Retail Enterprise Development Pty Ltd v Harris Scarfe Pty Ltd

[2006] VSC 82

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

PRACTICE COURT

No. 9240 of 2005

RETAIL ENTERPRISE DEVELOPMENT PTY LTD	Plaintiff
v
HARRIS SCARFE PTY LTD	Defendant

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JUDGE:	COLDREY J
WHERE HELD:	MELBOURNE
DATE OF HEARING:	28 FEBRUARY 2006
DATE OF JUDGMENT:	10 MARCH 2006
CASE MAY BE CITED AS:	RETAIL ENTERPRISE PTY LTD v HARRIS SCARFE PTY LTD
MEDIUM NEUTRAL CITATION:	[2006] VSC 82

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CROSS-VESTING APPLICATION – Section 5(2)(b)(iii) of Jurisdiction of Courts (Cross-Vesting) Act 1987 - Relevant matters – Cross-vested to Supreme Court of South Australia

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	T. Walker	Logie-Smith Lanyon
For the Defendant	P. Clarke	Voitin Walker Davis

HIS HONOUR:

The Application

1. This is a return of a summons brought by Harris Scarfe Australia Pty Ltd, the defendant in the proceeding, seeking an order pursuant to s. 5(2) of the Jurisdiction of Courts (Cross-Vesting) Act (Vic) 1987 (“the Cross-Vesting Act”) for transfer of those proceedings to the Supreme Court of South Australia where there is currently a proceeding in progress.

The Parties

1. The Plaintiff, Retail Enterprise Developments Pty Ltd, is a company deemed to be incorporated pursuant to the Corporations Act and is a trading corporation within the meaning of section 4(1) of the Trade Practices Act (Cth) 1974. The sole director, secretary and shareholder of the Plaintiff company is Susan Joy Dixon who entered into a contract with the Defendant to provide them with certain services in her position as ‘Buying Controller – Women’s Apparel and Children’s Wear’ for the Defendant.

1. The Defendant is also a company deemed to be incorporated pursuant to the Corporations Act and is a trading corporation within the meaning of section 4(1) of the Trade Practices Act (Cth) 1974. It carries on business principally as a retailer. 

The Proceedings

1. The Defendant issued proceedings in the South Australian Supreme Court on 19 May 2005 in South Australia. The Statement of Claim alleges, inter alia, loss and damage by reason of breaches of an agreement entered into with Ms Dixon in April 2003.  It appears that the agreement was in fact entered into with the plaintiff with Ms Dixon being nominated as the approved person under that agreement.  This matter is addressed in the South Australian proceeding.

1. The Plaintiff commenced a proceeding against the Defendant in Victoria by writ dated 10 November 2005 (“the Victorian proceeding”), claiming, inter alia, the failure of the Defendant to pay the Defendant for consulting services rendered pursuant to this agreement.

1. On 28 February 2006 an application was made in this Court by the Defendant for the Victorian proceeding to be transferred to the Supreme Court of South Australia.

Relevant Legal Principles

1. The relevant law is found in s.5(2)(b)(iii) of the Cross-Vesting Act which provides :

"(2)     Where—

(a)a proceeding (in this sub-section referred to as the "relevant proceeding") is pending in the Supreme Court (in this sub-section referred to as the "first court"); and

(b)      it appears to the first court that—

(iii)it is otherwise in the interests of justice that the relevant proceeding be determined by the Supreme Court of another State or of a Territory—

the first court shall transfer the relevant proceeding to that other Supreme Court."

1. In determining whether an application for transfer should succeed, the Court must consider “the interests of justice”[1].  This concept has been the subject of a number of  previous decisions.  Expressions such as “the more appropriate forum” for the hearing and determination of the substantive dispute in pursuit of the interests of justice[2], and the forum with the “most real and substantial connection” with the particular subject matter of the proceeding[3] have been used.  In BHP Billiton Limited v Trevor John Schultz & Ors[4] the High Court, in the joint judgment of Gleeson CJ, McHugh and Heydon JJ, stated that it was “not necessary that it should appear that the first court is a clearly inappropriate forum” but that it was “both necessary and sufficient that, in the interests of justice the second court is more appropriate”.

   [1]Ewins v BHP [2006] VSC 4

   [2]Bankinvest AG v Seabrook (1988) 14NSLWR 711; Schmidt v Won (1988) 3 VR 435

   [3]Toll (FHL) Ltd & Ors v Finemore & Ors [2001] VSC 467

   [4][2004] HCA 61 at para 14

1. As to the factors that point to a connection with one forum over the other, the judgements in Schultz variously referred to the following : availability of witnesses; the places where the parties respectively reside or carry on business; the law governing the relevant transaction; the Court best equipped to deal with the issues; the location of events; and the presence of the parties in the Court to which the transfer was sought[5]. The Court also noted the difficulty in giving any guidance as to the weight to be attached to any particular factor in determining the application[6].

   [5]At paras 18 and 262

   [6]At para 18

1. Previous decisions have also discussed the issue of whether the party seeking the transfer of proceedings carries any burden of proving its appropriateness.  The following observation of Gillard J in Ewins v BHP encapsulates the present approach:

“Many judges have referred in the past to the burden and the general view is that an applicant does carry a burden.  However, as in most contested litigation where the burden of proof rarely plays a part, in the vast majority of cases seeking a transfer it will seldom be of any importance.  Nevertheless, where the factors favouring a transfer and those against are equal, the burden of proof will have a part to play”[7].

[7][2006] VSC 4 at para 23

The Present Application

1. The principal factors advanced by counsel for the Defendant as requiring a transfer of the proceeding to the Supreme Court of South Australia included:

·The head office of the Defendant is located in Adelaide, South Australia

·The Victorian and South Australian proceedings share common subject matter; namely, the agreement for consulting services between the Defendant and Ms Dixon and the retention of the laptop computer.

·The South Australian proceeding preceded the Victorian proceeding and the former is in the advanced stages of the discovery process.

·Those documents discovered in the South Australian proceedings that were located other than in Adelaide have now been transferred to Adelaide.

·At the time of the provision of services by Ms Dixon to the Defendant the subject of both proceedings, Ms Dixon was based in the Defendant’s head office in Adelaide.

·The witnesses anticipated to be called by the Defendant at trial reside and work in Adelaide.

·The forensic accounting expert engaged by the Defendant is located in Adelaide.

·The Defendant’s principal legal advisers are based in Adelaide.

·There is the possibility of inconsistent findings by each State Superior Court if the two proceedings continued separately.

·There would be an unnecessary and costly duplication of expenses in conducting two proceedings.

1. In response, counsel for the Plaintiff argued that the subject matter of the South Australian and Victorian proceedings constituted discrete claims.  As to the applicable governing law, this was essentially the law of contract and being the common law of Australia, negated the impact of this factor.  Counsel further asserted that there was a lack of evidence firstly that supported the Defendant’s claim that it would be financially inconvenienced and secondly that the South Australian proceedings disclosed any inadequacy in the services provided by the Plaintiff which would found any breach of the agreement.

1. Many of the matters relied upon by the Defendant may be categorised as relating to cost and convenience.  If these were the only factors advanced to support the claim for a transfer, then the application may well require more to succeed.  As Gillard J noted in Ewins, technological developments including audio visual link and electronic correspondence diminish the impact of arguments about cost and inconvenience in relocating witnesses and documents[8].  These are not however the only factors.

   [8]At paras 37-38

1. In my opinion examination of the factual circumstances does reveal a considerable commonality.  Moreover, I regard the question of the breaching of the first agreement as being raised on the pleadings in each proceeding.  These are powerful considerations for a consolidated hearing (I note in passing that the question of an equitable set off was also canvassed in argument).  Additionally, a consolidated hearing would avoid any possibility of inconsistent verdicts.

1. The relatively advanced stage of the South Australian proceeding is a further factor to be taken into account.  Ultimately I have concluded that, in the circumstances, (which include cost and convenience) the interests of justice require the Victorian proceeding to be transferred to the Supreme Court of South Australia.

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