TCL Air Conditioner (Zhongshan) Co Ltd v The Judges of the Federal Court of Australia & Anor [2012] HCATrans 204

[2012] HCATrans 204

[2012] HCATrans 204

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S178 of 2012

B e t w e e n -

TCL AIR CONDITIONER (ZHONGSHAN) CO LTD

Plaintiff

and

THE JUDGES OF THE FEDERAL COURT OF AUSTRALIA

First Defendant

CASTEL ELECTRONICS PTY LTD

Second Defendant

GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY BY VIDEO LINK TO CANBERRA AND MELBOURNE

ON TUESDAY, 21 AUGUST 2012, AT 9.33 AM

Copyright in the High Court of Australia

MR B.W. WALKER, SC:   May it please the Court, I appear for the plaintiff.  (instructed by Norton Rose Australia)

MR R.M. GARRATT, QC:   If the Court pleases, I appear with my learned friend, MR D.L. BAILEY, for the second defendant.  (instructed by Browne & Co Solicitors & Consultants)

MR S ROBERTSON:   May it please the Court, I appear for the Attorney‑General in the State of New South Wales intervening.  (instructed by Crown Solicitor (NSW))

HIS HONOUR:   There is a submitting appearance by the Federal Court judges.  Yes, Mr Walker.

MR WALKER:   Your Honours, since the case was last before your Honour there has been filed, on behalf of the plaintiff, an affidavit of Mr McKimmie of 27 July 2012.  It adds something to the formal record of proceedings before the Federal Court, which are the subject of our constitutional writs.  There is, so far as we understand, nothing filed, certainly nothing served from the second defendant.  Picking up, therefore, the matters that fell from your Honour on the last occasion it would appear that the record is full, perhaps overfull, in relation to the material necessary to argue the points we wish to raise.  We have ascertained from Justice Murphy’s chambers that judgment is not expected until October.  We cannot be more exact than that.  That, I think, your Honour, completes the intelligence we can add to what was before the Court on the last occasion. 

HIS HONOUR:   Yes.  What should I do this morning, Mr Walker?

MR WALKER:   It is our submission, your Honour, that the appropriate course is to list the matter for hearing before a Full Court.  The issue is not going to become more ripe by reason of the material before the Court.  There is nothing incomplete about it.  There is, perhaps, the misnomer “moot” to be concerned about in light of what may happen before Justice Murphy.  I do not want to add to the comments of both parties before your Honour on the last occasion in relation to that, but rather than this state of suspended animation, in our submission, the nature of the issue is that it is appropriate for these matters, or this matter, to proceed. 

If it turns out to be in need of rapid arrest, by reason of events later, then that can be considered if and when that occasion arises.  There is certainly sufficient prospect, on any view of the matter, and without venturing predictions, that there will be a live issue to be debated and for this Court to determine to justify those steps being made.

HIS HONOUR:   Yes.  I could give directions today with a view to having the matter ready for hearing in the November sittings.  I think that is the best thing to do.

MR WALKER:   That is our submission, your Honour.

HIS HONOUR:   Yes.  Do you support that, Mr Garratt, or not oppose it, I suppose I should say?

MR GARRATT:   Yes, your Honour.  We are all in a difficult position because of the uncertainty.  One of the possibilities might be that Justice Murphy finds there was no evidence to support the – in other words, he upholds the natural justice attack.  He could then, under his powers, remit the matter to the arbitrators on the view that there certainly was evidence to sustain a lesser percentage of losses, not the 22.5 per cent that the arbitrators found, but 14 or seven per cent, or some other figure.  So it is possible, we would think not highly possible, but it is possible that that could happen, in which case the matter would go back to the arbitrators and one would need to know where it would go from there.

If the arbitrators then make a further award that may or may not be challenged.  It might not be enforced in the Federal Court, in which case this would go away altogether.  Those considerations suggest caution, the alternative being simply to adjourn the directions hearing over until October.  We think it not likely that that would be the outcome that I have indicated, but I cannot exclude it. 

HIS HONOUR:   Yes, thank you.

MR GARRATT:   We do regard the situation contemplated by Mr Walker as the most likely course, but we cannot say that it is ‑ ‑ ‑

HIS HONOUR:   No, of course, I understand that.

MR GARRATT:   ‑ ‑ ‑ the necessary course.

HIS HONOUR:   When did Justice Murphy reserve his decision?

MR GARRATT:   April, your Honour, 27 April.  He has, as part of his task, evaluating the evidence on the damages issue, the position put by Mr Walker’s clients was that there was no evidence to support the award of damages on the footing that 22.5 per cent of the sales were lost, that is Castel’s sales were lost because of the wrongly imported goods.

HIS HONOUR:   Yes, thank you.  Now, Mr Garratt, as far as you are concerned is the evidence now complete - in this Court, I mean?  Your side was to put on any more affidavits ‑ ‑ ‑

MR GARRATT:   We have not filed anything, your Honour.  We did that on the basis that we would not be proceeding before the judgment of Justice Murphy and the only ‑ ‑ ‑

HIS HONOUR:   That is not what the order says.

MR GARRATT:   No it is not, your Honour, but there was the discussion.  The only slight ‑ ‑ ‑

HIS HONOUR:   It is not a question of a discussion.  It is a question of what the order was.  Now, do you want to put on any more affidavits or not?

MR GARRATT:   Well, your Honour, we apprehend there is no disagreement that Mr Walker’s clients have not obtained the judgments.  They opposed his Honour making a declaration on the basis of his previous reasons.  Part of the relief that is sought is certiorari calling into this Court a judgment to be quashed.  There is no judgment and they opposed any declaratory judgment.  Now, we have not put evidence on about that, but we apprehend it is not a matter in dispute. 

HIS HONOUR:   No - just a minute.  Is that so, Mr Walker?

MR WALKER:   That is so, your Honour.

HIS HONOUR:   Well, there we are.

MR GARRATT:   Then we are content, your Honour.

HIS HONOUR:   Thank you.  Now, Mr Walker, the order to show cause.  Is that in an adequate form?

MR WALKER:   As to paragraph 1 granting the relief is the form that, in our submission, is appropriate.  As to 2, it is, for the reasons my friend has just noted, anticipatory and whether or not that remains an appropriate form does depend upon future events. 

HIS HONOUR:   Yes.

MR WALKER:   Clearly enough paragraph 1 suffices to vindicate the position if we are correct.

HIS HONOUR:   Now, just remind me, there is no appeal pending, no interlocutory appeal pending, is there, in respect of the January judgment?

MR WALKER:   No, there is not.  I was about to mention, your Honour, your Honour will recall your comments on the last occasion, the transcript of which was forwarded to the Federal Court, referring to the not unknown expedient of delivering judgment in the form of reasons but deferring the making of orders, to which I would add even if it be that the reasons or other statements in court on the occasion of delivering reasons foreshadowed, perhaps, with precision what orders would follow.  Now, depending upon whether that course is followed or any variant of it, order 1 in the show cause might need some slight adaptation.  Restraining from granting the relief may or may not be the appropriate form.  If the expedient your Honour noted were followed it would be the appropriate form.

HIS HONOUR:   Yes.  Now, there is quite a large pile of affidavits here, including affidavits of service.  I am sure they do not need to go in the record for the Full Court of this Court.  Which affidavits would actually be sufficient on both sides?

MR WALKER:   Your Honour, for us it would be Mr McKimmie’s of 3 and 27 July.

HIS HONOUR:   Now, Mr McKimmie has an affidavit affirmed on 3 July and then there is ‑ ‑ ‑

MR WALKER:   Yes, the bulk of which, of course, is the – I am so sorry.

HIS HONOUR:   The bulk of which is the arbitration record, if I can put it that way.

MR WALKER:   Yes.

HIS HONOUR:   Then he also has an affidavit affirmed quite recently, that is 27 July.

MR WALKER:   That is correct.

HIS HONOUR:   Yes, what else?

MR WALKER:   That is it, your Honour.  Now, there is the question obviously mandatory to be proved of the service of section 78B notices, but they do not go to anything substantive.

HIS HONOUR:   No.  Now, on the other side are there any affidavits to go in to the record?

MR WALKER:   No, your Honour.

HIS HONOUR:   I think not, particularly in the light of what has transpired this morning.  That is right, Mr Garratt, is it not?

MR GARRATT:   That is so, your Honour.

HIS HONOUR:   Yes, thank you, all right.  What is the rule that enables a referral in of the application for show cause for ‑ ‑ ‑

MR WALKER:   I am sorry, your Honour, I do apologise I have come unable to answer that.

MR GARRATT:   Your Honour, the rule appears to be rule 25.03.

HIS HONOUR:   Yes, thank you.  This is what I propose:

1.Pursuant to rule 25.03.3, order that the application for an order to show cause filed on 4 July2012, be referred for hearing by the Full Court, if otherwise practicable, in the November sittings.

2.The affidavit evidence comprise the affidavits of Mr McKimmie filed 4 July and 27 July 2012.

3.Leave to the plaintiff and the second defendant to seek further directions from a Justice with respect to the preparation of the matter for the Full Court on two days written notice.

4.The costs of today be costs in the cause. 

So if matters develop and require any adjustment of the record before the November sittings either side can apply to a Justice for some further directions.  Is there anything else?

MR GARRATT:   No, your Honour.

MR WALKER:   No, your Honour.

HIS HONOUR:   I do not think it affects you, Mr Robertson, at this stage.  Very well, thank you, gentlemen.

AT 9.52 AM THE MATTER WAS ADJOURNED