produce Pty Limited v Enterprise Finance Solutions Pty Ltd
[2010] FCA 1201
•3 November 2010
FEDERAL COURT OF AUSTRALIA
Murdoch Produce Pty Limited v Enterprise Finance Solutions Pty Ltd
[2010] FCA 1201
Citation: Murdoch Produce Pty Limited v Enterprise Finance Solutions Pty Ltd [2010] FCA 1201 Parties: MURDOCH PRODUCE PTY LTD (ACN 086 834 988) and JUSTYN ROSS McGRIGOR v ENTERPRISE FINANCE SOLUTIONS PTY LTD (ACN 101 737 204) File number: NSD 1499 of 2010 Judge: FOSTER J Date of judgment: 3 November 2010 Legislation: Trade Practices Act1974 (Cth), ss 52, 53, 73, 86A(4) Date of hearing: 3 November 2010 Place: Sydney Division: GENERAL DIVISION Category: No Catchwords Number of paragraphs: 26 Counsel for the Applicants: Mr A Crossland Solicitor for the Applicants: Attwood Marshall Lawyers Counsel for the Respondent: Mr C Carter Solicitor for the Respondent: SR Law
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 1499 of 2010
BETWEEN: MURDOCH PRODUCE PTY LIMITED (ACN 086 834 988)
First ApplicantJUSTYN ROSS MCGRIGOR
Second ApplicantAND: ENTERPRISE FINANCE SOLUTIONS PTY LTD (ACN 101 737 204)
Respondent
JUDGE:
FOSTER J
DATE OF ORDER:
3 NOVEMBER 2010
WHERE MADE:
SYDNEY
THE COURT:
1.Pursuant to s 86A(4) of the Trade Practices Act 1974 (Cth), ORDERS that proceeding number 24415/10 in the Local Court of New South Wales be transferred to the Federal Court of Australia.
2.ORDERS that the applicants in this proceeding pay the respondent’s costs thrown away by the order for transfer made in par 1 above.
3.ORDERS that the costs of the Application made before Foster J on 3 November 2010 be costs in the proceeding in this Court.
4.DIRECTS the applicants to file and serve by 15 November 2010 in the transferred proceeding in the Federal Court of Australia an Application and Statement of Claim in which they set out all claims which they propose to make against Enterprise Finance Solutions Pty Limited, the respondent in this proceeding.
5.DIRECTS the respondent to file and serve by 29 November 2010 its Defence and any Cross-Claim which it proposes to make.
6.DIRECTS the applicants to file and serve any Reply and Defence to Cross-Claim by 9 December 2010.
7.ORDERS that the matter be listed for directions before the docket judge on a date to be notified to the parties.
8.Pursuant to O 72 r 1 of the Federal Court Rules, ORDERS that the transferred proceeding be referred to mediation before the NSW District Registrar of the Federal Court of Australia or such other person as he nominates, such mediation to take place at the same time and as part of the mediation ordered by the Court in proceedings NSD 1069, 1138, 1188, 1192, 1206 and 1207 of 2010.
9.ORDERS that the Mediator so appointed make such directions as he or she considers appropriate for the conduct of the mediation.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 1499 of 2010
BETWEEN: MURDOCH PRODUCE PTY LIMITED (ACN 086 834 988)
First ApplicantJUSTYN ROSS MCGRIGOR
Second ApplicantAND: ENTERPRISE FINANCE SOLUTIONS PTY LTD (ACN 101 737 204)
Respondent
JUDGE:
FOSTER J
DATE:
3 NOVEMBER 2010
PLACE:
SYDNEY
REASONS FOR JUDGMENT
Earlier today, Murdoch Produce Pty Limited and Justyn Ross McGrigor (the applicants) filed an Application in this Court in which they sought an order that proceeding number 24415 of 2010 in the Local Court of New South Wales be transferred into this Court. That application is supported by an affidavit sworn by Melinda Turnbull on 2 November 2010.
The respondent to the present application (Enterprise Finance) opposes any transfer. In the alternative, Enterprise Finance submits that, if a transfer is to be ordered, it should be on terms that the applicants pay its costs to date in the Local Court on an indemnity basis.
The Local Court proceedings were commenced by a Statement of Claim filed on 9 February 2010. The plaintiff in the Local Court is now Enterprise Finance. For some time, the plaintiff in the Local Court was another (related) corporation, Quikfund (Australia) Pty Limited (Quikfund). The applicants are the defendants in the Local Court. They filed a Defence in the Local Court on 11 March 2010. In that Defence, the applicants pleaded that representations were made to them by an agent of Quikfund, Clear Telecoms, prior to the execution of the contract upon which Quikfund based its claim in the Local Court, suggesting that the services that were to be provided and the equipment that was to be provided under that contract had certain attributes. They alleged that those representations were false or misleading. It was also alleged that Quikfund was a credit provider within the meaning of s 73(14) of the Trade Practices Act1974 (Cth) (the Trade Practices Act) so that, in addition to being liable to the applicants for misrepresentations made by Clear Telecoms in breach of s 52 and s 53 of the Trade Practices Act, it was also liable to the applicants by reason of the operation of ss 52, 53 and 73 of the Trade Practices Act.
After the applicants filed their Defence in the Local Court in March 2010, the solicitors for Quikfund wrote to the solicitors for the applicants and suggested to them that the Defence had raised matters which were beyond the jurisdiction of the Local Court. In subsequent correspondence, those solicitors identified the extra-jurisdictional matter to which they had referred as being the material which invoked s 73 of the Trade Practices Act. By letter dated 21 June 2010, the solicitors for the applicants foreshadowed an amendment to their Defence and the filing of a Cross-Claim. There was a call-over before the Local Court on 23 June 2010 at which time leave was granted to the applicants to file an Amended Defence and also a Cross-Claim on terms that they do so by 7 July 2010.
The applicants did not file an Amended Defence nor did they file any Cross-Claim within the time limited by the leave which had been allowed to them, although they did forward to the solicitors for Quikfund a draft Amended Defence and proposed Cross-Claim under cover of a letter dated 12 July 2010.
At the call-over on 23 June 2010, the Local Court proceeding was fixed for hearing on 4 November 2010. Subsequent to the call-over, the parties in the Local Court exchanged witness statements and other evidentiary material.
The current lawyers for the applicants were first retained on or about 19 October 2010. By letter dated 20 October 2010, those solicitors informed the solicitors for Enterprise Finance (which corporation had, by then, been substituted as the plaintiff in the Local Court) that they proposed to make an application to have the Local Court proceeding transferred to this Court.
As part of that communication, the following was said:
Given the decision of his Honour Justice Nicholas to transfer to the Federal Court the proceedings in which Solitaire Pty Ltd is the Defendant, we assume that our Application would be successful here as well.
In the circumstances, do we have your consent to transfer these proceedings to the Federal Court?
Further, in light of his Honour’s direction for the various Federal Court proceedings to attend mediation, would you consent to an application to include our client in that same mediation.
Kindly let us have your response by close of business Friday 22 October 2010.
The response from the solicitors for Enterprise Finance was in the following terms:
We refer to your correspondence of 20 October 2010.
We confirm that this matter is listed for hearing in the Local Court on 4 November 2010, that the parties have exchanged evidence and that the hearing date was confirmed by your clients at a review recently.
The proposed application is late.
Please advise by return what is your client’s proposal for Local Court costs to date in light of the proposed transfer?
The solicitors for the applicants responded as follows:
We refer to your letter of 22 October 2010.
Our clients are prepared to pay for your client’s costs thrown away as agreed or assessed of the transfer.
We again note that in the decision of Solitaire Pty Ltd, his Honour Justice Nicholas deemed costs to be costs thrown away of the transfer.
Please advise by return letter if we have your consent now to transfer the proceedings to the Federal Court.
This second request for consent produced the following response:
We refer to your letter of 26 October 2010.
The transfer is not something our client can properly consent to as it is a matter for the Federal Court. Nevertheless, our client will not oppose a properly made transfer application on condition that:
1.Your clients agree to pay the costs thrown away by reason of the transfer, including the costs thrown away by the vacation of the hearing date; and
2.Your clients gives an undertaking to the Federal Court to pay those costs; and
3.In the event that the matter is transferred, your firm will appear at the Local Court to inform the Local Court that the matter has been transferred.
We will await your advice on the listing of your application.
This response produced yet a further letter from the solicitors for the applicants. This letter was in the following terms:
Thank you for your letter dated 29 October 2010.
Your attitude to these matters is in contrast to that you adopted regarding the transfer of proceedings defended by Airmark Consolidators and Mark Gonsalves. In that instance, your client consented to a transfer to the Federal Court. Moreover, your client consented to this happening without our clients (Airmark Consolidators and Mark Gonsalves) making a formal application. Our client thereby avoided a hefty filing fee. His Honour Justice Nicholas was content to take that course because it was well-understood between the parties that the Airmark proceedings were not, in principal or in parties [sic], different to those (Nepean Roofing, Glenmount Automotive, Austec) that had been the subject of a formal application. Ultimately, His Honour’s [sic] made an order for the mediation together of each of the proceedings in which your clients are involved, including the Airmark proceedings
It is difficult to see why you take a different position with the current proceedings, except that you would like our client to pay the filing fee. We know of no rule that says that because a matter is “for the court”, a party cannot consent to orders sought.
We are in the process of making a formal application, as you specify. In the circumstances, we will not be making any deal on costs. The Court can decide.
The current application is made pursuant to s 86A(4) of the Trade Practices Act which is in the following terms:
86A Transfer of matters
…
(4) Where:
(a)a proceeding is pending in a court (other than the Supreme Court) of a State or Territory; and
(b)a matter for determination in the proceeding arose under Part IVA or Division 1, 1A or 1AA of Part V, or a provision of the Australian Consumer Law;
the court shall, if directed to do so by the Federal Court, transfer to the Federal Court the matter referred to in paragraph (b) and such other matters for determination in the proceeding the determination of which would, apart from any law of a State or of the Northern Territory relating to cross vesting of jurisdiction, be within the jurisdiction of the Federal Court as the Federal Court determines.
There is no doubt, as the pleadings in the Local Court currently stand, that the applicants have pleaded contraventions of ss 52, 53 and 73 of the Trade Practices Act by way of defence. As I have already mentioned, there is, at the moment, no Cross-Claim filed in the Local Court although, no doubt, that omission would have been remedied before the commencement of the hearing. One of the cases which the applicants have attempted to propound by way of defence in the Local Court is a case based upon s 52 and s 53 of the Trade Practices Act which does not depend upon s 73 of that Act. The Local Court proceeding, therefore, qualifies as a proceeding in which a matter for determination arises under Div 1 of Pt V of the Trade Practices Act and thus falls within subpars (a) and (b) of s 86A(4) of that Act. The section is, therefore, engaged.
In addition to those matters, I have been told from the Bar table that the applicants wish to raise a case against Enterprise Finance based on s 47 of the Trade Practices Act.
A matter which has been agitated in front of me today is the question of whether or not the Local Court has jurisdiction to determine claims which are founded upon s 73 of the Trade Practices Act, or, as contended by Enterprise Finance in the Local Court, whether jurisdiction to determine claims based upon that section resides exclusively in this Court. It seems to me at the moment that there are difficulties in the contention being advanced by Enterprise Finance that the Local Court does not have jurisdiction to determine claims based upon s 73 of the Trade Practices Act. However, I do not think it appropriate on an application such as this to decide the question of whether or not such jurisdiction resides in the Local Court if it is not necessary to do so.
The applicants wish to agitate claims under s 47 of the Trade Practices Act and it is quite clear that such claims cannot be brought in the Local Court. It seems to me that that is a circumstance to be weighed in favour of transfer.
On the other side of the ledger is a history of the matter which, from the applicants’ point of view, does not manifest an appropriate attitude on their part to their obligation to the Local Court to progress their Defence and foreshadowed Cross-Claim expeditiously and as directed by that Court. In fact, as I have noted, they have not yet filed the foreshadowed Amended Defence nor have they filed the foreshadowed Cross-Claim.
Compounding matters, as far as the position of the applicants is concerned, is the fact that the application with which I am currently dealing was not made until today which, as I have already mentioned, is the day before the fixture before the Local Court which has been in place since 23 June 2010.
I have been told from the Bar table that there are at least eight other matters in this Court, seven of which are in the docket of Nicholas J and one of which appears to be in the docket of Cowdroy J, which involve consideration of issues which have some similarity to the issues sought to be raised in the present matter, although there appears to be a lively contest as to whether there are, in truth, issues of fact or law in common across all of these proceedings.
Be that as it may, on 16 September 2010, in six of the eight proceedings to which I have referred, Nicholas J made orders in the following terms:
1.Direct that during the course of the next 28 days the legal representatives for the parties confer for the purpose of agreeing upon a statement of issues specifying in relation to proceedings number NSD 1207, 1138, 1188, 1192, 1069 and 1206 of 2010 (the proceedings):
(a)the questions of fact or law raised in each proceeding;
(b)the extent to which any of those questions of fact or law are common to any one or more of the proceedings;
(c)which of those common questions of fact or law should or might be the subject of an order for separate determination.
2.Direct that a joint memorandum signed by the parties’ legal representatives recording the matters referred to in 1 above be filed and served by 4.00 pm 21 October 2010.
3.Order that the proceedings be referred to mediation to take place on or before 26 November 2010 before the NSW District Registrar of the Court or such other person as he nominates pursuant to Order 72 Rule 1 of the Federal Court Rules and that the Mediator appointed make such directions as he or she considers appropriate for the conduct of the mediation.
4.Order that the proceedings stand over for further directions to 9.30 am on 10 December 2010.
I have been told from the Bar table that, although some communications have been exchanged between the lawyers for the parties in respect of Order 1 made by Nicholas J on 16 September 2010, the Statement of Issues contemplated by those Orders has not yet been finalised nor has a date been fixed for the mediation. Notwithstanding those circumstances, it seems to me that the fact that there are already in this Court the eight matters to which I have referred, seven of which are to be mediated, is a powerful factor in favour of transfer.
When due account is taken of the existence of the other proceedings in this Court to which I have referred, the fact that the applicants have foreshadowed a case based upon s 47 of the Trade Practices Act and the possibility that the Local Court may not have jurisdiction in respect of the s 73 matters (a matter which I expressly refrain from deciding at the moment), I think that I should make the orders sought in the Application and transfer the proceedings to this Court.
It was submitted by Enterprise Finance that, were I to make that order, I should do so on terms as to costs. The applicants have been at fault in the Local Court in the sense that they have not brought forward their claims appropriately nor have they done so within the time frames dictated by that Court. On the other hand, Enterprise Finance did not consent to the requested transfer and actively opposed the transfer before me.
Further, it is not necessarily going to be the case that the applicants’ dilatoriness has imposed any real additional costs burden on Enterprise Finance. It may be so, but it is a matter that I think should be looked at when these matters are ultimately determined in this Court. I think that the appropriate order as to costs is that the applicants in this Court pay the respondent’s costs thrown away by the order for transfer and that the costs of the Application made before me today be costs in the proceeding in this Court, by which I mean that they are to be regarded as costs which fall within the general costs of the transferred proceeding when ultimately determined.
I will therefore make an order for transfer as I have indicated and the costs order which I have indicated. I will also make directions concerning the filing of pleadings and mediation.
I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Foster. Associate:
Dated: 5 November 2010
0
0
1