Pacer Australia Pty Ltd v Sales Perfect Pty Ltd

[1995] FCA 321

IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES REGISTRY             )    No. NG 143 of 1995
GENERAL DIVISION                 )

BETWEEN:

PACER AUSTRALIA PTY LIMITED
  Applicant

AND:

SALES PERFECT PTY LIMITED AND ANOTHER
  Respondent

SACKVILLE J.
SYDNEY
4 MAY 1995

REASONS FOR JUDGMENT

HIS HONOUR: I indicated on a previous occasion that I thought that these proceedings, subject to any argument that might be put, ought to be transferred to a State court pursuant to s.86A(1) of the Trade Practices Act 1974 ("the Act"). Section 86A(1) provides that, where a civil proceeding is pending in the Federal Court and a matter for determination in the proceeding arises under Division 1 or 1A of Part V of the Act, the Court may, subject to sub-section (2), upon application of a party or of the Court's own motion, transfer the proceeding to a court of a State.

Section 86A(2) of the Act provides that the Federal Court shall not transfer a matter to another court under the power conferred by sub-section (1), unless the other court has power to grant the remedies sought before the Federal Court and it appears to the Federal Court that it is otherwise in the interests of justice
that the matter be determined by the other court.

There is no dispute before me today that the matter ought to be transferred out of the Federal Court to a court within New South Wales. The only dispute is whether the transfer should be to the District Court or to the Supreme Court. The applicant contends that the matter should be transferred to the Supreme Court of New South Wales, because the statement of claim and application include a claim, in substance, for equitable compensation by reason of breach of fiduciary duty that has been alleged in the statement of claim. The applicant's contention is that the District Court does not have jurisdiction to award equitable relief of this kind. That being the case the requirements of s.86A(2) are not complied with as far as the District Court is concerned. Accordingly, it is only the Supreme Court that can grant the relief sought in the proceedings.

The respondents contend, in effect, that the claim based upon fiduciary duty is really "window dressing".  However, I do not think that at this stage of the proceedings I ought to attempt an assessment of whether the allegations relating to breach of fiduciary duty are likely to be successfully maintained in the proceedings.  There has been no application to strike out the allegations in the statement of claim relating to breach of fiduciary duty.  In those circumstances I think I should regard the claim as being on foot and arguable.

It is perfectly true that paragraph 8 of the application refers
not to equitable compensation but to "equitable damages and other consequential relief as the Court deems appropriate in respect of breaches of fiduciary obligations".  Although this formulation is somewhat inexact, the substance of it, in my opinon, is that the applicant intends to claim equitable compensation for breach of the fiduciary duty alleged in the statement of claim.

Since there is no dispute between the parties that the District Court does not have jurisdiction to award relief in respect of a claim for equitable compensation arising out of a breach of fiduciary duty, I consider that I have no alternative but to order the proceedings to be transferred to the Supreme Court of New South Wales. 

For the sake of completeness I indicate that, although there is no dispute today that the matter should be transferred out of this Court, I take the view that it is in the interests of justice that the matter be determined by the Supreme Court rather than by this court.  The observations that I made on the last occasion that this matter was before the Court provides the basis for the conclusions that I have reached on that aspect of the matter.

Accordingly, I direct that the proceedings being NG 143 of 1995 be transferred to the Supreme Court of New South Wales.

I certify that this and the preceding 2 pages are a true copy of the Reasons for Judgment of the Honourable Justice Sackville.

Associate:

Dated:

Heard:4 May, 1995

Place:            Sydney

Decision:4 May, 1995

Appearances:      Mr D. Marks, instructed by A.S. Laumberg, Solicitor, appeared for the applicant.

There was no appearance for the First Respondent.

Mr M. Furlong, Solicitor, appeared for the Second Respondent.