Pacific Star Communications Pty Ltd v Telstra Corporation Ltd

[1997] FCA 1618

IN THE FEDERAL COURT OF AUSTRALIA )

NEW SOUTH WALES DISTRICT REGISTRY ) No. NG 498 of 1997

GENERAL DIVISION )

Between: PACIFIC STAR

COMMUNICATIONS	PTY
LIMITED

First Applicant

SunNET PTY LIMITED

Second Applicant

ComsWEST PTY LIMITED

Third Applicant

And: TELSTRA CORPORATION

LIMITED

Respondent

REASONS FOR JUDGMENT

EINFELD J SYDNEY 26 NOVEMBER 1997

As at 30 June 1997, the Court was being asked to make interlocutory orders to maintain in position the relationship

between the parties to this application and the services being

provided by the respondent to the applicant companies. At that time, the respondent applied to transfer that interlocutory proceeding to Queensland, either the Supreme Court or the Queensland registry of the Federal Court. That application

failed for reasons set out in the judgment given on 30 June which can be summarised, in respect of the proposed cross vesting to the Supreme Court, as being that it seemed likely that the Queensland Supreme Court proceedings brought by Telstra

to recover a debt from these applicants would have to be cross- vested to this Court because a cross-claim was to be filed raising a claim under section 46 of the Trade Practices Act over which the Queensland Supreme Court does not have primary jurisdiction. As to a change of venue, I found that it was not

convenient to have two registries of the Court hearing similar litigation when there was no true prejudice or inconvenience suggested.

Although no such cross-claim had been filed, cross-claims in similar proceedings before this Court had raised such matters, and the Court was informed then, as it has been informed today, that similar claims are to be made in this litigation. The applicants here explain that the reason why the cross claim has not been filed in the Queensland Supreme Court proceedings is because the respondent has been tardy in providing particulars

and an amended statement of claim in those proceedings. It seems that those matters have only been attended to in the last few days.

There is now before this Court an application by the respondent to transfer to the Queensland Supreme Court the substantive application filed here, and section 5 ( 4 ) of the Commonwealth Cross-vesting Act and the New South Wales Cross-vesting Act have been called in aid of that application. It is not necessary for

me to quote in this judgment that subsection verbatim but it is presupposed on the concept that there are related proceedings in

both this Court and a State Supreme Court and that for various

reasons it is more appropriate that the proceedings be

determined by the Supreme Court.

Contained in the application sought to be cross-vested are a large number of declarations and orders, and what are described as damages for breach of contract, damages for negligence, damages under section 82 of the Trade Practices Act, and damages

under section 186 of the Telecommunications Act. The application includes a request for a declaration that section 46 of the Trade Practices Act has been contravened but makes no other reference to that section nor does the affidavit which has been filed in support of the application refer to it in any

specific detail.

As the alternative to a statement of claim provided in Order 4 rule 6 of the Court's rules for the filing of an affidavit together with the application has been availed of, the omission to disclose in the filed affidavit, in respect of the section 46 claim, the nature of the claim and the material facts on which it is based, represents a breach of the rules. However, to deal

with this matter on that basis of abstraction would really be to

close one's eyes to what is actually taking place in the world.

It is by now well-known that there is a substantial amount of litigation in this Court between service providers and Telstra

and between Optus and Telstra. I am hearing most of it and am

deeply involved in its complexity and details. The cases raise

very important and significant matters for the telecommunications market place. Because that market place significantly impacts upon the public interest, it would not be right to look at this particular application completely blind to what else is taking place, and indeed to the very way in which all this litigation including the present application has been contested and litigated up to date.

The picture that has emerged from this litigation is that the service providers and the alternative carrier, Optus, have substantial complaints about Telstra's billing operations and the use of some of its monopoly powers still remaining in the market. It does not seem to me that the interests of justice and the community and public interest, let alone the interests of the litigants as a whole, will be well served by attempting to have this litigation heard in several places or in more than one place, and particularly to have it heard in a State Court and the Federal Court at the same time.

That type of scenario was exactly what the cross-vesting legislation was designed to avoid and raises all the fears that

cross-vesting legislation was intended to resolve, namely, that there can be inconsistent rulings and resulting litigious crises between Federal and State Courts; and that litigants can forum-

shop or exhaust opponents' finances by running cases in two

different places at once or successively.

Very little seems to have happened, actually, in the five months that have passed since the proceeding on 30 June to cross-vest the interim application to the Queensland Supreme Court or cross vest the Supreme Court proceedings to this Court. Indeed, so far as I can see from the present litigation in this Court, virtually nothing has happened except a hearing concerning security and other matters that was dealt with in a judgment given on 14 November 1997 which is yet to be completely concluded or finalised by compliance with the orders. Neither mediation nor sensible case management has yet crystallised although efforts are now about to be made in the month of December to try to bring that to some fruition in some of the other cases. It certainly cries out to be done in this case.

Because so little has changed in the intervening period, I cannot see why the considerations that motivated the decision in June should be any different now. It is said on behalf of Telstra, quite rightly, that the colour of the Part IV claim which lay behind the decision in June has not yet been seen. On the other hand, it is impossible for me to treat that situation as being quite as bad as it sounds because the disputes raised in the affidavits filed on behalf of the applicants here show

that the substance of the matters likely to be in contention is so similar to those in contention in the other litigation of a similar kind as to make it likely that the section 46 claim will also be in similar terms. The same situation applied when the

application to cross vest from the New South Wales Supreme Court to this Court yet there was no contest by Telstra with cross vesting on that ground. It is not easy to see how cross vesting from the Supreme Court of Queensland could now be contested by Telstra if the same argument emerges.

If, when the defence and cross-claim are filed in the Queensland Supreme Court, it turns out that the section 46 claim is either very different or there is no section 46 claim at all, then the matter can be reviewed. Indeed, I have no doubt that the Supreme Court of Queensland will be affected in its consideration of whether the Queensland case should be cross- vested to the Federal Court by those matters, amongst others.

Much as I would like to think otherwise, if only to relieve the burdens on this Court being caused by all this litigation, I

just cannot see how the resolution of this matter and the

important public interest which it concerns can be served by

having part of it in the Federal Court in Sydney and another

part in the Queensland Supreme Court if, as seems likely, the issues in the State case will be the same as in the cases in

this Court, even if all the issues have not yet found their way into pleadings. To my way of thinking, that will just bring the institution of justice into great disrepute and justifiably so because the issue will have been dealt with on a theoretical

basis and not in the real practical world in which we all have

to operate. For the present, I therefore refuse the application

to transfer this matter to the Supreme Court of Queensland. At another time and in other circumstances and with other sets of facts, a different decision might be made but that is the position as at the moment.

I order that the applicants file and serve a statement of claim

by not later than 4.00 pm on Friday 12 December 1977. Costs

will be reserved.

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