Pacific Hydro Group Two Pty Ltd v Argyle Diamond Mines Pty Ltd
[2003] VSC 229
•27 June 2003
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
COMMERCIAL LIST
F5535
No. 2024 of 2003
| PACIFIC HYDRO GROUP TWO PTY LIMITED (ACN 061 436 815) AND OTHERS | Plaintiffs |
| v | |
| ARGYLE DIAMOND MINES PTY LIMITED (ACN 008 912 418) AND OTHERS | Defendants |
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JUDGE: | BYRNE J | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 3 JUNE 2003 | |
DATE OF JUDGMENT: | 27 JUNE 2003 | |
CASE MAY BE CITED AS: | PACIFIC HYDRO GROUP TWO PTY LTD & ORS v ARGYLE DIAMOND MINES PTY LTD & ORS | |
MEDIUM NEUTRAL CITATION: | [2003] VSC 229 | |
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Practice and Procedure – Cross-vesting - More appropriate forum.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiffs | Mr M.L. Sifris SC with Mr A. Trichardt | Baker & McKenzie |
| For the Defendants | Mr Wayne Martin QC with Mr S. Standing | Freehills |
HIS HONOUR:
Before the Court is an application by the defendants to transfer this proceeding to the Supreme Court of Western Australia pursuant to s.5(2) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (Vic).
The litigation is brought by the plaintiffs, a consortium of companies engaged in the supply of hydro-electricity. They are in this proceeding referred to collectively as "PHL". PHL seeks declarations as to the meaning and effect of certain provisions in a power purchase agreement made in or about 8 November 1994 between it and the defendants who are participants in the Argyle Diamond Mine joint venture. The defendants are collectively referred to as "ADM". Under this agreement PHL agreed to construct a hydro-electric power station at the Ord River Dam in the Kimberley region of Western Australia and to sell the electricity produced by the power station to ADM.
The pleadings are already much amended.[1] They show that the power station has been constructed and electricity has been supplied for some years. The agreement makes provision for the supply of an initial minimum quantity of electricity, being 1,015 GWh in the period from 1 April 1996 to 31 March 2003, subject to certain adjustments. The agreement also contains in cl. 13.4 and cl. 21.4 procedures for ADM to increase the quantity of power to be taken upon certain terms and for fixing the price for this additional commitment. ADM has on 16 April 2003[2] given to PHL notice in accordance with cl. 13.4(b) advising of its wish to increase the commitment.[3]
[1]Further Amended Statement of Claim filed 10 June 2003; Amended Defence and Counterclaim filed 11 June 2003.
[2]Defence para.6(b).
[3]Defence para.7(b).
The parties are in dispute as to the meaning and effect of cl. 13.4 as it applies to this additional commitment, including the terms under which it may be provided and the price to be paid for it. ADM wishes to agree the terms including price and if this be not possible to refer these matters to an expert pursuant to cl. 13.4(e). PHL's position is that the cl. 13.4(b) notice is bad[4], that the price may not be referred to an expert[5] and, in any event, that the provisions of cl. 21.4 for fixing the contract price for the additional commitment are uncertain and unenforceable.[6] Accordingly, the price for the electricity after 19 March 2003 should be fixed pursuant to cl. 21.5, as for a spot sale.[7] It seeks payment of the extra sums due on that basis.
[4]Statement of Claim para.8.
[5]Statement of Claim para.13A.
[6]Statement of Claim para.12.
[7]Statement of Claim para.12A.
In its counterclaim ADM seeks declarations as to its interpretation of the agreement. It seeks damages for PHL's refusal to negotiate the terms for the additional commitment.[8]
[8]Defence para.30.
The principles which I should apply in determining this application are not in contest. I am obliged to determine as between this Court and the Western Australian Court, which is the more appropriate forum to determine this litigation. Relevant factors for the purpose include the law governing the agreement in dispute; the connection between the alleged conduct and the jurisdiction; and the cost and inconvenience to the parties of one forum rather than the other. Other factors which have been taken into account have been the fact that the plaintiff has selected a particular forum and the desirability of a speedy determination of a commercial dispute.[9] This is, of course, not an exhaustive list of factors which may be considered. The statute simply requires me to determine whether having regard to the interests of justice it is more appropriate the relevant proceeding be determined by the Supreme Court of Western Australia.
[9]See generally Ross Mollison Group Pty Ltd v The Really Useful Company (Australia) Pty Ltd [2000] VSC 256.
On behalf of ADM, I was pressed with the fact that the location of the power station and the mine is in Western Australia and that the parties agreed that Western Australian law applied and they submitted to the non-exclusive jurisdiction of the courts of that State.[10] These are of course very weighty matters.
[10]Cl. 39.6.
The argument against transfer rested upon the submission that this case really is one which involves no more than the construction of a written document in accordance with common law principles. There being no relevant difference in the substantive law on this matter, there was no reason to suppose that this task might be more appropriately undertaken in Western Australia, or indeed in any particular location. A possible point of difference between the law of Western Australia and that of Victoria to which I was referred on behalf of ADM arises from a decision of the Western Australian court in Baulderstone Hornibrook Engineering Pty Ltd v Kayah Holdings Pty Ltd[11]. In this case Heenan J restrained a party to a building contract from referring a dispute to a referee acting as an expert, as opposed to an arbitrator, where this was provided for in the contract. His Honour concluded that such a provision, if given effect to, would oust the jurisdiction of the Court. I express no view as to the correctness of this decision. It was said that in other jurisdictions, including Victoria, this approach may not obtain. What was surprising about this is that ADM, who relies upon the difference, is the party who would uphold the contractual procedures in this case including the reference to an expert.
[11](1997) 14 BCL 277.
It was further contended that the matter should be transferred because the witnesses were located in Western Australia. The response of PHL was that the majority of the witnesses as to the pre-contractual negotiations were in Melbourne or, at least, not in Western Australia. In response to my inquiry as to what witnesses might be called and what evidence led upon an issue which was essentially that of construing a written contract, I was told that extensive evidence would be led as to the matrix of facts against which the contract was entered into. I therefore directed that the parties identify the expressions in the contract whose interpretation warranted such evidence and the summary of the evidence to be led. This they have done by memoranda on behalf of PHL on 16 June and on behalf of ADM on 11 June. The position of PHL is now that the evidence of pre-contractual dealings is not admissible.
I have examined these memoranda. I express no view as to the admissibility of the evidence identified by counsel for ADM. I am not satisfied that the background facts identified by them, if they are required to be proved, would involve a substantial body of evidence.
I was next pressed with the argument that the likely duration of the trial would be measured in weeks rather than days and that it would conveniently be managed and heard expeditiously by a judge in the Long Causes list in the Western Australian Court. Neil Philip Gentilli, the Western Australian solicitor for PHL, says that the proceeding might not be entered in the expedited list in Western Australia and that, in such event, the trial, which he estimates as being of some three days, would not be listed for at least 10 months. I am not satisfied that the proceeding as it presently stands would require the length of trial predicted by counsel for ADM. I am not satisfied that the requirement for expedition points to the transfer to Western Australia. A speedy hearing is available in the Commercial List in this Court.
ADM has now filed another affidavit, that of Terrence James Appleby sworn 17 June 2003, which shows how the disputes are developing. The deponent says that ADM intends to put in train the procedures for appointment of an expert pursuant to cl. 13.4(e) and cl. 35 of the agreement. This has provoked a response from PHL who threatens to apply to this Court for injunctive relief. Having achieved this result, ADM now says that this was injunctive relief properly to be dealt with by the Western Australian Court. To my mind, this smacks of tactical manoeuvring. Indeed, this might be said of the positions adopted by both parties since this proceeding was commenced.
This type of forum shopping was, I am sure, far from the intention of those responsible for the cross-vesting legislation, and this Court should not lend its aid to these practices. I put them to one side, focussing upon the fundamental question whether the Western Australian Court is a more appropriate forum.
When the case was originally presented, it seemed to me that this had not been demonstrated since the issue was essentially one of the construction of a document. Notwithstanding the extensive oral and written submissions of the parties, I see no reason to depart from this view. I therefore decline to transfer the proceeding to Western Australia. I will fix the case for trial in October and give directions accordingly.
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