Tryam Pty Ltd v Grainco Australia Ltd

[2003] NSWSC 812

CITATION:	Tryam Pty Ltd & Anor v. Grainco Australia Ltd & Ors [2003] NSWSC 812
HEARING DATE(S):	30 April, 2003
JUDGMENT DATE:	5 September 2003
JURISDICTION:	Equity Division Commercial List
JUDGMENT OF:	Palmer J
DECISION:	Proceedings transferred to Supreme Court of Queensland; Notice of Motion challenging jurisdiction under s.106 Industrial Relations Act stood over to be determined by Supreme Court of Queensland, if required.
CATCHWORDS:	JURISDICTION PRACTICE AND PROCEDURE - Whether Supreme Court has jurisdiction under Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW) to decide matters of substance in a proceeding transferred to the Court under s.8(1) - whether and to what extent Supreme Court should consider prospects of success in such a proceeding in order to determine whether it is "in the interests of justice" to transfer the proceeding to another Court - INDUSTRIAL LAW - UNFAIR CONTRACTS - Whether Industrial Relations Commission has jurisdiction under s.106 Industrial Relations Act 1996 (NSW) only in respect of contracts the proper law of which is that of New South Wales - whether conflict between decisions of the Full Bench of the Commission and decision of the High Court - HIGH COURT - INDUSTRIAL RELATIONS COMMISSION - Whether privative clause in Industrial Relations Act has effect of making Full Bench of Commission the supreme authority on extent of Commission's jurisdiction under Industrial Relations Act - UNFAIR CONTRACTS - s.106 Industrial Relations Act - meaning of "work in any industry" discussed - CROSS-VESTING - Whether proceedings sought to be cross-vested have sufficient substance to warrant cross-vesting in the interests of justice - whether Supreme Court of Queensland or Supreme Court of New South Wales is the more appropriate forum - significance of contractual provision requiring parties to submit to exclusive jurisdiction of Courts of Queensland.
LEGISLATION CITED:	- Financial Emergency Act 1931 (Vic) - Grain Marketing Act 1991 (NSW) - Industrial Arbitration Act 1940 (NSW) - s.88F - Industrial Relations Act 1991 (NSW) - s.275 - Industrial Relations Act 1996 (NSW) - s.105, s.106, s.179 - Industrial Relations Act 1999 (Qld) - s.276 - Interest Reduction Act 1931 (NSW) - Judiciary Act 1903 (Cth) - s.33, s.39(2) - Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW) - s.5, s.6, .6A, s.8 - Service and Execution of Process Act 1901 (Cth) - s.11 - Supreme Court Act 1970 (NSW) - s.48 - Supreme Court Rules Pt.1 r.1.3 - Trade Practices Act 1974 (Cth) - s.67 - Workers Compensation Act 1928 (Vic) - Commonwealth Constitution - Chapter III, s.73
CASES CITED:	- Ace Business Brokers Pty Ltd v Phillips-Treby [2000] NSWIRComm 163 - Amalgamated Society of Railway Servants v Osborne [1910] AC 87 - Australian Entre Business Centres Pty Ltd v Smith (1989) 29 IR 172 - Bankinvest AG v Seabrook (1988) 14 NSWLR 711 - Barcelo v Electrolytic Zinc Co of Australia Ltd (1932) 48 CLR 391 - BNY Australia Ltd v James (1992) 40 IR 1 - Bonython v Commonwealth (1950) 81 CLR 486 - Bristol-Myers Squibb Company v F.H. Faulding & Co Ltd (2000) 97 FCR 524 - Brown v Rezitis (1970) 127 CLR 157 - Caltex Oil (Australia) Pty Ltd v Feenan [1981] 1 NSWLR 169 - Cheater v Cater [1918] 1 KB 247 - Chevron Breeders & Producers of Australia Pty Limited v Fast Food Service Development Pty Ltd [1984] AR 576 - Chrysler Jeep Automotive Distributors Australia Pty Ltd v Canberra Star Motors Pty Ltd (1998) 79 IR 452 - Cosgrove v International Opal Pty Ltd [1977] AR 751 - Davies v General Transport Development Pty Ltd [1967] AR(NSW) 371 - Dawson v Baker (1994) 120 ACTR 11 - Deputy Commissioner of Taxation for New South Wales v Palmer [1907] AC 179 - Goodgold Pty Ltd v Bumpa T Bumpa Automart Pty Ltd (unrep. NSW Ind Comm, 18 December 1992 - Gosper v Sawyer (1985) 160 CLR 548 - Harris v Digital Pulse Pty Ltd (2003) 44 ACSR 390 - James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357 - V.G. Haulage Services Pty Ltd, Ex parte; re Industrial Commission of New South Wales [1972] 2 NSWLR 81 - Jacobs v London County Council [1950] AC 361 - Jones v Bartlett (2000) 205 CLR 166 - London Jewellers Ltd v Attenborough [1934] 2 KB 206 - McClelland v Trustees Executors and Agency Co Ltd (1936) 55 CLR 483 - Maloney v Hoffman [1980] AR 318 - Mansweto v Midas Australia Pty Ltd (1996) 65 IR 182 - Merwin Pastoral Co Pty Ltd v Moolpa Pastoral Co Pty Ltd (1933) 48 CLR 565 - Mitchforce Pty Ltd v Industrial Relations Commission of NSW [2003] NSWCA 151 - Mount Albert Borough Council v Australasian Temperance & General Mutual Life Assurance Society [1938] AC 224 - Mynott v Barnard (1939) 62 CLR 68 - O'Toole v Charles David Pty Ltd (1991) 171 CLR 232 - Permanent Trustee Co (Canberra) Ltd v Finlayson (1968) 122 CLR 338 - Perrott v XcelleNet Australia Ltd (1998) 84 IR 255 - Plaintiff S157/2002 v Commonwealth of Australia (2003) 77 ALRJ 454 - Production Spray Painting & Panel Beating Pty Ltd v Newnham (1991) 27 NSWLR 644 - R v Coldham; Ex parte Australian Workers Union (1983) 153 CLR 415 - R v Hickman; Ex parte Fox & Clinton (1945) 70 CLR 598 - R v Metal Trades & Employers Association; Ex parte Amalgamated Engineering Union (1951) 82 CLR 208 - R v Warner (1661) 1 Keb 66 [83 ER 814] - Reich v Client Server Professionals of Australia Pty Ltd (No 2) [2000] NSWIRComm 196. - Richardson, ex parte; re Hildred [1972] 2 NSWLR 423 - Rosenboom v Qantas Airways Ltd [2002] NSWSC 792 - Soueid v G.E. Nixon Pty Ltd - NSW Industrial Commission, unrep., 28 September 1992 - Savage v Digital Equipment Corporation (Australia) Pty Ltd [1999] NSWIRComm 227 - Bill Stevens Pty Ltd v WTH Pty Ltd - NSW Industrial Commission, unrep., 7 May 1993 - Stevenson v Barham (1977) 136 CLR 190 - Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 - Vita Food Products Incorporated v Unus Shipping Company Ltd (in liq) [1939] AC 277 - Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society (1934) 50 CLR 581 - Cross & Harris Precedent in English Law (1991) 4th Ed at 85-86, 158 - Nygh & Davies Conflict of Laws in Australia (2002) 7th Ed. p.366
PARTIES :	Tryam Pty Limited t/as Summer Hill Grains - First Plaintiff Bernard Sidney Hughes - Second Plaintiff Grainco Australia Limited - First Defendant Australian Independent Grain Terminals Pty Limited - Second Defendant Australian Bulk Alliance Pty Limited - Third Defendant Marketlink (Aust) Pty Limited - Fourth Defendant
FILE NUMBER(S):	SC 50034/03
COUNSEL:	F.C. Corsaro SC with S.E.J. Prince - Plaintiffs S. Doyle SC - First & Fourth Defendants
SOLICITORS:	Tress Cocks & Maddox - Plaintiffs Minter Ellison - First & Fourth Defendants

Introduction

1 Before the Court are two Notices of Motion filed by the First and Fourth Defendants (“Grainco” and “Marketlink”). The first motion seeks a declaration that the New South Wales Industrial Commission has no jurisdiction over Grainco and Marketlink in proceedings commenced in the Commission by the Plaintiffs (“Tryam” and “Mr Hughes”) for relief under s.106 of the Industrial Relations Act 1996 (NSW) (“the IRA”). The second motion seeks an order cross-vesting the proceedings in the Commission to the Supreme Court of Queensland, if it is held that the Commission does, in fact, have jurisdiction.

The parties and the background facts

2    Grainco is a company incorporated and based in Queensland. It was established following a restructuring of the Queensland grain industry in 1991 and it represents an amalgamation of the Queensland State Wheat Board, the Barley Marketing Board, the Central Queensland Grain Sorghum Marketing Board, the Queensland Grain Handling Authority, the Queensland Barley Growers Co-operative Association Ltd and the Central Queensland Producers Co-operative Association Ltd. Grainco carries on the business of bulk grain storage and handling throughout Queensland, New South Wales and Victoria and supplies services and products to primary producers and other clients in those States. It is an unlisted public company and has about 8,000 shareholders. It has staff in Queensland, New South Wales and Victoria, although most of its staff is in Queensland.

3    Marketlink, a company in which Grainco has a majority interest, is the vehicle through which Grainco conducts its marketing activities. The Second Defendant (“Terminals”) carries on the business of receiving, handling, transporting and storing grains at numerous locations throughout Australia. It is a subsidiary of the Third Defendant (“Alliance”), which is a joint venture company in which Grainco and another company are the participants. Clearly, Grainco, Terminals, Alliance and Marketlink are substantial commercial enterprises.

4    Tryam commenced business as a grain merchant, agent and accumulator in about 1987. It owns various grain storage facilities in New South Wales. Mr Hughes is the Director of Tryam responsible for its day-to-day operations. Although not on the same scale as Grainco, Tryam, too, is a substantial commercial enterprise: by 2000 its annual turn-over was between $4M and $5M.

5    These proceedings arise out of three contracts between the parties. By an agreement dated 10 November 2000 (“the Agency Contract”) Grainco appointed Tryam as its agent within a defined area in New South Wales and Tryam agreed to carry out certain accumulation services for Grainco in that area. By an agreement dated 28 November 2000 (“the Harefield Storage Contract”) Tryam agreed to provide a grain storage facility operated by it at Harefield in New South Wales to Terminals for a period of ten years. By an agreement dated 8 February 2002 (“the Grainco Storage Contract”) Tryam agreed to receive, handle, transport and store a range of commodities on Grainco’s behalf. It will be necessary to go into further detail as to the terms of these agreements later but for the moment it is sufficient to note that the Agency Contract and the Grainco Storage Contract expressly provide that their proper law is that of Queensland. The Harefield Storage Contract provides that its proper law is that of New South Wales.

The three proceedings

6    On 5 March 2003 Grainco commenced proceedings in the Supreme Court of Queensland against Tryam and Mr Hughes seeking relief for breach of contract, damages for conversion and orders under the Trade Practices Act 1974 (Cth) (“the Queensland Proceedings”). On the same day, Tryam commenced proceedings against Grainco in the Federal Court in Sydney claiming relief under the Trade Practices Act in respect of the contracts between it and Grainco (“the Federal Court Proceedings”).

7 On 18 March 2003, Tryam and Mr Hughes filed in the Industrial Relations Commission of New South Wales (“the Commission”) a Summons seeking relief under s.106 IRA against Grainco and other Defendants in respect of the contracts which are the subject of the Federal Court Proceedings (“the IRA Proceedings”).

8 By Summons filed in the Commercial List of this Court on 1 April 2003, Tryam and Mr Hughes sought an order that the IRA Proceedings be removed into this Court pursuant to s.8(1)(b)(i) of the Jurisdiction of Courts (Cross-Vesting) Act 1987 (NSW) (“the Cross-Vesting Act”). The Summons stated that the application for cross-vesting was made with the intention of moving to have the Federal Court Proceedings, the IRA Proceedings and the Queensland Proceedings cross-vested to this Court so that this Court is seized of jurisdiction to determine all disputes between the parties.

9    By Notice of Motion filed in the Commission on 3 April 2003, Grainco and the Fourth Defendant (“Marketlink”) sought a declaration that the Commission has no jurisdiction over them in respect of the subject matter of the proceedings in the Commission. Rule 82(1)(g) of the Industrial Relations Commission Rules provides that the Commission may, on notice of motion filed by a respondent, make a declaration in the very terms sought by Grainco and Marketlink. The Notice of Motion stated that the grounds upon which the relief was sought were that the proper law of the Agency Contract and the Grainco Storage Contract was not the law of New South Wales and that neither of the contracts was one “whereby a person performs work in any industry” for the purposes of s.106(1) IRA.

10 On 4 April, McClellan J made an order removing the IRA Proceedings into this Court. His Honour stood over to 30 April 2003 for hearing the Notice of Motion which had been filed by Grainco and Marketlink in the Commission challenging the jurisdiction of the Commission.

11 On 11 April, Grainco and Marketlink filed a Notice of Motion in this Court seeking an order that the IRA Proceedings be transferred to the Supreme Court of Queensland pursuant to s.5 of the Cross-Vesting Act.

The Supreme Court’s jurisdiction to determine the jurisdiction of the Commission

12 Before the Court are the two motions of Grainco and Marketlink, the first challenging the Commission’s jurisdiction under s.106 IRA, the second seeking transfer of the proceedings to the Supreme Court of Queensland. Mr Doyle SC appeared for Grainco and Marketlink in support of the motions; Mr Corsaro SC and Mr Prince of Counsel appeared for Tryam and Mr Hughes to oppose. There was no appearance for Terminals and Alliance.

13 In order at this stage to give some indication of the fundamental issues raised in this application, I will record the parties' submissions as to jurisdiction in the broadest outline. Grainco submits, first, that there is direct High Court authority for the proposition that the Commission has no jurisdiction under s.106 IRA in respect of a contract the proper law of which is not the law of New South Wales: as the proper law of the Agency Contract and the Grainco Storage Contract is that of Queensland, the Commission has no jurisdiction under s.106 IRA in respect of those contracts and a declaration to that effect should be made by this Court. Second, Grainco submits that neither the Agency Contract nor the Grainco Storage Contract is one which leads directly to the performance of work in any industry, in the sense required by s.106 IRA, so that those contracts are not within the scope of s.106 and this Court should make a declaration accordingly.

14    In response to the first point, Tryam submits that the decision of the High Court relied upon is not in point; if it is in point, it is nevertheless obiter dictum; finally, if the High Court decision is in point and is ratio, there are three decisions of the Full Bench of the Commission directly in point to the contrary of the High Court decision and those decisions, not the decision of the High Court, are binding on this Court. As to the second point, Tryam submits that it is, at the least, sufficiently arguable that the Agency Contract and the Grainco Storage Contract are contracts whereby work is performed in an industry so that a “strike-out declaration” should not be made under R.82(1)(g) at this stage.

15 Counsel directed their arguments as to whether the Commission had jurisdiction under s.106 IRA apparently upon the basis that that question arose for determination in this Court by reason of the Notice of Motion which Grainco and Marketlink had filed in the Commission seeking a declaration under Industrial Relations Commission Rule 82(1)(g). Indeed, Mr Corsaro founded a number of his submissions on the premise that this Court, in hearing that motion, was exercising the jurisdiction of the Commission and was, therefore, bound by Full Bench decisions of the Commission as to the extent and operation of s.106 IRA. In my opinion, the parties have acted upon a misapprehension as to the nature of the Supreme Court’s jurisdiction on a cross-vesting application.

16 Tryam’s proceedings in the Commission were removed into this Court pursuant to s.8(1)(b)(i) of the Cross-Vesting Act. That section provides:

“(1) Where:

(a) a proceeding (in this subsection referred to as the "relevant proceeding") is pending in:

(i) a court, other than the Supreme Court, of the State; or

(ii) a tribunal established by or under an Act; and

(b) it appears to the Supreme Court that:

(i) the relevant proceeding arises out of, or is related to, another proceeding pending in the Federal Court, the Family Court or the Supreme Court of another State or of a Territory and, if an order is made under this subsection in relation to the relevant proceeding, there would be grounds on which that other proceeding could be transferred to the Supreme Court; or

(ii) an order should be made under this subsection in relation to the relevant proceeding so that consideration can be given to whether the relevant proceeding should be transferred to another court,

the Supreme Court may, on the application of a party to the relevant proceeding or of its own motion, make an order removing the relevant proceeding to the Supreme Court.

(2) Where an order is made under subsection (1) in relation to a proceeding, this Act applies in relation to the proceeding as if it were a proceeding pending in the Supreme Court.

(3) Where a proceeding is removed to the Supreme Court in accordance with an order made under subsection (1), the Supreme Court may, if the Supreme Court considers it appropriate to do so, remit the proceeding to the court or tribunal from which the proceeding was removed.”

17 It was Tryam’s stated purpose in making its application under s.8(1)(b)(i) that, once the IRA Proceedings had been removed into this Court, it would apply to the Federal Court and to the Supreme Court of Queensland under s.5 of the corresponding cross-vesting Acts for transfer of the proceedings in those Courts to the Supreme Court of New South Wales so that all proceedings would be heard in this Court. Grainco and Marketlink themselves could have initiated an application to this Court under s.8(1)(b)(ii) to have the IRA Proceedings transferred into this Court for the purpose of a subsequent application under s.5(2) for transfer to the Supreme Court of Queensland. However, once the IRA Proceedings had been transferred into this Court pursuant to Tryam’s application under s.8(1)(b)(i) they were, by s.8(2), deemed to be a “proceeding pending” in this Court and were therefore capable of being transferred to the Queensland Supreme Court upon the application of Grainco and Marketlink under s.5(2)(b)(ii).

18    The IRA Proceedings transferred to this Court have at the present time the deemed status only of “a proceeding pending” in this Court until such time as the fates of Tryam’s application to transfer other proceedings to this Court and Grainco’s application to transfer the IRA Proceedings to Queensland are determined. A proceeding which is deemed by s.8(2) to be a “proceeding pending” in this Court is in a kind of limbo: it is “pending” only for the purpose of awaiting a determination as to its final resting place. The power of a Supreme Court to deal with such a proceeding is limited to transferring it to another court in accordance with the provisions of s.5(1), s.5(2), s.6 and s.6A, remitting it pursuant to s.8(3) to the court or tribunal in which it was first commenced, or retaining it in the Court until the result of a cross-vesting application to another Supreme Court or the Federal Court is known. Although the proceeding has, by virtue of s.8(2), the status of a “proceeding pending” in the Supreme Court nothing in the Cross-Vesting Act empowers the Supreme Court to hear and determine the proceeding on its merits while it is in that state of limbo. This is clear, in my opinion, from the fact that the power given to the Supreme Court to transfer a proceeding to itself, whether under s.8(1)(b)(i) or s.8(1)(b)(ii), is conferred only for one express purpose, namely, to facilitate the transfer of proceedings to the appropriate forum in which all proceedings between the parties should be heard. The Court must, of course, form opinions about the proceeding for the various purposes required by s.5, s.6 and s.6A but the Court may act on those opinions only for the purposes of those sections. In short, as Street CJ observed in Bankinvest AG v Seabrook (1988) 14 NSWLR 711, at 714, a determination of a cross-vesting application under s.8(1) or s.5, while judicial, is nevertheless more in the nature of an administrative decision in case management.

19 One opinion which the Supreme Court must always form concerning a “proceeding pending” in that Court for the purpose of a transfer application under s.5 is whether or not the transfer is in the interests of justice: s.5(1)(b)(ii)(C); s.5(2)(b)(ii)(C); s.5(2)(b)(iii). “Interests of justice” is a phrase of the widest import and, doubtless, it was deliberately framed so in order that the Court might take into account all of the relevant circumstances of each particular case. In many cross-vesting applications, the factors to be considered will be confined to the “useful check list” given by Higgins J in Dawson v Baker (1994) 120 ACTR 11, at 22 (cited with approval by Mason P in James Hardie & Coy Pty Ltd v Barry (2000) 50 NSWLR 357, at 379. While a consideration of the interests of justice always involves the determination of which forum is more appropriate (per Spigelman CJ in James Hardie at 361), the interests of justice are not determined by reference to that question alone: see the discussion of the authorities by Sperling J in Rosenboom v Qantas Airways Ltd [2002] NSWSC 792, at para 25ff.

20 So, for example, where a court to which a proceeding has been transferred under s.8(1)(b)(ii) becomes convinced in the course of hearing an application to transfer that proceeding to another Supreme Court under s.5(2)(b)(ii) or (iii), that the proceeding is an abuse of process or is otherwise unarguably doomed to failure, the Court cannot itself strike out or dismiss that proceeding because its jurisdiction is limited only to the transfer of the proceeding under s.5(2)(b) or the remission of the proceeding under s.8(3). However, even if the “appropriate forum” of the proceeding were the court of another State, the Supreme Court would nevertheless be entitled to conclude that it would not be “in the interests of justice” to transfer such a proceeding to that court, with the consequence of further needless expense and delay to the parties and the imposition of a burden on the court system of another State. The Court would be entitled to conclude that the proceeding should be remitted under s.8(3) to the court or tribunal of origin, to be disposed of speedily with the benefit of the Court’s reasons. Whether the Court made such a determination within the broad parameters of “the interests of justice” or on the basis that the court or tribunal of origin was the “appropriate forum” in which to bring the proceedings to the speediest conclusion probably does not much matter.

21 These observations should not be understood as encouraging parties to a cross-vesting application under s.8(1)(b)(ii) to debate the merits of the case in the course of that application or in a consequent application under s.5(2)(b)(ii) for the purpose of contesting whether the case has sufficient substance to justify transfer “in the interests of justice”. Quite the contrary: if any application in the nature of a strike-out or summary judgment is to be made, as a general rule it should be made and determined prior to any application under s.8(1)(b)(ii) for the cross-vesting of that proceeding coming before the Supreme Court or after the Supreme Court has transferred the proceeding to another Court or remitted it to the court or tribunal of origin. To permit parties readily to transfer proceedings into a Supreme Court pursuant to s.8(1)(b)(ii) and then debate there the merits of the case under the guise of raising a question whether there is sufficient substance in the proceeding to warrant its transfer to another Court in the interests of justice may well be to encourage forum shopping within the Australian Court system.

22 The extent of the debate as to the jurisdiction of the Commission which has occurred in the present case is the result, it seems to me, of the parties’ misapprehension as to the nature of the jurisdiction which the Supreme Court is exercising in a cross-vesting application under s.5(2). The challenge by Grainco and Marketlink to the Commission’s jurisdiction made by their Notice of Motion filed in the Commission on 3 April 2003 should have been determined in the Commission before the hearing of any application to transfer the IRA Proceedings to this Court pursuant s.8(1) of the Cross-Vesting Act. One course which I could now take in this application would be to remit the IRA Proceedings to the Commission under s.8(3) in order to enable the debate as to jurisdiction to take place there, without prejudice to the right of any party to make a cross-vesting application to this Court at a later time. However, it seems to me that that course would not be conducive to the “just, quick and cheap resolution” of the real issues in the cross-vesting application (Supreme Court Rules Pt.1 r.1.3) because the question of jurisdiction has now been fully argued by Senior Counsel on both sides in this Court and it would produce further delay and expense to the parties to have the same debate repeated in the Commission.

23 In the exceptional circumstances of this case, I am of the view that I should entertain the questions argued by the parties as to the jurisdiction of the Commission, but only for the purpose of determining whether there is sufficient substance in the IRA Proceedings to warrant their transfer to the Supreme Court of Queensland in the interests of justice if the other relevant factors in the matter indicate that Queensland is the appropriate forum in which the IRA Proceedings should be heard. If I were to come to the conclusion that the Commission unarguably had no jurisdiction, it would seem to me to be pointless to transfer the IRA Proceedings to the Supreme Court of Queensland: I would remit the proceedings to the Commission to be disposed of as the Commission saw fit in the light of my reasons for remission. On the other hand, if I were to come to the conclusion that it was sufficiently arguable that the Commission had jurisdiction, I would then consider the other factors relevant to the question whether the Supreme Court of Queensland is the appropriate forum.

Tryam’s claims for relief under s.106 IRA

24 In Tryam’s Amended Summons filed in the IRA Proceedings, Tryam and Mr Hughes seek:

– declarations that the three subject contracts, or the “arrangements” incorporating in those contracts, are unfair, harsh, unjust, unconscionable and against the public interest;

– an order that each of the contracts or arrangements be varied from its commencement or such other date as the Commission considers just, in accordance with provisions set out in schedules to the Amended Summons;

– an order that Grainco or Marketlink, Terminals or Alliance, pay to Tryam and Mr Hughes such sum as the Commission considers just in the circumstances in connection with the contracts or arrangements so avoided or in connection with their unfair conduct in connection with the operation of the contracts or arrangements;

– interest, costs and such other or further orders as may be appropriate.

25    The Agency Contract is defined in paragraph 22 of the Amended Summons as the agreement dated 10 November 2000 between Tryam and Grainco. Pursuant to that contract Grainco appoints Tryam as its agent to acquire grain on Grainco’s behalf in a defined area in New South Wales. I will return later to some of the provisions of the Agency Contract in more detail.

26 Paragraph 24 of the Amended Summons alleges that the Agency Contract also formed part of an arrangement whereby work was performed by persons (including Mr Hughes) in the grain accumulation and agency industry in New South Wales within the meaning of s.105 IRA (“the Agency Arrangement”).

27    Paragraph 23 alleges that the Agency Contract was entered into “in the context of” certain representations by Grainco to Tryam and Mr Hughes made at various times, as alleged in paragraphs 57, 58, 88, 94, 96, 102 and 103 of the Amended Summons. In summary, the alleged representations are to the effect that Grainco was about to become a “major player” in the grain industry in the area in which Tryam did business, that it would be of benefit to Tryam to ‘get on board’ with Grainco, that if Tryam became an agent for Grainco in Tryam’s area of business Tryam would need to be Grainco’s exclusive accumulation agent in that area and would have to cut its ties with its existing customers, that the arrangement would take the risk factor out of Tryam’s business, that Tryam would get good volumes of work and that Tryam would be Grainco’s exclusive agent in a defined region, that there was a clause in the Agency Contract providing that there was an option to extend the term of the contract without specifying whose option it was to extend, but that the option was Tryam’s option so that the Agency Contract would last as long as Tryam wished.

28    Paragraphs 128 to 132 are headed: “Unfair conduct – Termination and Denial of The Agency Contract”. Those paragraphs allege that at a meeting on 7 May 2002 Grainco purported to terminate the Agency Contract and that it has not paid any compensation to Tryam “for the termination of the Agency Contract and/or Agency Arrangement”.

29    Paragraph 140 alleges that “The Agency Contract and/or Agency Arrangement was unfair, harsh and unconscionable and against the public interest” upon the grounds that the Agency Contract failed to contain the clauses pleaded for inclusion in Schedule A, did not reflect the agreement which had been reached between the parties, and failed to give effect to representations which had been made to Tryam by Grainco. Paragraph 141 alleges that Grainco’s conduct in purporting to terminate the Agency Contract or the Agency Arrangement was unfair, harsh and unconscionable for various reasons.

30    Paragraph 142 alleges that Marketlink’s conduct was unfair, harsh and unreasonable in that it “required” and “encouraged” Grainco to terminate the Agency Contract, took for itself the goodwill of Tryam’s business, attempted to entice to itself an employee of Tryam and “adopted a policy of requiring all agency agreements between (Grainco) and its agents to be terminated to enable (Marketlink) to operate those businesses on its own account”.

31    The Harefield Storage Contract is defined in paragraph 29 of the Amended Summons as the contract entered into between Tryam and Terminals on 28 November 2000. Paragraph 30 alleges that the contract was entered into “in the context of” certain representations made by Grainco, as particularised in paragraphs 59 to 62. The representations were to the effect that the Harefield Storage Contract would prove profitable to Tryam. Paragraph 31 alleges that the Harefield Storage Contract formed part of an arrangement whereby work was performed in the grain storage industry in New South Wales (“the Harefield Storage Arrangement”).

32    Paragraphs 70 to 72 allege that in November 2002 Grainco did not notify farmers that the Harefield storage site would be open to receive grain to be purchased by Grainco, to the detriment of Tryam. Paragraphs 73 to 83 allege that the weighing system for grain transported in connection with the Harefield Storage Contract as implemented by Grainco pursuant to the Harefield Storage Contract was inappropriate and caused Tryam loss.

33    Paragraph 143 alleges that the Harefield Storage Contract is unfair in the way in which its terms operate. Schedule B to the Amended Summons contains the variations sought to be made to the Harefield Storage Contract. There is no reference in Schedule B to the Harefield Storage Arrangement. The variations sought to be made are identified by reference to clause numbers in the Harefield Storage Contract.

34    The Grainco Storage Contract is defined in paragraph 33 of the Amended Summons as the contract entered into between Tryam and Grainco dated 8 February 2002. Pursuant to that contract, Tryam agrees to provide storage facilities for Grainco’s grain at certain defined sites in New South Wales. I will return to some of the provisions of the Grainco Storage Contract in more detail. Paragraph 35 alleges that the Grainco Storage Contract formed part of an arrangement whereby work was performed in the grain agency industry in New South Wales (“the Grainco Storage Arrangement”).

35    Paragraph 143 alleges that the Grainco Storage Contract is unfair, harsh and unreasonable, together and separately, by reason of the inclusion or omission of certain terms. Schedule C to the Amended Summons contains the variations sought to be made to the Grainco Storage Contract. There is no reference in Schedule C to the Grainco Storage Arrangement. Schedule C seeks orders varying the Grainco Storage Contract by the addition and deletion of certain words.

Grainco’s submissions on the “proper law point”

36 Section 106 IRA relevantly provides:

“ Power of the Commission to declare contracts void or varied

(1) The Commission may make an order declaring wholly or partly void, or varying, any contract whereby a person performs work in any industry if the Commission finds that the contract is an unfair contract.

(2) The Commission may find that it was an unfair contract at the time it was entered into or that it subsequently became an unfair contract because of any conduct of the parties, any variation of the contract or any other reason.

(3) A contract may be declared wholly or partly void, or varied, either from the commencement of the contract or from some other time.

(4) In considering whether a contract is unfair because it is against the public interest, the matters to which the Commission is to have regard must include the effect that the contract, or a series of such contracts, has had, or may have, on any system of apprenticeship and other methods of providing a sufficient and trained labour force.

(5) In making an order under this section, the Commission may make such order as to the payment of money in connection with any contract declared wholly or partly void, or varied, as the Commission considers just in the circumstances of the case. …”

37 So far as is presently relevant, s.105 IRA defines contract as “any contract or arrangement, or any related condition or collateral arrangement”, other than an industrial agreement. An “unfair contract” is defined to mean a “contract” (as previously defined) which is “unfair, harsh or unconscionable” or which is “against the public interest”.

38 Mr Doyle SC submits, first, that the Commission has jurisdiction under s.106 IRA only in respect of contracts the proper law of which is that of New South Wales. Because the proper law of the Agency Contract and the Grainco Storage Contract is the law of Queensland it is clear, he submits, that neither the Commission nor any other Court exercising its jurisdiction under the cross-vesting legislation has jurisdiction to entertain a claim under s.106(1) IRA to avoid or vary those contracts. Mr Doyle says that his submission is directly supported by a number of decisions of the High Court, culminating in Gosper v Sawyer (1985) 160 CLR 548 (“Gosper”). Mr Doyle’s argument runs as follows.

39 Section 106 IRA does not contain any express territorial limitation as to the contracts which may be declared void or varied thereunder. On its face it can apply to any contract whereby a person performs work in an industry whether or not there is any connection with New South Wales. However, where general words are used in a statute there is no presumption that Parliament intended that its enactment apply to the full extent of its legislative authority and that any nexus with the jurisdiction which could support the legislation will suffice. In each case, the question of what limits are implicit in the enactment is a question of construction of the particular statute. In support of these propositions Mr Doyle relies upon Barcelo v Electrolytic Zinc Co of Australia Ltd (1932) 48 CLR 391 (“Barcelo”), Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society (1934) 50 CLR 581 (“Wanganui”), and Mynott v Barnard (1939) 62 CLR 68 (“Mynott”).

40    In Barcelo the respondent, a company incorporated in Victoria, issued debentures pursuant to the terms of a trust deed between itself and a trustee for the debenture holders. The proper law of the trust deed was that of Victoria. The company had a register of debenture holders in Melbourne and another register in London. Interest on the debentures registered on the Melbourne register was paid in Victoria and interest on the debentures registered on the London register was paid in the United Kingdom. Interest on all debentures became payable after the commencement of the Victorian Financial Emergency Act 1931. Section 19(1) provided that “every mortgage” (which included the subject debentures) was to be construed as if the interest rate payable was the reduced rate of interest fixed by the Act. The question for determination was whether the Act applied to payments of interest to debenture holders registered on the London register as well as to payments to those registered on the Melbourne register. The Court held that it did.

41    At p.423, Dixon J referred to the “settled, if artificial, rule of construction for confining the operation of general language in a statute to a subject matter under the effective control of the Legislature”. At p.425, his Honour said:

“These principles of construction should apply to limit the operation of the general words of sec.19 (1) and sec.22 (1) to debts or obligations which, according to the rules for the exterritorial enforcement of rights recognized and administered by British Courts, are governed by the law of Victoria.

These enactments amount to a variation and partial discharge of a pecuniary obligation. According to the rules of private international law which we ourselves administer, a discharge to be good must be considered so by the law which gives rise to the obligation. ‘In the first place, there is no doubt that a debt or liability arising in any country may be discharged by the laws of that country, and that such a discharge, if it extinguishes the debt or liability, and does not merely interfere with the remedies or course of procedure to enforce it, will be an effectual answer to the claim, not only in the Courts of that country, but in every other country. This is the law of England, and is a principle of private international law adopted in other countries. … Secondly, as a general proposition, it is also true that the discharge of a debt or liability by the law of a country other than that in which the debt arises, does not relieve the debtor in any other country’ ( Ellis v M'Henry (1871) LR 6 CP).

A debt which arises under the municipal law of Victoria is considered proper to be discharged by or under Victorian law, and, if the general words are confined in their operation to such debts, the particular rule of construction is satisfied. It is true that the Victorian Parliament is empowered only to make laws in and for Victoria, and from this circumstance a territorial limitation of a constitutional character arises. But there is no reason to doubt the competence of the State Legislature to discharge obligations flowing from Victorian law.”

42    In Wanganui, a New Zealand local authority borrowed money from a society incorporated in New South Wales. The proper law of the contract was that of New Zealand, although interest on the loan was payable in New South Wales. The question was whether the New South Wales Interest Reduction Act 1931 operated to reduce the amount of interest payable. The majority (Dixon, Evatt and McTiernan JJ) held that the New South Wales Act did not apply to the loan. At p.600, Dixon J said in a frequently quoted passage:

“Under the State Constitution the Legislature of New South Wales might validly enact a law reducing the interest upon any debt which was for any reason so connected with New South Wales that the statute could not be treated as wholly relating to a subject with which New South Wales had no possible concern. So long as the statute selected some fact or circumstance which provided some relation or connection with New South Wales, and adopted this as the ground of its interference, the validity of an enactment reducing interest would not be open to challenge. … But, because there are such a number and such a variety of ways in which a transaction may be connected with the State sufficiently to found the constitutional jurisdiction, the territorial limitation of legislative power gives no guidance when it is necessary to construe perfectly general words which select or indicate none of these grounds. … It appears to me that it is necessary in such a case to rely upon the ordinary rules of the common law for a rule of interpretation which will supply the restriction subject to which the words will be read. The case is one for applying what I believe to be the well settled rule of construction. The rule is that an enactment describing acts, matters or things in general words, so that, if restrained by no consideration lying outside its expressed meaning, its intended application would be universal, is to be read as confined to what, according to the rules of international law administered or recognized in our Courts, it is within the province of our law to affect or control. The rule is one of construction only, and it may have little or no place where some other restriction is supplied by context or subject matter. But, in the absence of any countervailing consideration, the principle is, I think, that general words should not be understood as extending to cases which, according to the rules of private international law administered in our Courts, are governed by foreign law. As the present statute deals with the discharge pro tanto of obligations, it ought to be understood as confined to those obligations which arise under the law of New South Wales.”

43    In Mynott a worker employed under a contract, the proper law of which was that of Victoria, was fatally injured while working for the employer in New South Wales. The question was whether the worker’s dependants could hold the employer liable under the Victorian Workers Compensation Act 1928 and turned on whether the words “any employment” in s.5 of the Act meant employment anywhere or only employment in Victoria. The Court held that, as a matter of construction, employment meant “employment in Victoria” in the sense of carrying out work in Victoria, not in the sense of being employed under a contract of employment governed by the law of Victoria. As the worker had been injured while carrying out work in New South Wales, the Victorian Act had no application. At p.79, Latham CJ said:

“In special cases, in the absence of any other clear indication of the intention of parliament, the governing law of a contract may be selected as the best practicable means of determining the territorial application of a statute which is essentially a statute dealing with contracts ( Barcelo v Electrolytic Zinc Co of Australasia Ltd ; Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society ). In those cases the court had to consider the applicability of a statute which altered the obligations of mortgages. The question was determined by adopting the principle that a legislature, in intervening for the purpose of varying existing contractual relations, might reasonably be supposed to be intending to deal with such obligations only where they were obligations created by contracts the governing law of which was that of the country of the legislature in question.”

44    Pausing at this point: Barcelo and Wanganui show that the process of confining the operation of general language in a statute so as to conform to the rules of private international law requires two steps: first, ascertaining as a matter of construction of the statute what is the precise “subject matter” upon which the statute is intended to operate; second, ascertaining what the rules of private international law have to say about the ability of the legislature to affect that subject matter. In Barcelo and Wanganui the statute which the Court had to consider was, as pointed out by Latham CJ in Mynott, “essentially a statute dealing with contracts”. Contracts and the variation or discharge of obligations arising under contracts being the “subject matter” of the legislation, the governing law of the contracts was selected as the means of determining the territorial application of the general words of the statute because, under the rules of private international law as administered in our Courts, whether or not a variation to or discharge of a contractual obligation is effective is determined according to the proper law of the contract.

45    So, in Barcelo and Wanganui, as the “subject matter” of the statutes was the variation of contractual obligations to pay interest, the proper law of the contracts was determinative of the question whether or not they fell within the operation of the legislation. On the other hand, in Mynott the “subject matter” of the legislation was not a contract of employment but the actual carrying out of work and its consequences. As the carrying out of work in that case did not occur in Victoria, the Victorian Act did not apply to an injury sustained in the course of carrying out the work. For other examples of the construction of statutes by reference to the rules of private international law in the context of contractual rights and obligations, see Merwin Pastoral Co Pty Ltd v Moolpa Pastoral Co Pty Ltd (1933) 48 CLR 565; McClelland v Trustees Executors and Agency Co Ltd (1936) 55 CLR 483; Mount Albert Borough Council v Australasian Temperance & General Mutual Life Assurance Society [1938] AC 224, at 236ff, 243.

46 In the present case, Mr Doyle says that the “subject matter” of s.106 is not the carrying out of “work in any industry” but the avoidance of contracts. He places heavy reliance on the decision of the New South Wales Court of Appeal in Ex parte Richardson; re Hildred [1972] 2 NSWLR 423 (“Hildred”) and on the decision of the majority of the High Court in Gosper, both of which decisions it will be necessary to examine in some detail. I shall return to them shortly.

Tryam’s submissions on the “proper law point”

47    Mr Corsaro SC does not seek to engage in discussion of the principles underlying the decisions in Gosper and Hildred. His submissions may be summarised thus:

– there are three recent decisions of the Full Bench of the Commission which hold explicitly that the proper law of a contract is but one of the factors to be taken into account in determining whether the contract is amenable to the Commission’s jurisdiction under s.106 IRA: Chrysler Jeep Automotive Distributors Australia Pty Ltd v Canberra Star Motors Pty Ltd (1998) 79 IR 452 ( “Chrysler” ); Perrott v XcelleNet Australia Ltd (1998) 84 IR 255 ( “XcelleNet” ); and Savage v Digital Equipment Corporation (Australia) Pty Ltd [1999] NSWIRComm 227 ( “Savage” );

– the Full Bench decisions are direct authority for the proposition that the fact that the proper law of a contract is not the law of New South Wales does not in itself deprive the Commission of jurisdiction under s.106 IRA;

– the Full Bench decisions are consistent with the decisions in Gosper and Hildred ;

– alternatively, if they are not consistent, then:

the decision in Gosper is not in point;

the statements in Gosper relied upon by Mr Doyle are obiter dicta;

the reasoning of Kerr CJ in Hildred has been expressly rejected by the Full Bench decisions;

– further, if the Full Bench decisions are inconsistent with the decisions of the High Court in Gosper and the Court of Appeal in Hildred , nevertheless this Court is bound to follow the Full Bench of the Commission rather than the High Court or the Court of Appeal because the privative clause in s.179 IRA makes the Full Bench the final arbiter on all questions arising under the Act, including all questions as to the construction of the Act and the jurisdiction of the Commission thereunder;

– in any event, as this Court is exercising jurisdiction over the matter under the cross-vesting legislation it is exercising the jurisdiction of the Commission under s.106 IRA and I am therefore bound to follow the decisions of the Full Bench of the Commission as if I were a judicial member of the Commission;

– in any event, the foreign proper law clauses of the relevant contracts are alleged in Tryam’s Summons to be unfair within the meaning of s.106 IRA so that they are liable to be deleted from the contracts;

– further, the jurisdiction under s.106 IRA is not confined to avoiding or varying contracts: it extends to “arrangements” and Tryam’s Summons for Relief pleads not only contracts but also “arrangements” as the foundation for the jurisdiction conferred by the section;

– assuming that the Full Bench decisions are correct or are binding and that the proper law of the contract is not determinative in itself of jurisdiction, there are other factors which bring the contracts and the arrangements pleaded within the jurisdiction of s.106 IRA;

– finally, this is not a case in which the question of jurisdiction under s.106 IRA can be decided without a full hearing of the facts.

The decision in Gosper

48    The first question is: what did Gosper relevantly decide? It is necessary to attend closely to the facts upon which the decision rests and to the questions which were before the Court for decision.

49    The respondent in the appeal, Mr Sawyer, commenced employment with Shell Refinery (Australia) Pty Ltd in 1973. He worked in New South Wales and the proper law of his contract of employment was the law of New South Wales. A condition of his employment contract was that he join the Shell Australia Contributing Pension Fund (“the Fund”), which he did. The Fund was constituted by a trust deed which had been executed in Victoria, and the proper law of which was the law of Victoria. All of the trustees of the Fund were resident in Victoria.

50 In 1983 Mr Sawyer’s employment was terminated and he received from the Fund what he contended was an inadequate payment. He filed a Notice of Motion in the Commission, to which the trustees of the Fund were made respondents. He sought an order from the Commission under s.88F IAA that the Commission declare void in whole or in part or vary in whole or in part and either ab initio or from some other time “the contracts, arrangements or conditions or collateral arrangements relating thereto between the applicant of the one part and the respondents of the other part and, in particular, an arrangement and/or a condition or collateral arrangement relating thereto between the applicant of the one part and the respondents of the other part being the Shell Australia Contributory Pension Fund”.

51    The Deputy Industrial Registrar ordered that copies of the Notice of Motion and affidavits in support be served on the respondent trustees in Victoria. That was done. The trustees entered a conditional appearance and challenged the validity of service.

52 Mr Sawyer then applied to the Commission for leave to serve the originating process in Victoria. The application came before Cahill J, who referred to the Commission in Court session the question whether there was any jurisdiction in the Commission to make a binding order in Mr Sawyer’s favour against the trustees. On 8 June 1984 the Commission held that the Supreme Court Rules as to service outside the State of New South Wales were made applicable to service of the Commission’s process, that s.11(1)(b) of the Service and Execution of Process Act 1901 (Cth) was applicable to proceedings under s.88F and, apparently, that leave to proceed could be given under that section. Further, and critically for present purposes, the Commission held that it had jurisdiction to make an order under s.88F notwithstanding that the proper law of the trust was the law of Victoria.

53    The Commission remitted the matter to Cahill J who, on 26 June 1984, confirmed service on the trustees as valid.

54 The trustees obtained special leave to appeal to the High Court from the judgments of the Commission given on 8 June and 26 June 1984. Pending hearing of the appeal, they obtained an order nisi for prohibition under s.33(1)(b) of the Judiciary Act 1903 (Cth) requiring the Commission to abstain from exercising federal jurisdiction which it did not possess, namely, jurisdiction in proceedings under s.88F based upon service effected on the trustees in purported reliance on s.11(1)(b) of the Service and Execution of Process Act. It was conceded at the hearing of the appeal that, as the Commission was purporting to exercise federal jurisdiction under the Service and Execution of Process Act, the High Court had power to grant special leave to appeal under s.39(2)(c) of the Judiciary Act.

55    The Court was constituted by Gibbs CJ, Wilson and Dawson JJ, who delivered a joint judgment, and by Mason and Deane JJ, who also delivered a joint judgment. Although all Judges concurred in allowing the appeal, it will be convenient to refer to the joint judgment of Gibbs CJ, Wilson and Dawson JJ as “the majority judgment” and to the joint judgment of Mason and Deane JJ as “the minority judgment”.

56    There were three issues which were considered by the majority judgment:

– whether the Commission’s process could validly be served on the trustees in Victoria by the combined operation of the Supreme Court Rules and the Industrial Arbitration (General) Regulations;

– if not, whether the process could be validly served and the proceedings could validly be heard pursuant to s.11(1)(b) of the Service and Execution of Process Act , which empowers any Court of record of a State, such as the Commission, to grant relief in respect of a contract which was “made or entered into within that State” ;

– whether the Commission was correct in holding that it had jurisdiction under s.88F to avoid or vary a contract the proper law of which was not that of New South Wales.

The minority judgment considered only the first two of these issues.

57 As to the first issue, the majority judgment held that the Commission’s Regulations did not render the Supreme Court Rules applicable to proceedings in the Commission so that the law of New South Wales did not authorise service of Mr Sawyer’s process out of New South Wales: at 559. The minority judgment came to the same conclusion: at 565-566.

58 As to the second issue, the majority judgment held that the relief sought by Mr Sawyer did not affect his contract of employment, which was made in New South Wales, because the relief was concerned only with the Fund and the trust deed: at 559. Further, the trust deed was not a “contract” within the meaning of s.11(1)(b) of the Service and Execution of Process Act: at 559-60. Finally, even if the trust deed could be held to be a “contract” for the purposes of s.11(1)(b) it was not a contract “made or entered into within” New South Wales, so that that section could have no operation: at 560.

59 The minority judgment held that the relief sought by Mr Sawyer under s.88F was the avoidance or variation of the terms of the trust deed (at 568); that the mere fact that Mr Sawyer’s s.88F proceedings related to the provisions of a trust deed did not necessarily mean that those proceedings could not be an action “affecting” a “contract” for the purposes of s.11(1)(b) Service and Execution of Process Act; that, however, even if there was a “contract” between the trustees and Mr Sawyer that contract could not come within s.11(1)(b) because it was not “made or entered into in” New South Wales: at 560.

60    As to the third question, upon which the minority judgment was silent, the majority judgment said at 560:

“For these reasons the Commission had no power to authorize the service of its process on the trustees in Victoria. In any case, even if the trustees had submitted to the jurisdiction of the Commission, s 88F would have conferred no power to avoid or vary the trusts of the fund. The power given by s 88F is to declare void in whole or in part or to vary in whole or in part ‘any contract or arrangement or any condition or collateral arrangement relating thereto whereby a person performs work in any industry’. It may be assumed, without deciding, that the phrase ‘whereby a person performs work in any industry’ governs ‘contract or arrangement’ and not ‘collateral arrangement relating thereto’ and that the power extends to avoid or vary, not only the contract or arrangement of employment, but also any collateral arrangement relating thereto. It may further be assumed, again without deciding the question, that a trust deed providing pension benefits for employees is a collateral arrangement within the section. However, the fund in the present case is governed by a trust created in Victoria and (as cl 34 of the trust deed states) is governed by the law of Victoria. A New South Wales statute could not constitutionally have the effect of altering the law of Victoria as to the administration of a Victorian trust (see Permanent Trustee Co (Canberra) Ltd v Finlayson (1968) 122 CLR 338 at 343) and if s 88F purported to have that effect it would be a nullity by the law of Victoria. However, there is nothing in the words of s 88F that suggests that it was intended to give the Commission power to affect trusts governed by laws other than that of New South Wales. Under s 88F the Commission has no power to alter trusts set up in another State which provide for the establishment of a pension fund, even though employees in New South Wales are beneficiaries under the trust. This conclusion is in no way inconsistent with Ex parte Richardson; Re Hildred [1972] 2 NSWLR 423, where it was held that the Commission could grant relief under s 88F in respect of a contract governed by the law of New South Wales, even though the contract was intended to be performed in part outside New South Wales. In the present case the contract of employment is governed by the law of New South Wales, but the trust deed is not. The Commission has clear power, under s 88F, to make an order with respect to a contract of employment governed by the law of New South Wales and to avoid or vary a term of that contract which requires the employee to become a member of a pension scheme established under a trust governed by the law of Victoria. However, it is the contract, and not the trust, that the Commission has power to avoid or vary in such a case. In the present case the order sought against the trustees is to avoid or vary the trust deed, and that is beyond the power of the Commission.

The appeal should be allowed. The judgments of the Commission given on 8 and 26 June 1984 should be set aside, and the question referred to the Commission should be answered by declaring that there is no jurisdiction in the Commission to make orders under s 88F against the trustees.”

61    Mr Corsaro says that all that is decided in Gosper is that, on the particular facts of that case, s.88F did not confer on the Commission jurisdiction in respect of a trust deed the proper law of which was that of Victoria; he says that the decision has no application to contracts or arrangements such as are the subject of the present proceedings. Mr Doyle, on the other hand, submits that this passage enunciates a principle of law which is, of necessity, not confined to trust deeds or to the particular facts of the case in Gosper but extends to any contract or arrangement the proper law of which is not that of New South Wales.

62    The reasons given by the majority on the third issue in Gosper are somewhat Delphic: they may be read as both Mr Corsaro and Mr Doyle submit. Some Judges in the Commission have read Gosper in the way that Mr Doyle suggests: see the discussion infra in paragraphs 92-106. I note that the application of Gosper to contracts generally seems to have been accepted in Nygh & Davies Conflict of Laws in Australia (2002) 7th Ed. at p.366 where Gosper is cited as authority for the proposition that “Provisions such as are found in s.87 of the Trade Practices Act 1974 (Cth) and similar State legislation do not apply to contracts which objectively considered are governed by the law of a foreign country, or, in the case of State legislation, by the law of another Australian jurisdiction”.

63    On the other hand, a stream of authority has developed within the Commission which bypasses Gosper, culminating in the three Full Bench decisions upon which Mr Corsaro relies. It will be necessary to trace the development within the Commission of the jurisprudence on the point, but I should first give my own conclusions as to what Gosper decides.

64    Mr Doyle submits that Gosper is authority for the proposition that s.88F IAA does not apply to any contract or arrangement the proper law of which is not that of New South Wales. That is a categoric proposition of universal application; the majority judgment in Gosper, however, does not say anything expressly to that effect. Mr Doyle would say that that proposition is implicit in the majority’s reasoning; in my opinion, that is to read too much into what their Honours were saying.

65    Their Honours’ statements must be taken in context. The subject matter of Gosper was a trust deed which had no direct connection with New South Wales: it was executed in Victoria, its proper law was that of Victoria, its trustees were resident in Victoria, its beneficiaries were to be found in several States, albeit some in New South Wales and, of course, it required no work to be done in New South Wales. According to the report of counsel’s arguments appearing in the Commonwealth Law Reports (pp.551-53), counsel for Mr Gosper made no submission that s.88F did not, on its true construction, apply to contracts the proper law of which was not that of New South Wales. Their submissions were confined to the proposition that s.88F had no application “where trusts and trustees are involved” and where the relationship between the parties arose in Victoria. Counsel for the Attorney General for Queensland, who adopted Mr Gosper’s submissions, likewise confined their argument to the question whether an order under s.88F could operate to vary or avoid trusts governed by the law of Victoria. No counsel challenged the validity or extent of s.88F generally: no reference was made in submissions to Barcelo, Wanganui or any other cases in the line of authority upon which Mr Doyle now relies.

66 In the light of the way in which the case was argued, the majority judgment focussed upon the alleged operation of s.88F upon the trust deed before the Court and held that “there is nothing in the words of s.88F that suggests that it was intended to give the Commission power to affect trusts governed by laws other than that of New South Wales”. In arriving at this conclusion, their Honours had obviously read Hildred, wherein the Chief Justice had emphasised the principles enunciated in Barcelo, Wanganui and Mynott, yet the majority judgment did not refer to those cases because, I infer, their Honours did not regard them as relevant to the very limited and specific proposition which had been argued before them. The only case to which their Honours did refer – Finlayson – was a case concerned, not with contracts generally, but with the administration of a trust. One cannot help but feel that if their Honours had wished to go beyond the specific proposition which had been argued and to enunciate a general principle that s.88F did not apply to any contract whereby work, however extensive, was performed in New South Wales if the proper law was not that of New South Wales, with the consequence that s.88F could be avoided by choosing a foreign proper law, then their Honours would have not omitted to say so unequivocally.

67    Mr Doyle’s submission is really that the majority in Gosper decided “sub silentio” the general principle for which he contends. However, it was said as far back as 1661 that “precedents sub silentio without argument, are of no moment”: R v Warner (1661) 1 Keb 66, at 67 [83 ER 814] per Twisden J. Cross & Harris Precedent in English Law (1991) 4th Ed, at p.158 says:

“It seems always to have been accepted that if a proposition of law, though implicit in a decision, was never expressly stated either in argument or in the judgment, the decision constitutes no binding authority for it, whether on the ground that there is here an exception to stare decisis, or for the reason that such a proposition is not truly part of the ratio.”

68    For these reasons, and notwithstanding that some Judges in the Commission have thought otherwise, I am unable to accept Mr Doyle’s submission that Gosper is authority for the proposition that s.88F IAA and, consequently, s.106 IRA, do not apply to a contract, otherwise within the section, if the proper law of the contract is not that of New South Wales.

Whether Gosper is ratio or obiter

69    As this case may well go elsewhere, it may be useful to give my view as to Mr Corsaro’s submission that Gosper is obiter. For the purpose of this discussion, I will assume, contrary to the conclusion expressed above, that the majority judgment holds, by necessary implication, that s.88F IAA and, consequently, s.106 IRA, cannot have application to any contract or arrangement the proper law of which is not that of New South Wales.

70    The identification of the ratio decidendi of a case, particularly one decided by an appellate court in which different judgments are given, often raises a variety of difficulties, as has been pointed out by Finkelstein J in Bristol-Myers Squibb Company v F.H. Faulding & Co Ltd (2000) 97 FCR 524, at 570ff. Difficulties arise in the present case because the statements in Gosper as to the extraterritorial reach of s.88F were made only in the majority judgment and in answer to the third question raised, a decision on the first two questions having already determined the result of the proceedings in favour of the appellant.

71    Where an appellate court is agreed upon the orders to be made but is divided on the reasons for those orders, Cross & Harris Precedent in English Law, at 85-86, suggests that the ratio is ascertained from the reasons of the majority. As the reasons of the minority are discarded in ascertaining the ratio where the minority differs from the majority as to the result – see e.g. per Kirby J in Jones v Bartlett (2000) 205 CLR 166, at 232 – consistency would seem to require that the reasons of the minority should likewise be discarded when the minority differs from the majority as to the reasons for the result although not as to the result itself. This was the position expressly adopted by Lord Shaw of Dunfermline in Amalgamated Society of Railway Servants v Osborne [1910] AC 87, at 108, when his Lordship arrived at the same result as the majority but upon a different ground: see also Cross & Harris at 86.

72    I proceed on the basis that the ratio in Gosper is to be found only in the majority judgment. I say “ratio” but it is now well established that there can be more than one ratio in a decision. In London Jewellers Ltd v Attenborough [1934] 2 KB 206, at 222, Greer LJ, referring to a decision which in his Lordship’s view bound the court in the case before it, said:

“In that case two reasons were given by all the members of the Court of Appeal for their decision and we are not entitled to pick out the first reason as the ratio decidendi and neglect the second, or to pick out the second reason as the ratio decidendi and neglect the first; we must take both as forming the ground of the judgment.”

73    In Cheater v Cater [1918] 1 KB 247, at 252, Pickford LJ, after citing a passage from an earlier judgment, said:

“That is a distinct statement of the law and not a dictum. It is the second ground given by the Lord Justice for his judgment. If a judge states two grounds for his judgment and bases his decision upon both, neither of those grounds is a dictum.”

74    Both of the above passages were cited with approval by Lord Simonds in Jacobs v London County Council [1950] AC 361. His Lordship, with whom the other members of the House agreed, said at 369:

“It is not, I think, always easy to determine how far, when several issues are raised in a case and a determination of any one of them is decisive in favour of one or other of the parties, the observations upon other issues are to be regarded as obiter. That is the inevitable result of our system. For while it is the primary duty of a court of justice to dispense justice to litigants, it is its traditional role to do so by means of an exposition of the relevant law. Clearly such a system must be somewhat flexible, with the result that in some cases judges may be criticized for diverging into expositions which could by no means be regarded as relevant to the dispute between the parties; in others other critics may regret that an opportunity has been missed for making an oracular pronouncement upon some legal problem which has long vexed the profession. But, however this may be, there is in my opinion no justification for regarding as obiter dictum a reason given by a judge for his decision, because he has given another reason also. If it were a proper test to ask whether the decision would have been the same apart from the proposition alleged to be obiter, then a case which ex facie decided two things would decide nothing.”

75    In Harris v Digital Pulse Pty Ltd (2003) 44 ACSR 390, Heydon JA (as he then was) referred to an earlier decision of the Western Australian Supreme Court and said, at 444:

“Three reasons were given [for the decision] (that the proposition was wrong; that it was beyond the power of a first instance judge to accept; and that insufficient facts were pleaded). Each reason was independent and free standing. Each thus constituted a separate ratio decidendi …”

In support of that proposition his Honour referred to the passage from Jacobs’ case set out above. How many ratios are there in the majority judgment in Gosper ?

76 Their Honours’ negative answer to the first question – whether service of the Commission’s process on the trustees in Victoria was valid under the Commission’s Regulations and the Supreme Court Rules – would not have disposed of the case because valid service could have been effected under s.11(1)(b) Service and Execution of Process Act, if the “contract” the subject of the proceedings had been made in New South Wales. Their Honours’ negative answer to the second question – whether service under the Service and Execution of Process Act was valid – did dispose of the case, because the Commission could not entertain the proceedings at all if the process could not be validly served on the trustees. Their Honours’ answer to the second question, therefore, can safely be classified as ratio.

77 But their Honours’ negative answer to the third question – whether the Commission had jurisdiction under s.88F in any event – was just as dispositive of the case as was their second answer. Their Honours made every antecedent factual and legal assumption in favour of Mr Sawyer, but concluded that he failed on the ultimate question of law, namely, whether s.88F could apply to the subject matter of the proceedings. Their Honours could just as well have given that answer first rather than third and there would then have been little doubt that the decision on that point would be seen as ratio. As Lord Macnaghten said in Deputy Commissioner of Taxation for New South Wales v Palmer [1907] AC 179, at 184:

“… it is impossible to treat a proposition which the Court declares to be a distinct and sufficient ground for its decision as a mere dictum, simply because there is also another ground stated upon which, standing alone, the case might have been determined.”

78    In my opinion, therefore, the decision in the majority judgment in Gosper as to the extent of jurisdiction under s.88F was a second ratio in the decision. If, contrary to my earlier conclusion, the majority judgment holds that s.88F has no application to a contract the proper law of which is not that of New South Wales, I would be confronted with Mr Corsaro’s submission that, nevertheless, the Full Bench has supremacy – a submission with which I deal in paragraphs 123ff.

The decision in Hildred

79    Mr Doyle submits that in any event I am bound by the decision in Hildred which, he says, is in his favour. In that case, the applicant entered into a written contract with the respondents whereby the respondents agreed to produce a variety show for touring throughout the Far East and the applicant undertook to act as the manager of the bookings for the tour. The contract provided that after the tour was concluded the applicant was to continue to perform services for a total period of two years in relation to performances in and outside New South Wales. The contract was made in New South Wales and the parties were resident in New South Wales. After the tour to the Far East had concluded, the respondents commenced proceedings in the Industrial Commission of New South Wales seeking an order under s.88F that the contract with the applicant be declared void. The Commission declared the contract void upon certain conditions. The applicant appealed to the Court of Appeal by way of prohibition and certiorari on the ground that the Commission had no jurisdiction to make the order.

80 Kerr CJ held at 428C that the proper law of the contract was the law of New South Wales and he agreed with Asprey JA that the contract was one whereby the applicant performed work in an industry in New South Wales notwithstanding that work was also to be performed outside New South Wales. Having found that the proper law of the contract was that of New South Wales, the Chief Justice, in discussing the jurisdictional scope of s.88F, said at 427E:

“The section does not seek to regulate or deal with work performed under contracts, but with the contracts themselves. It creates a jurisdiction to declare certain types of contract void in whole or in part. The contracts it touches are not all contracts wherever made or between any persons whatsoever. The contracts it touches must be New South Wales contracts in the sense that the New South Wales legislation is not to be taken as intending to apply to contracts to which under the accepted rules of international law it should not be made to apply . If persons who are residents in New South Wales make contracts in New South Wales intended to be governed by the law of New South Wales, as is the position in the present case, then the legislature can create a jurisdiction to avoid such contracts, and this may be so even if they are intended to be performed in whole or in part outside New South Wales, just as it could create a jurisdiction to enforce such contracts. I shall later discuss to some extent whether s. 88F (1) does extend to the avoidance of New South Wales contracts intended to be performed outside New South Wales. In speaking of the avoidance of contracts of a certain kind, s. 88F (1) does not speak of all contracts, but only of New South Wales contracts in the sense which I have mentioned.” (Emphasis added.)

81    At 428F, his Honour said:

“In these circumstances, even though the contract was to be performed partly outside New South Wales, it was a New South Wales contract which attracted New South Wales law and there is no reason for reading s.88F(1) so as to exclude this contract from its operation. The law of New South Wales provides for such a contract to be avoided in certain circumstances and the Supreme Court of New South Wales could not enforce it if it were avoided by that Commission under that law. I see nothing in international law or in s.17 of the Interpretation Act to indicate that this contract should be outside the operation of s.88F(1). This approach is supported by what was said by Latham C.J. in Mynott v. Barnard ((1939) 62 CLR 68, at 79) where he said: ‘In special cases, in the absence of any other clear indication of the intention of parliament, the governing law of a contract may be selected as the best practicable means of determining the territorial application of a statute which is essentially a statute dealing with contracts. ( Barcelo v Electrolytic Zinc Co of Australasia Ltd (1932) 48 CLR 391); Wanganui-Rangitikei Electric Power Board v Australian Mutual Provident Society ((1934) 50 CLR 581) In those cases the court had to consider the applicability of a statute which altered the obligations of mortgages. The question was determined by adopting the principle that a legislature, in intervening for the purpose of varying existing contractual relations, might reasonably be supposed to be intending to deal with such obligations only where they were obligations created by contracts the governing law of which was that of the country of the legislature in question.’ Later at p.86, Latham CJ said that: ‘The territorial application of an Act must, in the absence of any express relevant provision, be determined by reference to the general subject matter and the character of the Act.’

The general subject matter and the character of s.88F(1) is that it is a provision for altering by decision of the Commission the obligations under certain contracts, namely, those whereby a person performs work in an industry. It follows that for s.88F(1) to apply the contract must be a New South Wales contract in the sense in which I have used that phrase. Is that enough, or must it be a New South Wales contract whereby work is performed in a New South Wales industry? The answer to this question would appear to be ‘Yes’. If a contract for which the law of New South Wales was the proper law was a contract whereby the only work to be performed was in the United States theatrical industry, there could be much doubt about whether the section applied. If, on the other hand, the contract was made in the United States and was governed by the law of the United States, but required performance of work in New South Wales, it would be questionable whether it could be attacked under s.88F(1) merely because the work was to be performed here. This would be so because it could be strongly argued that the contract was not a contract to which the section was meant to apply.”

82 Pausing at this point: it is quite clear that Kerr CJ held that it was not enough to bring a contract within the reach of s.88F that the contract be one whereby work was performed in an industry in New South Wales; as a matter of statutory interpretation in the light of the rules of private international law, the contract must also be one which was governed by the law of New South Wales.

83    The reasoning of Asprey JA in Hildred does not expressly refer to the question of the proper law of the subject contract. Asprey JA, like the Chief Justice, referred (at 432E) to the rule of construction that, in the interpretation of statutes, the Court will presume, so far as the language admits, that general words should be read subject to accepted rules of private international law. His Honour said:

“‘Industry’ is defined by s.5(1) of the Act as meaning, unless the context otherwise indicates, ‘craft, occupation, or calling in which persons of either sex are employed for hire or reward, and unless otherwise indicated by the context or any provisions of this Act any division of an industry or combination, arrangement, or grouping of industries’.
…
Section 17 of the Interpretation Act, 1897 provides, inter alia, that in any statute ‘all references to localities, jurisdictions, and other matters and things shall, unless the contrary intention appears, be taken to relate to such localities, jurisdictions, and other matters and things in and of New South Wales’. The words which I have quoted from s.17 of the Interpretation Act have been described as ‘vague words which appear to be intended to give statutory effect to the rule of construction that, in the interpretation of statutes, the courts will presume, so far as the language admits, that general words should be read subject to accepted rules of international law, and therefore as not intended to apply to persons or things to which in accordance with those rules they should not be made to apply’ (see Vicars v Commissioner of Stamp Duties (NSW) ((1945) 71 CLR 309) per Williams J). In Wanganui-Rangitikei Electric Power Board v Australian Mutual Providence Society Dixon J expressed the principle of that rule of construction as ‘general words should not be understood as extending to cases which, according to the rules of private international law administered in our Courts, are governed by foreign law’.

…

What attracts the jurisdiction of the court to award, and what confers upon an applicant the right to receive, compensation under the various workmen's compensation statutes is the injury received in the course of the employment. What attracts the jurisdiction of the Commission to grant, and confers upon an applicant a right to obtain, relief under s.88F of the Act is a contract or arrangement whereby a person performs work in the theatrical industry in or of New South Wales. … It is not the performances of the artists but the agency contract or arrangement or the contract or arrangement under which they perform which is struck at by the section on the ground that it, not the performances, falls within one or other of the pars.(a) to (e) of sub-s.(1). The present case is well within these principles. … In my opinion, the rules of private international law are not offended by the construction which I give to s.88F, construed in the light of s.17 of the Interpretation Act in its application to the simple agreement. I can discern no intention in the Act to place such a restrictive construction upon ‘a person who performs work in any industry’ as is contended for. In my opinion, the Industrial Commission of New South Wales had jurisdiction to entertain the application made to it by the respondents and to make the orders which McKeon J made at the conclusion of the hearing.”

With this conclusion Kerr CJ agreed.

84    It is clear from the opening words of the judgment of Kerr CJ that the reasons of Asprey JA were prepared before those of the Chief Justice and that the Chief Justice had read them prior to adding “some observations” (at 425B). It is clear also that counsel had not argued the question whether or not a necessary criterion for jurisdiction under s.88F was that the proper law of the contract be that of New South Wales because Asprey and Manning JJA did not advert to such an argument, each dealing only with the question whether the performance of work had to be in or substantially in New South Wales. In any event, the contract had been made in New South Wales between New South Wales residents so that there could have been no debate that the proper law was that of New South Wales. What Kerr CJ was concerned to point out in his additional observations was that it should not be thought that the only criterion for jurisdiction under s.88F was that the contract was one whereby work was performed in an industry ‘in and of’ New South Wales: there may be cases (of which Hildred was not one) where the contract required work in an industry ‘in and of’ New South Wales but the proper law was not that of New South Wales and such a contract would not be within the jurisdiction of the Commission.

136    The Chief Justice continued:

“This passage suggests three elements are required to conclude that a contract, etc leads ‘directly’ to the performance of work in an industry:

(i) The contract itself ‘directly envisages’ performance of work.

(ii) The contract has a ‘recognisable impact on the conditions of that employment’ and ‘work’.

(iii) A purpose that would defeat the industrial objectives of the legislation is discernible.

The joint judgment in which [Jacobs JA] joined in Stevenson v Barham suggests that his Honour no longer maintained (iii). However, (i) and (ii) are consistent with the latter decision as elucidated by the identification therein of the ‘direct’ relationship between the contract and the performance of work as supplying the requisite ‘industrial colour or flavour’.”

137    At para.187, Handley JA said:

“It is established by Barham [para19] which is binding on the Commission and this Court, that a contract which only leads indirectly to the performance of work in an industry is not within the jurisdiction of the Commission. Practically every contract leads indirectly to the performance of work in an industry. Thus a contract of insurance will result in clerical work being performed in the office of the insurance company, there will be work in banks as the cheque for the premium is collected and credited, and work in the post office as the cheque and the policy are sent and received. The same can be said of a sale of securities on the stock exchange, or a contract of loan including all contracts between banker and customer.”

138    In my view, the foregoing supports the conclusion, first expressed by Jacobs JA in V.G. Haulage and restated by Priestley and Handley JJA in Production Spray Painting & Panel Beating Pty Ltd v Newnham (1991) 27 NSWLR 644, at 657, and by the Chief Justice in Mitchforce at para.13, that a contract or arrangement, to fall within the jurisdiction of s.88F and its successors, must be one which “directly envisages the employment of a person or persons in industry” and, in addition, has “a recognisable impact on the conditions of that employment”. It is not enough to attract jurisdiction that the contract is for the supply of goods or services and that, as a necessary consequence, work in an industry will be performed. The contract must be one the purpose of which is both to engage a person or persons in work in an industry and to provide for, or directly affect, the terms and conditions upon which the person or persons will work.

139 Whether any particular contract falls within the jurisdiction of s.106 IRA cannot be determined according to a generic label such as “share-farming agreement”, “franchise agreement” or “hotel lease”. As Stephen J pointed out in Stevenson v Barham at 194, generically labelled agreements may vary infinitely in form and legal effect, according to their particular terms. Each contract or arrangement coming before the Court must, therefore, be adjudged according to its own provisions and a decision as to any one so-called generic contract or arrangement will probably be of little assistance in determining the fate of another made in a different context, although the contracts or arrangements may contain some similar provisions.

The Agency Contract and the Grainco Storage Contract

140    The relevant provisions of the Agency Contract are as follows:

– the Recitals state:

“ WHEREAS :

A. Grainco Australia carries on the business of bulk commodity storage and handling and trade facilitation throughout Queensland, New South Wales and Victoria, as well as the provision of services and the supply of products to primary producers, growers and clients (collectively called ‘clients’) in those States.

B. As a part of Grainco Australia’s business philosophy of a strong presence amongst clients at a regional level, it wishes to appoint an Agent to represent it in the District described in clause 3.

C. The Agent is engaged in the business of grain merchants and agents as set out in this agreement.”

– Clause 1 relevantly provides:
“(a) Grainco Australia appoints the Agent to represent Grainco Australia’s interests in the District described in clause 3 in relation to the matters set out in clause 4.”

– Clause 4 relevantly provides:

“ AGENT RESPONSIBILITIES

The Agent shall:-–

(a) act exclusively for Grainco Australia to source a range of primary products (Commodities) within the District at prices nominated to the Agent by Grainco Australia. Such Commodities shall specifically include (but not be limited to) the following:– Wheat, Coarse Grains, Lentils, Pulses and Oilseeds.

…

(i) manage and operate its business in an efficient and businesslike manner;

(j) employ sufficient competent and appropriately qualified staff to carry on its business and its responsibilities under this Agreement;

…

(p) in consultation with Grainco Australia, monitor deliveries against contracts and ensure where possible, that the customer fulfils their commitment.

(q) notify Grainco Australia Melbourne Trading office prior to 5.00pm each day of the quantity of Commodities contracted during business hours on that day. A faxed copy of the contract(s) will be sufficient.

…

(s) provide accurate information to Grainco Australia upon request on the following; Crop Conditions, Crop Production Forecasts, Customer Activity, Competitor Activity.

…

(x) except as expressly provided in the Agreement, meet all costs and expenses of conducting its business and satisfying its obligations under this Agreement including all costs associated with any farmer depot network established by the Agent.”

– Clause 5 provides for the payment by Grainco of commissions to Tryam at specified rates in respect of purchases or sales of grain on Grainco’s behalf, and for Grainco to supply Tryam with information as to markets and procedures.

Mr Hughes is not a party to the Agency Contract nor is he specifically referred to therein.

141    The relevant provisions of the Grainco Storage Contract are as follows:

– the Recitals provide:

“a. The Company carries on the business of receiving, handling, trading, transporting and storing grains, oilseeds, legumes and pulses at numerous locations throughout Australia;

b. The Storage Provider carries on the business, inter alia, of receiving, handling, transporting and storing Commodities at Alleena, Marina and Junee Reefs (‘the Facility’);

c. The Company has agreed to utilise the services of the Storage Provider to store and handle Commodities on its behalf at the Facility on the following terms and conditions.”

– a preamble provides:

“The Storage Provider owns and operates, among others, a Facility at Alleena, Marina and Junee Reefs, NSW. The Storage Provider has agreed to operate this Facility under conditions specified by the Company. The Storage Provider will charge a storage and handling fee for the services as outlined in Schedule A. The Storage Provider will make available storage as outlined in Schedule A.

The Storage Provider has existing arrangements with various domestic customers and this business will operate outside the scope of this agreement. All endeavours will be made to accommodate this other business.”

– Schedule A specifies that bunkers are to be provided for storage of grain having a total capacity of 77,000 tonnes;

– Clause 2 provides:

“ Site Operations

The Storage Provider agrees and undertakes:–

2.1 to manage and operate the Facility in an efficient and business-like way

2.2 To implement and utilise the GA Quality Assurance Standards as they are applied to storages and procedures throughout the facility;

2.3 to receive Commodities on behalf of the Company into the Facility and to handle and store the Commodities for and on behalf of the Company in such manner as the Company may from time to time direct;

2.4 if requested by the Company, to outturn all or any part of the Commodities received into storage at the Facility, or any Commodities held in store prior to harvest, in such manner as the Company may from time to time direct. This is in accordance with Clause 8.2 of this Agreement;

2.5 to keep the Facility open for receival of Commodities on such days and during such core hours during defined harvest periods as the Company shall determine in consultation with the Storage Provider.

2.6 in the discharge of his duties hereunder, promptly conform to , observe and comply with all reasonable policies, regulations and directions from time to time made or given by the Company;

2.7 undertake such other duties and services in relation to the handling and storage of Commodities as the Company shall from time to time assign to, or vest in it

2.8 maintain an auditable trial [sic] of documentation for all activities related to the Company (as per Index item 4 of this Agreement).”

– Clause 3 provides:

“ Personnel

The Storage Provider will employ or cause to be employed all competent personnel necessary for and/or incidental to the carrying on of the handling and storage business.

The Storage Provider will:

a make available such competent personnel to attend at such place and time and for such period as the Company shall in its absolute discretion determine for the purpose of tuition and training by the Company in relation to classification of Commodities, preparation of documentation, the Company policies and procedures, grower relations and any other matters which the Company may from time to time determine. The cost of the provision of such training will be at the Company’s expense, however the Storage Provider shall meet the costs of any wages, travelling, accommodation, meals and other costs of the Storage Provider or the Storage Providers’ employees associated with such training. Such training will be held at a mutually convenient location.

b ensure that only staff who have successfully completed the Company’s Classification Course are permitted to carry out the function of classifying Commodities received into storage at the Facility.

c Maintain a register of training, which accurately records all training activity for all personnel employed at the facility as outlined in the GA standards.

d ensure that all staff are issued with appropriate safety equipment for the duties performed.”

142 Mr Doyle submits that the Agency Contract and the Grainco Storage Contract are simply contracts between two commercial enterprises for the provision of services by one to another: it could not be the law that every such contract is within the scope of s.106 IRA. As I have said, one cannot treat the issue in this broad way: an examination of the terms of the particular contract is required.

143 In the present case, the terms of the Agency Contract and the Grainco Storage Contract, in my opinion, generally provide for no more than the terms upon which one corporation will provide an agency service or storage facilities for another corporation. The duties of Tryam are spelled out in some detail and it is obvious that those duties would be performed by the company’s human agents, so that the contracts would lead indirectly to work in an industry, namely, the grain accumulation, storage and transport industry. That alone, however, would not be enough to bring the contracts within the scope of s.106 IRA, for the reasons which I have discussed above.

144    But there is one exception to this description of the general character of the Agency Contract and the Grainco Storage Contract and it is a critical exception. Clause 4(j) of the Agency Contract expressly requires Tryam to “employ sufficient competent and appropriately qualified staff to carry on its business and its responsibilities under this Agreement”. Clause 3 of the Grainco Storage Contract provides that Tryam is required to employ or cause to be employed competent staff to be trained by Grainco in particular aspects of the operation of Tryam’s storage facilities pertinent to the storage of Grainco’s grain.

145    Without these clauses, Tryam’s duties under the Agency Contract and the Grainco Storage Contract might have been carried out by it by any means it chose, e.g., by direct employment of staff or by independent sub-contractors. But Clause 4(j) of the Agency Contract and Clause 3 of the Grainco Storage Contract expressly require Tryam to perform its duties under those contracts by staff directly employed by it, so that the contracts therefore arguably lead directly to the performance of work by such employees in the grain accumulation, storage and transport industry. Further, because Tryam is obliged to ensure that the staff employed by it to perform its duties under the Agency Contract and the Grainco Storage Contract are appropriately qualified and trained, and because the security of employment of those particular employees is likely to be affected by the duration of those contracts and, possibly, by the way in which those contracts are performed by Grainco, the contracts may arguably have a recognisable impact on such employees’ conditions of employment.

146    Because of these two clauses in the Agency Contract and the Grainco Storage contract, it is sufficiently arguable, in my opinion, that these contracts qualify as contracts “whereby a person performs work in any industry” within the scope of s.106 IRA.

147    I say “sufficiently arguable” because I do not need to determine – nor should I determine – this question on a final basis. I am concerned with the question only for the purposes of seeing whether, in the light of the issues as to jurisdiction which have been argued, there is sufficient in Tryam’s IRA Proceedings to warrant those proceedings being transferred to the Queensland Supreme Court “in the interests of justice”, if the Supreme Court of Queensland is otherwise the more appropriate forum: see paragraphs 22 and 23. For the reasons I have given, I conclude that there is sufficient substance in the proceedings.

Whether contracts have “substantial connection” with New South Wales

148 Mr Corsaro submits that, in accordance with the Full Bench decisions, jurisdiction under s.106 IRA is afforded, regardless of the proper law of the contract, if the contract has a “substantial connection” with New South Wales. Mr Corsaro submits that the following circumstances demonstrate that the Agency Contract has a substantial connection with New South Wales:

– the contract was negotiated in discussions which took place in New South Wales;

– it was executed by Tryam in New South Wales;

– the agency thereunder is in respect of a defined area in New South Wales;

– the contract requires Tryam to perform work in that defined area in New South Wales;

– Tryam has at all times conducted its operations from Temora in New South Wales;

– the commodity which is the subject matter of the agency is grain in New South Wales vested in Grainco pursuant to the Grain Marketing Act 1991 (NSW).

As to the Grainco Storage Contract, Mr Corsaro points to the fact that the contract entitles Grainco to use the services of Tryam to store and handle Grainco’s grain at a number of Tryam’s facilities in New South Wales, and that Clause 3 of the contract requires Tryam to employ all relevant personnel necessary for or incidental to the conduct of those activities.

Mr Doyle does not strenuously contest these submissions.

149 In my view, it is sufficiently arguable (in the sense and for the purpose explained in paragraph 23) that each of the Agency Contract and the Grainco Storage Contract has a substantial connection with New South Wales and that, in accordance with the Full Bench decisions, those contracts are within the jurisdiction of the Commission under s.106 IRA.

150 Marketlink is not a party to the Agency Contract or the Grainco Storage Contract, but it is sufficiently arguable that the Commission has jurisdiction to make a monetary order under s.106(5) against Marketlink if Marketlink is found to have engaged in unfair conduct in relation to the Agency Contract, as alleged in paragraph 142 of the Amended Summons. Mr Doyle conceded in the course of his submissions that the Commission has jurisdiction to make orders under s.106 IRA against persons not party to the impugned contract: see e.g. Brown v Rezitis; Ace Business Brokers Pty Ltd v Phillips-Treby [2000] NSWIRComm 163; Reich v Client Server Professionals of Australia Pty Ltd (No 2) [2000] NSWIRComm 196.

Cross-vesting application

151 It will by now have become apparent that I am of the view that the IRA Proceedings have sufficient substance to warrant their cross-vesting to the Supreme Court of Queensland pursuant to the Notice of Motion filed by Grainco and Marketlink, if the other relevant factors in the case demonstrate that such a course is required in the interests of justice. It is to this question that I now turn.

152    Mr Doyle relies upon the following factors as indicating that the appropriate forum for trial of all three proceedings between the parties is the Supreme Court of Queensland:

– the Agency Contract and the Grainco Storage Contract expressly provide that the proper law of the contracts is that of Queensland and that the parties submit to the jurisdiction of that Court. In the case of the Agency Contract the submission to Queensland jurisdiction is exclusive. Mr Doyle submits that Tryam has agreed to litigate disputes arising out of those contracts in Queensland and that it should be held to its bargain;

– there is no evidence to suggest that the choice of law and jurisdiction clauses in the Agency Contract and the Grainco Storage Contract were not bona fide;

– there is no juridical advantage to Tryam which will be lost to it if the proceedings are transferred to Queensland: the Queensland Supreme Court will have all the cross-vested jurisdiction of the Commission and will otherwise have all the jurisdiction necessary to determine the proceedings commenced in that Court by Grainco on 5 March 2003, as well as the Federal Court Proceedings commenced by Tryam and Mr Hughes if those proceedings are cross-vested to the Queensland Supreme Court;

– there is no procedural disadvantage which will be suffered by Tryam if the proceedings are cross-vested to the Queensland Supreme Court nor is there any suggestion that all proceedings between the parties could be brought to trial more expeditiously or cheaply in New South Wales than in Queensland. The Queensland Supreme Court conducts a specialist commercial list and has procedures for the consolidation of concurrent proceedings;

– the location and transport of witnesses is not a factor of any significance. Tryam’s principal witness is Mr Hughes who is resident in Temora and Grainco’s principal witness is Mr Schmidt, who is resident in New South Wales. Grainco is prepared to transport Mr Schmidt to Brisbane for a hearing in the Queensland Supreme Court. Mr Hughes would have to travel and be accommodated whether the proceedings are heard in Sydney or in Brisbane;

– although the subject contracts required work to be done in New South Wales, there is no suggestion that it will be necessary for the Court to have a view of any property or facilities in New South Wales, or to have regard to conditions of work in New South Wales.

153    Mr Corsaro relies on the following factors as indicating that the Supreme Court of New South Wales is the appropriate forum for trial of all matters:

– the Harefield Storage Contract (to which Grainco and Marketlink are not parties) expressly provides that the proper law of that contract is the law of New South Wales;

– the relief claimed in the IRA Proceedings includes variation of the Agency Contract and the Grainco Storage Contract by deletion of the Queensland proper law and jurisdiction clauses;

– the claim for relief in the IRA Proceedings will have a substantial effect on the Queensland Proceedings and the Federal Court Proceedings because the IRA Proceedings enable the Court to declare void or vary those contracts;

– determination of the IRA Proceedings involves the application and interpretation of New South Wales legislation “and reference to a specialist court within this State. There is no equivalent body of jurisprudence in Queensland. The Supreme Court of New South Wales should be left to decide the law of New South Wales” ;

– Mr Hughes and the principal witness for Grainco and Marketlink, Mr Schmidt, are residents of New South Wales;

– the events which are the subject of the proceedings took place in New South Wales and the grain storage facilities are within New South Wales;

– Alliance and Terminals have not applied to cross-vest the proceedings to Queensland.

154 I am of the view that the more appropriate forum for the determination of the IRA Proceedings is the Supreme Court of Queensland and that it is in the interests of justice that those proceedings be cross-vested to that Court pursuant to s.5(2)(b)(i) and (ii) of the Cross-Vesting Act. My reasons have regard to the “check list” referred to by Higgins J in Dawson v Baker at 22, and are as follows.

155 First, it is clearly in the interests of justice that the three separate proceedings commenced by the parties be heard together by one court. The proceedings concern three contracts, two of which provide that the proper law is that of Queensland and that the parties submit to the jurisdiction of the Queensland Courts. From a perusal of the pleadings in the IRA Proceedings, it seems to me that the main contest between the parties arises out of and in respect of the Agency Contract and the Grainco Storage Contract, not out of the Harefield Storage Contract.

156    The Queensland Proceedings commenced by Grainco and Marketlink plead causes of action in contract and tort, as well as under the Trade Practices Act. The Supreme Court of Queensland is just as experienced in dealing with such causes of action as is the Supreme Court of New South Wales. It is true that the law to be applied to the IRA Proceedings is New South Wales law, but it is not correct to say that Queensland has no equivalent of the IRA and that jurisprudence in this area of law is lacking in Queensland. Section 276 of the Industrial Relations Act 1999 (Qld) is similar to s.106 IRA. There is no reason to suppose that the Supreme Court of Queensland is any less capable of applying the law of New South Wales as to s.106 IRA than is the Supreme Court of New South Wales.

157 In this regard, it is of particular significance and weight, in my view, that the complaints made by Tryam in the IRA Proceedings as to unfair conduct seem, on its pleadings, to be principally concerned with the making of representations by Grainco upon the basis of which Tryam is said to have entered into the subject contracts, and that Grainco did not later honour those representations. These complaints could be pleaded as familiar causes of action under the Trade Practices Act, which Tryam has obviously done in its Federal Court Proceedings. It seems to me, at this stage of the proceedings, somewhat artificial, to put it neutrally, that a commercial dispute as to the terms of commercial contracts between two substantial trading corporations should be said to have such an “industrial flavour” as naturally to attract the jurisdiction of the Commission rather than falling to be determined under the common law and the Trade Practices Act. There is in Tryam’s IRA Proceedings as pleaded no issue which calls for judicial experience in workplace conditions or employment conditions generally, but there are many issues which call for judicial experience in commercial law, Trade Practices law and contract law. It seems to me that to treat the determination of the commercial dispute between the parties to this litigation as revolving around Tryam’s claims under s.106 IRA, rather than as revolving around its causes of action pleaded in the Federal Court Proceedings, is to regard the tail as entitled to wag the dog.

158 In my view, it is likely that the substantive law to be applied in the determination of the matters in dispute between the parties will be the common law and Trade Practices law, and that the jurisprudence relating to s.106 IRA will have little, if any, part to play. However, as I have said, to the extent that such jurisprudence is applicable the Supreme Court of Queensland is, in my view, just as capable of applying it as is the Supreme Court of New South Wales.

159    Second, I take into account that Tryam has agreed to litigate disputes as to the Agency Contract and the Grainco Storage Contract in the courts of Queensland. While such an agreement as to jurisdiction is not a decisive factor, it nevertheless carries weight. No basis has been shown by Tryam which could found a suggestion that the Queensland jurisdiction clauses were exacted from Tryam unfairly or oppressively. When Tryam agreed to litigate these contracts in Queensland it was implicitly agreeing to the proposition that the more appropriate forum for such litigation was Queensland rather than New South Wales. In those circumstances, it seems to me that Tryam must show clearly that circumstances have arisen which now make the New South Wales courts the more appropriate forum so that there are good reasons in the interests of justice for allowing Tryam to depart from its agreement.

160 Third, Tryam has not identified any advantage conferred upon it by procedural law in New South Wales which it would lose if the IRA Proceedings are cross-vested to the Queensland Supreme Court.

161 Fourth, I do not see such a substantive connection between the IRA Proceedings and the New South Wales Supreme Court as would indicate that the New South Wales Court is the more appropriate forum. Although the subject contracts relate to work to be performed in New South Wales, the gravamen of Tryam’s complaints in the IRA Proceedings is, as I have noted, failure to honour oral representations said to have made by Grainco which induced Tryam’s entry into the contracts. The mere fact that those representations were made in New South Wales does not enable the New South Wales Court to adjudicate upon them any more effectively than the Supreme Court of Queensland.

162    Fifth, the balance of convenience in terms of witnesses is neutral. Both Mr Hughes and Mr Schmidt will have to travel and be accommodated, whether the proceedings are heard in Sydney or Brisbane. Alliance and Terminals have not appeared in these proceedings, from which I infer that their position as to forum and convenience of witnesses is neutral.

163    Sixth, convenience to the court system and expedition in having all proceedings finally determined is also neutral. The Queensland Supreme Court, like the New South Wales Supreme Court, has a commercial list and there is no evidence that all proceedings between the parties would take any longer to be brought to trial in Queensland than in New South Wales.

164 In conclusion, in my view no circumstances have been shown which make New South Wales the more appropriate forum for trial of the IRA Proceedings than Queensland. Accordingly, I consider it to be in the interests of justice not to deprive Grainco of the benefit of Tryam’s agreement to submit to the jurisdiction of the Queensland courts disputes arising under the Agency Contract and the Grainco Storage Contract. Although the Harefield Storage Contract provides that its proper law is that of New South Wales it contains no provision that the parties submit to the jurisdiction of the New South Wales courts. There is, therefore, no countervailing agreement on the part of Grainco, Marketlink, Alliance or Terminals that disputes relating to the Harefield Storage Contract will be submitted to the courts of New South Wales rather than to those of Queensland.

Orders

165    For these reasons, I conclude that:

– the IRA Proceedings should be transferred to the Supreme Court of Queensland pursuant to s.5 of the Cross-Vesting Act , as sought in Grainco’s Notice of Motion filed on 11 April 2003;

– no order should be made by this Court in respect of Grainco’s Notice of Motion filed on 3 April 2003 in which Grainco challenges the Commission’s jurisdiction;

– Grainco’s Notice of Motion filed on 3 April 2003 should be stood over generally, to be determined by the Supreme Court of Queensland when the IRA Proceedings are transferred to it, if Grainco still wishes to seek the relief claimed therein.

166    I will stand the proceedings over for a short time to enable the parties to consider these reasons and to bring in Short Minutes of Order. I will then hear any argument as to costs.

– o0o –

Last Modified: 09/05/2003