Tucker v State of Victoria

[2018] VSC 389

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
EMPLOYMENT AND INDUSTRIAL LIST

S CI 2017 05032

TOBIAS JOHN TUCKER (also known as Toby Tucker)	Plaintiff
v
STATE OF VICTORIA	Defendant

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JUDGE:	McDONALD J
WHERE HELD:	Melbourne
DATE OF HEARING:	13 June 2018
DATE OF JUDGMENT:	18 July 2018
CASE MAY BE CITED AS:	Tucker v State of Victoria
MEDIUM NEUTRAL CITATION:	[2018] VSC 389

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PRACTICE AND PROCEDURE – Application for leave to amend Statement of Claim to plead breach of Fair Work Act 2009 (Cth) s 50 – Application to transfer proceeding to Federal Court of Australia – Application to strike out proceeding – Application to plead breach of Fair Work Act 2009 (Cth) s 50 dismissed – Application to transfer proceeding to Federal Court dismissed – Application to strike out proceeding dismissed – Fair Work Act 2009 (Cth) ss 12, 50, 539 – Civil Procedure Act 2010 s 7 – Jurisdiction of Courts (Cross-vesting) Act 1987 s 5 – Public Administration Act 2004 ss 8, 20 – Supreme Court (General Civil Procedure) Rules O 36.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr D Williams QC with Ms M Paszkiewicz	WMB Lawyers
For the Defendant	Mr P Gray QC with Ms J Swanwick	Maddocks

HIS HONOUR:

Introduction

1. There are two applications before the Court.  The plaintiff applies for leave to amend his statement of claim, in the form of the further amended statement of claim dated 25 May 2018 (‘proposed FASOC’), and leave to join a further defendant, Mr Paul Broderick, in his capacity as the Commissioner of State Revenue.  The plaintiff also seeks an order transferring the proceeding to the Federal Court of Australia pursuant to the Jurisdiction of Courts (Cross-vesting) Act 1987. The defendant applies for summary judgment on the ground that the proceeding has no real prospect of success, or alternatively, is an abuse of process. For the reasons which follow, I have granted, in part, the plaintiff’s application for leave to amend his statement of claim. I have also granted him leave to join Mr Broderick as second defendant in the proceeding. I have refused the plaintiff leave to plead a breach of s 50 of the Fair Work Act 2009 (Cth) (‘FWA’). I have dismissed the plaintiff’s application to transfer the proceeding to the Federal Court of Australia. The Court has no power to transfer the proceeding based on the statement of claim in its amended form. I have dismissed the defendant’s application for summary judgment.

Background

1. By a further amended originating motion dated 13 March 2018, the plaintiff seeks injunctive and declaratory relief in respect of investigations into misconduct he is alleged to have engaged in during the course of his employment with the State Revenue Office (‘SRO’). 

1. The details of the investigations are conveniently summarised in the plaintiff’s outline of submissions dated 8 June 2018:

…

Since about November 2011, the plaintiff has been employed by the defendant as a Legal Officer within the State Revenue Office (SRO). On 4 October 2013, the plaintiff was offered, and accepted, an ongoing position as a Senior Solicitor in the Customer Services and Debt Management Branch of the SRO. The Employment Agreement (as defined in paragraph 5 of the FASOC), is in writing, constituted by

(a)       a letter from the defendant to the plaintiff dated 4 October 2013;

(b)a document titled ‘Acceptance of Employment Terms’ signed by the plaintiff and the defendant on 4 October 2013; and

(c)a letter from the defendant to the plaintiff dated 7 March 2012 which varied the agreement;

(collectively, the Employment Documents).

In broad terms, the plaintiff’s claims under the FASOC arise out of investigations by the defendant into two separate allegations regarding the plaintiff’s conduct during the course of his employment.  On 9 June 2017, the Plaintiff was informed that he was alleged to have engaged in misconduct within the meaning of clause 21.3 of the Victorian Public Service Enterprise Agreement 2016 (VPSEA) because:

(a)he had allegedly made inappropriate, harassing and offensive comments to another employee, Susie Maamary (the Maamary Allegations); and

(b)he had allegedly made numerous searches of customer records on the SRO eSys database not related to any known SRO business purpose between 24 November 2016 and 23 May 2017 (the Searches Allegations).[1]

…

[1]Plaintiff, ‘Plaintiff’s Outline of Submissions’, 8 June 2018, 3 [6]–[7] (footnotes omitted).

1. The investigations have been carried out pursuant to cl 21 of the Victorian Public Service Enterprise Agreement 2016 (‘VPSEA’). The VPSEA is an agreement approved by the Fair Work Commission pursuant to the provisions of the FWA.

1. On 11 May 2018, Ierodiaconou AsJ made orders by consent that the plaintiff’s amended statement of claim filed 11 April 2018 be struck out.  Accordingly, when the plaintiff’s summons was heard on 13 June 2018 there was no extant statement of claim.

1. The plaintiff submits that, without detracting from the full import of the matters set out in the proposed FASOC, the claims resulting out of these investigations can be broadly described as follows:

(a)   breaches of implied terms of the employment agreement, in that the defendant:

(i)     failed to adhere to an internal policy that it had devised and implemented as an employer, namely the ‘Managing Misconduct Policy May 2017’ (‘Misconduct Policy’) in conducting the investigations referred to above; and/or

(ii)  failed to exercise its rights, duties, powers or authorities under the Misconduct Policy, in respect of the employment of the plaintiff, in good faith;

(b)   breaches of the Public Administration Act 2004 (‘PAA’), in that the defendant failed to conduct the investigations and disciplinary processes referred to above in accordance with cl 21 of the VPSEA; and

(c) several contraventions of section 50 of the FWA, in that the defendant failed to comply with cls 21.6(a), 21.11(a), 21.8(a) and (b), and 21.10(a) of the VPSEA during the course of the investigations referred to above.[2]

[2]Ibid 4 [10].

Alleged breach of implied term of contract of employment

1. Paragraph 6 of the proposed FASOC pleads:

It was an implied term of the Employment Agreement that the first defendant would adhere to any internal policy that it had devised and implemented as an employer, in respect of the employment of the plaintiff, including the ‘Managing Misconduct Policy May 2017’ (“the Misconduct Policy”).

PARTICULARS

The term is implied in fact, in order to give business efficacy to the Employment Agreement.

1. Mr Gray QC, who appeared with Ms Swanwick for the defendant, submitted that the plaintiff has no real prospect of succeeding with this claim.  He pointed to paragraph 10 of the offer of ongoing employment dated 21 November 2011:[3]

   [3]Supplementary Affidavit of Adrian Chun-Ngen Wong, 12 June 2018, exhibit ACW-33.

…

10. Duty to comply with all SRO policies and lawful directions.

As an employee of the SRO you must comply with all SRO policies and procedures (which are not incorporated as terms of this contract but you must nonetheless abide by them because they are lawful and reasonable directions) including but not limited to:

·   Electronic Communications Policy

·   Equal Opportunity Policy

·   Health, Safety and Wellbeing Policy and Procedures

·   Information Privacy Policy

·   SRO Code of Ethics

·   VPS Code of Conduct; and

·   Any lawful directions given

…

1. Mr Gray submitted that the cause of action pleaded in paragraph 6 has no real prospect of success because it is inconsistent with the express provision of the contract stipulating that the SRO policies and procedures are not incorporated into the contract.

1. Clause 10 of the offer of ongoing employment is headed ‘[d]uty to comply with all SRO policies and lawful directions.’  The plaintiff has a real prospect of successfully arguing that cl 10 imposes a contractual obligation upon him to comply with all SRO policies, notwithstanding that the polices are not incorporated into the contract.  Clause 10 is a term of the contract.  A failure by the plaintiff to comply with SRO policies and procedures arguably constitutes a breach of the contract.  This conclusion is not altered by reason of the policies and procedures not being incorporated into the contract.  If there is an express contractual obligation upon the plaintiff to comply with SRO policies and procedures, he has a real prospect of establishing an implied term that his employer is also subject to a contractual obligation to comply with all SRO policies and procedures.

Breach of the PAA

1. The proposed FASOC pleads a cause of action for breach of statutory duty imposed upon the SRO by s 8(b) and s 20(3)(c) of the PAA. These sections provide:

8        Public sector employment principles

Public sector body Heads must establish employment processes that will ensure that—

…

(b)       public sector employees are treated fairly and reasonably; and

…

20       Employment and retirement

…

(3)A public service body Head, in exercising a right, power, authority or duty referred to in this section, must do so in conformity with—

…

(c)       the public sector employment principles; and

…

1. Paragraphs 8 to 10 of the proposed FASOC are as follows:

Obligations of the defendants under the PA Act

8.Under the PA Act, the defendants are, and at all material times were, obliged to exercise a right, power, authority or duty of the employer, in respect of the employment of the plaintiff, in conformity with the public sector employment principles.

PARTICULARS

The obligation arises by section 20(3)(c) of the PA Act.

9.Under the public sector employment principles, the defendants have, and at all material times had, an obligation to establish employment processes that ensure that the plaintiff is treated fairly and reasonably (‘the Fairness Obligation’).

PARTICULARS

The obligation arises by section 8(b) of the PA Act.

10.By reason of the matters alleged in paragraphs 8 and 9 above, the defendants have, and at all material times had, an obligation under the PA Act to conduct any disciplinary process against the plaintiff in accordance with clause 21 of the VPSEA.

PARTICULARS

The employment processes established by the defendants include the ‘Managing Misconduct Policy May 2017’ (‘the Misconduct Policy’).  The Misconduct Policy provides that disciplinary processes must be conducted in accordance with clause 21 of the VPSEA.

1. The defendant submits that the plaintiff has no real prospect of establishing that the defendant was subject to an obligation to both establish the processes prescribed by s 8(b) of the PAA, and also to adhere to those processes in conducting any disciplinary process involving the plaintiff.  The defendant’s outline of submissions dated 12 June 2018 stated:

In Quinn v Overland, Bromberg J, in determining whether to grant the applicant injunctive relief, considered it arguable that s 8(b) of the PA Act imposed a requirement that the processes established pursuant to that provision be adhered to. While not finally determining the issue, his Honour said at [55]:

By requiring that the processes established “will ensure” compliance with the principles identified, s.8 arguably imposes a requirement that the public sector body Head comply with those processes.

His Honour did not explain this conclusion. His Honour seems to have considered (at [59]) that Young J had reached a similar conclusion in the case of Paras v Department of Infrastructure [2006] FCA 662, but in fact that case is clearly distinguishable from both Quinn and the present case (in that Young J concluded that a suite of provisions in the PA Act raised a serious issue to be tried that a right of internal review existed in relation to a summary dismissal, where the Federal Court was exercising FW Act jurisdiction). Bromberg J also (at [59]) referred to a case on the general presumption that procedural fairness conditions the exercise of statutory powers affecting interests, but this begs the question whether s 8 of the PA Act should be read as converting employment-related processes and decision making into processes and decisions that are performed under a Victorian statute.That is a threshold question, the answer to which may lead to the presumption applying, but the existence of the presumption does not assist in answering the question.

With respect, Bromberg J erred in characterising s 8 as a provision that required that the processes “will ensure” compliance with the principles identified by the provision. The words “will ensure” are not part of a direct obligation imposed by s 8, but instead form part of a description of what must be established.[4]

[4]Defendant, ‘Defendant’s Outline of Submissions for Interlocutory Hearing on 13 June 2018’, 12 June 2018, 11 [40]–[42] (citations omitted).

1. There may be room for debate about Bromberg J’s reasoning in Quinn v Overland.[5] However, this falls well short of justifying the striking out of paragraphs 8 to 10 of the proposed FASOC. The plaintiff has a real prospect of succeeding in establishing that the combined effect of s 8(b) and s 20(3)(c) of the PAA is to impose upon the defendant a statutory duty to adhere to the processes prescribed by cl 21 of the VPSEA.

   [5](2010) 199 IR 40.

Contravention of s 50 of the FWA

1. Section 50 of the FWA provides that a person must not contravene a term of an enterprise agreement. Section 50 is a civil remedy provision.[6] Section 539(2) of the FWA provides:

For each civil remedy provision, the persons referred to in column 2 of the item may, subject to sections 540 and 544 and Subdivision B, apply to the courts referred to in column 3 of the item for orders in relation to a contravention or proposed contravention of the provision, including the maximum penalty referred to in column 4 of the item.

[6]Fair Work Act 2009 (Cth) s 539(1).

1. Item 4 of the table in s 539(2) of the FWA provides that an application in respect of an alleged contravention of an enterprise agreement may be filed in the Federal Court, the Federal Circuit Court or an eligible State or Territory court. ‘Eligible State or Territory court’ is defined in s 12 of the FWA as including the Magistrates’ Court and/or the County Court. The Supreme Court of Victoria is not an eligible court.

1. Paragraphs 40 to 46 of the proposed FASOC plead seven separate contraventions of s 50 of the FWA. Paragraph J of the prayer for relief seeks the imposition of penalties in respect of the seven alleged contraventions. The Supreme Court of Victoria has no jurisdiction to hear and determine the plaintiff’s claim for penalties for contravention of the VPSEA.[7]

   [7]Cf In the matter of Optimisation Australia Pty Limited [2018] NSWSC 31 [433]–[441]; The Australian Steel Company Limited v Communications Electrical, Electronics, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [2004] VSC 61 [10].

1. The Court has power under r 36.01(1)(a) of the Supreme Court (General Civil Procedure) Rules 2015 to grant leave to amend a pleading for the purpose of determining the real question in controversy between the parties. The exercise of this power is subject to the overarching purpose under s 7 of the Civil Procedure Act 2010 (‘CPA’) of facilitating the just, efficient, timely and cost effective resolution of the real issues in dispute.

1. The phrases ‘real question in controversy’ and ‘real issues in dispute’ must be read subject to any constraints imposed upon the Court’s jurisdiction to resolve issues in dispute between the parties. The fact that the plaintiff wishes to pursue a claim for penalties for alleged contravention of the VPSEA does not confer upon the claim the status of ‘a real issue in dispute’. This conclusion is reinforced by the fact that ‘court’ is defined in s 3 of the CPA as the Supreme Court, County Court or Magistrates’ Court. Mr Williams QC, who appeared with Ms Paszkiewicz for the plaintiff, acknowledged that the parties were in ‘heated agreement’ that if the plaintiff wishes to pursue his claims alleging contravention of s 50 ‘we’ve got to go somewhere else to do it’.[8]  An issue in dispute between the parties which is not within the Supreme Court’s jurisdiction is not a real issue in dispute.

   [8]Transcript of Proceedings (13 June 2018) 21.26–21.28.

1. As the Court has no power to grant the relief sought in respect of the alleged breaches of the VPSEA it is highly questionable whether r 36.01 is a source of power to grant the amendment sought.  Assuming in the plaintiff’s favour that there is power to grant the amendment, it is not an appropriate exercise of that power to permit an amendment to plead a cause of action which the Court has no power to hear and determine.

1. I reject the plaintiff’s application to file the proposed FASOC insofar as it includes the allegations in paragraphs 40 to 46 and the relief claimed in paragraph J of the prayer for relief.  The plaintiff is otherwise granted leave to file the proposed FASOC.  The plaintiff is also granted leave to join Mr Broderick as a second defendant in the proceeding in respect of the claims pleaded in the proposed FASOC.

The plaintiff’s application to transfer the proceeding to the Federal Court of Australia

1. The plaintiff seeks orders transferring the proceeding to the Federal Court of Australia pursuant to s 5(1) of the Jurisdiction of Courts (Cross-vesting) Act 1987. Section 5(1) provides:

5        Transfer of proceedings

(1)       Where—

(a)a proceeding (in this subsection referred to as the relevant proceeding ) is pending in the Supreme Court; and

(b)it appears to the Supreme Court that—

(ii)       having regard to—

(A)whether, in the opinion of the Supreme Court, apart from any law of the Commonwealth or another State relating to cross-vesting of jurisdiction and apart from any accrued jurisdiction of the Federal Court or the Family Court, the relevant proceeding or a substantial part of the relevant proceeding would have been incapable of being instituted in the Supreme Court and capable of being instituted in the Federal Court or the Family Court;

(B)the extent to which, in the opinion of the Supreme Court, the matters for determination in the relevant proceeding are matters arising under or involving questions as to the application, interpretation or validity of a law of the Commonwealth and not within the jurisdiction of the Supreme Court apart from this Act and any law of the Commonwealth or another State relating to cross-vesting of jurisdiction; and

(C)the interests of justice—

it is more appropriate that the relevant proceeding be determined by the Federal Court or the Family Court, as the case may be—

the Supreme Court shall transfer the relevant proceeding to the Federal Court or the Family Court, as the case may be.

1. Mr Gray submitted that the Court has no power to transfer the proceeding to the Federal Court pursuant to s 5(1). He submitted that the Court’s power to transfer a proceeding is only enlivened if the Supreme Court proceeding falls within s 5(1)(b)(ii)(A) or (B). He submitted that unless a proceeding does fall within either of these provisions the Court cannot apply the ‘interests of justice’ criteria in s 5(1)(b)(ii)(C). For the reasons which follow, I accept this submission.

1. Based on the proposed FASOC, following the Court’s grant of leave to amend (which excludes the FWA claims) the proceeding does not fall within the terms of ss 5(1)(b)(ii)(A) or (B). The proposed FASOC alleges breaches of contract and breach of statutory duty arising under the PAA. It seeks declarations and injunctions based upon the defendant’s alleged failure to comply with the procedures prescribed by cl 21 of the VPSEA.

1. The Court has jurisdiction to grant the declarations sought notwithstanding the fact that the foundation of the declarations sought is the VPSEA. The Court’s jurisdiction to make a binding declaration of right without granting consequential relief arises under s 85 of the Constitution Act 1975 read in conjunction with s 36 of the Supreme Court Act 1986.[9] If the Court accepts the plaintiff’s contention that s 8(b) and s 20(3)(c) of the PAA imposed an obligation upon the defendant to comply with the processes prescribed by cl 21 of the VPSEA, this would enliven the Court’s power to grant declaratory relief if it is satisfied that the procedures were not followed.

   [9]AWB Ltd v Cole (No 2) (2006) 233 ALR 453, 463 [45]–[46]; Ambridge Investments Pty Ltd (in liq) v Baker [2010] VSC 59 [61]–[73].

1. The proceeding is capable of being instituted in the Supreme Court of Victoria. As such, s 5(1)(b)(ii)(A) has no application. Further, the proceeding is within the jurisdiction of the Supreme Court of Victoria. As such, s 5(1)(b)(ii)(B) has no application.

1. The question which arises is whether the ‘interests of justice’ criteria in s 5(1)(b)(ii)(C) is a stand-alone ground empowering the Supreme Court to transfer a proceeding to the Federal Court. For the reasons which follow, this question should be answered in the negative.

1. The proceeding is entirely within the jurisdiction of the Supreme Court.  There is no basis for concluding that the Supreme Court is not an ‘appropriate court’ for determination of the proceeding.[10] If s 5(1)(b)(ii)(C) operates as a stand-alone ground permitting the transfer of a proceeding to the Federal Court it would authorise the transfer of any proceeding commenced in the Supreme Court, irrespective of the absence of any connection with a law of the Commonwealth. Theoretically, it would permit a common law damages claim for negligence to be transferred to the Federal Court. This would be inconsistent with the structure of a system in which proceedings entirely or substantially within the jurisdiction of a State Supreme Court are initiated and determined in that Court.

   [10]Jurisdiction of Courts (Cross-vesting) Act 1987, preamble.

1. The history of s 5(1) points strongly to the conclusion that s 5(1)(b)(ii)(C) does not operate as a stand-alone ground empowering the Supreme Court to transfer a proceeding to the Federal Court.

1. Prior to amendments to s 5(1) arising from the Federal Court (Consequential Amendments) Act 2000, s 5(1) included ss 5(1)(b)(i) and (iii). These provisions provided as follows:

5        Transfer of proceedings

(1)       Where—

…

(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 or the Family Court and it is more appropriate that the relevant proceeding be determined by the Federal Court or the Family Court;

…

(iii)it is otherwise in the interests of justice that the relevant proceeding be determined by the Federal Court or the Family Court—

the Supreme Court shall transfer the relevant proceeding to the Federal Court or the Family Court, as the case may be.

…

1. Sections 5(1)(b)(i) and (iii) were repealed by s 24 of the Federal Courts (Consequential Amendments) Act 2000. The effect of the deletion was to significantly curtail the Supreme Court’s power to transfer a proceeding to the Federal Court. Prior to the amendment, s 5(1)(b)(iii) conferred upon the Supreme Court a stand-alone ground to transfer a proceeding to the Federal Court if it appeared to the Supreme Court that it was ‘otherwise in the interests of justice’ that the relevant proceeding be determined by the Federal Court. The existence of a stand-alone ‘interests of justice’ ground in s 5(1)(b)(iii) weighs heavily against the conclusion that s 5(1)(b)(ii)(C) simultaneously operated (and continues to operate) as a stand-alone interests of justice ground. The better view is that the interests of justice ground contained in s 5(1)(b)(ii)(C) only operates in circumstances where the criteria prescribed in ss 5(1)(b)(ii)(A) or (B) are satisfied.

1. This conclusion is reinforced by the textual consideration that the word ‘and’ appears between ss 5(1)(b)(ii)(B) and (C). It is also supported by the judgment in Re Wakim; Ex parte McNally,[11] in which the High Court held that the cross-vesting scheme which conferred State judicial power on federal courts, implemented by co-operative legislation enacted by the Commonwealth, State and Territory parliaments, was invalid.  The judgments of the Court emphasised the limitations upon the power of Commonwealth and State parliaments to enact legislation conferring State jurisdiction upon a federal court.

   [11](1999) 198 CLR 511 (‘Re Wakim’).

1. Gleeson CJ stated:

The essence of the argument in support of the validity of the cross-vesting legislation is that Ch III has nothing to say, either expressly or by implication, concerning judicial power other than the judicial power of the Commonwealth.  The corollary is that the delimitation of original jurisdiction, undertaken in Ch III, has no application to the conferring of judicial power upon the federal judicature by State Parliaments, with the consent of the Parliament of the Commonwealth. 

On this argument, there would be nothing to prevent a State Parliament enacting legislation of the kind considered In re Judiciary and Navigation Acts, and, with the consent of the Parliament of the Commonwealth, conferring upon the High Court, or another federal court, jurisdiction to make declarations as to the validity of State legislation. …

…

Conferring, or agreeing to the conferment, upon a federal court, established under the Constitution to exercise the judicial power of the Commonwealth with respect to a limited class of matters, of jurisdiction to exercise the judicial power of the States is not in aid of the execution of the principal power. It is both a substantial addition to the power, and an attempt to circumvent the limitations imposed upon the power by the Constitution.[12]

[12]Ibid 543 [15]–[16], 546 [24].

1. Gummow and Hayne JJ stated:

…

In the present cases the immediate question is whether the Commonwealth Parliament has any power either to consent to States conferring jurisdiction on federal courts or itself to confer State judicial power on federal courts. If there is no power for the Commonwealth to take those steps, the fact that all the States wish that it could do so or seek to have it do so, does not supply that absent power. … To hold to the contrary would be to hold that the Parliaments of the Commonwealth and the States could, by co-operative legislation, effectively amend the Constitution by giving to the Commonwealth power that the Constitution does not give it. …

…

But whatever may be the content of any legislative power implied from the creation and existence of the Commonwealth as the national polity, that power does not authorise the Parliament to consent to the vesting of State jurisdiction in federal courts. …

The Commonwealth legislation that purports to confer State jurisdiction on federal courts (or, as the respondents and interveners would have it, consented to the conferring of the jurisdiction by the States) is invalid.[13]

[13]Ibid 577 [113], 581 [126], 582 [127].

1. The introduction to the Explanatory Memorandum for the Federal Courts (Consequential Amendments) Bill 2000 states:

The High Court held in 1999 that the schemes for cross-vesting jurisdiction between federal and State courts were constitutionally invalid (Re Wakim 163 ALR 270). As a consequence of that decision, the Federal Courts (State Jurisdiction) Act 1999 (No 54/1999) was enacted to enable State courts to deal with applications under the schemes that would otherwise have been dealt with by a federal court and to provide—

•that the rights and liabilities of persons under ineffective judgments of a federal court in the purported exercise of State jurisdiction were taken to be rights and liabilities under judgments of the Supreme Court; and

•for the transfer of proceedings before a federal court in relation to State matters to the Supreme Court.

The main purposes of this Bill are—

(a)to remove from State Acts provisions purporting to confer jurisdiction on a federal court;

…

1. The Federal Courts (Consequential Amendments) Act 2000 was a legislative response to the High Court’s judgment in Re Wakim. The deletion of ss 5(1)(b)(i) and (iii) from the Victorian cross-vesting legislation post Re Wakim removed provisions which permitted the Supreme Court of Victoria to transfer proceedings to the Federal Court which, in effect, conferred State jurisdiction upon the Federal Court. Sections 5(1)(b)(ii) and (A) and (B) establish, as a pre-condition for the transfer of proceedings to the Federal Court, that the Supreme Court proceeding has a relevant nexus with the jurisdiction of the Federal Court. That nexus is satisfied where the proceeding, or a substantial part of it, would have been:

(a)   incapable of being instituted in the Supreme Court and capable of being instituted in the Federal Court; and/or

(b)   the matters for determination in the relevant proceeding are matters arising under or involving questions as to the application, interpretation or validity of a law of the Commonwealth not within the jurisdiction of the Supreme Court.

If the pre-conditions as stipulated in ss 5(1)(b)(ii)(A) and/or (B) are not satisfied, there is no capacity to transfer a proceeding in reliance upon the interests of justice ground in s 5(1)(b)(ii)(C).

1. I was not referred by the parties to any judgment of the Victorian Supreme Court where a proceeding has been transferred to the Federal Court solely in reliance upon s 5(1)(b)(ii)(C). However, in Bob Jane Corporation Pty Ltd v Robert Frederick Jane,[14] Judd J stated:

The factors to which regard must be had under s 5(1)(b)(ii), when deciding which court is more appropriate, necessarily involve overlapping considerations. A consideration of the interests of justice is, of course, predicated on the assumption that the jurisdiction of this Court was regularly invoked and that it was capable of being instituted in the Family Court. It follows, from the foregoing reasons, that there is a real question as to whether the proceeding is capable of being instituted in the Family Court, at least at this time.[15]

Although his Honour was considering the transfer of proceedings from the Supreme Court to the Family Court, his reasoning applies equally to the transfer of proceedings to the Federal Court. His Honour’s reasoning is consistent with the conclusion expressed above, that s 5(1)(b)(ii)(C) is not a stand-alone ground pursuant to which a proceeding may be transferred to the Federal Court.

[14][2014] VSC 27.

[15]Ibid [49].

1. In Vucic v Belosevic,[16] Debelle J considered the operation of provisions of the South Australian cross-vesting legislation. His Honour stated, in respect of ss 5(1)(b)(ii) and (iii) of the Act prior to the Re Wakim amendments:

   [16][2003] SASC 296.

…

Paragraph (b) of s 5(1) provided three alternative grounds on which to transfer proceedings from the Supreme Court to the Family Court. They were:

(1)where there were related proceedings in the Family Court and it was more appropriate that the relevant proceeding be determined by the Family Court;

(2)that all three of the prerequisites in paragraph (ii) were satisfied; or

(3)that it was in the interests of justice that the proceedings be determined by the Family Court.

The fact that the requirements of paragraph (ii) were cumulative was emphasised by the use of the conjunctive “and” in paragraph (ii) in contrast to the disjunctive “or” which created the three alternative grounds in s 5(1)(b)(i), (ii) and (iii). The fact that s 5(1)(b)(iii) provided a separate ground of the interests of justice also indicates that paragraph (c) was but one of three requirements in paragraph (ii) which all had to be established.

For these reasons, the interests of justice standing alone is not a separate ground on which to transfer proceedings from the Supreme Court to the Family Court. It is necessary to satisfy all three paragraphs (A), (B) and (C) of s 5(b)(ii).[17]

[17]Ibid [11]–[12].

1. Although his Honour was considering an application for the transfer of proceedings from the South Australian Supreme Court to the Family Court, his reasoning applies equally to an application to transfer proceedings to the Federal Court. His Honour’s reasoning is clear authority, which I follow, for the proposition that the interests of justice ground in s 5(1)(b)(ii)(C) is not a stand-alone ground justifying the transfer of proceedings from the Supreme Court to the Federal Court.

Conclusion

1. In light of the conclusions set out above, there is no utility in considering whether it is in the interests of justice for this proceeding to be transferred to the Federal Court.  The plaintiff is granted leave to amend his statement of claim in the form of the proposed FASOC, save for paragraphs 40 to 46 and paragraph J of the prayer for relief.  The plaintiff is also granted leave to join Mr Broderick, in his capacity as the Commissioner of State Revenue, as the second defendant.  The plaintiff’s application for an order transferring the proceeding to the Federal Court is dismissed.  The defendant’s application to strike out the proceeding is dismissed.  I shall provide the parties with an opportunity to make submissions on costs.  However, as each party has enjoyed a measure of success and failure, it may be appropriate to order that costs be reserved, or alternatively, be costs in the cause.

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