Sherwood Overseas Co Pty Ltd v Jaymac International Pty Ltd - [2008] FMCA 495

FEDERAL MAGISTRATES COURT OF AUSTRALIA

SHERWOOD OVERSEAS CO PTY LTD v JAYMAC INTERNATIONAL PTY LTD

[2008] FMCA 495

TRADE PRACTICES – Misleading and deceptive conduct – misrepresentation.

PRACTICE & PROCEDURE – Venue – application to change – mandatory matters for consideration – other relevant matters for consideration.

Federal Court Act, 1976 (Cth), s.48
Federal Court Rules (Cth) o.10, r.1(2)(f), o.30, r.6
Federal Magistrates Act, 1999 (Cth), ss.45, 52
Federal Magistrates Court Rules, 2001 (Cth), rr.8.01(2), 14.02, 15.07-15.10
Trade Practices Act, 1974 (Cth), ss.52, 53(d), 80

Abrahams v Qantas Airways Limited (No. 2) [2007] FMCA 639
Australian Competition and Consumer Commission v Internic Technology Pty Ltd & Anor (1998) 42 IPR 225
Australian Steel Co (Operations) Pty Ltd v Steel Foundations Limited & Anor (2003) 58 IPR 69; [2003] FCA 374
Autodesk Inc & Ors v Ginos Engineers Pty Ltd & Anor [2007] FMCA 1848
Goodall v Nationwide News Pty Ltd [2007] FMCA 218
National Mutual Holdings Pty Ltd & Ors v The Sentry Corporation & Anor (1988) 19 FCR 155
Omiros Pty Ltd v PM Developments Pty Ltd & Ors (No. 2) [2005] FMCA 234
PM Developments Pty Limited v Omiros Pty Ltd [2005] FCA 1090
WG & B Manufacturing Pty Ltd v Telsa Farad Pty Ltd [1999] FCA 859
WH Books Limited & Ors v Miller & Anor (1998) 41 IPR 364

Applicant:

SHERWOOD OVERSEAS CO PTY LTD

Respondent:

JAYMAC INTERNATIONAL PTY LTD

File Number:

PEG 10 of 2008

Judgment of:

Lucev FM

Hearing date:

14 April 2008

Date of Last Submission:

14 April 2008

Delivered at:

Perth (by telephone to Brisbane)

Delivered on:

18 April 2008

REPRESENTATION

Counsel for the Applicant:

Mr P. D. Evans

Solicitors for the Applicant:

Freehills

Counsel for the Respondent:

Mr K. Philp

Solicitors for the Respondent:

Bennett & Philp

ORDERS

The Respondent’s Application for change of venue is dismissed.
The matter be adjourned to a directions hearing on 5 May 2008 at 10.30am Perth time, with leave granted to the Respondent to appear by video link.
The parties confer both in writing (which for this purpose includes email communication) and by telephone with a view to drawing appropriate directions for the directions hearing on 5 May 2008.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

PEG 10 of 2008

SHERWOOD OVERSEAS CO PTY LTD

Applicant

And

JAYMAC INTERNATIONAL PTY LTD

Respondent

REASONS FOR JUDGMENT

Application

This is an application in a case by the Respondent for the transfer of the substantive proceedings from the Perth Registry to the Brisbane Registry of this Court. The Respondent’s application is opposed by the Applicant.
The substantive proceedings relate to an application in which the Applicant alleges that the Respondent has:
a)engaged in conduct that is misleading or deceptive, or likely to mislead or deceive, a member of the public in contravention of s.52 of the Trade Practices Act, 1974 (Cth);[1] and
b)in trade or commerce, in connection with the supply or possible supply of goods or services, or in connection with the promotion by any means of the supply or use of goods or services, misrepresented a sponsorship, approval or affiliation that it does not have in contravention of s.53(d) of the TP Act,
and seeks injunctive relief under s.80 of the TP Act in relation to various matters connected with the Respondent’s use of the name, logo and products of a pool cleaning device known as the Kreepy Krauly. The Applicant also seeks damages, alternatively an account of profits, interest and costs.
[1] “TP Act”.
The Respondent has filed a Response in which it joins issue with the Applicant.

Issue

The issue in these proceedings is whether the proceedings ought to be transferred from the Perth Registry to the Brisbane Registry of this Court, having regard to the mandatory considerations under Rule 8.01(2) of the Federal Magistrates Court Rules, 2001 (Cth).[2]

Law

[2] “FMC Rules”.

Legislation

Section 52 of the Federal Magistrates Act, 1999 (Cth)[3] provides as follows:
[3] “FM Act”.
(1)The Federal Magistrates Court may sit at any place in Australia.
(2)The Federal Magistrates Court or a Federal Magistrate may, at any stage of a proceeding in the Federal Magistrates Court, order that:
(a)the proceeding; or
(b)a part of the proceeding;
be conducted or continued at a place specified in the order, subject to such conditions (if any) as the Federal Magistrates Court or Federal Magistrate imposes.
Rule 8.01 of the FMC Rules provides as follows:
(1)A party who files an application or response in a proceeding may apply to have the proceeding heard in another registry of the Court.
(2)In considering an application, the Court must have regard to:
(a) the convenience of the parties; and
(b) the limiting of expense and the cost of the proceeding; and
(c) whether the matter has been listed for final hearing; and
(d) any other relevant matter.

Cases

The starting point in a discussion of the relevant case law is the judgment in National Mutual Holdings Pty Ltd & Ors v The Sentry Corporation & Anor[4] in which the Full Court of the Federal Court dealt with an application that a proceeding commenced in Melbourne should be tried at Sydney and that that was the “proper place” of the proceedings. The application was made under s.48 of the Federal Court Act, 1976 (Cth)[5] and order 10, rule 1(2)(f) and order 30, rule 6 of the Federal Court Rules.[6]
[4] (1988) 19 FCR 155 (“Sentry Corporation”).
[5] “FC Act”.
[6] “FC Rules”.
In passages oft quoted the Full Court of the Federal Court in Sentry Corporation said as follows:
“The Court must, however, be satisfied, after considering all relevant matters, that there is sound reason to direct that the proceeding be conducted or continued elsewhere. Its starting point is that the proceeding has been commenced at a particular place. Why should it be changed? On the one hand, if the party who commenced the proceeding chose that place capriciously the Court would be justified in giving no weight to the choice of place. At the other end of the scale, a proceeding may have continued for some time at the place of commencement with many steps having been taken there, for example, filing of pleadings and affidavits, discovery and inspection. Due weight would be given by the Court to such matters before directing that the proceeding should continue at a different place.
The balance of convenience is important, but its weight must vary from case to case. Ultimately the test is: where can the case be conducted or continued most suitably bearing in mind the interests of all the parties, the ends of justice in the determination of the issues between them, and the most efficient administration of the Court. It cannot and should not, in our opinion, be defined more closely or precisely.”[7]
[7] Sentry Corporation at 162 per Bowen CJ, Woodward and Lockhart JJ.
The Full Court of the Federal Court expressly found that the test of “manifest preponderance of convenience” was not the appropriate test to be applied in considering motions under s.48 of the FC Act and the FC Rules.[8]
[8] Sentry Corporation at 167 per Bowen CJ, Woodward and Lockhart JJ.
In applying the test that it identified as correct the Full Court of the Federal Court in Sentry Corporation identified a number of factors which might be taken into account, including:
a)residence of the parties;
b)residence of the witnesses;
c)expense to the parties;
d)the place where the cause of action arose; and
e)the convenience of the court itself.[9]
[9] Sentry Corporation at 162 per Bowen CJ. Woodward and Lockhart JJ.
The balance of convenience was also identified as a relevant consideration in Sentry Corporation, not necessarily determinative of each case, and as indicated above, a matter of varying weight from case to case.[10]
[10] Sentry Corporation at 162 per Bowen CJ, Woodward and Lockhart JJ.
Sentry Corporation has been applied or followed in a number of cases in the Federal Court and this Court.[11]
[11] See WH Books Limited & Ors v Miller & Anor (1998) 41 IPR 364 at 366 per Emmett J (“WH Books”); Australian Competition and Consumer Commission v Internic Technology Pty Ltd & Anor (1998) 42 IPR 225 at 232 per Lindgren J (“Internic”); WG & B Manufacturing Pty Ltd v Telsa Farad Pty Ltd [1999] FCA 859 at para. 2 per Finkelstein J (“WG & B Manufacturing”); Australian Steel Co (Operations) Pty Ltd v Steel Foundations Limited & Anor (2003) 58 IPR 69 at 89 per Kenny J; [2003] FCA 374 at paras. 74-75 per Kenny J (“Australian Steel”); Autodesk Inc & Ors v Ginos Engineers Pty Ltd & Anor [2007] FMCA 1848 at para.7 per Lloyd-Jones FM (“Autodesk”); Omiros Pty Ltd v PM Developments Pty Ltd & Ors (No. 2) [2005] FMCA 234 at para. 16 per Mcinnis FM (“Omiros (No. 2)”).
The Federal Court has identified other factors which warrant consideration when applying the test identified in Sentry Corporation. They include:
a)that the choice of venue should not be capricious;[12]
b)whether a party might receive a legitimate juridical advantage (such as the ability to claim damages or additional damages, or to be awarded pre-judgment interest, in one venue and not the other);[13]
c)the governing law of any contract;[14]
d)the size and nature of any businesses concerned;[15]
e)the degree of connection with the respective venues, and in particular the subject matter of the litigation (especially where a view or inspection might be required by the court);[16]
f)the location of Counsel, solicitors and other advisers, particularly those with actual knowledge and relevant experience;[17]
g)case and docket management considerations, particularly whether a case can or ought to be managed and heard in one Registry, or managed in one Registry and heard in another, which might include consideration of what steps have been taken in the litigation, and if steps have been taken, the nature of those steps and how many steps;[18]
h)that the Court can sit, take evidence and hear witnesses anywhere in Australia;[19] and
i)whether witness statements or affidavits have already been taken, and whether a change of venue might render them redundant.[20]
[12] Sentry Corporation at 162 per Bowen CJ, Woodward and Lockhart JJ; WH Books at 365 per Emmett J.
[13] Sentry Corporation at 167 per Bowen CJ, Woodward and Lockhart JJ.
[14] Australian Steel IPR at 91 per Kenny J; FCA at para. 87 per Kenny J.
[15] WH Books at 365 per Emmett J; Australian Steel IPR at 89-90 per Kenny J; FCA at paras. 76-79 per Kenny J.
[16] Australian Steel IPR at 89-91 per Kenny J; FCA at paras. 79-89 per Kenny J; WH Books at 365 per Emmett J; Internic at 232 per Lindgren J.
[17] Internic at 234-235 per Lindgren J.
[18] WH Books at 365 per Emmett J; Internic at 235-236 per Lindgren J; WG & B Manufacturing at paras. 11-13 per Finkelstein J; Australian Steel IPR at 92 per Kenny J; FCA at para. 92 per Kenny J.
[19] Internic at 233 per Lindgren J.
[20] Internic at 235 per Lindgren J.
In relation to sub-paragraph (g) above the Federal Court in WG & B Manufacturing said as follows:
“…counsel for the respondents, did point out that nowadays the Federal Court organises its lists in such a way that one Judge takes charge of a case from its inception, deals with all interlocutory applications wherever possible, and hears the trial. This does seem to be a desirable manner of conducting litigation, because it means that the Judge who ultimately hears the case has acquired a detailed understanding of the issues raised and is thus able to dispose of the case more efficiently.
I accept that this is a factor that should be taken into account in deciding whether the matter should be decided now or whether it is preferable that my decision should be deferred. Nevertheless I am still of the view that it is appropriate to adjourn the respondent’s application, not to a specific date, but to be brought on once all the interlocutory steps have been completed. At that time it will be clear how many witnesses will be called by each party. When it is known where those witnesses reside, and what will be the likely duration of their evidence, a more informed decision can be made as to the proper location of the proceeding. I do not believe that the parties will be disadvantaged it if turns out that the trial should take place in South Australia, but in the meantime all interlocutory steps have taken place in Victoria.
I should point out that when the application for transfer is brought on for further hearing, the applicant will not be entitled to raise as an issue for consideration the fact that the interlocutory steps have taken place in Victoria. Nor will it be entitled to argue that a transfer may result in it losing the services of its current legal advisers. They may be relevant considerations to take into account in an ordinary case, but they would not be proper considerations to take into account in this case, because the applicant has itself suggested that I should defer ruling on the transfer application for the time being. It should not obtain an advantage in consequence of that ruling.”[21]
[21] WG & B Manufacturing at paras. 11-13 per Finkelstein J.
This Court has also considered applications for change of venue.
In Omiros (No. 2) the court was dealing with an application to transfer proceedings from the Melbourne Registry to the Brisbane Registry in a trade practices action relating to agreements concerning the engagement of an architect from Melbourne for a project involving the construction of an apartment complex at Burleigh Heads in Queensland.[22] In refusing the application for a change of venue the Court considered a number of factors as follows:
a)issues concerning the interpretation of Queensland legislation, which did not provide a significant basis upon which to change venue;
b)that the application, heard in February 2005 and determined in March 2005, was made in the face of allocated hearing dates over five days in April 2005 in Melbourne, and orders for the filing and service of affidavits for that hearing in the interim;
c)no earlier five day hearing was available in Queensland;
d)there would be inconvenience to one party or the other if the matter was heard in Melbourne or Brisbane;
e)the Court did not necessarily consider that that inconvenience ought to be “visited upon the applicant who has commenced proceedings in Melbourne, who resides in Melbourne, has a legal team in Melbourne and in part seeks to claim against the Respondents in relation to a contract entered into in Melbourne to which it is alleged that Victorian law applies”;[23]
f)the extent and nature of interlocutory steps already undertaken.[24]
[22] Omiros (No. 2) at para. 4 per McInnis FM.
[23] Omiros (No. 2) at para. 16 per McInnis FM.
[24] Omiros (No. 2) at para. 16 per McInnis FM.
The Court applied the test in Sentry Corporation to the factors identified above in refusing the application for change of venue.[25]
[25] Omiros (No. 2) at para. 16 per McInnis FM.
The unsuccessful Respondent in Omiros (No. 2) made an application to the Federal Court for enlargement of time in which to apply for leave to appeal from the judgment of this Court, and leave to appeal that judgment. The application (by Notice of Motion) was dismissed.[26] In a succinct judgment the Federal Court found that:
a)the applicant in the Notice of Motion had confused the issue of venue, that is to say, the registry in which the case is managed, with the issue of the conduct of a trial, noting that this Court, like the Federal Court, is a national court and can sit in any part of Australia to deal with all or part of a hearing;[27]
b)that “once the issues in the proceeding are clear, and it is known what witnesses will be called, it will be possible for the present applicant to seek a direction as to the place of the trial, and to seek directions as to the manner in which the trial is to be conducted”;[28] and
c)because the order of this Court appealed from was an interlocutory judgment no estoppel arose, and therefore the order could be revisited, either as a result of a change of circumstances or by way of seeking directions as to the conduct of the hearing, as distinct from attempting to change the venue of the entire proceeding.[29]
[26] PM Developments Pty Limited v Omiros Pty Ltd [2005] FCA 1090 (“Omiros Appeal”).
[27] Omiros Appeal at para. 3 per Gray J.
[28] Omiros Appeal at para. 3 per Gray J. This approach is not dissimilar to that adopted by the Federal Court in WG & B Manufacturing: see para 14 and footnote 22 above.
[29] Omiros Appeal at para. 4 per Gray J.
In Autodesk this Court dealt with an application to transfer proceedings from the Court’s Sydney Registry to the Adelaide Registry. Ultimately, the issue narrowed to a consideration of travel of witnesses to the hearing venue. The Court found that it was not satisfied, at the stage at which the change of venue application was made, that it was possible to identify the amount of travel required and it was therefore not prepared to grant the application to change venue.[30]
[30] Autodesk at para. 20 per Lloyd-Jones FM.

Consideration of legislation and case law

In determining a change of venue application this Court is constrained by the mandatory requirements of rule 8.01(2) of the FMC Rules. The Court must have regard to those matters identified in paragraphs (a), (b) and (c) of rule 8.01(2), and must then consider any other relevant matter by reason of paragraph (d) of rule 8.01(2) of the FMC Rules. In that respect, this Court’s considerations are different to those of the Federal Court, insofar as the Federal Court has unfettered discretion as to which factors it will consider. That said, the Federal Court authorities on change of venue set out above are relevant insofar as they consider the three mandatory factors in rule 8.01(2)(a)-(c), and other factors considered by the Federal Court in those cases might well be other relevant matters for the purpose of rule 8.01(2)(d) of the FMC Rules.

Consideration

Consideration of the matter must proceed on the basis of the mandatory considerations set out in r.8.01(2) of the FMC Rules.

Convenience of the parties

The Applicant:
a)has its place of business in Western Australia;
b)its witnesses (perhaps other than an expert or experts) in Western Australia;
c)appears to be a small – medium size business enterprise; and
d)has solicitors in Western Australia (albeit a large national firm capable of conducting the litigation in Queensland).[31]
The Respondent’s position is similar save that the location is Queensland not Western Australia and the Respondent is represented by a non-national Queensland firm of solicitors.
[31] Transcript at 15.
It is fair, and effectively conceded by both parties, that whether future proceedings are heard in Perth or Brisbane one party or the other will be inconvenienced, and, generally speaking, the level of inconvenience to the parties will not be materially different for the non-resident party.

Limiting expense and cost of proceeding

Wherever future proceedings be heard, be it in Perth or Brisbane, one of the parties will have to incur additional expense and cost.
At this stage it is very difficult to determine with any precision to what extent, if at all, the expense and cost of the proceeding might be limited by a change of venue.
At this stage there has been no discovery. It will be for the parties to persuade the Court to make a declaration that discovery is in the “interests of the administration of justice”.[32] However, until discovery is dealt with it is not really possible to say anything about the nature and quantity of relevant documents and how they will impact on any hearing, other than that each party’s business records and other relevant documents, are in Western Australia and Queensland respectively.
[32] FM Act, s.45; FMC Rules, r.14.02; and see Abrahams v Qantas Airways Limited (No. 2) [2007] FMCA 639, especially in relation to the meaning of the phrase “interests of the administration of justice”: at paras. 9-11 per Lucev FM; and for a summary of matters the Court might consider relevant in determining whether to make a declaration and order re discovery: at para. 25 per Lucev FM.

With respect to witnesses each party appears to have one principal witness at this time: Mr Jackson for the Applicant and Mr Rose for the Respondent. As is usual, each has sworn affidavits in relation to the Application and Response respectively. If that remains the position then it is clear that one of the parties must be disadvantaged by the venue for further proceedings, or more pertinently, final hearing of this matter. Likewise with expert witnesses, who may come from Western Australia or Queensland, but who may also come from anywhere,[33] unless the parties agree on a joint expert or the Court appoints a single expert or directs a joint report to be filed by the parties’ experts.[34]
[33] Australian Steel IPR at 91 per Kenny J; FCA at 89 per Kenny J; Transcript at 17.
[34] FMC Rules, rr.15.07-15.10.
As to other witnesses, it is simply too early to tell and too risky to speculate, as to how many there may be and where they may come from. In that regard the Court notes that the process of discovery may result in an increase or decrease in the number of witnesses to be called. The Court also notes that on many matters on which evidence might have been called there is no factual dispute, and thus no witnesses will need to be called on those issues.
Finally, in respect of witnesses, it may (or may not) be that many of the witnesses might give evidence which is short and relatively uncontroversial. If that be so it may be appropriate to hear their evidence by video, or even by telephone.[35]
[35] Goodall v Nationwide News Pty Ltd [2007] FMCA 218 “provides detailed guidance for any litigant and legal advisors in relation to the matter of video link evidence in the court”: Hassall & Steele (Eds), Federal Magistrates Court Guidebook (Sydney: Thomson Legal and Regulatory Limited) para 2.1550.
Until it is known what witnesses are to be called, and where they reside, and the likely duration of their evidence, it is not possible to determine issues of limitation of expense and cost in relation to the proceeding, and in particular in relation to travel expenses for those witnesses.[36] Thus, with respect to witnesses, it is not possible to make a properly informed decision about issued relevant to venue until more information is known. [37] In that respect it will be appropriate for the Court to make further directions with respect to the filing and service of affidavits by witnesses, including experts.
[36] Autodesk at para. 20 per Lloyd-Jones FM.
[37] Omiros Appeal at para. 3 per Gray J; WG & B Manufacturing at para. 12 per Finkelstein.
The position with respect to solicitors and other professional advisers is no different to the position in relation to other issues: the Applicant’s solicitors and professional advisers are in Western Australia, the Respondent’s are in Queensland. Again, it is evident that whether the hearing be in Perth or Brisbane one party or the other will have to incur the additional expense of having its solicitors and professional advisers travel, or in having to deal with them remotely.
The cost and expense of mediation (which the Court is likely to order at a future directions hearing) will be the same whether the proceeding is in Perth or Brisbane, and again, one party will incur additional expense by reason of the venue at which the mediation takes place. Given that mediation might be conducted with the assistance of a video conference or telephone link there may be no significant expense involved for the remote party.
Given that this matter is in its early stages, or “very, very much in its infancy” as the Respondent put it,[38] issues associated with case and docket management although a factor, are not yet likely to increase costs and expenses for either party whether or not the venue does or does not change. At least on an interlocutory basis the matter can be managed efficiently by way of video link or telephone hearings (as it has been to date).[39]
[38] Transcript at 14.
[39] WG & B Manufacturing at para.13 per Finkelstein J.

Whether listed for final hearing

The action has not proceeded beyond the filing of an Application and Response and supporting affidavits because of the Respondent’s initial objection to jurisdiction and the application to transfer the proceedings, only the latter of which is now pursued. Thus, the Court has not made, at this stage, the usual directions that it would make at a first court date, including listing the matter for final hearing.
At this stage there has been no indication from the parties as to an approximate length of hearing. Given the number of interlocutory processes still to be completed, it is unlikely that there will be any difference in the timing of a final hearing, whether they be in Perth or Brisbane.

Any other relevant matter

There is no evidence of caprice in the Applicant’s choice of venue for the initiating application.
In relation to the subject matter of the litigation the Court again notes that many factual issues are not in dispute. Further, the subject matter does have a strong connection with both Western Australia and Queensland, but it does appear that it might ultimately come to be more closely connected with Queensland. Whether that is so, and if so to what degree, and whether that warrants a change of venue, it is not possible to tell at this stage.

Conclusion and Order

Having regard to the mandatory factors under r.8.01(2) of the FMC Rules the Court has come to the conclusion that at this stage it is not in the interests of the administration of justice, the determination of the issues, or the efficient administration of the Court to allow the application for change of venue. That application will be dismissed. It may be that once the interlocutory processes are more advanced, or completed, that a further change of venue application might be appropriate. That will be a matter for future consideration by the Respondent, and by the Court if any application is made.
The matter will be adjourned to a further directions hearing at 10.30am on 5 May 2008. There will be an order to that effect, and an order requiring the parties to confer both in writing and by telephone with a view to drawing appropriate directions.
The Court will hear the parties as to the costs of this application for change of venue.

I certify that the preceding forty (40) paragraphs are a true copy of the reasons for judgment of Lucev FM

Deputy Associate: S. Gough

Date: 18 April 2008