Oil Basins Limited v The Commonwealth of Australia

[1993] HCATrans 345

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No M124 of 1993

B e t w e e n -

OIL BASINS LIMITED

Plaintiff

and

THE COMMONWEALTH OF AUSTRALIA

First Defendant

and

THE COMMISSIONER OF TAXATION

Second Defendant

and

THE BROKEN HILL PROPRIETARY

COMPANY LIMITED

Third Defendant

and

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DAWSON J
(In Chambers)

BHP PETROLEUM (BASS STRAIT) PTY

LTD

Fourth Defendant

and

ESSO AUSTRALIA RESOURCES LTD

Fifth Defendant

For judgment and hearing

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 10 NOVEMBER 1993, AT 9.25 AM

Copyright in the High Court of Australia

HIS HONOUR:  These two applications were heard by me in

chambers in Melbourne. In my opinion the

Commissioner of Taxation and the Commonwealth of Australia are properly joined in this action. I

would dismiss the applications of the defendants,

and I publish my reasons.

The order is:

Dismiss the applications of the first and

second defendants, dated 14 October 1993;	dismiss
the applications for the third, fourth and	fifth
defendants, dated 11 October 1993.

Now, gentlemen.

MR YOUNG: If Your Honour please. We have prepared minutes

of orders and directions for the future conduct of

the matter, on the basis that we might be

successful.	Can I hand to Your Honour proposed
directions that we would say are appropriate.

HIS HONOUR:  Have you discussed these with the other

parties?

MR YOUNG:  I have shown the document to my learned friends,

Your Honour. I cannot say that we have reached any

consensus about the directions, but if I might

briefly explain the steps that we say are

appropriate. The first order simply deals with the

entry of an appearance, which is unconditional.

HIS HONOUR:  Perhaps we can take them one by one. Once I

dismiss the objection to jurisdiction, does not the

appearance become unconditional?

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MR YOUNG: Well, it seemed to us that that was a little bit

unclear on the face of the rules, Your Honour,

which is why we made express provisions for it.

HIS HONOUR:  There is no trouble about that anyway.

MR YOUNG: Paragraphs 2 and 3 deal with pleadings.

HIS HONOUR:	Yes.
MR YOUNG:	We would say that it is appropriate for pleadings

to be directed, and that would also appear to be

the ordinary course adopted in cases in this Court.

Paragraphs 4, 5 and 6 are orders in the usual form

providing for a remitter of the action to the

Federal Court in Melbourne. Paragraphs 7 and 8

have already been accommodated by the orders that

Your Honour pronounced. That, in effect, dismisses the applications - - -

HIS HONOUR:	No one has asked for costs, have they?
MR YOUNG:	No, well we do ask for costs on the unsuccessful objections to jurisdiction.

HIS HONOUR: Well, we had better hear what the others have

to say about that.	Mr Lewisohn, what do you say
about that?

MR LEWISOHN:	I have nothing to say, Your Honour.
MR MYERS:	I have nothing to say on the question of costs,

Your Honour, but I do have something to say on

other aspects of these directions.

HIS HONOUR:  The applications will be dismissed with costs.

MR YOUNG: There is one aspect, Your Honour, I should

further explain. Paragraph 7, in dealing with the

summons by the third, fourth and fifth defendants,

dismisses paragraphs 2, 3, 4, 5 and 6. Those

paragraphs related to the jurisdictional objection.

Paragraph 1 sought a permanent stay of the action.

As was explained to Your Honour at the hearing,

that stay is sought on the basis of the pending

arbitral proceedings. Therefore, we have accepted

paragraph 1 on the basis that the application for a

stay is still alive in so far as it is premised

upon a different ground, namely the pending

arbitration proceedings.

HIS HONOUR:  That application was never really pressed before me, was it?

MR YOUNG:  No, Your Honour. What was done was to indicate

to Your Honour that that matter would be pressed at

a later date on the basis of evidence. Further, it

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was said that that application, because it depended

on evidence, could most appropriately be dealt with

after remitter.

HIS HONOUR:  When I said that the applications are

dismissed, that did not include that application

because I did not regard that one as being before

me.

MR YOUNG:  Yes. That is why we have accepted it from

paragraph 7, Your Honour; otherwise I have nothing

to say.

HIS HONOUR:	Mr Lewisohn?
MR LEWISOHN:	I have no comment to make in relation to those proposed orders, Your Honour.
MR MYERS:	Your Honour, what I have to say arises out of the

circumstance that the first prayer for relief in

the summons of 19 October was an application for a

stay.	My learned friend, Mr Young, has pointed out
to - - -

HIS HONOUR:	I have not dealt with it.
MR MYERS:	Your Honour has not dealt with it, not at all,

and it depends upon evidence and it is a matter

that will have to be dealt with by the Federal

Court. However, if one is seeking a stay on the

basis that there are pending arbitral proceedings

covering the same subject-matter, one cannot take a

step in the action before pressing the stay

application.

So it is inappropriate to direct that the

defendants file and serve defences on or before any

particular time or that there be a reply until the

stay application has been dealt with. Apart from

anything else, one does not know when and how the

Federal Court will deal with the stay application,

and it would place the applicant for the stay in
great jeopardy if the applicant for the stay were

obliged to deliver a defence. It is regarded as

almost fatal to a stay application that one has

taken a step in the proceeding.

HIS HONOUR:  Is that so? I mean, you may well be right?

MR MYERS:  Yes, it is. If one takes a step in the

proceeding before making an application or pressing

an application for stay on the ground that there

are other pending proceedings, that is regarded as

a very big black mark against a stay application.

HIS HONOUR:  Even if it is a step that is taken pursuant to

an order that is made - - -

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MR MYERS:	I suppose the answer is yes, but I suppose one

could always explain to the Federal Court judge

that a Justice of the High Court directed that it

be done notwithstanding that there was a stay

application. However, the authorities are pretty

clear that one ought not to take any step in a

proceeding before pressing a stay application and

we would respectfully suggest that - - -

HIS HONOUR:  I can understand that when it goes to

jurisdiction but the basis for this application is

not an objection to jurisdiction.

MR MYERS:  No, but it does -

HIS HONOUR: It is wider than that, is it?

MR MYERS:  Yes, it is, Your Honour. So, we would

respectfully suggest that the most convenient

course is simply to remit it and the judge of the

Federal Court who deals with the action may give

directions as soon as may be regarding the
disposition of the stay application and then for
pleadings. It is certainly not necessary that

there be any pleadings before the stay application

is heard. It will be heard and determined as far

as the pleadings are concerned by reference to

statement of claim alone.

That is the first matter. The second is this,

Your Honour. There is a summons which seeks an

order that certain exhibits be - - -

HIS HONOUR: Perhaps you can deal with that separately

later, I think, Mr Myers. Mr Young.

MR YOUNG:  Your Honour, there are three reasons why we say

the pleadings should be directed in the manner that

we have indicated.

The first, Your Honour, is that we disagree

with the proposition that where a stay is being

sought because of pending arbitration proceedings,

that there will be any jeopardy or prejudice

occasioned if pleadings are directed in the

meantime. The stay application is already on foot.

The directing of pleadings will ensure that

the issues to arise in the action are identifiable

on the face of the pleadings and that, we would

say, is desirable in the context of an application

that is to be made on the basis that the court

action overlaps the arbitration to such an extent

that there should be a stay. Quite contrary to

what has been put, we would say it is highly

desirable that pleadings be directed so that the

issues to arise in the litigation can be compared

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with those arising in the arbitration. There is,

so far as we are aware, no authority that indicates

that compliance with directions such as these will

be fatal. or prejudicial to a stay application

mounted on grounds of a pending arbitration.

Thirdly, Your Honour, we would say this: that

this action has been on foot since 20 September.

Our amended statement of claim was delivered on

7 October. We are now into November. Unless

pleadings are directed, the further progress of the

action is really left at the discretion of the

defendants as to when they choose to mount their

stay application and bring it on in the Federal

Court.	We would say that that is an unsatisfactory
state of affairs.	We regard the action as one of
considerable urgency.	We wish to press on with all

due speed, and a month or more having already

passed without any step being taken in the action

because of the unsuccessful objections to

jurisdiction, we would say it is appropriate to

direct pleadings, and then there is some incentive for the defendant to mount its stay application as

soon as may be.

HIS HONOUR:  Do you have anything to say in reply to that,

Mr Myers?

MR MYERS:  Your Honour, it is evident that the defence and

the reply cannot have anything to do with the stay

application. The scope of the proceedings will be

determined by the statement of claim. It is

neither necessary nor desirable that pleadings be

delivered before the stay application is heared. I

do not think there is anything else I wish to reply

to.

HIS HONOUR:  What do you say as to the actual dates, if I

were to make an order?

MR MYERS:	The 19th; that gives us a week or more -
HIS HONOUR:	It is not a very complicated statement of

claim.

MR MYERS:  It is not a very complicated statement of claim,

Your Honour. I cannot really urge that it is

necessary that there be more time. Undoubtedly,

the timetable is crafted with the commencement date

of the arbitration in mind with is 24 November.	I
cannot urge that we need more time though.

HIS HONOUR:  Very well. I make an order in terms of

paragraphs 1, 2, 3, 4, 5, and 6 of the minutes,

which have been handed up.	What do you say as to
the cost of this summons, Mr Myers?	You obviously

ask for the costs to be costs in the cause.

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MR YOUNG:  Yes, in relation to summons for direction for

remitter, yes, Your Honour, we have done that because that appears to be the usual order in remitter cases.

HIS HONOUR:	You do not have anything to say about that?
MR MYERS:	No, I do not say anything at all.

HIS HONOUR:  And paragraphs 9 and 10. Very well. Now,

there is the other matter. That is yours, is it

not, Mr Myers?

MR MYERS:  Yes, Your Honour. There is a summons of

5 November for orders that certain exhibits be

treated as confidential to the parties and not

divulged for public examination. I understand it

is the practice of the Court that the exhibits are

on the Court file and would, in the ordinary

course, be available for examination by members of

the public.

HIS HONOUR:  They our in the Court file and I am told that

they are required to be on the Court file even

before the proceedings come on for hearing.

MR MYERS: That puzzled me very much.

HIS HONOUR:  On the basis in this Court the judges do read

the material before proceedings commence. I do not

know what justification there is for that in the

rules, but that is the practice. But certainly,

once the exhibits have been tendered they are on

the Court file, yes, but Order 58 rule 8 covers the

situation. It is subrule (2).

MR MYERS:  Any person shall be entitled except:

the annexures and exhibits to any

affidavit -

HIS HONOUR:	- - - prior to the admission of any such affidavit, annexure or exhibit in evidence in
Court.

Well now, these proceedings and the previous

proceedings, of course, were in chambers.

MR MYERS:  Yes, Your Honour, I see that and I must say that

I had assumed that these would not, therefore, be

available for public examination, but my

instructing solicitors were informed by the

Registry in Melbourne that that was not so and that

a member of the public could inspect these

documents.

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HIS HONOUR: Well, is there any other way of reading

subrule ( 2) :  11 in Court II means in Court?

MR MYERS:  I believe not, Your Honour, and what Your Honour

is putting to me, not only is consistent with the

rule, but consistent with the practice of courts

everywhere. Yet, I was instructed that - was

informed that they will be available for the public

to look at.

HIS HONOUR:  I can give a direction, if necessary, but I am

just seeking assurance - - -

MR MYERS: Perhaps, in the light of what has passed between

us, Your Honour, if this transcript can be produced

to the appropriate officer there will, doubtless,

be no difficulty.

HIS HONOUR:	I am just seeking assurance that my reading of the rule is the correct reading.
MR MYERS:	It seems to me to be so, Your Honour.
HIS HONOUR:	Mr Lewisohn.
MR LEWISOHN:	Provided this order is not impinging on the

accessibility of the first and second defendants to

whatever documents are on the record, we have

nothing to say and, as I read the proposed order,

it does not impinge on the accessibility of the

first and second defendants. If Your Honour

pleases.

HIS HONOUR:	What do you say, Mr Young?
MR YOUNG:	We, Your Honour, would take the same stance as

Mr Lewisohn. As we read it, it is not really

directed at us, in any event, since we are parties

to the arbitration.

HIS HONOUR:	Am I right in my reading of the rule?
MR YOUNG:	Yes.

HIS HONOUR:  Very well. I will direct the Registrar,

pursuant to Order 58 rule 8(2), that the exhibits

mentioned in the summons dated 5 November 1993 be
not available for search, inspection or the taking

of a copy.

Now, of course, I take it that copies of the

exhibits go to the Federal Court and what happens
there is nothing to do with me, but the rules, I

think, in a Federal Court are different anyway.

You might have a look at those. Yes, Mr Lewisohn.

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MR LEWISOHN:	Your Honour, in relation to that, if it were

the case that the first two defendants were to

approach the Registrar of the Federal Court and seek copies of these exhibits which they do not

have at the moment, that direction might be

interpreted as excluding the first and second
defendants and, with respect, it should be

qualified either not to operate with respect to any

party, or to operate until further order.

HIS HONOUR:  Direct that they be not available for those

purposes other than to the parties to the

proceedings. I will add that to the direction.

MR LEWISOHN:  Yes.

HIS HONOUR: Is there anything else, gentlemen? Very well.

AT 9.44 AM THE MATTER WAS ADJOURNED SINE DIE

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